The NHS is set to be one of the big winners in next week’s spending review – with a boost of up to £30 billion at the expense of other public services.
The Department for Health and Social Care is set to get the biggest settlement in the government’s spending review next week, while other areas will face cuts.
Chancellor Rachel Reeves will argue that Labour is investing in health, security and the economy, according to reports in The Times.
The Department of Health is set to be handed a 2.8% annual increase in its day-to-day budget over a three-year period. This amounts to a cash increase of £30 billion by 2028 – £17 billion in real terms. However, the health services capital spending budget will only increase in line with inflation, according to the reports.
Reeves will put £113 billion a year extra in infrastructure spending for projects designed to grow the economy, such as the Sizewell C nuclear power plant and a new generation of mini reactors.
Bringing down NHS waiting times was one of Labour’s key commitments. Sir Keir Starmer has pledged to ensure that by the next election 92% of patients in England waiting for planned treatment are seen within 18 weeks of being referred.
Latest NHS data suggests around 60% of people are currently seen in this time and figures released last month showed the overall number of patients on waiting lists had risen slightly from 6.24 million to 6.25 million.
Meanwhile, in order to meet tough financial savings targets this year and reduce the NHS its deficit by around £6.5 billion, hospital leaders have warned they’re being forced to make cuts to frontline services.
The NHS received £3.1 billion in additional capital investment in the 2024 budget, however, health leaders warned this was short of the £6.4 billion a year needed for the NHS to meet its productivity target of 2 per cent a year.
A recent analysis by The Nuffield Trust shows that since coming into office, Labour has set healthcare spending to grow at 2.9 per cent for 2024-25 and 2025-26. Between 2011 and 2023-24, budgets grew at 2.4 per cent.
For 2025-25, £1.5 billion of the additional funding for the NHS is due to cover the costs of the increase in employer National Insurance contributions, meaning for this financial year, spending growth will actually be less than 2 per cent, the Nuffield Trust estimates.
Following the autumn budget, £22.6 billion extra was allocated to the DHSC however, this will be absorbed by spending pressures such as inflation and meeting waiting times targets.
Matthew Taylor, chief executive of the NHS Confederation, told The Times that without big changes to the way the health service treats patients, the funding increase “is not going to enable us to achieve recovery and reform”.
“Without additional capital investment, either traditional or through the private sector, I just don’t think it’s possible to combine recovery and reform,” he said.
