Has the NHS had its budget reduced by £30 billion?

11 March 2021
What was claimed

The 2021 Budget reduced day-to-day health and social care spending by £30 billion.

Our verdict

The NHS and the Department of Health will receive less Covid-19 specific funding in 2021 but its core budgets will increase.

“The Chancellor buried a £30 billion cut to day to day spending in the Department of Health and Social Care”

The Labour Party says that the government’s recent budget contained “a £30 billion cut to day to day spending in the Department of Health and Social Care”, which Labour says will reduce frontline healthcare services.

This claim was repeated by the Daily Mail, Morning Star and the New European.

It is correct that the day-to-day Department of Health and Social Care (DHSC) budget has been reduced by £30 billion, however this reflects the withdrawal of additional funding for the Covid-19 response in 2020.

Funding for the day-to-day running of the NHS, besides Covid, actually rose in the budget. 

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Where is the money going?

The budget shows government departmental spending in terms of resource and capital spending. Broadly speaking, resource spending relates to running costs or day-to-day costs while capital relates to investment (e.g. new hospitals).

In 2020/21 the resource funding for Health and Social Care in England was £140.3 billion, of which £129.7 billion was provided to NHS England. In 2021/22, the resource budget will increase to £147.1 billion, of which NHS England will receive £136.1 billion.

However, Covid-19 specific resource funding will decrease from £58.9 billion to £22 billion. Of this, NHS England will receive £3 billion in 2021/22, down from £18 billion in the most recent year.

The budget doesn’t include the depreciation of assets or account for the change in prices over time, so the amount the NHS receives in 2021/22 will be slightly lower in real terms.

It should also be noted while the resource and capital spending plans set out what the government wants DHSC to spend within the year, it is not a fixed “lump sum” budget, and in extraordinary circumstances it may be breached. In such circumstances, the government might choose to spend more, as it did in 2020/21. 

Correction 1 March 2022

This article was corrected to include two paragraphs and a chart that were not included on first publication, due to an administrative error.

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