Thumbs up for capital boost but we could do better | Niall Dickson

Niall Dickson

The latest capital injection for the NHS falls short of the mark, says Niall Dickson, chief executive of the NHS Confederation, who here explains why more capital investment is needed and how it is critical to transforming healthcare.  

It would be churlish not to welcome the latest capital injection. It is not enough; it is another short-term reaction; and it certainly does not amount to an investment plan; but for those 40 trusts named, particularly the six in the first phase, this is good news.

However, the backlog of maintenance and the paucity of investment in infrastructure, IT and tech more generally in hospitals, but not just in hospitals, represents a real brake on what is possible if we are to transform care and ensure the safety of patients.

The absence of any mention of capital in the 2018 ‘birthday’ spending plans ahead of the Long Term Plan was a lost opportunity which has still not been grabbed. The maintenance backlog alone is around £6 billion and this latest injection, even with the earlier £1.8 billion, falls woefully short of what is required.

In a recent survey of our members, 85 per cent of you reported lack of capital investment had inhibited delivery. In parts of the system the state of our estate is dire - mental health trusts, for example, have among the worst fabric and fastest rising maintenance backlogs. Some of the places where we treat some of the most acutely ill and vulnerable patients are disgracefully underfunded.

None of this should be a surprise to anyone who looks beyond these shores. In the years before the financial crash, the UK had made its way up the healthcare capital spending league to a level comparable with other OECD countries, at just over 0.5 per cent of GDP.

Since then, it has dropped to about half that level. Interestingly, not much of the fall is explained by capital-to-revenue transfers. The Health Foundation estimates that in 2016, without a capital-to-revenue transfer, capital spending could have been just 0.03 per cent higher.

In other words, the real issue was, and is, that the original allocations have been grossly inadequate in the first place.

The foundation estimates that the cost of bringing the UK up to the OECD average of capital spending as a share of GDP in 2019/20 was £9.5 billion, which means we were £3.5 billion (58%) short last year alone.

Of course, we need a longer-term solution, with guarantees of funding over the same period as the revenue funding stream. As others have pointed out, we should benchmark ourselves against comparable countries to measure progress. 

And if the centre and the politicians are serious about the principle of subsidiarity, which they claim to be, key decisions about where the money is spent should be devolved to local systems rather than subject to national and indeed sometimes political determination. And dare one say it, in some cases, it may be decided that investment in IT infrastructure is better than a shiny new hospital.

Niall Dickson is chief executive of the NHS Confederation. Follow him on Twitter @NHSC_Niall and the Confed @nhsconfed 

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