Nuffield Trust response to the Spending Review

Responding to the Spending Review, Nuffield Trust Senior Policy Analyst Sally Gainsbury said:

“The spending announced for the NHS exemplifies the dilemma faced by a government boxed in by anaemic growth and little appetite for further tax rises.

“Spending pressures including inflation and increased planned treatment capacity mean that the funding announced at the Autumn Budget has been more than wiped out. DHSC starts the period covered by this Spending Review £1.3bn in the red.

“Compared to the settlements for other departments - from policing to education - the NHS deal looks generous. But seen in the context of all the promises made by the government to the British people - to drive down waiting lists, shift care closer to home, rapidly improve tech - and the commitments to meet staff pay demands and rising costs of new drugs, today’s settlement soon melts away. With capital funding staying flat in real terms for the rest of the spending review period, it will be difficult for the NHS to invest in the technology and facility upgrades it needs to meet the government's ambitious productivity targets.

“A hope for the government’s 10 Year Health Plan is that reform and productivity gains will mean that the NHS can cope with its spending growing slower than it has for much of its history. But the government must be clear what its priorities are for health and where there will be compromise. Other sectors will also need to play a part in reducing healthcare need. For example, it remains to be seen whether the government's changes to the benefit system will support or hinder improvements in population health. It is also unclear how much of the investment announced today in affordable housing will come in the form of much needed social housing.

“We now know what money Baroness Casey will have to work with as she carries out her review on social care over the next few years, and it’s unlikely to lead to the transformation we were promised. Local government may find enough money to keep up with existing demands from today’s settlement, but that will only come by racking up council tax again, and little will be left for a programme of reform. Plans for a Fair Pay Agreement for care workers are welcome, but with tightly constrained finances, councils could only fund this by cutting into other budgets.”