Johnson announces £1.8bn for NHS as departments await Spending Review

Written by Beckie Smith on 5 August 2019 in News
News

Johnson says 'strong economic performance' has made funding possible 

Projects being funded include a £99.9m women’s and children’s hospital at the Royal Cornwall Hospital site in Truro. Photo:  Ben Birchall/PA

The prime minister, Boris Johnson, has announced a £1.8bn immediate cash injection to upgrade NHS facilities and infrastructure in England.

The announcement comes as government departments wait to hear whether the Spending Review planned for this summer will go ahead. A three-year exercise had been expected to set departmental budgets this autumn, but the seven-month extension of the UK’s deadline has made it unlikely that a full three-year exercise will take place this year.

Twenty hospital trusts will each receive a share of £850m to upgrade outdated facilities and equipment at 20 hospitals, while the remaining £1bn will be added to the NHS capital budget for this year to fund urgent infrastructure projects and existing upgrade programmes, Johnson said ahead of a visit to a hospital in Lincolnshire today.


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Johnson – who has been criticised for backing the Brexit “battle bus” claim that leaving the EU could lead to an £350m extra a week being spent on the NHS – said the funding boost was possible because of the country’s “strong economic performance”.

Writing for the Sunday Times, Johnson said: “If you ask where the money is coming from... Like every penny of public spending, NHS funding derives from a strong and dynamic market economy.”

However, the allocation could cut into the overall funding envelope for public services at the next Spending Review.

The pledge comes just over a year after the former chancellor, Philip Hammond, announced a real-terms NHS funding increase of £20bn a year by 2023-24. Shortly after revealing the settlement, Hammond told ministers that it would leave no extra money for other policy areas, and he said that no other department would get NHS-style settlement before the full Spending Review.

And if Sajid Javid, who became chancellor in Johnson's cabinet reshuffle last month, follows the “indicative five-year path” set out by his predecessor, other departments are likely to see budget cuts in the upcoming Spending Review. Hammond said departmental spending would rise by 1.2% annually in real terms from 2019-20, but this figure drops to zero once the NHS settlement account is removed.

Commenting on the announcement, Ben Gershlick, a senior economist at the Health Foundation, a independent charity, said investment in the NHS "must not come at the expense of other areas of public funding which benefit people's health and have seen sustained cuts in the past decade, such as Sure Start and other local government services".

Johnson said today the £850m boost for hospitals would provide “more beds, new wards, and extra life-saving equipment".

The biggest tranches of funding include £99.9m to build a women’s and children’s hospital in Truro; £99.5m for a new critical intensive care block, delivery suite and operating theatres at Luton and Dunstable University hospital trust; £97.1m to replace outdated outpatient, treatment and diagnostic accommodation with a purpose-built hospital facility in Birmingham; and £72.3m for an adult mental health inpatient unit in Greater Manchester.

NHS England’s chief executive, Simon Stevens, said the money was a “significant start to the much needed capital investment so that our nurses, doctors and other NHS staff will be able to care for their patients in modern facilities with state of the art equipment”.

But Gershlick said that while the announcement was welcome, it would not be enough to meet the He “£6bn maintenance backlog” at hospitals and other NHS facilities across the country.

He said long-term capital funding was needed rather than one-off payments, and that “years of underinvestment in the NHS’s infrastructure means this extra money risks being little more than a drop in the ocean”.

“Any new funding for buildings, equipment and technology will help, but allocating money late in the year and changing budgets multiple times is not an effective way to plan investment,” he added.

No.10 said the devolved administrations would receive additional funds according to the Barnett formula, which ensures funding increases are fairly distributed across the UK. Wales will receive around £110m, Scotland will get £180m and Northern Ireland £60m.

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Beckie Smith
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Beckie Smith is a reporter for CSW who tweets @Beckie__Smith.

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