Department of Health and Social Care

That, for the year ending with 31 March 2026, for expenditure by the Department of Health and Social Care:

(1) further resources, not exceeding £102,988,518,000, be authorised for use for current purposes as set out in HC 871 of Session 2024–25,

(2) further resources, not exceeding £7,761,339,000, be authorised for use for capital purposes as so set out, and

(3) a further sum, not exceeding £116,089,479,000, be granted to His Majesty to be issued by the Treasury out of the Consolidated Fund and applied for expenditure on the use of resources authorised by Parliament.—(Keir Mather.)

The debate will be opened by a member of the Health and Social Care Committee, Paulette Hamilton.

I am delighted to open this debate on the Department of Health and Social Care’s main estimate. My remarks will focus on the recent spending review, which includes some welcome funding increases and sets out some ambitious reform objectives. However, it also raises questions about deliverability, particularly of objectives to do with capital investment, efficiency savings and the role of social care.

Let me begin with capital investment. The Government have rightly emphasised the need to shift from analogue to digital systems across the NHS. The increase of nearly 50% in technology and transformation funding will mean that it reaches up to £10 billion by 2028-29, which is a welcome and substantial commitment. However, the NHS has a poor track record on digital transformation. The National Audit Office has highlighted the risks around fragmented delivery, unclear governance and unrealistic timelines, and those lessons remain highly relevant. Its 2020 report on digital transformation in the NHS found that despite £4.7 billion in national funding, many trusts were still reliant on systems that were outdated and not integrated.

The capital budget is being asked to do a great deal more than achieve digital transformation. The Government have committed to the new hospital programme, and to addressing critical infrastructure risks, such as those posed by reinforced autoclaved aerated concrete. Over five years, £30 billion is allocated for maintenance and repair, and £5 billion is allocated for critical risk. However, by the end of the decade, there will be no real-terms uplift in the capital allocations, compared with this year. In fact, in 2027-28, the funding settlement actually falls to £13.5 billion from £14 billion the previous year, meaning that inflation in construction costs and materials will significantly erode its purchasing power. The British Medical Association has warned that current funding cannot cover both the new hospital programme and essential maintenance, and now that programme must also compete for funding with the vital digital transformation. Can the Minister explain how the Department will choose its priorities from those competing essential demands on the capital budget?

I thank my hon. Friend for giving way, as well as for her excellent chairing of the Health Select Committee at the moment and for opening today’s debate. Does she agree that this Government’s record investment in our health service will be vital to turning around the health service after 14 years of under-investment and a lack of reform? As my hon. Friend has touched on, that investment also needs to be targeted to enable the three shifts that the 10-year plan talks about. In particular, we need to reverse the trend of more spending going towards secondary care while less goes to primary care. We need a big uplift in dentistry, which my hon. Friend has mentioned, but also in primary care—in GPs—and in pharmacy.

Hear, hear. My hon. Friend makes some valuable points, and I agree with every one of them.

Underpinning the settlement I have described, however, is the Government’s pledge to generate £17 billion in efficiency savings over three years, with a staggering £9.1 billion expected in the final year of this Parliament. Critically, those savings have already been factored into the settlement—in effect, they have been spent before they have been delivered. In the light of that, we need absolute confidence that there is a clear and robust plan to generate those savings. The Government are assuming an annual productivity improvement in the NHS of 2%, more than triple the long-term average of 0.6%. They appear to be relying on digital transformation to unlock the bulk of those savings, which is risky, given the history of digital change programmes in the NHS.

Another source of savings is the plan to cut reliance on temporary staff by reducing sickness absence and overhauling staff policies, including limits on agency spending and eliminating the use of agencies for entry-level roles. Again, this is a welcome ambition, but delivering it will be a significant challenge, one that will require meaningful, sustained improvements to staff wellbeing and working conditions. We cannot build a sustainable workforce on good will alone. Therefore, will the Minister say when we can expect an updated and fully costed workforce plan to deliver on these ambitions?

Delivering the reforming elective care for patients plan is also central to achieving those efficiencies. It proposes reforms such as optimising surgical pathways through hubs, streamlining referrals, expanding remote monitoring and reducing unnecessary procedures. The plan assumes a rapid transformation of services, with significant improvements in productivity and patient flow expected within just a few years. That is ambitious, especially given the context of ongoing workforce shortages, ageing infrastructure and rising demand. Reform is essential, but it must be realistic, properly resourced and paced to succeed. We cannot afford to set targets that look good on paper but falter in practice, damaging morale and patient care. What steps is the Minister taking to ensure that the projected £17 billion in savings will materialise and be delivered on time? What happens to those additional resources for frontline delivery if those savings are delayed or fall short?

