Economic pressures

In this section we look at the current economic context and explore past and future trends in health care spending in the UK.  

In this section

Key messages

  • Future funding scenarios for health and social care
    Current funding prospects for health and social care suggest a continuing period of financial austerity, with funding just covering inflation. But there is considerable uncertainty after 2015/16. For the Office for Budget Responsibility’s central projections to hold true for health, the NHS would face a further significant productivity challenge on top of the current Nicholson challenge of £20 billion, amounting to annual gains of over 2 per cent per year to 2021/2. This contrasts with a long-term trend of annual real-terms growth in NHS funding of around 4 per cent per annum.

Key uncertainties

  • Future funding for health and social care
    Will health and social care receive settlements above or below the rate of GDP growth in the future? And how will the future demand for health and social care affect the need for continuing productivity gains?
  • Economic prosperity
    The economic prosperity of the UK is increasingly dependent on the economies of other countries. The most stark example of this is the current economic threat posed by the crisis in the Euro zone.

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