News / Think-tanks call for NHS transformation fund

A transformation fund, worth up to £2bn a year is needed to drive essential changes to services by 2020/21, according to the King’s Fund and Health Foundation.

The think-tanks said a dedicated fund of between £1.5bn and £2.1bn a year would help the NHS in England shift to the new models of care outlined in the Five-year forward view and unlock the efficiency savings needed to balance health service finances. However, they warned that more resources than the £8bn pledged by the government would be required.

The fund should also become a fundamental part of how the NHS is funded in the long-term, they added. 

A single body – either an existing organisation or newly created one – should oversee investment in transformational change. The investment should be introduced in two phases. The first phase would operate between 2016/17 and 2020/21 and include two strands: one to achieve higher rates of efficiency growth across all services and another to invest in developing new models of care. 

The second phase should be implemented in 2020/21 and beyond, focusing on widespread roll-out of successful new models of care. The funding should cover double running costs associated with the introduction of these new models.

The think-tanks’ report, Making change possible: a transformation fund for the NHS, added staff should be given time away from their day jobs to help them change their practice.

And it suggested using the NHS estate to generate a long-term source of funding for transformation. Selling off surplus estate might yield £700m. But this would be one-off income and would not be enough to support the transformation programme. However, if the NHS retained ownership of the estate and, perhaps in partnership with a commercial developer, offered it for commercial use or social housing, it could be a long-term source of income.

Health Foundation chief economist Anita Charlesworth recognised the difficulty in giving the NHS additional funding in the current economic environment. But she added: ‘Without more resources specifically for transformation, the NHS will be unable to become more productive and the bill for additional running costs will only get larger. The transformation fund should become a fundamental part of the DNA of the health service from here onwards.'

King’s Fund policy director Richard Murray said: 'The fundamental task is to get a workforce of more than one million people to work differently. This would be a huge challenge at the best of times but is an even bigger task when services are under such intense pressure. This cannot be done within the existing resources – dedicated funding is required to deliver the changes needed.'

The NHS Confederation backed the transformation fund plan. Policy director Johnny Marshall said: ‘We’ve been arguing for some time for greater resources in transformation to cover the double-running that is often essential for change to be effective. Too often investment has been allocated under the assumption that new services will automatically replace the current model and deliver benefits immediately.