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What does the budget mean for health and social care?

Building on techUK’s initial analysis of the Budget and Spending Review, we have highlighted key areas that may impact the UK’s health and social care sector.


As expected, investments in the NHS and R&D were a major feature of the budget, in keeping with Government plans to Build Back Better for health and social care. 

The NHS’s day-to-day budget is set to increase by 3.8% on average each year, making it the highest real-terms core capital budget the NHS has had since 2010. DHSC’s settlement will provide a £43.9 billion cash increase in core resource spending over the Parliament – equivalent to a real-terms growth rate of 4.1% on average over the Spending Review period.  

Likewise, the spending review documents also published yesterday said the 3-year health settlement will enable the Government to “keep building a bigger, better trained NHS workforce”. However, no annual budget details for Health Education England (HEE) have been published. While the focus on training and workforce is welcome, it is crucial that Government sets out the budget for HEE and works to encourage a focus on digital skills.  

Social care

As highlighted in our Ten Point Plan for Healthtech, planning and funding for social care is typically developed with the NHS in mind and then worked backwards to fit the care sector. This leads to policy being developed and funding allocated in sub-optimal ways.

In this budget it was announced that English councils will receive £4.8 billion of new grant funding over the next three years for social care and other services. The Government has hailed this as the largest annual increase in local government core funding in over a decade. It is in addition to the £5.4 billion for social care announced in September and raised by the ‘Health and Care Levy’, as well as the £162.5 million fund to help the sector recruit and retain staff announced last week. You can see techUK’s commentary on this funding boost here.

While digital technology will not be the cure-all for the slew of challenges facing the health and care system, to deliver on the Government’s ambition to improve outcomes, reduce the burden on the workforce and build back better, funding for digital transformation and upskilling will need to be prioritised. techUK welcomes the commitment indicated by this budget and spending review, and looks forward to greater detail on how the money will be allocated.  

Life sciences and innovation

Although the Government has revised the R&D investment target down from £22 billion by 2024/25 to £20 billion, the commitment to spending 2.4% of GDP on R&D by 2027 remains. Additionally, the core research budget of the Department for Business, Energy and Industrial Strategy will increase to £14.2 billion per year by 2024/25 to deliver on the Innovation Strategy, which includes funding for Horizon Europe, the new Advanced Research and Invention Agency (ARIA), support for priorities of the new National Science and Technology Council, Innovate UK, and others.

Among other sectors, life sciences will benefit from the newly established £1.4 billion Global Britain Investment Fund, which will aim to spread economic opportunities more evenly across the UK as part of the Government’s work to level up.

In addition, £95 million will be allocated to the Office for Life Sciences for delivery of the Government’s Life Sciences Vision, for which the Government was set to outline next steps for delivery by the end of October 2021. 

In February 2021, techUK published the Ten Point Plan for Healthtech to outline recommendations for how we can drive progress. This plan called for the provision of targeted and dedicated investment for digital technology for health and social care. This budget makes many promising indications that the Government will work to provide this kind of commitment to better funding social care, health services, and the life sciences sector, with further detail anticipated.

With white papers on adult social care reform and integration expected in November 2021, techUK will be working to respond once further detail is published. You can read the full budget documents here as well as techUK’s submission to the 2021 Budget and Spending Review here.


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