Revealed: the new approaches to NHS reform that could end spiralling of UK health costs and save £21bn a year

Unleashing the most effective drivers to transform the NHS could end the unsustainable rise in health spending and stabilise it as a share of GDP, according to an IPPR report published today. 

New economic modelling for the report, undertaken with LCP (see note 4), reveals that – if fulfilled – the government’s promises on productivity and prevention in the health service could contain DHSC spending in England at its current level of around 8 per cent of GDP by the end of this parliament. 

That is well below the current trajectory towards almost 10 per cent in a decade’s time - a level which critics say would be impossible to sustain - and would equate to a difference of £21 billion a year by the end of this parliament, IPPR says. 

Building an NHS fit for the future is a “life or death challenge”, the report says, with the health of the nation, the health of the economy and the public’s belief in the NHS itself all on the line. 

To bring long-term spending growth under control, the government needs to examine “ruthlessly” whether its established “levers of reform” are genuinely best, or whether other means are more likely to deliver the results it needs. 

After analysing the effectiveness of six common “reform levers” across health systems of comparable countries around the world, IPPR researchers concluded that the UK government should rely less on the familiar use of targets, competition and choice, and regulation, although all still have a role to “shore up performance”. 

Instead, IPPR urges the government to use three different levers that it says are waiting in the NHS toolkit and hold “particular promise” to deliver the transformation that the NHS needs: 

Practical policies that could enable these approaches could include redistributing first-rate managers from NHS England and other central bodies to local health systems, jointly setting with them a small number of targets for broad health outcomes, and launching public feedback dashboards for improvement, the paper says. Also key would be investing in leadership, improving data use and engaging with staff to drive reform.
 

Dr Annie Williamson, IPPR research fellow, practising NHS doctor and lead author of the report, said: 
 

“To unlock better health for all without an unsustainable rise in spending, the government and NHS leaders need to look hard at the evidence on what works, and what doesn’t. We can’t afford to fail in this. 

“But the evidence we have uncovered suggests that the most common approaches taken over the last few years are less effective than many supposed. Too many overbearing central targets, too much reliance on regulation and inspections, and putting too much faith in competition as the silver bullet to transform care will not deliver what we need. 

“Instead we need to make more use of different levers in the NHS toolkit – enabling frontline staff to make changes based on their own insights, gathering and acting on patient feedback in real time, and pushing staff, power and resources from the centre to local health systems. Between them, these are more likely to drive the reform the NHS so desperately needs.” 

Dame Patricia Hewitt, former health secretary, said: 

“To transform the NHS, we need more than a vision for change. What is required is a ruthless focus on the ‘how’ of reform – an evidenced-based, policy toolkit to turn big ambition into effective strategy. The IPPR provides just that.  

“As IPPR argues, building an NHS fit for the future means moving away from a centralised, command-and-control approach and towards a model which learns, adapts and improves based on the insights of those who use and work in NHS services. This is a must read for anyone involved in health policy and leadership.”  

ENDS 

Dr Annie Williamson, Sebastian Rees and Avnee Morjaria, the report’s authors, are available for interview. 

Annie Williamson is an IPPR research fellow and a practising NHS doctor 

Sebastian Rees is IPPR head of health and principal research fellow 

Avnee Morjaria is IPPR associate director for public services 

CONTACT 

David Wastell, Director of News and Communications: 07921 403651 d.wastell@ippr.org  

Liam Evans, Senior Digital and Media Officer: 07419 365334 l.evans@ippr.org 

NOTES TO EDITORS 

 
IPPR worked with LCP to develop two core scenarios:  
a) History repeated: life expectancy follows ONS projections, with flat healthy life expectancy and NHS productivity growth of 0.5 per cent per annum in line with historical trends.  
b) Prevention and productivity as promised: productivity grows at 2 per cent per year, and the health mission to halve the gap in healthy life expectancy between regions is delivered by 2034/35. 
 

Further details are available on LCP’s accompanying blog: https://www.lcp.com/en/insights/blogs/latest-projections-show-how-productivity-and-preventionreform-can-bend-the-curve-of-nhs-finances