Capital efficiency – how to reform healthcare capital spending says the NHS is ‘being held back’ from most effectively spending the investment it has been given to repair its estates, purchase vital equipment, and build new facilities, due to ‘bureaucratic hurdles’ that are ‘slow, unclear, and duplicative’. The Confederation says local NHS leaders have told it that the capital approvals processes from local Trust and Integrated Care Board (ICB), up through NHS England, the Department of Health and Social Care, and the Treasury, ‘is too slow, as there are too many duplicative stages, creating delay and adding cost’.
The report recommends reducing the number of approval stages for projects – currently at least 19 – and giving local health systems greater autonomy over their spending.
For example, NHS England and the government must both approve any investments over £50 million, but the Confederation believes this should rise to £100 million, allowing projects such as new hospitals, new scanners, and artificial intelligence to progress more quickly. ICBs should also be allowed to raise additional investment away from government allocations, including via private means, which is not currently allowed, the report argues.
Lord Darzi’s report, Independent investigation of the NHS in England, published last September, highlighted that the NHS has been ‘starved of capital funding’ for over a decade, resulting in a £37 billion shortfall. While welcoming the £3.1 billion additional capital investment at the 2024 Budget, the Confederation says ‘this is still at least £3.3 billion short’ of the £6.4 billion a year additional capital investment needed to help boost NHS productivity growth to 2 per cent per year.
NHS Confederation CEO, Matthew Taylor (pictured), said: “Across the NHS, staff are having no choice but to treat patients in crumbling buildings, and with out-of-date equipment. This is neither safe nor good for productivity. As Lord Darzi highlighted, the NHS has been starved for capital for more than a decade, so it’s vital that it can maximise the return on every penny it has.
“But what money there is too often held back by red tape – creating delay and cost, undermining taxpayers’ value for money. The verdict from NHS leaders is clear: the NHS capital regime is broken.
“Our new report sets out 16 measures that can help the NHS make the most effective use of the capital funding it already has, including the extra investment promised by the government in the last Budget.
“Cutting the bureaucratic burden on NHS organisations getting approval to begin new projects is essential to avoid costly delays,” Matthew Taylor continued. “Part of this is simplifying the process, but it also requires more autonomy to let local leaders get on and make the decisions that are best for their populations.
“One option to bridge this gap is to allow new routes for private investment. This does not mean throwing open the doors to private finance, but rather creating the environment where the NHS has more options for raising the vital funding it needs to tackle its maintenance backlog, and invest in the latest equipment and technologies.”