George Osborne confirms extra £2bn for NHS

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As you’ll no doubt have seen in the media this week, Chancellor George Osborne has announced that he will put an extra £2.2 billion into the NHS in 2015/16 - of which £1.95bn will be allocated to England.

The Chancellor described the funding as a “down payment” on the NHS Five Year Forward View, the plan that sets out how the health service needs to change over the next five years to promote better public wellbeing and reduce ill-health.

So how will the £1.96 billion be spent?

  • £1.5 billion: this will become part of general spending given to clinical commissioning groups (CCGs). The allocations for this part of the funding will be decided on by NHS England at its board meeting on 17th December. 
  • £200 million: this fund will be used to read some of the new models of care set out in the Five Year Forward View, and will also be used to support health economies experiencing extreme clinical / financial pressure. The allocation of this funding will be decided jointly by NHS England, the TDA, Monitor and the CQC. 
  • £250 million: this money has been allocated to expand and enhance primary and out-of-hospital care. This funding will be ring-fenced and repeated for four years (2015/16 – 2018/19 inclusive).

Where is it being funded from?

  • £1 billion: this is additional funding from the Treasury, released from departmental underspends outside of health. 
  • £700 million: a reallocation from within the overall Department of Health (DH) budget; £550 million is from DH underspend. 
  • £250 million: from banking fines. 

NHS Providers, who represent NHS trusts across the country, has welcomed the additional funding but says there is still a long way to go: “We recognise that the 2015/16 financial year is still significantly challenging for our members and over the coming weeks we will continuing our influencing work to help ensure this additional funding rapidly reaches the frontline providers of NHS services.

It added: “It is essential that additional funding should be used to support the frontline delivery of clinical care to patients across acute, ambulance, community and mental health services, rather than being lost or delayed within the system.”

The Government has announced its commitment to implementing the five-year plan, with many of the measures designed to curb the rise in hospital admissions and the impact of the aging population. The plans involve increasing spending on the health service in England by £8bn a year in real terms by 2020.

Published 4th December 2014

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