UK Budget: NHS to benefit from funding boost but social care support lacking

Chancellor Rachel Reeves announced the increase of over £22bn to the NHS pot including £1.5bn to deliver capacity for more than 30,000 NHS procedures, 1.25 million more diagnostic tests and new beds. The funding boost will also provide £1bn to address the backlog of critical NHS maintenance and £1.8bn to support elective activities.

The budget also set out an increase of £3.1bn on capital investment for health. This includes £2bn for NHS technology and digital as well as the establishment of a dedicated fund to support 200 upgrades to GP surgeries. A total of £460m will be provided to address the risk of future health emergencies, with £26m worth of funding to open new mental health crises centres.

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While the chancellor also announced £600m in new grant funding for social care, Joanne Ellis, healthcare expert at Pinsent Masons, said the Budget included just a “passing reference to social care”, calling for more support for “the most vulnerable people in our society”.

For instance, Ellis shared concerns that the increasing minimum wage rates will “continue to put pressure on the provision of social care as work force cost increases will need to be passed on to service users. There is no corresponding visibility as to whether the extra £600 million of council funding announced will be used to set realistic local authority hourly rates for a period of time to allow providers to plan ahead”.

From 1 April 2025, the national minimum wage for those aged 21 and over will rise to £12.21 per hour – an increase of 6.7% from £11.44. The minimum wage for 18 to 20-year-olds will rise from £8.60 to £10 per hour, with apprentice hourly rates increasing to £7.55 from £6.40. This represents the biggest hike in rates on record.

The government also announced an increase in carer’s allowance, from £81.90 per week to the equivalent of 16 hours at the national living wage per week. This will allow carers to earn over £10,000 per year whilst still receiving the allowance.  

“Although the increase in the carer’s allowance weekly earnings limit is welcome to a predominately female caring work force, in reality it means carers can now work longer paid hours on top of their caring responsibilities,” said Ellis.

Mark Ferguson, public policy expert at Pinsent Masons, said: “It is clear more will need to be forthcoming to overcome the challenges facing the NHS. The additional funds will be welcomed, and will surely have a positive impact, but the government has invested significant political capital in improving the NHS and it needs to show progress sooner rather than later.”