The King’s Fund responds to the 2025 Autumn Budget

Responding to the Autumn Budget, Sarah Woolnough, Chief Executive of The King’s Fund, said:

‘The generous settlement the NHS received at the spending review earlier this year and its apparent protection today will help the health service just about keep its head above water as it battles a long list of financial challenges. Nonetheless, rising demand, fragile social care, industrial action, major workforce payouts, and potential drug price increases mean health and care leaders still face a daunting task.

‘The scrapping of the two-child benefit cap and investment in neighbourhood health centres are bold steps towards improving the public’s health and reducing pressure on the NHS long term. However, the government still lacks a clear plan for how it will deliver its NHS reforms or stabilise social care, and for how new private investment partnerships will avoid the costly mistakes of the past.’

Two-child benefit cap and public health

‘The lifting of the two-child benefit cap could be significant in tackling deep health inequalities. It will take hundreds of thousands of children out of poverty – a key driver of health conditions, from obesity to asthma. Conditions such as these can lead to lifelong struggles with health, affecting quality and, ultimately, length of life, as well as place long-term pressure on NHS budgets. Alongside a cross-government approach with measures such as the ‘milkshake tax’, we welcome ministers using levers other than direct NHS funding to improve health outcomes.

‘Other policies such as an increase to gambling duty will build on this too; however, the government could have gone further. There is space for tighter restrictions on junk food ads, while the move to raise taxes on electric vehicles could set back efforts to increase their uptake and improve air quality. Overall, this Budget represents steps in the right direction but there is room for improvement in creating a more coherent public health policy.’

Finances

‘This Budget lands against a bleak economic backdrop, yet health spending appears to have emerged relatively protected. There is still a long list of challenges alongside an intense political focus on driving down NHS performance targets – including waits for routine hospital care – which will mean the NHS is forced into trade-offs. It will have to divert its limited resources into achieving these targets to the detriment of other areas equally important to health outcomes and public satisfaction.

‘The full cost of the government's restructure of the NHS is still unknown. Redundancy payments may be affordable this year because of a new agreement with HM Treasury to bring forward planned future spending, but the opportunity costs of restructuring the NHS while embarking on the most significant set of NHS reforms in a decade will be considerable. It also risks distracting senior management at a time when there should be a laser focus on improving performance.

‘The £300 million announced for investment in technology is welcome in showing the government’s focus on improving efficiency, but in the context of the previously announced £10 billion over three years in investment in this area it is a relatively small sum.’

Neighbourhood health centres

‘The government's announced investment in neighbourhood health centres is welcome. It shows that ministers are looking at different ways to release new funding and prioritising delivery of care closer to home. Successive governments have not made progress on shifting care out of hospitals, and ministers must demonstrate a clear break from this poor track record.

‘The use of public–private partnerships at a large scale in the NHS should be treated with caution given the repeated challenges previously. Ministers must prove they have learnt from the mistakes of schemes such as the private finance initiative by implementing appropriate checks and balances to design schemes more carefully and ensure value for money.

‘Delivering neighbourhood health requires more than new or upgraded buildings. So that care is delivered in these new ways, rather than simply shifting old models out of hospital to community facilities, we need to expand diagnostic capacity, improve digital infrastructure, and build a truly sustainable workforce. And a drive for improved co-ordination of health care, including with social care, which was notably absent from the Chancellor’s remarks, will be necessary to improve the experience for many patients.’