The sector has had several days now to absorb the announcements from this autumn’s budget. The main driver from a healthcare perspective was a renewed Government commitment to reducing NHS waiting lists and delivering improvements across health sector. However, with the backdrop of a stuttering economy and strained public finances, nobody expected the Government to splash the cash, and the Chancellor has taken a targeted approach.
Key Takeaways for the Healthcare Sector
Measures introduced by this Budget include an additional £300 million to drive technology improvements, with new digital tools intended to help NHS staff and improve productivity, letting staff spend more time with patients rather than on time-consuming admin duties.
Another key announcement was the 250 new Neighbourhood Health Centres in England, with 120 of those to be delivered by 2030, shifting care from hospitals closer to where people live. In a nod to the tight finances, the vast majority of these health centres will be funded by a new on-balance sheet public-private-partnership (PPP) model. While the details on this finance model are to follow, introducing private capital to build new facilities should not only increases overall investment in the NHS but free up public funding to tackle the NHS estate’s maintenance backlog.
In essence, the overall budget for health and social care in England is now forecast to increase by an average of 2.4% in real terms over the 2025-26 to 2028-29 Spending Review period. This is slightly lower than the 2.7% forecast in June. General sector reaction has been that the NHS budget in England is under significant pressure from factors such as the rising demand for care, rising staff costs through increases in the National Living Wage and new pay settlements, ongoing strike action and higher drug prices driven by the new UK-US trade deal.
The new UK-US trade deal
While the new trade deal makes the UK the only country in the world to secure a zero percent tariff on pharmaceutical exports to the US, cementing Britain’s position as a global leader in life sciences and driving billions in investment into the UK’s life sciences sector, it also introduces many benefits to NHS patients, through improved access to life-saving medicines and safeguard supply chains. The Government will also increase investment in innovative treatments by 25%, the first major rise in over two decades. However, while medicines play a key role keeping people out of hospital, new funding has not been announced for this deal, which is causing some further concern for those with a keen eye on the already strained NHS budget and the difficult decisions that may need to be taken unless new funding for medicines is announced.
Specialist Assistance from Vickery Homan
Budgetary pressures are not new to the health and care sectors. GP practice manager’s, care home operators and other sector professionals with an eye on the finances face a constant challenge to balance the books. Here at Vickery Holman, we have an experienced team of surveyors that can assist where required. Whether a valuation for lending, financial reporting or sale purposes, or rental advice for Notional Rent assessments or a leased rent review, it is highly advisable to seek specialist valuer input, which the Healthcare team here at Vickery Holman would be happy to provide.
