Options for restoring the public health grant
About 16 mins
In this briefing
Key points
- The nation’s health is fraying, placing a growing burden on public services and limiting our prosperity. With acute pressures rising across many public services as a result, constrained resources are being pulled into a vicious cycle of treating problems at the expense of preventing them.
- The ringfenced public health grant to local authorities funds a range of preventive services in England including health visiting, sexual health services, and drug and alcohol services. Since 2015/16 it has effectively been cut by 28% per person in real terms and now stands at £3.6bn, equivalent to just 2.2% of the NHS England budget.
- We present three policy options in order to restore the public health grant and allocate it on a more equitable basis. Our policy options assume restoration to 2015/16 real-terms per person levels over a 5-year period, with varying levels of redistribution.
- Restoring the public health grant to the real-terms equivalent of 2015/16 per person levels would require a £1.4bn real-terms increase per year. Taking a phased approach over a 5-year period would mean total additional spend of £4.6bn in real terms.
- However, any restoration should aim to address longstanding inequalities in grant allocation between local authorities. One option to do this would be only marginally more costly, requiring a £1.8bn real-terms increase per year, or £5.5bn if phased over a 5-year period. Other approaches would allow local public health teams to do more but would be more costly to deliver.
- Restoring the public health grant and maintaining its ringfenced protection would help improve local population health, contribute to relieving pressures on health and care services and support disease prevention among working-age adults.
Figure 1
Mandated (prescribed) functions
1. Sexual health services – sexually transmitted infections testing and treatment
2. Sexual health services – contraception
3. NHS Health Check programme
4. Local authority role in health protection
5. Public health advice to NHS commissioners
6. National child measurement programme
7. Prescribed children’s 0 to 5 services
Non-mandated (non-prescribed) functions
1. Sexual health services – advice, prevention and promotion
2. Obesity – adults
3. Obesity – children
4. Physical activity – adults
5. Physical activity – children
6. Treatment for drug misuse in adults
7. Treatment for alcohol misuse in adults
8. Preventing and reducing harm from drug misuse in adults
9. Preventing and reducing harm from alcohol misuse in adults
10. Specialist drug and alcohol misuse services for children and young people
11. Stop smoking services and interventions
12. Wider tobacco control
13. Children 5 to 19 public health programmes
14. Other children’s 0 to 5 services non-prescribed
15. Health at work
16. Public mental health
17. Miscellaneous, can include, but is not exclusive to:
a. nutrition initiatives
b. accidents prevention
c. general prevention
d. community safety, violence prevention and social exclusion
e. dental public health
f. fluoridation
g. infectious disease surveillance and control
h. environmental hazards protection
i. seasonal death reduction initiatives
j. birth defect preventions
18. Test, track and trace and outbreak planning
19. Other public health spend relating to COVID-19
Figure 2
Alongside the public health grant, local authorities have received separate funding for specific policy areas:
- £533m of additional funding for drug and alcohol treatment and recovery services has been committed (in cash terms) to public health teams between 2022/23 and 2024/25, to deliver Dame Carol Black’s 10-year drug strategy. No forward plan for this funding is currently in place.
- 75 local authorities receive separate additional funding for Start for Life family hubs.
Local authorities have also been promised £70m a year from 2024/25 over the next 5 years to expand stop smoking services and help drive plans to create a ‘smokefree generation’ in England.
These additional funding streams may have had the effect of restoring some services that had previously been cut, but they come with extra conditions and cannot compensate for longer term disinvestment in the grant.
Figure 3
Table 1: Summary of three policy options for the public health grant (2024/25 real-terms annual spend)
| Option | Scenario | 2024/25 | 2025/26 | 2026/27 | 2027/28 | 2028/29 | 2029/30 |
|---|---|---|---|---|---|---|---|
| 1 | Restore the grant to real-terms per-person 2015/16 levels | £3.6bn | £3.9bn | £4.2bn | £4.5bn | £4.9bn | £5.2bn |
| 2 | Uplift restored allocations for local authorities that are currently below their ACRA-assessed redistribution target | £3.6bn | £3.9bn | £4.3bn | £4.7bn | £5.1bn | £5.6bn |
| 3 | Restore and redistribute relative to the current restored allocation for Westminster City Council | £3.6bn | £4.5bn | £5.6bn | £6.9bn | £8.6bn | £10.7bn |
Option 1: real-terms per person restoration of the grant to 2015/16 levels
This option increases the public health grant to 2015/16 real-terms, per person levels without any redistribution. This would be the equivalent of the 2024/25 grant being £5.0bn instead of £3.6bn – an additional £1.4bn.
