Select committee: Public Accounts Committee
Conclusion 12
5th Report - NHS financial sustainability
Published 29 Jan 2025
Addressed to HM Treasury
Public Accounts Committee NHS financial sustainability All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Conclusion (the committee's words)
Demand for capital in the NHS continues to outstrip supply and the UK lags behind other OECD countries in terms of capital investment in its health system. DHSC has maintained its recent track record of not fully investing the capital funds HMT allocates it and instead reallocating large amounts for day-to-day revenue spending. It transferred £0.4 billion from capital to revenue in 2022–23, £0.9 billion in 2023–24, and it told us that a similar amount of £0.9 billion would be switched during the current 2024–25 financial year.19 However, DHSC provided assurances that there would be no further transfers of capital to resource funding because the Chancellor has introduced new fiscal rules to prevent this from happening.20 14 Q 74, Final local government finance settlement: England, 2024 to 2025 - GOV.UK 15 Q 75 16 Q76 17 C&AG’s Report, para 1.8 18 Q 7 19 Q 18; C&AG’s Report, paras 4.21 and 4.23 20 Q 17 10
From: Public Accounts Committee, 5th Report - NHS financial sustainability (HC 350), 29 January 2025
Government response
Latest Treasury Minutes progress report to the Committee of Public Accounts on the Fifth Report of Session 2024-26
The government responded to the whole report on 4 June 2026.
Treasury minutes: Government response to the Committee of Public Accounts on the Fifth report from Session 2024-25
Published 16 May 2025.
Summary written by Accountability Index from the government's response. It is not the government's own words.The government agrees with several of the Committee's recommendations, including on earlier planning guidance, productivity and capital-to-revenue switches, is still considering others, and disagrees with the recommendation on paperless providers.
- On planning, the government agrees that guidance should be issued earlier, with a target implementation date of December 2025. NHSE and DHSC are working so guidance is published "ideally before Christmas".
- On the ten-year plan, prevention spending definitions and community funding, the government "is considering" the recommendations and says it will notify the Committee of its response "when it is confirmed".
- The government agrees that NHSE should set out its productivity actions (target: Autumn 2025). It says the plan for productivity improvements from 2026-27 "will be set out following Phase 2 of the Spending Review".
- The government disagrees with the recommendation on paper reduction, saying it "does not agree that providers should be fully paperless" as some patient communications must be sent by letter. It expects trusts and ICBs "to restrict fax machine use".