What do Labour’s reforms mean for local systems in the NHS?
About 3 mins
Recent weeks have already seen a raft of guidance from policymakers on plans for the health service. A(nother) NHS bill is also expected soon that could see major changes to the way the system operates – including potentially undoing some of the reforms introduced less than 4 years ago under the previous government. Following proposals set out in the 10-Year Health Plan, among the changes expected in the bill are measures that would redefine the role and makeup of the NHS’s integrated care systems (ICSs) – the now 26 clustered or merged area-based agencies responsible for planning and coordinating services and directing most NHS funding at a local level.
Ahead of the bill being introduced, what can be learnt from the ICS experiment so far? Our recent report took stock of progress, exploring the development of ICSs since their formal creation in 2022 and the implications of their evolving role, through the eyes of senior NHS leaders. We reported on in-depth interviews with 39 local leaders in four ICS areas conducted throughout 2025, as the national policy context rapidly unfolded around them.
What’s the story?
The government has chosen to embark on yet another round of NHS reorganisation, despite saying it did not want one. Scrapping NHS England dominated the headlines. But changes to integrated care board (ICB) functions refocus the organisations as NHS ‘strategic commissioners’ – with less emphasis on leading integration of health and care services and convening local partners, and more emphasis on areas like negotiating and managing contracts, and developing commercial skills (so-called ‘payer functions’). Other changes proposed in the 10-Year Health Plan include removing NHS providers from ICB boards, replacing local authority members with mayors and scrapping integrated care partnerships (broader collaborative forums with local government and other partners set up to guide local decisions).
Wider policy changes under Labour embed a focus on organisations over systems too. NHS providers will be given more power and autonomy (for instance, with new opportunities for high-performing NHS trusts to take on responsibility for managing the whole health budget for a local population via new ‘integrated health organisation’ (IHO) contracts). New league tables publicly rank providers and encourage competition. ‘System control totals’, which required ICBs and NHS trusts to achieve financial balance across their local area, are gone – replaced with a requirement for individual bodies to break even. And oversight and performance management focuses predominantly on individual NHS organisations, rather than on the system as a whole. Taken together, Labour’s reforms mean that the dial is shifting away from collaboration as the organising principle for managing the health service.
Local leaders we interviewed for our research were broadly positive about ICBs focusing on strategic commissioning. They welcomed ambitions to strip out duplication and ambiguity and focus NHS commissioners on setting a long-term strategy for improving the health of their local population – and then purchasing care from local providers to help deliver it. But they identified unresolved questions about how the new NHS operating model will work and felt this more strategic model of commissioning needed to be ‘actively constructed’ in the NHS. (Some were also not sure what it really meant in practice.)
Several leaders across our sites were also disappointed at the diminishing focus on partnership working and collaboration. This left some questioning the vision for local systems in the longer run and concerned that progress made in the past 3 years would be lost:
‘There’s a danger that we’ll lose the importance of working together […]. That feels quite a marked change that, I think, has carried some real risks, and the sense that you can get everything by commissioning that you need, when actually, an awful lot of this is dependent on good relationships, good knowledge base and so on.’ (Place leader)
At the time of our interviews there was limited detail on how the new IHOs proposed in the 10-Year Health Plan would work. But for some leaders we interviewed, the notion of IHOs alone raised existential questions about the future of ICBs. One leader, for example, recalled recent conversations with hospital chief executives questioning whether ICBs would be needed as much in future. Recent policy documents restate that IHOs will ‘become the norm’ and are clear IHOs will ‘take on responsibility for resource allocation and service planning across the whole care pathway’, with some responsibilities shifting from ICBs to IHOs in the process. This will have done little to quell the feeling of jeopardy among ICB leaders and concerns that commissioning bodies in the NHS may have a limited lifespan.
Supporting cross-sector collaboration
ICSs were invented because Andrew Lansley’s 2012 reorganisation left an NHS leadership vacuum at a local level. National NHS bodies wanted organisations to come together to fill this gap, collaborating across local areas to improve services and make best use of public money. The idea was that coordinated action across the NHS, local government and other sectors is needed to tackle complex health challenges that extend beyond organisational boundaries, like improving services for people with multiple health and social care needs or intervening earlier to prevent disease.
These challenges have not gone away. But with ICBs reverting to something more like a traditional NHS commissioning body, who will lead the way in providing system leadership and supporting coordinated action? New neighbourhood entities or IHO contract holders may assume this role at a more local level. But these models are still vague and evolving and will take time to become established. Even then, similar past attempts in the NHS have struggled. Could mayoral strategic authorities step in? Recent developments in Greater Manchester and South Yorkshire suggest this is one of the options being tested by government. But the remit of strategic authorities is already vast and universal coverage of strategic authorities is not on the cards until the end of the parliament. Health and wellbeing boards may also be a candidate having made a comeback in recent policy documents. But these boards lacked teeth in the past and their local status varies widely.
In reshaping the NHS this time around, policymakers must ensure that mechanisms are in place to encourage the cross-sector collaboration needed to tackle long-term challenges facing the nation’s health. In practice, this could mean reversing plans to remove local authority membership from ICB boards, strengthening the emphasis on system-wide performance in the NHS performance assessment framework, or supporting areas to maintain and develop integrated care partnerships where they are proving fruitful. Without these or similar measures, the risk – at least in the interim – is a return to a fragmented NHS, where system coordination is everybody’s and nobody’s responsibility.