This represents real-terms budget increases for individual local authorities of between 12% and 71%. A 5-year implementation period would mean more manageable annual increases of between 1% and 13% (Figure 4b).
To keep the grant in line with projected levels of cost growth over the 5-year period (a combination of inflation and average earnings growth), the annual budget in 2029/30 would be £5.2bn (Figure 4a; Table 1). The difference from the £5.0bn cost if this policy were implemented in 2024/25 is due to expected increases in costs of service provision and demographic change. The total additional spend over 5 years would be £4.6bn in real terms.
However, as shown in Figure 3, without any redistribution of the grant there would be 64 local authorities with allocations greater than their target based on the 2016 ACRA formula and 89 local authorities would have allocations below their target.
Figures 4a, 4b
Option 2: uplift restored allocations for local authorities below their ACRA-assessed redistribution target
This option takes the 5-year scenario described in option 1 and provides additional funding for local authorities that are below their 2016 ACRA formula target (as shown in Figure 3). Figure 5b illustrates the 2024/25 real-terms per person allocations under this scenario (denoted by purple dots). This would be the equivalent of the 2024/25 grant being £5.4bn instead of £3.6bn – an additional £1.8bn. The varying difference between some local authorities’ target allocations and current allocations would mean that, over 5 years, almost 90 local authorities would see a real-terms public health budget increase of between 40% and 60%, and two local authorities would see these budgets more than double (Figure 5c).
Therefore, if phased over 5 years, local authority allocations would increase annually by between 1% and 16% in real terms. The largest annual percentage change for individual councils would be experienced by Slough and by Westmorland and Furness local authorities. Allocations for local authorities with larger year-on-year changes may need to be restored over a longer time period to enable effective planning and use of increased funds.
This option would require an additional spend of £5.5bn in 2024/25 prices over a 5-year period and the annual budget in 2029/30 would be £5.6bn (Figure 5a; Table 1). The difference from the £5.4bn cost if this policy were implemented in 2024/25 is due to expected increases in costs of service provision and demographic change. Although it is worth noting there would likely be practical challenges for DHSC over and above option 1 because of the need to additionally consult on and implement the updated 2016 ACRA formula in full by 2025/26.
Figures 5a, 5b, 5c
Option 3: restore per person funding and match better funded local areas
Prevention of ill health has experienced chronic under-investment despite offering significant value for money. The burden of ill health has risen since 2016 when allocations were initially set – and are projected to increase further.
Option 3 not only redistributes the grant based on the 2016 ACRA formula but increases the overall size of the grant based on the current allocation received by Westminster City Council. The scenario modelled in Figure 6b illustrates this option. Westminster City Council is the local authority that has the highest allocation (excluding City of London) relative to the 2016 ACRA formula. Under this policy option, all local authorities would receive an additional uplift to the allocations described in option 2, except City of London and Westminster. (City of London may be an outlier for a number of reasons which could include small numbers, historical NHS spending decisions, and/or differences between resident and service population numbers.)
If this option had been implemented in 2024/25, the total grant would be £10.3bn – an additional £6.7bn. Over a 5-year period, this option would require an additional spend of £18.3bn in 2024/25 prices and the annual budget in 2029/30 would be £10.7bn (Figure 6a; Table 1). The difference from the £10.3bn cost if this policy were implemented in 2024/25 is due to expected increases in costs of service provision and demographic change.
However, this would mean about 130 local authorities being given annual grant increases of 20% or more in real terms (Figure 6c). The size of these changes is likely to be challenging to manage in some local authorities and may be more helpfully redistributed over a longer period. For City of London, the increase would be limited to ensure its allocation is restored to its 2015/16 per person level.
Lower thresholds could be used that would bring down the overall additional cost to government and decrease the size of relative changes for local authorities over time. For example, basing allocation levels on Camden would require an additional spend of £13.2bn in 2024/25 prices over 5 years and involve smaller percentage changes for individual local authorities than if basing the grant uplift on Westminster.