NHS Capital Spending

Luke Evans Excerpts

Wednesday 4th March 2026 Westminster Hall

[Dr Luke Evans (Hinckley and Bosworth) (Con)]

I, too, associate myself with the comments about the hon. Member for West Lancashire (Ashley Dalton) on her stepping down as a Minister. She was a formidable opponent and will be sorely missed. I am sad to see her step back, but she has made the right decision for her, as in this place we should all do.

I thank the hon. Member for Carshalton and Wallington (Bobby Dean) for securing this debate. He was absolutely spot on when he said we do not scrutinise the process of NHS capital spending nearly enough. I was taken by what he said on that point, but less surprised that not many solutions came forward, although that is key to having this debate, because it is hugely technical.

I will use an example from my constituency for both the pros and the cons, the good and bad stories about capital investment. I was elected in 2019 and Hinckley is my biggest town. Healthcare is an important priority for my constituents and talk of improved hospital services there has been ongoing for 30 years now. On the good side, we were lucky enough to be picked to have a community diagnostic centre, a £24 million investment, and I was lucky enough to open it last year. That shows what good can come of capital investment. Under the previous Government, at August 2024, there were 165 similar good news stories of community diagnostic centres being opened across the country, not to mention the 108 surgical hubs that have not been talked about, but that are increasing patients’ ability to be seen and treated quickly, helping to deal with the waiting lists.

I also come with a negative story related to the same hospital. We were looking for a second project, a £10 million day case investment, but unfortunately, despite funding having been secured, delays in the system and difficulties with changing need have meant that that has been cancelled. The NHS papers specifically on that case state:

“The STP Capital business case for the Hinckley Day Case Unit received national approval in March 2024”—

but then struggled. The papers go on to say:

“However, since business case approval there have been further key changes… Changing financial context nationally and local financial challenges… Increased capital costs of the scheme circa £2m compared to that approved by the board… Programme delays resulting in a significantly reduced capital resource”.

They go on to explain that further delays to the programme occurred due to

“Cost pressures that exceeded the STP capital allocation…Since the approval of the STP Capital Business case in 2024, delays can be attributed to…The planning application phasing (considering the contention surrounding the demolition of the Hinckley District Hospital…The delay in submitting the planning application to allow the development of a robust design to address the Local Planning Authority’s concerns”.

We can already see the difficulties in how need is being allocated across Leicestershire and how planning and inflation interfere. That is the process issue at the heart of making these capital decisions.

That leads us to the bigger picture that confronts the Government today. As has been mentioned, funding is important, so what is the best document we can look at to see what the Government are trying to do? The 10-year plan is clear:

“We will continue to use private providers to improve access and reduce waiting times, to return the NHS to its constitutional standards. As we outlined in our Plan for Change, we will not let spare capacity go to waste on ideological grounds. We will continue to make use of private sector capacity to treat NHS patients where it is available, and we will enter discussions with private providers to expand NHS provision in the most disadvantaged areas.”

The Opposition agree with that, but I am not sure that all Government Members will, so I am interested to know whether all the Minister’s hon. Friends are aligned with it. I agree with the concern that the previous Government’s private finance initiatives, which brought in £13 billion of investment for new hospitals, cost the taxpayer more than £80 billion in repayments. We are still paying for that now.

Turning back to the NHS 10-year plan, a section called “Harnessing new investment” states that

“we will learn from previous experience with the Private Finance Initiative…In other cases, however, PFI was a costly mistake which represented poor value for money. Contracts were too complex and lacked proper transparency.

As the government considers new sources and models of private investment, we do so with this experience in mind.”

How do we know that? Where is it set out that the Government have learned this time? In the same section, the Government tell us they will “evolve” their

“infrastructure finance models and…consider the use of Public Private Partnerships…where there is a revenue stream, appropriate risk-transfer can be achieved, and value for money for taxpayers can be secured.”

Those are not small tests; they are the fundamental ones that we must ensure are in place, so my simple question is this: what is different this time? How will we assure value for money, and who will make that decision? How will we see genuine risk transfer being assessed, rather than simply pricing it into decades of payments? How will that work?

The 10-year plan also states:

“We will codevelop this with the National Infrastructure and Service Transformation Authority (NISTA), building on the successful NHS Local Improvement Finance Trust programme, and will look to drive competition in the market to incentivise others, including third party developers, to improve their offer to deliver better services at lower cost to the taxpayer.”

That is great—but LIFT is used only for small practices, so what model will come forward for everything else? The plan states:

“We will engage with the market on this programme and support NISTA in its wider market testing of a new PPP model.”

What is that model? Can we see it? What does it look like?

