23 November 2017

What funding commitments have been made?

Additional Resource Funding of £2.8 billion, including:

  • £335 million to be provided in 2017
  • £1.6 billion to be provided in 2018/19
  • £900 million provided in 2019/2020.

This funding has been earmarked for improving A&E services, reducing waiting times, improving performance for treatment after referral and supporting the integration of patient care.

Additional Capital Investment of £3.5 billion, including:

  • £2.6 billion for Sustainability and Transformation Partnerships (STPs)
  • £700 million for turnaround plans in trusts facing the biggest performance challenges
  • £200 million supporting efficiency programmes (e.g. reducing spend on energy).

The Nuffield Trust, Health Foundation and King's Fund joint statement advises that the NHS budget is an estimated £4 billion lower than what will be needed to run the service in 2018/2019. The NHS Confederation has taken the view that an additional £8 billion is needed each year in order to sustain day to day service.

The additional funding offered will undoubtedly be welcomed to help with the winter demand the NHS faces – and represents a per-head increase in NHS England’s budget in real terms. It is also intended that the funding will help support pay increases as part of the Agenda for Change contract – including for midwives, nurses and paramedics.

However, the absence of long-term additional funding restricts the ability for anything other than shorter term measures. Critics are already suggesting that the funding does no more than paper over the cracks.

Social care

There was no mention of social care in the Autumn Budget.

Social care was a focal point of the election in June this year, with the so-called “dementia tax” policy receiving heavy criticism. In the budget, social care is conspicuous by its absence. The King's Fund has been vocal in calling for structural reform and additional funding to bridge a projected £2.5 billion funding gap by 2020.

On the one hand, this is a surprise. The financial viability of local authority funded social care continues to be called into question, as investment focuses on segments of the market that drive better returns: private pay and specialist care.

However, less than a week ago the government announced that the Green Paper on social care would be delivered in Summer 2018 – having originally been scheduled for the end of this year in the Spring 2017 Budget. The current silence on new social care policy will undoubtedly focus more attention on the Green Paper and subsequent consultation.

Mental health

The Budget reiterates the policy commitment to achieve “parity of esteem between mental health and physical health”.

A Green Paper is scheduled for December, setting out the government’s plans to “transform mental health services for children and young people.”

Predictions this week have focused on the need for mental health spending commitments in the Budget. In a similar way to social care, it is no surprise that the government is withholding any policy commitments or proposals, in anticipation of the upcoming Green Paper.

And the initial reactions…

The Budget amounts to a funding commitment of £119.1 billion for healthcare (including the NHS) in 2017/18, rising to £121.9 billion in 2018/19 and £124.2 billion in 2019/20. The initial reaction from NHS England’s national director Sir Bruce Keogh is that the funding is welcomed, but that it is “significantly less” than the £4 billion estimate that is needed, which he says re-opens the long-standing debate as to the level of service that the public can reasonably expect from the NHS. Sir Bruce’s view has been echoed by other industry commentators – in that the funding is a step in the right direction, but falls short.

Key contact

Patrick Parkin

Patrick Parkin Partner

  • Healthcare
  • Procurement and State Aid
  • Commercial

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