The health and care sector plays a valuable role in improving population health and societal wellbeing, protecting people from the financial consequences of illness, reducing health and income inequalities, and supporting economic growth. However, there is much debate regarding the appropriate level of funding for health and care in the UK. In this Health Policy paper, we look at the economic impact of the COVID-19 pandemic and historical spending in the UK and comparable countries, assess the role of private spending, and review spending projections to estimate future needs. Public spending on health has increased by 3ยท7% a year on average since the National Health Service (NHS) was founded in 1948 and, since then, has continued to assume a larger share of both the economy and government expenditure. In the decade before the ongoing pandemic started, the rate of growth of government spending for the health and care sector slowed. We argue that without average growth in public spending on health of at least 4% per year in real terms, there is a real risk of degradation of the NHS, reductions in coverage of benefits, increased inequalities, and increased reliance on private financing. A similar, if not higher, level of growth in public spending on social care is needed to provide high standards of care and decent terms and conditions for social care staff, alongside an immediate uplift in public spending to implement long-overdue reforms recommended by the Dilnot Commission to improve financial protection. COVID-19 has highlighted major issues in the capacity and resilience of the health and care system. We recommend an independent review to examine the precise amount of additional funds that are required to better equip the UK to withstand further acute shocks and major threats to health.


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Charlesworth, A., Anderson, M., Donaldson, C., Johnson, P., Knapp, M., McGuire, A., McKee, M., Mossialos, E., Smith, P., Street, A. & Woods, M. 2021, 'What is the right level of spending needed for health and care in the UK?', The Lancet, 397(10288), pp. 2012-2022. https://doi.org/10.1016/S0140-6736(21)00230-0

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Last updated: 24 May 2023
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