The NHS budget and how it has changed

This content relates to the following topics:

Part of The NHS in a nutshell

Article information

  • Posted:Monday 02 July 2018

Planned spending for the Department of Health in England is approximately £124.7 billion in 2017/18. This includes £335 million of additional funding announced in the 2017 Autumn Budget.

Though funding for the Department of Health continues to grow, the rate of growth has slowed considerably compared to historical trends. The Department of Health budget will grow by 1.2 per cent in real terms between 2009/10 and 2020/21. This is far below the long-term average increases in health spending of approximately 4 per cent a year (above inflation) since the NHS was established and the rate of increase needed based on projections by the Office of Budget Responsibility (4.3 per cent a year).

In the Autumn Budget 2017, the government provided the Department of Health with £2.8 billion in additional revenue funding for day-to-day spending such as staff salaries and medicines. Further funding on top of this amount was promised for future pay awards for NHS staff on Agenda for Change contracts, such as nurses, midwives and paramedics, subject to a deal being agreed with the unions to modernise the pay structure for Agenda for Change staff. 

The government has also committed to an extra £10 billion in capital funding over the parliament for investment in buildings, facilities and equipment. Central government funding accounts for £4 billion of this amount (£3.5 billion announced in the Autumn Budget and £0.4 billion announced in the Spring Budget 2017), with the remainder coming from private financing and sales of surplus NHS land and assets.

In June 2018, the Prime Minister announced a new long-term funding settlement for the NHS. See our NHS funding blog for more information on the details of this offer.