Capital investment is essential

The roundtable discussion made clear that the need for capital is immediate, and urgent.

Delivering goals for NHS

Capital investment is critical to address the existing challenges that the NHS faces across its physical and digital infrastructure, while also driving improved productivity and delivering on key priorities set out in this year’s 10YHP. Specifically, investment is needed to:

• Address critical estates risks.
• Drive forward the shift to digital.
• Shifting care away from acute settings and into the community, by providing the right capacity in the right place.
• Drive increased productivity across the NHS, ensuring all funding delivers the maximum impact for patients and the public.

The value of investing in healthcare

Investing in the NHS is the right thing to do. Through the NHS, we have a commitment to  public healthcare for everyone in this country, free at the point of use, from cradle to grave. Everyone deserves the same quality care, and to provide this requires modern, fit for purpose infrastructure, that enables people to live healthier and longer lives.

Additionally, health is a crucial driver of economic productivity and growth. A healthier population is more able to work, increasing employment and bolstering the economy. This has been recognised by the government, for the first time in June 2025’s UK 10-year infrastructure strategy.

Analysis by PA Consulting indicates that healthcare investments offer a fourfold return on investment – meaning schemes deliver financial benefits worth more than four times the initial outlay over their lifespan (often around 50 years). For example, major new hospitals are regularly projected to deliver a return of over four, including the New Hospital Programme (4.8), Luton and Dunstable University Hospital (5.1) and Shrewsbury and Telford Hospital NHST (4.4).

Supporting key worker housing Key worker housing is critical to supporting NHS staff to live a reasonable distance from their workplace – but in many places affordable housing options are limited. NHS trusts can support key worker housing by permitting third party developers to use their surplus land, providing reliable demand for accommodation, and offering developers opportunities for mixed tenancy developments. Third party models are often suitable for this. This allows accommodation to be funded and delivered by private developers, without needing NHS capital.

Examples of the types of benefits these investments offer are captured below. 

Table 1
Examples of benefits of transformational 

Domain	Examples
Health improvements	Improving quality of care and reducing mortality/morbidity More predicative, proactive and preventative care model​ Digital care models​ enabling improved access and more proactive care Addressing health inequalities and reducing outcome gaps – larger in areas with greatest health inequality​ Improving access to healthcare​ through new facilities
Social and economic benefits	Employment and economic development as a local anchor institution​ and employer – contributing to reducing economic inequality in key regions Improving wellbeing​ of patients and staff Enhanced research and innovation opportunities, including attracting inward investment​ Reduced emissions, supporting net zero and sustainability goals (including social cost of carbon and air quality)​
NHS productivity	More virtual, digital and AI-supported care​ New models of care – including admission avoidance, enhanced discharge, improved flow and reduced acuity of care setting through fit for purpose facilities​ Transition from reactive to proactive maintenance Reduction/mitigation of critical estates risks Improved efficiency of staffing models and reduction in duplication

To deliver this return, and maximise the impact of healthcare investment, it will be necessary to focus on transformational investment – where the investment enables and drives a new model of care, a new operating model and ultimately achieves better outcomes for patients. 

Across international and public sector comparators, healthcare investment is low

Compared to peers, the UK spends a lot on healthcare but, despite significant increases in capital budgets in recent years, investment in infrastructure remains low. Within the OECD, the UK ranks 6th for healthcare spend, but 30th for capital investment as a share of healthcare spend.

This underinvestment results in a greater burden for day-to-day spending, due to missed productivity gains, and maintenance and risk management costs associated with an ageing estate. Lord Darzi’s investigation into the NHS identified low level of capital investment as a key issue behind limited digital adoption, low scanning capacity, and rising levels of backlog maintenance and estates-related service disruption. 

The investigation was clear on the need for capital investment in the NHS, identifying a £37bn shortfall in capital investment compared to peer countries.

However there is an opportunity to reverse this, by exploring innovative routes to securing capital, including joint approaches with other services including local government and housing. Ministers should consider broader funding reforms to enable a more place-focused approach to infrastructure investment. This could bring a range of benefits to communities, for example by bringing NHS services to people’s doorsteps while aiding high street regeneration and providing new affordable housing for key workers.

New Hospital Programme The NHP represents one of the most substantial healthcare investment programmes in decades, with investment reaching c.£3bn per year at peak. It is therefore imperative that this drives the transformation necessary to deliver the 10YHP. New hospitals need to be: Digital-first: Enabling the shift to digital by hosting virtual services, providing seamless digital care, and embedding digital in the fabric of the building. Integrated with their local neighbourhood system: Supporting increased delivery of care in community and primary care settings, minimising the number of patients needing to go to hospital. Delivering transformed care models: Changing the operation of acute services to reduce duplication, improve specialisation, and support improved quality of care. This means new hospitals that are not a like-for-like replacements – instead, they should be leading examples of how care is best delivered to NHS patients. This will unlock the full benefit of the historic investment in hospital facilities – and make the biggest difference to patients.