I thank my fellow member of the Select Committee and stand-in Chair for giving way, and I congratulate her on how she is introducing the issues today. Does she agree that the length of time set for the Casey review to report does not give us a sense of confidence that the Government have injected sufficient urgency to address the serious problems of ensuring that we have a robust social care system that can stand up to the pressures that lie ahead?

I thank the hon. Member for that deep and thoughtful point. He is absolutely right. Timescales are an issue, and that is why, as a Select Committee, we are asking the Government a number of questions so that we can scrutinise what is happening and get the information.

My Committee considered the better care fund in our inquiry into adult social care. It was introduced with the aim of driving better integration between health and social care, and shifts resources upstream from NHS acute services. However, the evidence we heard was stark. These resources have been overwhelmingly focused on hospital discharge. While timely discharge is important, that does not match the fund’s original objectives. How will the Government ensure that this increase in funding leads to a greater focus on prevention? The Chancellor referred to the Government’s plan for an adult social care fair pay agreement. Reaching such an agreement is not just desirable but essential. Staff working in care homes are far more likely to live in poverty and deprivation than the average British worker.

The hon. Member is making her points very well, and I congratulate her on her success in bringing this debate to the Chamber. I agree with what she has said about fair pay for social care workers—I support that as well—but does she agree that a fair pay agreement will put undue pressure on providers unless there is some money or financial incentive attached to it so that they are able to meet their fair pay requirement?

The hon. Gentleman has made a valuable point. The problem is that we in the Committee are waiting for the workforce plan, and we are not sure what is being planned. What the hon. Gentleman has suggested is desirable, but at this moment we do not know what the workforce plan will throw up. It is possible that what he has suggested is already in the plan; let us just wait and see.

The current position is both morally unacceptable and economically short-sighted, fuelling the workforce crisis. What concrete progress has been made in establishing the fair pay agreement? Can the Minister give the House an update? Will she also tell us whether the funding that is required to pay for this essential agreement will come out of the £4 billion that has been announced for social care?

While both the main estimate and the spending review present a vision of reform, it is clearly a vision built on some highly optimistic assumptions. We need to see robust, detailed plans to deliver the digital transformation and the unprecedented scale of efficiency savings that the Minister is counting on. Without such plans, and without realistic assessments of the challenges, the risk is not just that these reforms will fall short, but that they will do so at the expense of frontline services, patient care, and the morale of our dedicated health and social care workforce.

I urge the Minister to address the specific questions that I have raised today.

Order. It will not have escaped Members’ notice that we are playing “beat the clock” this afternoon. There is another debate to follow, with a very large number of speakers, and we are going to have to try and split the time between two debates. That means two things. First, after the next speaker I will impose a limit of three minutes on every speaker. The Liberal Democrat Front Bencher has agreed to cut her speech to six minutes and the other two Front Benchers have agreed to cut theirs to eight minutes, with no interventions. Secondly, it is up to Members, but if they intervene, we will not get through this, or else some Members will not be called—and it may be that Members who have spoken in earlier debates will not be called at all.

I congratulate the hon. Member for Birmingham Erdington (Paulette Hamilton) on securing the debate.

We have learned this week that rather than the Government ensuring that funding reaches the frontline, spending on staff at the Department of Health and Social Care and seven other arm’s length bodies has increased by more than 10% since Labour came to power, while GPs, social care providers and hospices are forced to do more with less.

The situation is further compounded by rising financial pressures. Despite repeated promises that additional funding would improve patient care, the chief financial officer of NHS England has confirmed to the Select Committee that all the extra money allocated to the NHS will be swallowed up by national insurance increases, inflation and pay settlements, which means that none of it will go towards real improvements in frontline care.

The rise in national insurance contributions was supposed to bolster the NHS and social care. In reality, it has landed like an extra tax on providers themselves. GP surgeries, care homes, hospices and community services are all grappling with the additional payroll costs, just as they struggle with surging demand and chronic workforce shortages. The Institute of General Practice Management estimates that the average GP practice now pays an extra £20,000 a year in national insurance alone. Across the nearly 6,500 practices, that adds up to around £125 million a year—money that could otherwise pay for more than 2 million GP appointments, at a time when patients are struggling to be seen.

Adult social care providers face an equally stark reality. The Nuffield Trust projects that employers will shoulder nearly £940 million in extra national insurance costs in this financial year, on top of the £1.85 billion required to cover the rise in the national living wage. Local councils already face a £665 million shortfall in delivering their legal social care duties. The Government have promised a 3% real-terms rise in NHS revenue spending each year to 2028-29, reaching £232 billion by the end of that financial year, yet despite the headline increases, capital investment is being held flat in real terms. NHS leaders have made it clear that it will not be enough to rebuild or modernise our hospitals, or to fund the facilities required to support more care in the community.