I note from the Minister’s answers to written questions that 120 neighbourhood health centres will be operated by 2030; 70 will be new buildings, 50 will come from refurbishment and, of those, 80% will be funded through PPPs. However, there are no plans to publish the business case. That raises legitimate questions. Why are the Government hiding this? We have been here before, and the country is nervous about this, so why can we not see what is being brought forward? If a new model is genuinely different, transparency should not be a threat; it should be a strength. Why will Parliament and the public not see it?

[Luke Taylor]

It would be remiss of me not to ask at this point, while the hon. Gentleman is speaking about transparency and funding for hospital projects, about the previous Government’s imagined 40 new hospitals. I invite him to give some transparency as to where the money to fund that hospital programme was supposed to come from and where it ultimately disappeared to. My residents are still suffering from the impact of his Government’s not providing that money. Can he expand on what happened to that money, which never arrived?

[Dr Evans]

I am grateful for the chance to put this on the record. The health infrastructure plan 2019 had the £3.7 billion, which was the seed funding to look into the projects to bring things forward. That also dealt with the first wave—the three hospitals that were brought forward to allow the second and third waves to come on. The hon. Gentleman will also know that, as the Government and the Opposition have stated, all big national infrastructure is done through a series of spending reviews. The money—£20 billion—was committed through those stages on the basis of that plan. The Government throw the same argument back at us when it is convenient for them to say, “We are not increasing defence spending because it needs to come in a spending review.” Both sides are playing politics, but there was money allocated in that plan. I appreciate that the hon. Gentleman was not in Parliament at that time, but he can ask the House of Commons Library to look at it so that he understands it, and he can then pass that on to his constituents to answer that question.

If we have a new model, we in this House need to be able to scrutinise it. GPs’ rents and rates are reimbursed, but there is concern that if we have further PPPs, similar to the previous PFIs, GPs may be on the hook for ongoing premises costs. We must have crystal clear guarantees, so they understand what they are and are not accountable for.

The 10-year plan states:

“We will also work with NISTA to consider the opportunities for health that could be achieved through private financing of revenue-raising assets (such as key worker accommodation and car parks)”.

That will set alarm bells ringing, as it looks like the Government will use key workers, or staff and patients coming into car parks, to generate funds. I would be grateful for clarity about what the Government actually mean by that statement, because this is a contentious issue. People know that we need to have funding coming into the health services, but where will those streams come from and what will they look like? If the 10-year plan is looking at revenue-raising assets, I am keen to understand exactly what that looks like.

Overall, there is a desire in the 10-year plan, which is shared across the House, to improve healthcare. Nobody disagrees with that, but the criticism of the 10-year plan is that there is no delivery chapter. I am grateful to the hon. Member for Carshalton and Wallington for securing this debate so that the Opposition can ask questions about what delivery will actually look like when it comes to improving the health of the nation.

--- Later in debate ---

[Karin Smyth]

The Chancellor has made her key decision to put us back on track, announcing in the Budget that capital health spending would increase by £15.2 billion by the end of the spending review period in 2029-30. That funding will be used as intended; in previous years, as we heard, capital funding was diverted to cover day-to-day costs. We have tightened the Treasury rules; we have changed them, because that is what Government can do—who knew! As a result, capital funding will now be fully focused on repairing, upgrading and expanding NHS buildings and facilities to support long-term productivity. This settlement represents record levels of capital investment into healthcare, and it will support the three shifts set out in the 10-year health plan: moving care out of hospitals into the community, replacing outdated systems with modern digital services and focusing on preventing illness rather than just treating it.

Of course, rebuilding NHS infrastructure cannot happen overnight. I assure hon. Members that the Government do understand that long-term certainty over capital funding is needed for the NHS to move from these short-term fixes to more strategic investment. That is another key decision made by the Chancellor. That is why, through the 2025 spending review, we have delivered a four-year capital health settlement, extending to 2029-30. That is backed by a further five years of certainty for estates maintenance funding. I am genuinely grateful to hon. Members for recognising that that is a massive change that we have engineered into the system, and I think we are all seeing the benefit.

That change means there is a £30 billion commitment in capital funding over five years to support the day-to-day maintenance and repair of the estate, with a further five years of funding certainty, as set out in the 10-year plan. For the first time, NHS trusts have also been given multi-year operational capital allocations, with clear funding set out until 2029-30, and indicative funding for a further five years. This is an unprecedented opportunity for local health systems to plan with confidence over a nine-year period, and I continue to encourage all Members to engage with their integrated care boards, which will be prioritising schemes over that period.

Within the £30 billion, the estates safety fund will continue, providing £6.75 billion of investment over the next nine years to target the most critical building repairs, alongside £2 billion to continue supporting NHS England’s RAAC programme across the spending review. Additionally, £21 billion in operational capital over the five-year spending review will empower NHS organisations to invest in local priorities, including hospital infrastructure. It will take time to build up capacity and capability, but this marks the beginning of our rebuilding of an NHS that is fit for the future.

