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News release

Spending Review 2020 and the impact on the NHS

Matt Custance, Healthcare Partner at Grant Thornton UK LLP, said:

“We welcome the announcement of an additional £3 billion for the NHS, as well as an additional £2.3 billion to its capital budget. There is a reinforced commitment to the rebuilding of 40 new NHS hospitals as well as an upgrade to a further 70. There was, concerningly, no recommitment to the additional eight new hospitals recently announced, notwithstanding the PM mentioning a figure of 48 in an earlier response to a PMQ. Overall, however, the announcement of more NHS capital plays well with the Government’s clear commitment to deliver an infrastructure-led recovery and it is right that the NHS should benefit during a health emergency. In this vein, pay will rise for NHS staff, unlike other parts of the public sector, where this is constrained.

“Specific provision is made for NHS Test and Trace, vaccine procurement and PPE, with £18 billion offered for 2021/22, of which Test and Trace consumes the lion’s share (£15 billion), with vaccines at £0.9 billion and PPE at £2.1 billion. This seems to assume that the vaccination programme will reduce the need for PPE, given a spend of £15.2 billion last year. Reducing the PPE commitment sits uncomfortably with the pattern of regular virus challenges and also the threat to populations from Anti-Microbial Resistance, which the previous Chief Medical Officer has warned us about. If this reflects a reduced use of PPE in a clinical setting, then it will require a massive programme to build confidence in the effectiveness of the vaccine for the public as well as NHS staff.

“Of the £3 billion NHS recovery funding, £1 billion is allocated to recovery of elective surgical waiting lists. The Spending Review is set against a huge backlog of elective surgery, following two winters and a summer pandemic where huge volumes of work has been cancelled. It will be enormously challenging for the NHS to make headway against this backlog within this budget settlement. There is also a risk around the increase in social care funding of £1 billion. If this is not enough to relieve pressure on the NHS, it will have a bounce back effect on the NHS’s ability to deliver, including in mental health services. Set against some of the other figures including projected unemployment of 7.5%, already tired NHS and social care staff will be under pressure for some time to come.

“The other £2 billion of NHS recovery funding is allocated to “waiting times for mental health services, give more people the mental health support they need, invest in the NHS workforce and help ease existing pressures in the NHS caused by Covid-19”. It’s not clear how this is split, but because of our work with clients on mental health services across both local authorities and NHS providers we know how challenging it currently is to meet demand, especially for complex mental health needs such as secure care. This money could help deliver real creativity in meeting demand. Some of this may be about new facilities, some may be about supporting NHS and council staff with the resources to keep people out of institutions and safe and well within their communities wherever possible. It will be exciting to see how far the NHS can make that go.”