Select Committee · Public Accounts Committee

NHS financial sustainability

Status: Closed Opened: 31 Oct 2024 Closed: 16 May 2025 3 recommendations 23 conclusions 1 report

The scale of the challenge facing the NHS is unprecedented. Local NHS systems in England ended 2023/24 with a collective deficit of £1.4bn. NHS England (NHSE) received more than £4.5bn in extra funding in 2023/24, and reduced planned spending against its central budget by £1.7bn – but these actions did not prevent NHS systems’ deficits …

Clear

Reports

1 report
Title HC No. Published Items Response
5th Report - NHS financial sustainability HC 350 29 Jan 2025 26 Responded

Recommendations & Conclusions

8 items
5 Recommendation 5th Report - NHS financial sustainabili… Deferred

Define government health prevention spending and increase flexible funding for local systems.

Given the constraints on public spending, it is highly likely that re- focusing attention from sickness to prevention cannot be achieved without re-allocating existing NHS funds in the same direction. Senior ICB leaders report a continued lack of progress with the government’s long-standing aim to move towards preventing ill health …

Government response. The government is considering defining health prevention spending, deferring to the upcoming 10 Year Health Plan and Spending Review Phase 2. It notes that 2025-26 planning guidance has removed many ringfences for local flexibility and NHS England will soon publish …
HM Treasury
6 Conclusion 5th Report - NHS financial sustainabili… Deferred

Ensure greater NHSE funding for community services, preventing redirection to hospitals.

NHSE’s long-held ambition to move more care from hospitals to the community has stalled. There would have been more investment and progress in mental health and community services, particularly GP surgeries and dental services, in 2023–24 had NHSE not redirected funding to prop up the day-to-day spending of local NHS …

Government response. The government is considering the recommendation, stating it will be addressed within the 10 Year Health Plan and multi-year Spending Review for decisions on shifting funding to community care. It highlights increased mental health spending in 2023-24 and the maintenance …
HM Treasury
1 Conclusion 5th Report - NHS financial sustainabili… Deferred

Committee scrutinised NHS financial management and sustainability with key departments.

On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department of Health and Social Care (DHSC), NHS England (NHSE), and HM Treasury (HMT) on the financial management and financial sustainability of the NHS in England.1

Government response. The government states it is working with NHS England to publish planning guidance earlier and aims to improve the planning process for future years. It defers further consideration of this recommendation to the upcoming 10 Year Health Plan.
HM Treasury
19 Conclusion 5th Report - NHS financial sustainabili… Deferred

Government aims for three NHS shifts, balancing long-term transformation with current patient care.

DHSC described how the new government had set out three shifts that they want to see in the NHS: from analogue to digital; from treatment to prevention; and from acute to community. DHSC said that it wanted “to see those shifts over time, but not at the expense of patients …

Government response. The government is considering measures for supporting the prevention shift in the context of the work of the 10 Year Health Plan and does not wish to pre-empt the content, but will consider defining health prevention spend as an enabler …
HM Treasury
20 Conclusion 5th Report - NHS financial sustainabili… Deferred

Progress on health prevention hindered by acute care focus and reduced public health grants.

Senior ICB leaders reported to the National Audit Office a continued lack of progress with the government’s long-standing aim to move towards preventing ill health rather than treating it. One of the most important reasons cited by ICBs has been the focus on other pressing national priorities, particularly elective care …

Government response. The government states that measures for supporting the prevention shift are being considered in context of the work of the 10 Year Health Plan.
HM Treasury
21 Conclusion 5th Report - NHS financial sustainabili… Deferred

DHSC believes prevention requires cultural and legislative change, not solely additional resource allocation.

DHSC told us it did not view providing more resources, or redirecting them from elsewhere, as a substantive part of the solution to the lack of progress with prevention. Instead, it considers that a shift towards prevention might be achieved through longer-term changes in culture, public attitudes and the legislative …

Government response. The government is considering measures for supporting the prevention shift in the context of the work of the 10 Year Health Plan and does not wish to pre-empt the content, but will consider defining health prevention spend as an enabler …
HM Treasury
22 Conclusion 5th Report - NHS financial sustainabili… Deferred

Inadequate definition and tracking of prevention spending impedes accurate assessment of policy progress.

Currently, NHSE does not even track spend and activity on prevention by ICBs at local levels, due to unavailability of data and the lack of consistency about what counts as prevention spending. While DHSC funds some prevention activities that sit outside the NHS, primarily through its Office for Health Improvement …

Government response. The government states that defining health prevention spend could enable a shift from sickness to prevention, and that this recommendation will be considered in the context of developing the 10 Year Health Plan.
HM Treasury
24 Conclusion 5th Report - NHS financial sustainabili… Deferred

Overall NHS productivity remains low despite increased elective activity and community investments.

Despite carrying out 15% more elective activity than before the pandemic, the NHS is less productive overall once the activities of mental health trusts, community trusts and GPs are considered.42 NHSE told us that, while government has had a long-term aim to shift more care and services into local communities, …

Government response. NHSE, with DHSC, is focusing on enabling a greater shift from hospital to community – including considering how funding decisions over coming years can support this through the 10 Year Health Plan and the multi-year Spending Review. This recommendation is …
HM Treasury

Oral evidence sessions

1 session
Date Witnesses
25 Nov 2024 Amanda Pritchard · NHS England, Andy Brittain · Department of Health and Social Care (DHSC), Antonia Williams · HM Treasury, Julian Kelly · NHS England, Sir Chris Wormald KCB · Cabinet Office View ↗

Correspondence

6 letters
DateDirectionTitle
10 Sep 2025 To cttee Letter from the Permanent Secretary of the Department of Health and Social Care…
4 Sep 2025 From cttee Letter to the Permanent Secretary of the Department for Health and Social Care …
7 Apr 2025 To cttee Letter from the Interim Permanent Secretary of the Department of Health and Soc…
27 Mar 2025 To cttee Letter from the Interim Permanent Secretary of the Department of Health and Soc…
10 Mar 2025 To cttee Letter from the Chief Financial Officer and Deputy Chief Executive at NHS Engla…
4 Feb 2025 To cttee Letter from the Interim Permanent Secretary of the Department of Health and Soc…