The 2019 Conservative manifesto committed to building 40 new hospitals in England by 2030. This is to address issues with the capacity, age and condition of parts of the NHS estate.

This Insight looks at what counts as a ‘new’ hospital, how much this will cost, and what progress has been made.

The New Hospital Programme

The New Hospital Programme was set up in 2020 to fulfil the Government’s manifesto commitment. It combined eight hospital building projects that were already under construction or pending final approval with the pledge for 40 more, which were to be completed between 2021 and 2030.

In 2023, seven hospitals that needed rebuilding because they contained reinforced autoclave aerated concrete (RAAC) were also brought under the programme. RAAC hospitals were prioritised due to the safety risk posed.

The Government has said that because of this reprioritisation and the rising cost of building materials, some projects will now be completed after 2030.

What is considered a new hospital?

In guidance sent to NHS trusts, the Department of Health and Social Care (DHSC) set out what constitutes a new hospital:

  • a whole new hospital on a new or current site;
  • a major new clinical building or wing at an existing site; or
  • a major refurbishment and alteration of an existing hospital.

There has been some debate over whether all the hospitals under the Government’s programme can be considered ‘new’ because some involve rebuilding existing sites rather than new buildings.

In October 2020, DHSC named 32 of the 40 new hospital projects. The NAO judged that 11 of these represent whole new hospitals, while 20 meet other elements of DHSC’s definition.

The NAO determined that one project, Christchurch Hospital in Dorset, does not meet the definition. However, it says DHSC intends to stop counting it towards the target. Instead, another project which covers hospitals on two separate sites will be split into two, with each counted as a new hospital.

How much funding has been allocated?

A NAO report on the progress of the New Hospital Programme sheds light on decisions around the programme’s funding.

In 2020, DHSC considered several options for delivering the 48 hospitals. It estimated that it needed between £3.7 billion and £16 billion of capital funding for the first four years, and between £19.8 billion and £29.7 billion for the full 10 years.

The Treasury initially allocated £3.7 billion at the 2020 Spending Review for the four years to 2024/25.

More recently, the Treasury has indicated that maximum funding for 2025/26 to 2030/31 will be £18.5 billion (although this amount is subject to future spending reviews). This would bring total funding to £22.2 billion.

Since the initial funding assessment, the scope of the New Hospital Programme has changed. Including RAAC hospitals is expected to increase overall costs, as these are likely to be expensive to replace (on average over £1 billion per hospital).

With the delivery of eight projects now delayed until after 2030, additional funding will be needed at a later date.

What progress has been made?

Of the eight projects already in planning before the New Hospital Programme was launched, three have opened or part opened, and three others are scheduled to open in 2024.

The first of the 40 new projects begun after the programme’s launch – the Dyson Cancer Centre in Bath – is expected to open in spring 2024. This is due to be followed by Shotley Bridge Hospital in County Durham in 2025, although building work is yet to commence.

Most construction work is scheduled for the later years of the programme,  including many of the larger hospital projects, but specific funding allocations are yet to be announced.

The Public Accounts Committee has expressed concerns about the lack of progress made and sufficiency of the programme’s funding.

The Government says it remains committed to all projects that have already been announced as part of the programme.

Why new hospitals are needed

The pace of hospital building has slowed in recent years.

Between 1999 and 2014, new and improved facilities were introduced at around 100 hospital sites, mostly using private finance initiatives. Following this, six new hospitals were completed between 2015 and 2020.

The condition of existing hospitals

The NHS estate contains many old buildings. In 2022/23, 42% of the estate had been built before 1985, with 14% pre-dating the NHS itself.

The age of a building is not in itself a problem. However, NHS England’s assessment of the maintenance backlog – the amount of investment required to restore buildings to a suitable working condition – shows that a growing portion of the estate is falling short of required standards.

Over the past decade, the total backlog has more than doubled in real terms from around £5 billion to £11.6 billion in 2022/23. Despite this, investment to reduce the backlog has amounted to a fraction of this cost (12% in 2022/23), as shown in the chart below.

The severity of maintenance issues has also increased: 54% of the backlog was considered to represent a high or significant risk in 2022/23, up from 34% in 2012/13.

The estimated cost of the NHS maintenance backlog has increased from around £5 billion in 2012/13 to £11.6 billion in 2022/23 (in 2022/23 prices). Over the same period, the investment to reduce the backlog was less than £1 billion until around 2021/22, and it stood at around £1.4 billion in 2023/23.
NHS Digital, Estates Returns Information Collection (ERIC), various editions

Hospitals with RAAC

In response to growing safety concerns, NHS England asked all NHS trusts to survey their estates for RAAC.

RAAC has been identified in 45 hospital sites, with seven hospitals found to have been constructed almost entirely of RAAC. The Government now plans to rebuild these seven hospitals under the New Hospital Programme, and it has committed to eradicating RAAC from the NHS estate by 2035.

Low capital investment

Capital investment includes spending on buildings and equipment. Analysis of Organisation for Economic Co-operation Development (OECD) data by the King’s Fund health think tank shows that the UK’s capital investment in health care has been below the average for comparable countries for nearly 20 years.

Capital investment fell particularly between 2014/15 and 2018/19, when DHSC reallocated £4.3 billion of planned capital spending to support core day-to-day spending. More recently, in November 2023, NHS England announced that capital budgets will be used to help manage financial pressures caused by NHS strikes.

Departments are not typically allowed to transfer funding from capital to resource budgets because it risks underinvestment, although exceptions can be made at the Treasury’s discretion.

The House of Commons’ Public Accounts Committee has criticised the “raiding of capital budgets”, arguing that DHSC has focused on short-term financial viability, while failing to consider the longer-term consequences on services and patients.

NHS productivity

Stakeholders have said that low capital investment has contributed to low NHS productivity.

In a survey conducted by the NHS Confederation in 2022, nine in 10 of its members (representing 182 organisations that provide NHS services) said a lack of investment in the NHS estate was undermining efforts to reduce waiting lists and to meet patient safety requirements.

The Institute for Government think tank has identified shortfalls in hospital bed capacity as an immediate cause of backlogs and delays.

Further reading

NAO, Progress with the New Hospital Programme, July 2023

Public Accounts Committee, The New Hospital Programme, November 2023, HC 77 2023-24

DHSC, New Hospital Programme – media fact sheet

HM Government, Improving NHS Infrastructure

About the author: Esme Kirk-Wade is a statistics researcher at the House of Commons Library, specialising in health and social care.

Photo by xy on Adobe Stock