• Since the NHS was established in 1948, public funding for health care has increased by more than both inflation and economic growth.
  • Health spending in the UK rose by an average of 3.7% a year in real terms between 1949/50 and 2013/14 (2014/15 prices).
  • During this period, the proportion of UK public spending on health rose from 3.6% to 7.5% of gross domestic product (GDP).
  • This chart was first published in January 2015.

Source: Author’s calculations, using data from: Public Sector Statistical Analyses 2014 (HM Treasury), Fiscal Facts: Spending by function (Institute of Fiscal Studies), OHE Guide to UK Health and Health Care Statistics 2013 (Hawe E and Cockcroft L), UK National Accounts – The Blue Book (Office for National Statistics), Quarterly National Accounts (Office for National Statistics), GDP deflators at market prices, and money GDP (HM Treasury).

In real terms, public spending on health in the UK1 has risen over time and in 2013/14 amounted to £132.2bn (2014/15 prices)2 - this is higher than at any other time in the history of the NHS. Spending has risen by an average of 3.7% per year between 1949/50 and 2013/14, a faster increase than economic growth, and as a result, public spending on health as a share of UK GDP more than doubled, from 3.6% in 1949/50 to 7.5% in 2013/14.

There was a particularly marked rise in health spending between 1999/2000 and 2009/10, averaging 6.3% a year in real terms, and corresponding to an increase in GDP from 5.0% to 7.8% of GDP. This was driven by the government’s commitment to increase health funding, as set out in The NHS Plan, 2000, during that time.

Health spending in the current parliament has risen by a yearly average of 0.6%, the lowest increase since 1955. Health spending as a proportion of GDP has fallen during this period; this is however in large part due to the UK economy being stagnant between 2007/08 and 2009/10, which inflated the proportion of GDP during that period. 

Footnotes

  1. This is spending on health for the whole of the UK, which includes all spending on the NHS apart from administration costs, but it also includes some other costs linked to health, such as spending on medical research.
  2. 2014/15 prices were calculated using the GDP deflators published in December 2014; updated GDP deflators have since been published. GDP deflators for 1949/50 – 1954/55 were not available by fiscal year, so we estimated these by calculating the annual change in GDP deflator for the corresponding calendar years and applying the same change.  

Further reading