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Spring budget 2024: tech investment for NHS ‘productivity’

Health service leaders have warned of another “tough year” for the NHS, after the announcement of the 2024 spring budget.

Jeremy Hunt, chancellor of the exchequer, announced this afternoon the UK Government’s fiscal plans for 2024-25 including a host of measures which will impact nursing and the NHS general.

“We need a more productive state, not a bigger state”

Jeremy Hunt

Chief among Mr Hunt’s announcements was a 2p reduction on national insurance, on top of a 2p reduction he made in the autumn. He said this move would promote growth, help “make work pay” while not risking funding for public services.

Mr Hunt, formerly health and social care secretary, said a previously-announced 1% real-terms increase in public spending per year would be protected, but that it would not increase despite calls from some.

Instead, the chancellor said he would commit £4.2bn for a programme to improve public sector productivity including £3.4bn for the NHS.

The NHS investment, the chancellor said, would go towards new technology and digital transformation including replacing “outdated IT systems” and other equipment.

He said this would improve efficiency in the health service by reducing unnecessary physical paperwork and lost hours due to IT infrastructure issues.

The funding has also been earmarked for the introduction of nationwide electronic patient records, electronic rostering via an NHS staff app and artificial intelligence (AI) to aid clinical staff.

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“Although spending rises each year, public sector productivity still remains below pre-pandemic levels by nearly 6%,” he said.

“This demonstrates the way to improve public services is not always more money, and more people; we need to run them more efficiently.

“We need a more productive state, not a bigger state.”

Mr Hunt claimed that these measures would allow the NHS to commit to an annual 1.9% increase in productivity.

“The public do not back his agenda”

Pat Cullen

NHS England chief executive Amanda Pritchard claimed that Mr Hunt’s announcements showed a commitment by the government to “back the NHS”.

“Adopting the latest technology is already having an impact on the way we deliver services for patients – including getting your prescriptions on the NHS App and virtual wards which let people recover at home,” she said.

“The significant £3.4bn investment in capital to fund new technology means the NHS can now commit to deliver 2% annual productivity growth in the final two years of the next parliament, which will unlock tens of billions of savings.”

The chancellor also announced a £45m boost to medical research charities to develop new medicines for diseases like cancer, dementia and epilepsy.

In addition, he said that “government support” meant pharmaceutical company Astrazeneca was now set to “expand their footprint” on the University of Cambridge’s biomedical campus and set up a vaccine manufacturing hub in Liverpool.

“I have long believed we should be manufacturing medicines as well as developing them,” Mr Hunt added.

Also revealed were increases in duty on tobacco and on vapes to further the “financial incentive” of quitting.

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Meanwhile, Mr Hunt said he would continue a freeze on alcohol duty until 2025 to give a boost to British pubs.

Missing from Mr Hunt’s announcement, however, was any mention of loan forgiveness for student nurses, which the Royal College of Nursing (RCN) and modern universities organisation MillionPlus had pressed him to implement ahead of the budget.

Pat Cullen speaking at RCN Congress 2023

Pat Cullen

RCN general secretary and chief executive Professor Pat Cullen said the chancellor’s tax cuts would be enough to fund the student loans of NHS nurses for the next four decades, and that “the public do not back his agenda”.

“They want the health service turned around more than they support tax reduction,” said Professor Cullen.

“Technology is transformative in healthcare but you still need enough staff to use it yet the chancellor did not face up to his NHS workforce plan now heading in the wrong direction.

“Fewer people are starting nurse courses, not more.

“When nursing staff are already forced to give care in corridors and treat 15 patients at a time, his productivity plan must not ask them for even more.”

Professor Cullen said financial measures including loan forgiveness “should have been announced” to boost domestic nurse recruitment.

NHS Providers chief executive Sir Julian Hartley welcomed the continuation of the yearly increase to day-to-day publc sector spending, which he said equated to around £2.5bn extra for the NHS.

Sir Julian, however, described it as a “temporary respite” and urged the chancellor to go further.

Julian Hartley

“Leaders across the NHS want nothing more than to provide high-quality patient care and improved services,” he said.

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“But to do this, they need to see long-term, multi-year investment in the health service which allows health leaders to plan for the future instead of this stop-start approach to NHS funding which leaves them constantly worrying about budget cuts followed by quick-fix, short-term funding announcements.

“They will be pleased though, that the chancellor has finally heard their calls for more investment in digital and technology in the NHS, which has the potential to transform healthcare for patients, improve access to services and free up staff time.”

Also missing from the budget was any targeted interventions for social care.

Profesor Vic Rayner, chief executive of the National Care Forum, said Mr Hunt’s budget was evidence the government had “undermined” past pledges on social care.

She said: “It is clear the chancellor has missed a key opportunity to address the huge funding pressures on local government and social care providers alike – these pressures are leading to multiple councils from across the political spectrum declaring bankruptcy due to the spiralling costs of social care.

“For the thousands of people who are waiting for assessments and care packages, this budget does nothing to improve the accessibility or availability of care.

“Additionally, for the organisations providing care and support, it does nothing to address the ongoing workforce and recruitment challenges.”

Professor Rayner added a call for the government to improve investment in social care in the future, including better pay and working conditions for the social care workforce.

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