How much NHS spending are parties really pledging?

How do the individual parties spending promises stack up to one another? And is austerity really over for the NHS?

Blog post

Published: 27/11/2019

All three major parties have published their manifestos for the 2019 general election, and we can now see their plans for NHS spending.

How do these stack up to one another? And do they mean a sharp change in the funding squeeze the health service has seen over the last decade, or more of the same?

All parties are pledging a similar amount of extra funding

Calculating exactly what the parties have promised isn’t as straightforward as simply reading their manifestos. In the main, all the pledges refer mostly to NHS England, the arm's length body that runs most but not all of the English system. Precise figures on areas like public health are often missing. The last Conservative government didn’t give us clear figures for investment in buildings and equipment – capital spending – past next year, and their party manifesto doesn’t either.

To arrive at comparable total NHS spending figures, I have assumed that this part of the NHS budget will rise in line with the respective pledges on the revenue budget. However, given the way the promises are presented and phrased, it is difficult to be completely certain.

Nevertheless, the chart below gives a reasonably fair comparison between the parties on the pledges for total real NHS spending in England to 2023/24.

All main political parties promise significant funding growth for the NHS in England 27/11/2019

Chart

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The Labour Party is promising annual real terms growth in overall NHS spending of around 4.3% a year between 2019/20 and 2023/24. The Conservatives, essentially confirming previous plans for the NHS by the last government, suggest spending will increase by around 3.4% a year, and the Liberal Democrats promise around 4% per year.

Those small differences amount to billions in actual money, and they do matter. But overall, the pledges are relatively similar.

Austerity is over – at least for the NHS

Fuzziness of the actual numbers aside, all three parties are promising a significant break with the last decade of austerity where NHS funding rose by an average of around 1.5% per year. In fact, for all of them, the amount of extra funding offered for the next four years would be as much as the health service has had in the last nine.

The chart below shows health spending as a proportion of GDP. As we can see, after a decade in which the share of national income spent on the NHS flatlined or fell, all the pledges would mean spending increasing at a faster rate than is forecast for the economy as a whole.

If we assume that past and promised spending for England applied to the whole of the UK, then NHS spending as a share of GDP would increase to somewhere between 8% (Conservatives) and nearly 8.3% (Labour), with the Liberal Democrats’ pledge reaching around 8.2%.

All funding pledges would boost NHS spending as a share of GDP 27/11/2019

Chart

Note:  

Historic and party pledges for NHS spending as a percentage of UK GDP are based on uplifting spending for England to UK based on the ratio of England’s Gross Value Added (GVA) to the UK’s GDP.

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It is worth noting that this roughly equal generosity does not apply when we look beyond the NHS. As the Institute for Fiscal Studies has noted, while the Conservative Party manifesto lays out big spending increases for the health service and schools, it would continue austerity beyond that. The party only commits to some slight interim funding increases in social care, leaving much-needed reforms until after a “cross party process”. At the other end of the spectrum, Labour’s manifesto would greatly increase spending all across the public sector, and expand its scope by nationalising utility and transport companies. Their manifesto includes funding for free personal care, at least for over-65s.

We should believe it when we see it

One final caveat about all of the numbers above: whichever party gets to implement their manifesto, experience suggests that none of the figures above will turn out to be the reality. Inflation and economic growth will almost certainly not be as forecast and a whole combination of as-yet unknown and unknowable events can change a future government’s funding plans.

Suggested citation

Appleby J (2019) 'How much NHS spending are parties really pledging?'. Nuffield Trust blog.

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