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Analysis

Health care funding
The latest funding figures for England

Published 20 March 2023
Last updated 4 November 2026
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Latest funding figures for England

We analyse the latest health care funding figures for England, looking at how current funding compares with historical levels and how it stacks up against what is needed to meet future pressures. 

This page was originally published on 20 March 2023 and is updated at every fiscal event. This analysis uses spending figures and inflation forecasts from the Office for Budget Responsibility’s October 2026 Economic and Fiscal Outlook, alongside historical spending and GDP deflator data published by HM Treasury.

All growth rates are presented in real terms (2026/27 prices) after adjusting for changes in pensions policy and inter-departmental transfers (see note). As specific funding figures for NHS England are no longer published, our analysis focuses on the Department of Health and Social Care budget. 
 

Key points

This page was last updated in November 2026, using the latest available data.

  • Between 2025/26 and 2028/29, Department of Health and Social Care (DHSC) total spending is planned to rise from £217.4bn in cash terms to £245.6bn. Adjusted for pensions and transfers, this works out to be a real-terms increase of 2.3% per year.
  • Day-to-day DHSC spending is planned to increase from £204.1bn in cash terms in 2025/26 to £231.1bn in 2028/29. This is a real-terms increase of 2.4% per year.
  • Over the same period, the DHSC capital budget is planned to increase from £13.3bn in cash terms to £14.5bn, a real-terms increase of 0.7% per year.
  • Adjusted for the changing size and age profile of the population, the day-to-day DHSC budget per head adjusted for age will grow by 1.2% per year in real terms between 2013/14 to 2028/29.
     
 

How much funding has been committed to health care?

The Department of Health and Social Care’s (DHSC’s) total budget, which consists of revenue and capital components, sets the limit on overall health funding in England. Revenue funding pays for the day-to-day running costs of the NHS, including staff pay and medicines, in addition to other programmes such as health care staff training and local government public health services. Capital funding is used to finance long-term investments, such as buildings and medical equipment.

The 2025 Spending Review set out planned health care spending for much of the parliamentary period. These plans were subsequently updated in the 2025 Autumn Budget and the 2026 Autumn Budget.

Table 1 and Figure 1 show the spend for DHSC by funding type (revenue, capital and total) from 2025/26 to 2028/29 in nominal figures (cash) and real figures (adjusted for inflation). Revenue and total funding in 2027/28 and 2028/29 use Budget ‘pre-adjusted plans’ (removing the technical change to revenue funding due to the 2027 change in employer pension contributions). This ensures that revenue and total funding figures can be compared consistently across years.
 

Table 1: Health spend by funding type, by year for England

 

Nominal figures (£bn)

Real-terms funding after adjusting for pensions and transfers (£bn)*

Real-terms annual growth rate**

 

2025/26

26/27

27/28

28/29

2025/26

26/27

27/28

28/29

2025/26 to 2028/29

DHSC revenue

204.1

212.5

221.1

231.1

202.6

206.7

212.1

217.5

2.4%

DHSC capital

13.3

13.8

13.5

14.5

13.7

13.8

13.2

13.9

0.7%

DHSC total

217.4

226.3

234.7

245.6

216.3

220.5

225.3

231.4

2.3%

* Real terms values are in 2026/27 prices. See Note box for more details.
** Calculated as the compound annual growth rate 
The sum of DHSC revenue and capital might not exactly equal DHSC total due to rounding.

Figure 1

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We present spending figures in cash terms and real terms, using our own calculations to account for inflation. We use the GDP deflator as the standard measure of inflation. This is the deflator used by the Treasury to calculate buying power across all public services. 

We also adjust for changes to pensions policy when presenting our total and revenue budgets, so our measures are comparable over the long term. These policy changes reflect a 6.3 percentage point increase in the employer contribution rate from April 2019 (costing an estimated £2.85bn) and a further 3.1 percentage point (£1.97bn) rise from April 2024. This was separately reflected in the financial directions to NHS England in March 2024. For 2027/28 and 2028/29, two spending plans are reported in the 2026 Autumn Budget: before and after a technical adjustment reflecting lower NHS employer pension contributions starting in 2027. We use spending plans before the technical adjustment, then apply our existing pension deductions consistently across years to avoid distorting comparisons of health spending over time. These should be treated more like accounting adjustments than meaningful changes in the resources available for health services. 

We further remove £1.43bn per year from 2025/26 onwards that has been allocated to the NHS by the government to cover the increase in employer National Insurance Contributions (NICs) announced during the 2024 Autumn Budget. As with the pensions, this additional funding does not reflect an increase in the NHS’s purchasing power. Removing it would enable a more coherent comparison over time. Further, an additional £0.43bn earmarked for restructuring and reform funding, including redundancies, was removed in 2025/26 and 2026/27.

From 2025/26 onwards, the Treasury estimates that an additional £1.61bn will be allocated to the NHS annually through inter-departmental transfers. These are already reflected in the 2025/26 cash outturn figures, so no further transfer adjustment is made for that year. For 2026/27, we add only the amount not already included in the Treasury’s cash figures, excluding the £0.774bn tranche already incorporated. For 2027/28 and 2028/29, we add the full £1.61bn annually when presenting our real-terms figures and growth rates, to provide a more complete picture of the funding available to the NHS.

It is difficult to estimate the future level of these transfers, as a substantial portion will come from the Immigration Health Surcharge, revenue which is expected to reduce substantially as new immigration restrictions come into force over this parliament.

Additionally, these numbers are sensitive to changes in the long-term inflationary forecast. Any unexpected increase in inflation will degrade the NHS’s purchasing power and limit the pot of cash available to fund day-to-day health services.
 

 

How does funding compare with historical levels?

Figure 2 shows the real-terms growth rates in total health funding over the past 40 years under different governments. The planned increase in funding between 2025/26 and 2028/29 (2.3%) is below the pre-COVID-19 long-term average (3.8%). However, it is higher than the funding growth observed in the 5 years preceding the pandemic (1.6% per year).

Figure 2

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How is growth in NHS funding impacted by demographic pressures?

Using the DHSC revenue component of the budget, Figure 3 illustrates the impact of adjusting for inflation and changes to the population size and age profile on the spending growth rate per year. Since 2013/14, the real-terms growth rate in the DHSC revenue budget has been 2.4% per year.

The population of England is increasing, with a growing share of people aged 65 years and older. Health care use typically increases with age. After accounting for both population growth and ageing, planned day-to-day DHSC spend per head adjusted for age will grow by 1.2% per year in real terms between 2013/14 to 2028/29.
 

Figure 3

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Looking ahead

The 2025 Spending Review allocated health and care funding for the bulk of the parliamentary period, with subsequent Budgets updating the government’s spending plans. Our analysis reflects the spending plans following the 2026 Autumn Budget.

From 2025/26 to 2028/29, total health funding is projected to grow at 2.3% per year in real terms. This is lower than the 3.8% pre-COVID-19 long-term average growth. 

The NHS's funding picture remains precarious. Without significant increases in productivity, the recent funding uplifts are likely only enough to keep up with existing cost pressures.
 

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