While there are a number of factors influencing productivity that are within the gift of trusts to control and influence, it is also critical to recognise that the converse is equally true. Productivity growth is dependent on a number of long-term enablers which would help transform the NHS to tackle the challenges of the future.
Redesigning services with digital solutions
The level of digital maturity across trusts varies widely. As with the maintenance backlog, limited operational capital budgets have restricted trusts' ability to substantially improve NHS technology and digital assets over the current Spending Review period. The government's £3.4bn investment in digital technologies across the NHS announced at the Spring Budget is welcome news for trusts. Improving their digital capabilities will better enable staff to focus on clinical priorities as well as enhancing the experience of patients, through widening access to care, by offering virtual appointments or liaising with clinicians using patient engagement platforms. Given financial pressures on day-to-day spending in successive years since the pandemic, it is vital that government and national bodies protect spending on digital technologies to avoid crucial transformation budgets being raided to supplement revenue budgets.
Approximately 60% of the additional funding announced at the Spring Budget will be targeted at upgrading outdated IT systems and ensuring all trusts have electronic patient records (EPRs) (HM Treasury, 2024). NHS staff will welcome additional funding which is designed to reduce the time spent by staff entering and searching for data, increasing productivity and supporting a population health management approach to prevent ill health across local communities. If government wants to see a sustainable increase in NHS productivity then it is imperative it works towards enabling the digitisation of the NHS at pace. As outlined by the Health Foundation, in order to maximise the value of additional staff time freed-up by digital technologies, national bodies must develop a culture that will support staff to devote additional time to training and research, as well as increasing care volumes (Horton & Moulds, 2024). It is important to recognise that digital investment will not necessarily deliver immediate productivity improvements. Therefore, if government and national bodies want to unlock substantial productivity savings for the long term, there needs to be sufficient focus on empowering and enabling staff to maximise the productivity benefits of new technologies.
Repairing the dilapidated NHS estate
Inflation has significantly damaged the value of the October 2021 Spending Review settlement which saw capital investment increased to an average of £8bn per annum – substantially higher than the £3bn average per annum between 2010-19 (NHS England, 2022). Trusts welcomed the multi-year settlement announced at the last spending review, however, inflationary pressures have significantly eroded the value of increased capital budgets. Tight operational capital budgets have left trusts with very little headroom to invest in their estate and update antiquated equipment and buildings in disrepair. As a result, the latest estates return information collection (ERIC) data for 2022/23 shows the NHS maintenance backlog has continued its deterioration to a now record-high level of £11.6bn. Trusts are managing significant levels of risk across their estate, with the most worrying aspect of the ERIC data showing that the proportion of the backlog categorised as 'high' risk now stands at £2.3bn – over six times higher than the equivalent figure for 2013/14 (NHS England, 2023b).
Trust leaders have continually raised the very real impact the maintenance backlog has on their productivity, including medical procedures being disrupted, postponed or cancelled, patients being moved from wards as a result of faulty equipment or safety hazards, and outdated mental health hospitals which do not provide a suitable therapeutic environment for mental health patients. There is an urgent need for government to provide trusts with the necessary capital funding to eradicate the maintenance backlog and enable trusts to provide safe, therapeutic environments for staff to deliver high quality patient care – this will result in a substantial boost to NHS productivity levels.
Transforming the NHS estate
Trusts are continuing to find it exceedingly difficult to access strategic capital funding to invest in major health infrastructure projects. Over 100 applications were made from trusts for the final eight places on the New Hospital Programme (NHP) highlighting the vital need for capital investment to enable trusts to overhaul their ageing NHS estates (Dunhill et al., 2023). Trusts excluded from the programme are concerned about access to national capital funding to prioritise the redevelopment of their estate. The NHP alone is insufficient to meet the total capital funding needs of the NHS. Furthermore, given the national priority on elective recovery and the shortage of mental health and community trusts in the NHP, many trust leaders are concerned about the underinvestment in mental health and community services. Government must ensure that adequate capital funding is available to support additional infrastructure projects where there is a clear economic case for investment as well as a public interest.
Trusts also play a key role in creating economic and social value for communities as anchor institutions, generating economic growth and prosperity as local employers and providing integral services to their local population. There is a clear productivity benefit in refurbishing ageing estates and providing a first-class environment for hard-working NHS staff to deliver high quality patient care. Government must consider widening access to strategic capital envelopes to enable trusts from all sectors to deliver the transformation required to optimise patient flow and deliver high-quality, integrated care across the whole system.
Reforming an underfunded social care system
Improving the flow of patients in and out of hospital is a vital component to delivering increased productivity levels. Trusts recognise there are a variety of factors which have held up patients from being discharged from hospitals, including issues with internal discharge processes. Research conducted by the Nuffield Trust highlights that the most frequent reason for delays to patients being discharged from hospital was waiting for further support packages to be made available at home – typically organised either by NHS community services or through adult social care (Nuffield Trust, 2023).
