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Naylor Review: £10bn needed now to fully finance STP reforms

A total of £10bn is required to properly fund England STPs and maintain health facilities in the future, an independent report written for the Department of Health has revealed.

The report, drawn up by Sir Robert Naylor, former CEO of University College London Hospitals NHS FT, warned that without actual new investment in the NHS estate, there is little chance that sustainability and transformation plans (STPs) will be delivered as facilities would remain as unfit for purpose.

Sir Robert’s review follows NHS England’s long-awaited Five Year Forward View (FYFV) progress update last week, which revealed that STPs – apparently now called sustainability and transformation partnerships – will be given a raft of new flexibilities in exchange for robust governance arrangements. The update also announced that accountable care systems would now be considered an ‘evolved’ version of an STP working as a locally integrated health system.

But today’s report warned: “The general consensus is that the current NHS capital investment is insufficient to fund transformation and maintain the current estate. We estimate that STP capital requirements might total around £10bn, with a conservative estimate of backlog maintenance at £5bn and a similar sum likely to be required to deliver the FYFV.

“This could be funded through property disposals, private capital (for primary care) and from the Treasury. However, the NHS needs to develop a robust capital strategy to determine the final investment requirements through the STP plans.”

Sir Robert also called on the NHS to rapidly develop robust capital plans that are aligned with clinical strategies, maximise value for money (including land sales) and address backlog maintenance.

“Government should support these plans by providing capital, but only where a strong case has been made. The review recognises that STPs are at different points in their development so we do not expect all areas to progress and require funding on the same scale or at the same time,” the report said.

“The allocation of additional public funds should be proportional to the amount received from property disposals.”

The review went on to recommend that a new NHS Property Board is established to provide leadership and expertise to STPs at arm’s length, acting as the primary voice to the system on estate matters. 

Dr Mark Porter, council chair of the BMA, said that the outstanding financial figure identified in the major report was even higher than that of the analysis his own union conducted earlier this year, which predicted that STPs needed around £9.5bn of capital funding to be successfully delivered.

“The NHS simply doesn’t have this kind of money available and these plans are fast becoming unworkable,” he argued.

Last month, the BMA also attacked the government for playing “cheap tricks” to mask its intention for STP funding, claiming that politicians deliberately misled the public by not being clear that the £325m for STP plans announced in the Spring Budget would be spread over three years rather than be made available upfront.

“This review is particularly interesting in light of Friday’s delivery plan from NHS England, which put lot of emphasis on the role of STPs, with a belief that they are sufficient to resolve the crisis,” added Dr Porter today.

He also warned there was a “real risk” that STPs will only be used as a cover for delivering cuts to healthcare and starving services of resource and patients of vital care.

“These figures are especially concerning given that everyone can see that the NHS is at breaking point,” the BMA council chief argued. “We urgently need an honest look at the pressures facing the NHS and how to give the investment needed to match the promises made.”