Health experts have cautioned that the NHS funding increase announced in England's budget will be insufficient to address the country’s struggling healthcare system and that any noticeable
patient improvements will take time.
Rachel Reeves announced an additional £22.6 billion in funding for the NHS over the next two years, claiming it as the most significant spending boost for the health service outside of the Covid pandemic since 2010. However, the King’s Fund, a leading health think tank, suggests that much of this money will be allocated to existing recruitment initiatives aimed at bringing more doctors and nurses on board.
Prime Minister Keir Starmer has signaled a shift in focus to reforming public services rather than resorting to higher taxes, a message intended to reassure financial markets. Siva Anandaciva, the chief analyst at the King’s Fund, emphasized that while the funding could lead to some improvements, such as additional appointments and upgrades to a limited number of outdated facilities, it falls short of delivering the comprehensive health and care reforms needed.
Labour’s plans will see the NHS budget grow annually by 3.8%, just slightly above the 3.6% increase required to sustain the expanding NHS workforce. The NHS long-term workforce plan, introduced by the previous government, was designed to address a potential shortfall of hundreds of thousands of healthcare workers. However, pay agreements and growing financial deficits will continue to put pressure on the budget.
In her budget speech, Reeves called the NHS the country’s “most cherished public service” and stressed that change must be felt by the public, including ensuring the NHS is there when people need it. Over £3 billion of the new funding has been allocated to repair deteriorating hospital infrastructure, but the King’s Fund warns that this will only make a small dent in the £13.8 billion maintenance backlog.
Anandaciva highlighted the impact of a decade of underinvestment, stating, “Too many buildings and pieces of equipment are simply outdated or unfit for purpose.” He also revealed that nearly £1 billion has already been redirected from capital funding to cover day-to-day NHS expenses, a move criticized by Health Secretary Wes Streeting. The result, according to Anandaciva, is crumbling infrastructure, outdated equipment, reduced productivity, and negative effects on staff and patient care. He urged the government to end the practice of diverting investment intended for long-term improvements.
Keir Starmer wrote in the Financial Times that Labour’s focus would be on reform and stability rather than increased spending, stating, “We cannot simply spend our way to better public services. Reform is essential.” Despite initial concerns in financial markets that drove up borrowing costs after the tax-raising budget announcement, Labour insists that departments will need to implement reforms to improve services within the existing spending framework.
The Institute for Fiscal Studies has warned that an additional £9 billion might be needed to prevent further austerity in underfunded public services. Meanwhile, the Nuffield Trust expressed doubts about the NHS’s future, with Becks Fisher, the director of research and policy, noting that while the funding will address immediate needs, it falls short of fulfilling the government's broader ambitions to overhaul the NHS. Fisher also raised concerns about inadequate funding for social care, highlighting the immense pressures local councils face in balancing budgets and meeting rising demands. The £600 million social care grant for next year, Fisher said, will not be enough to keep up with these challenges.