Blog post

Placing the NHS at the heart of economic and social recovery post COVID-19

Nesta Lloyd-Jones writes about the significant role the NHS will play in the wider recovery of local economies and communities following the pandemic.
Nesta Lloyd-Jones

29 October 2021

This month has, yet again, been one of the most challenging on record for the health and care service. As the UK Government announces its Budget and Spending Review, setting out spending plans until 2024/25, and the Welsh Government draft budget 2022-23 is scrutinised by the Senedd, discussion continues around the amount of funding the NHS receives but less around the role of the nation’s healthcare system on local economies.

It’s well-documented that NHS revenue spending accounts for around 50% of the Welsh Government’s budget, currently £9.1 billion, and additional funding has been made available to support the NHS response to the COVID-19 pandemic. However, there is less awareness of the significant contribution the NHS makes to local and national economies as an anchor institution, as well as the significant role it will play in wider recovery of local economies and communities following the pandemic.

Our latest briefing, Health, wealth and wellbeing: The NHS’ role in economic and social recovery, raises awareness of the direct and indirect contributions the NHS in Wales makes to the economy and local communities, including to the health and wellbeing of the population.

The briefing calls for Welsh Government and local leaders to place health and sustainability at the heart of all national COVID-19 recovery and economic plans, by embedding health and care within national and local regeneration planning, ensuring a much greater alignment between health and care strategies and those relating to wider economic development.  

Health, wellbeing and the economy are bound tightly together; a healthy (physically, psychologically and socially) population results in a more economically active population. Interventions designed to improve health, inclusive growth and wellbeing in Wales are in the interests of all local, regional and national partners, businesses and communities and should be a shared priority. In light of COVID-19, the NHS is seeking to reset its services and priorities, with a focus on how it can influence wider community issues in its role as an anchor institution. This includes how its resource allocation and utilisation can support local economic development, influence social and economic determinants of health and help build sustainable communities.

The size, scale and reach of the NHS means that it has a significant influence on the health and wellbeing of local populations and could have a key role in actively supporting and driving the nation's critical economic and social recovery, post COVID-19. As the largest employer in local areas, a key purchaser of goods and services, and a capital estate holder and developer, NHS organisations in Wales act as anchor institutions, whose long-term sustainability is tied to the wellbeing of the population. 

However, the socio-economic impacts of NHS Wales spread far beyond its economic scale and scope to include wider impacts, including employment stability, regional wages, occupational structure, and economic activity rates. Collectively, these factors positively impact Welsh productivity and the economy, with organisations and businesses benefitting significantly from healthier and more productive workforces. In many ways, health can be seen as the ‘new wealth’.

The COVID-19 pandemic, EU exit and climate change are anticipated to contribute to a future social and economic downturn. The NHS must use the system and partnership approach that emerged during the pandemic to drive up population health and wellbeing. We have a fantastic opportunity in Wales for a more focused ‘health and wellbeing in all policies’ approach to future national and local decision-making, through legislative frameworks such as the Wellbeing of Future Generations Act 2015, Social Services and Wellbeing Act 2014 and the Socio-Economic Duty.

There are opportunities for Public Service Boards, Regional Partnership Boards and other innovative local partnerships to consider issues such as workforce and supply chain development, community working, new forms of funding and strengthening population health through prevention and early intervention. In addition, there is an opportunity to start looking at the social value within procurement and the service the NHS is providing to help capture the wider impact, including socio-economic factors, to use and strengthen local supply chains and spread and scale best practice across Wales.

The NHS has a unique opportunity to use its resources to influence the wellbeing of the population it serves and reduce the health inequalities that exist in Wales. Tackling stubborn inequalities and driving recovery and growth through a renewed focus on health requires bold actions. It means prioritising health in its widest sense: from improving population health to strengthening research and development with industry on health technologies. It means anchor institutions – the NHS, universities, local and combined authorities – working together to co-design our communities where people want to live, work and invest through engaging communities and other partners on these efforts, but also boosting the role they themselves play as large employers and economic actors (who in turn will benefit from a healthier workforce).

We hope this briefing evidences the ways in which the NHS already supports local economies across Wales, but also recommends how we can further make a difference to the health, wealth and wellbeing of our communities.

The Welsh NHS Confederation supports its Members, NHS organisations in Wales, to understand and maximise their role as anchor institutions – working in partnership with other health and care organisations and, critically, other local anchors. Together, we can make a huge difference to the health, wealth and wellbeing of local communities.