Organisation objective

• NHS Mandate from Government
• NHS Long Term Plan
• NHS Long Term Workforce Plan

Executive summary

This paper updates the Board on the planning process for 2024/25 and financial allocations.

Background

1. In December we wrote to integrated care boards (ICBs) and trusts asking them to not to delay planning for 2024/25 whilst we continued to work with government to agree final expectations and priorities.

2. We confirmed that the overall financial framework would remain consistent, including the payment approach used to support elective recovery and that system plans will need to achieve and prioritise financial balance.

2024/25 priorities and planning guidance

3. At the time of writing, it remains our ambition to publish the 2024/25 planning guidance and priorities document before the end of March 2024, taking account of the NHS funding settlement announced at the Spring Budget (see below). In the context of a 0.2% real term increase in funding and the requirement on systems to deliver a balanced net financial position, we have set ambitious but deliverable performance expectations that build on the progress made this year.

4. Recovery of our core services remains the overall priority in delivering for patients. This includes:

• maintaining our collective focus on the overall quality and safety of our services
• improving ambulance response and A&E waiting times
• reducing elective long waits and improving performance against the core cancer and diagnostic standards
• making it easier for people to access community and primary care services, particularly general practice and dentistry
• improving access to mental health services so that more people of all ages receive the treatment they need
• improving staff experience, retention and attendance.

5. Recovering productivity and meeting planned efficiency requirements are critical to delivering on these priorities and balancing system finances. We are therefore requiring ICBs and providers to work together to develop plans to deliver specific efficiency savings and raise productivity.

6. NHS IMPACT will support delivery of clinical and operational excellence by:

• Helping to develop the leadership and organisational capacity, capability and infrastructure to create the conditions for improvement.
• Delivering a small number of centrally led national programmes to improve quality and productivity. The focus for 2024/25 will be interventions that improve patient flow.

7. As we focus on delivering for patients in the present, we also need to continue transforming the way we deliver care and create stronger foundations for the future. In 2024/25 we will support systems to:

• Level up provider digital maturity, keep connecting services to the NHS App, and implement the Federated Data Platform (FDP).
• Plan for and deliver the skill mix required to meet the needs of their population in line with the NHS Long Term Workforce Plan.
• Develop system infrastructure strategies based on local NHS priorities for estates and capital investment.

8. NHS England will work with systems to develop robust plans for the technology investment announced in the 2024 Spring Budget for the years from 2025/26. In support of this, we will improve the measurement and reporting of productivity across all sectors.

2024/25 budget and allocations

9. Core Government funding for NHS England, taking account of the funding announced at the Spring Budget, rises 0.2% in real terms between 2023/24 and 2024/25. Total funding including funding for Heath Education England’s previous responsibilities and increased employer pension contributions is £179 billion.

10. Allocations to each commissioning stream are set out in the table below. To maximise resources for frontline services we are delivering significant savings from NHS England corporate costs and ICB admin costs and are reducing some investments. Core service development and transformation investments in mental health, primary care, cancer and technology will continue. Key points to note are:

• The NHS budget and local allocations reflect an allowance for a 2% pay increase in 2024/25 in line with the level funded by government. Final decisions will follow the pay review body process.
• We have allocated extra funding to ICBs to reflect recurrent cost pressures on ICBs and providers and reduced the convergence factor which moves systems closer to their fair share.
• Despite these additional resources, we expect that expenditure on the acute sector will be broadly flat, after taking account of funding for the pay settlement, compared to 2023/24.
• Spend on mental health will increase through the Mental Health Investment Standard for ICBs and additional national investment.
• Spend on primary care services including general practice and community pharmacy will also grow

Table: high level allocations

Next Steps

11. Systems, including individual commissioners and providers, have been developing their plans for 2024/25 and our aim is to conclude the planning process in May 2024.