Autumn Statement 2023: what you need to know

Analysis

Political analysis

• Many of the challenges that applied last year remain, such as Russia’s invasion of Ukraine and the ongoing cost-of-living crisis. But this year we have also seen intensifying conflict between Israel and Palestine, the numbers of people too unwell to work continue to climb, and unprecedented industrial action across the public sector, including within the NHS.  

• Meanwhile, a recent cabinet reshuffle has placed new ministers in charge of several departments including Health and Social Care, so it remains to be seen how priorities and perspectives may be impacted by this. Also, the government has used this Autumn Statement to attempt to establish itself as the party of economic growth and to set some dividing lines against Labour – we are likely to see more of this in the run up to the Spring Budget, which is expected in March 2024 where reductions to income tax, stamp duty and inheritance tax are already being suggested.

• For the NHS, while inflation is receding, financial difficulties are still present such as the £10.2 billion capital backlog, many ICSs in deficit and the continuing cost of industrial action. Without significant new funding, as opposed to the repurposing of existing funding that is currently proposed, waiting lists will remain at record highs and the health service will continue to struggle on the back foot.  

• Heading into the Autumn Statement, we were clear that NHS leaders needed to see urgent funding to address critical issues around workforce, capital and social care, as well as support for the NHS to take long-term funding decisions and a cross-governmental approach to health.  

• This funding should be seen as an investment in the economy, as our research shows that investment in the NHS reaps huge benefits in GDP, with a £14 return for every pound spent in some parts of the system. 

Policy analysis

• The Autumn Statement saw no significant health funding announcements. This is despite the Nuffield Trust estimating the NHS faces a £1.7 billion deficit even including recent attempts to reorganise £800 million of NHS finances. 
• We also know how vital capital investment is to increase productivity. Decades of poor capital investment is one reason that the UK’s health productivity has not been able to meet its potential for the past 25 years. It is why we are fully behind the Chancellor’s desire to increase public sector productivity by at least 0.5 percentage points a year. However, there was no commensurate commitment to increase spending on capital and little demonstrating how this can happen in the absence of greater investment. 
• We welcome the commitment building on the announcement in the Spring Budget to expand Individual Placement Support (IPS) to an additional 100,000 people over the next five years. The programme helps those with mental health needs to find and retain employment and it has a strong evidence base. 
• Our members tell us that patients are presenting with higher complexity, therefore increasing the number of sessions is also welcome. Waiting times for talking therapies are too long in some areas, so we hope this additional capacity will help people access support more quickly.
• As always, increases in capacity in the system depend on increasing financial resources, training and retaining the workforce needed. The government must ensure these commitments are backed with the resources required to implement them. 
• While we support measures to increase employment for people with long-term health conditions, the proposals to increase conditionality and time limit benefits could increase poverty and health inequalities and may not support those furthest from the job market to find employment. This increase in poverty will have a negative impact on physical and mental health of the poorest people in society and therefore increase demand on all parts of the health and care system. 
• The focus on shifting to a more preventative model of care with care being provided closer to home is welcomed and is an ask that our members have been reiterating recently through our major conditions strategy engagement.
• Since the publication of the Khan Review in 2022, NHS Confederation has been calling for its implementation and welcomes the recent Smoke-Free legislation announcement and will be making a submission to the Smoking consultation. Healthcare leaders will welcome the government's use of regulatory and fiscal levers to improve population health, such as the 10 per cent increase in tobacco duty and freeze on alcohol taxes.
• However, the Autumn Statement fails to reference the recent increase in health inequalities and the financial challenges local systems are facing to commit to long-term action on improving population health outcomes equitably. 
• The in-principle agreement between the government and the pharmaceutical industry, the Voluntary Scheme for Branded Medicines Pricing, Access and Growth (VPAG), follows on from the VPAS (Voluntary Scheme for Branded Medicines Pricing and Access) scheme which will expire at the end of year. 
• This new scheme will support access to innovative cost-effective medicines and is estimated to deliver around £14 billion in savings to the NHS over the next five years. However, whether these savings will be reinvested into drugs budgets remains unclear. The agreement also establishes a £400 million industry-established fund to support the life sciences ecosystem, including clinical trial capacity.
• Members of our Primary Care Network will want further clarity on the changes to the Fit Note process, ensuring they are able to consult on plans for WorkWell Services. It's vital that changes to this process doesn’t disrupt the good work undertaken by primary care networks (PCNs) and GP federations through integrated neighbourhood working with local employment services.
• Primary Care Network members nationwide continue to see increased demand as a direct result of patients awaiting elective treatment. This comes at a time of increased financial pressure for at-scale primary care across the country. 
• The Autumn Statement includes a reference to introducing further scrutiny and a presumption against equality, diversity and inclusion (EDI) in the public sector. As we have raised with the government, we do not believe the NHS spends a large amount of its money on external EDI and NHS leaders know that EDI is a key strategic function that contributes to increased productivity, efficiency, patient safety and quality improvement.. 
• Spending on external EDI assists in ensuring the service stays within the law by drawing on services close to communities to develop the delivery of equitable care. Governance also requires organisation and the mobilisation of a professional, skilled workforce. The government’s own commissioned review of NHS leadership and management, undertaken by General Sir Gordon Messenger made clear that dedicated EDI professionals were necessary to help in this endeavour.
• While increasing the National Minimum Wage is welcomed, it will have an impact on the NHS, particularly in community services and primary care, which will need to see additional funding to cover these costs. This adds further pressure to primary care leaders.