I also assure Members that this Government recognise the pressures faced across the system and are committed to bringing performance standards back to what patients expect. That is why we are investing to expand hospital and emergency care capacity, helping to reduce waiting times and improve care for patients. Over the next four years, there is £1.9 billion for urgent emergency care to support A&E departments, as well as to support ambulance services in reducing handover times.

There is also £1.5 billion for diagnostics, including funding to expand the hours of community diagnostic centres, shifting care from hospital to the community. The hon. Member for Hinckley and Bosworth noted that those centres were started under the previous Government, but we have ensured they have expanded hours and that there are more of them. Crucially, they are not built as add-ons, but are fundamental to the pathways experienced by patients in the system and ensure we have good value for taxpayers’ money.

There is £473 million for mental health services, including for people with learning disabilities and autism. I think we would all agree that the mental health estate needs recognition. There is more than £280 million for community care, supporting services closer to home, and more than £139 million for electives across the next two years. To move away from paper-based systems towards modern digital services, the autumn Budget confirmed £300 million in capital investment in technology, building on the combined revenue and capital investment announced at the spending review of up to £10 billion by 2028-29.

We are transforming healthcare by shifting care out of hospitals and into the community. Over the next four years, we are investing more than £400 million to upgrade primary care buildings and deliver neighbourhood health centres, as part of our commitment to those 250 neighbourhood health centres through the rebuild programme.

[Dr Evans]

Will the Minister give way?

[Karin Smyth]

I will finish these points and answer some of the issues that have been raised.

The first 120 neighbourhood health centres will be operational by 2030 and will, as we have heard, be delivered through a mixture of public and private partnerships. I thank the hon. Member for Carshalton and Wallington for being one of the few to acknowledge that that is difficult—there is some controversy around it—but I am a strong supporter of the previous local improvement finance trust schemes and of the scheme at Southmead hospital in my local area, which was one of the better PFI schemes, and delivered unprecedented levels of care to the people of Bristol, including myself. It is important that we learn the lessons of the past, and we absolutely have, including those in the NAO report. Working with NISTA, as has been outlined, we will continue to pursue this issue and bring forward cases.

I do not want to rehearse the lack of funding for the new hospital programme.

[Dr Evans]

Will the Minister give way?

[Karin Smyth]

No, I will not, because I want to get through my final comments.

We put the new hospital programme on a sustainable footing. I understand that local people across the country were led up the garden path and told something was going to happen. I think we all recognise that the money was not there and that the programme was not on a sustainable footing. We have backed it with the appropriate investment, which is rising to £15 billion over each consecutive five-year wave from 2030, averaging £3 billion a year. The exact profiles of funding will be confirmed at future spending reviews, and that is weighted to ensure that the schemes profiled most are caught in that.

We are progressing wave 1, and I will continue to liaise with hon. Members on progress. My message every week to any NHS trust, to any Member of Parliament, to NHS England and to the team running the new hospital programme is that we need to deliver these hospitals. There is a large queue behind them, and we have heard about some of them today. I also understand that a number of colleagues do not have a hospital being progressed in the scheme. The Government are keen to get on with building these hospitals. As hon. Members have said, a lot of this is about trust and commitment. I want hon. Members and anyone paying attention to know that I am clear about the importance of getting on with this programme, delivering on the ground and ensuring that the programme is robust.

Finally, alongside increased capital funding, we are improving how that funding is managed. As we have heard, the old processes did not work: a local scheme went to the ICB, to the region, to NHS England, to the Department, to the Treasury and back again, with huge amounts of sign-off but no control or accountability, and with no one locally understanding what was happening. We are transforming that, bringing together a team and streamlining the process, ensuring it is well governed. That will ensure that things happen more quickly, and we are already seeing that. With underspends this year, we have got the money out and into schemes already in the system. We are getting more DEXA scanners. That is how we ensure this happens on the ground.

It is up to ICBs to prioritise proposals, and we are working more closely with them to support them to bring things forward. I urge all hon. Members who have spoken today, including my hon. Friend the Member for Harrow West (Gareth Thomas), the hon. Member for Torbay (Steve Darling), my hon. Friend the Member for Rushcliffe (James Naish), the hon. Members for Taunton and Wellington (Gideon Amos), for Sutton and Cheam (Luke Taylor), for Eastbourne (Josh Babarinde) and for North Devon (Ian Roome), to keep working with their local systems on particular schemes. I am happy to keep talking to people.

To the hon. Member for Taunton and Wellington, let me say that I have met NHS England about looking at maternity in the area, which I know is a huge concern, and I am happy to meet him. I will get back to the hon. Member for North Devon about some of the numbers he outlined, which are not familiar to me. On another point that was made, we are ensuring that we are building in contingency for the future, because we live in volatile times.

Motion lapsed (Standing Order No. 10(6)).