News / Cost pressure warning for chancellor

27 February 2017 Seamus Ward

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Chancellor Philip Hammond (right) has been warned, ahead of his Budget this month, that the NHS will need more funding to cope with demographic pressures from 2019/20.

News - Philip Hammond

In its green budget, published every year in advance of the Budget statement, the Institute for Fiscal Studies (IFS) said NHS spending up to and including 2018/19 would exceed the extra funding needed to meet demographic cost pressures by £1.2bn. But this would not be enough to cover non-demographic costs such as advances in medical technology. 

But spending in 2019/20 is set to be £1.3bn less than the amount needed to meet the demands of a growing and ageing population. Funding for social care has also been cut and, while the over-65s population grew by more than 15% from 2009/10 to 2015/16, adult social care spending fell by 6.4%. 

Funding transfers from the NHS via the Better Care Fund had helped to ease the pressure, said the IFS, but had stretched NHS resources further. 

Mr Hammond is due to deliver his first Budget on 8 March. The IFS said it was not surprising he faced calls to top up the NHS and wider Department of Health funding outlined in the 2015 spending review. 

As Healthcare Finance went to press, there was no indication the chancellor would address health and social care funding.