Trusts are concerned about the lack of capacity in the social care sector to keep people well at home and ensure timely discharge, with delays to social care assessments limiting trusts' ability to free up bed capacity and lengthening patients' stay in hospitals. It is widely accepted that extended stays in hospitals often result in poorer health outcomes for patients.
Trusts are keen for government to progress with previously planned reforms to the social care system. However, it is also clear that alongside changes to how the social care system operates, government must also commit to ensuring there is a sustainable settlement in place for local government to ensure social care is sufficiently financed. This will enable social care providers to direct resources across the range of services they provide, supporting the NHS with discharging patients from hospital, but also targeting investment in prevention and early intervention initiatives to support people to stay well at home.
Expanding primary and community care
Trust leaders support a shifting of resources towards targeting the prevention of ill health over the longer term. The NHS should take a much broader view of productivity when examining how it can deliver value for the taxpayer. It is far more productive to concentrate effort and resources towards initiatives that will reduce the number of patients requiring care. It is imperative that strategies to improve productivity across the NHS need to frame the issue as a whole-system challenge, rather than focusing too closely on individual organisational productivity. Fixing any fragmentation across all care pathways and ensuring a joined-up approach to productivity between all care providers will inevitably help trusts to reduce duplication, remove inefficiencies and deliver better outcomes for patients.
To improve whole-system productivity, government should expand capacity across primary and community care. The health and care system needs to pivot towards investing in early intervention schemes and adopt a population health management approach to healthcare delivery. Additionally, there is a proportion of the population's ill health which is not preventable, but requires resources in upstream services that enable long-term conditions to be managed effectively and avoid deterioration of conditions. By expanding the capacity across primary and community care, this will enable patients to receive the most appropriate level of care, reduce the pressure on discharging patients from hospital and result in patients being treated in less costly settings. Government must support trusts to invest in schemes designed to prevent ill health, as such schemes will take some time to have an impact on the demand levels experienced across all sectors. To support the drive to improve population health, it would also be sensible for government to increase the public health grant – which has been cut by 28% on a real-terms-per-person basis since 2015/16 (Finch et al, 2024). Trusts want to see further investment in upstream services that will help to reduce the burden on the NHS and prevent inequalities.
Implementing the NHS Long Term Workforce Plan
Trusts welcomed the publication of the NHS Long Term Workforce Plan (LTWP) in June 2023 and its focus on ensuring the NHS has an established workforce pipeline to manage future demand levels, improving staff wellbeing and retaining current staff. Government must ensure the LTWP is fully implemented and funded to support staff recruitment, training and retention initiatives over the lifecycle of the plan. Trusts understand current financial pressures have led to an increased focus on controlling temporary staffing levels, especially eliminating off-framework agency spending, and ensuring trusts consolidate total workforce growth over 2023/24. However, trusts are also cognisant that total workforce numbers need to increase over the long term if the health service is to keep pace with an ageing population and mounting demand pressures.
The LTWP also focuses on the retention of current staff as a key pillar to ensuring the NHS is well-resourced and equipped for future challenges. However, as the recent NHS staff survey results show, all indicators related to staff burnout remain persistently high (NHS England, 2024g). For example, due to the relentless operational pressures during the pandemic and post-pandemic recovery, some staff are, understandably, less likely to work unpaid overtime, or take on additional shifts. If productivity is to sustainably increase over the long term, then government and national bodies must channel efforts into improving staff morale, reducing burnout and ensuring staff feel adequately supported in their roles.
Underpinning the modelling of the LTWP is the assumption that labour productivity within the NHS will grow between 1.5% – 2% each year (NHS England, 2023a). Indeed, NHS England has now committed to deliver 1.9% annual productivity growth over the period 2025/26 to 2029/30. In order to achieve this level of productivity growth, government has to recognise the interdependencies between productivity, capital investment (including digital) and a well-resourced workforce. If government wants to see productivity targets met over the long term and see the benefits of the LTWP fully realised, then it must do more to ensure the long-term enablers of productivity have seen sufficient investment. This includes supporting the NHS to develop an inclusive, open culture which enables innovation and empowers staff to drive forward initiatives that deliver better quality, more cost-efficient care.
The NHS is well placed to help support the government's wider aim to improve the productivity of the national economy. Over 2.8 million people are currently economically inactive due to long-term sickness, highlighting how the NHS plays a crucial role in preventing ill health, treating patients on waiting lists and supporting their recovery back to work (ONS, 2024b). If government wants to tackle productivity throughout the economy, a good starting place would be investing in the long-term enablers of productivity growth across the NHS.