Recommendation 2

With little contingency up to 2029–30, there is a risk that delays and cost overruns in the early years will have knock on effects on subsequent hospital schemes. Although some of the early hospital schemes in the programme (known as ‘wave 0’) are open or due to complete soon, enabling works for many hospital schemes in the next wave (‘wave 1’) are yet to start. Wave 1 contains the first schemes to be built to the Hospital 2.0 design which will be more complex. The Hospital 2.0 design is novel and it is taking time to finalise. Wave 1 will include 16 more hospital schemes than anything delivered so far, with a planned spend of £8.9 billion from 2025–26 to 2029–30, compared to £720 million for schemes in wave 0. Despite these challenges, the Department has set aside very little contingency funding for 2025–26 to 2029–30, just 3% of total funding for the period. If the programme faces unexpected cost increases in the next few years, there is very little buffer to absorb them, and knock-on delays to subsequent hospital schemes are likely. recommendation The Department must closely monitor progress to ensure knock-on effects are managed effectively by: a. using an assessment of progress on the early schemes to re-estimate the hospital opening dates and costs for later schemes; and b. improving transparency by reporting publicly on progress and spending every year for each scheme, and explaining any significant variances and the consequences for the programme.