Addressing NHS productivity could unlock billions to deliver neighbourhood NHS, says IPPR
Restoring NHS productivity to pre-pandemic levels would have freed £19 billion more in 2023/24, enough to build a new health centre in almost every neighbourhood, according to a new report from IPPR.
Billions worth of extra care could be unlocked if NHS productivity problems and high staff turnover are addressed, according to a new paper from IPPR, From the frontline: Empowering staff to drive the NHS reform agenda.
Analysing the “twin crises” hitting NHS performance – low productivity and poor staff retention – the report establishes that in 2023/24, the NHS in England had a budget of £171 billion, but productivity was 11 per cent lower than before the pandemic, according to NHSE’s own estimates. If productivity had matched 2019/20 levels, the report finds, the NHS could have delivered an extra £19 billion worth of care – enough to build 900 new health centres, and almost enough to deliver the Labour Party’s manifesto promise of building a ‘Neighbourhood NHS’ in one year alone.
The new Labour government has now announced a major uplift to NHS spending in the 2024 autumn budget, taking the planned daily expenditure budget to £192 billion by 2025/26. Increasing productivity will be crucial to ensuring maximum benefit for patients. The NHS has a target to improve productivity growth to 2 per cent per year by 2029/30. Achieving this goal next year could deliver an additional £3.8 billion worth of care – enough to more than triple the numbers of MRI and CT scanners in the NHS.
“After years of mounting pressures, the NHS is facing two major challenges: high levels of frustration among staff, and low productivity which is taking a toll on patients.”
Dr Annie Williamson, IPPR research fellow and current NHS doctor
Exacerbating the issues around poor productivity, the report argues that the NHS is facing a parallel crisis of staff frustration and departure. It notes that between 2010 and 2023, the average annual NHS leaver rate was 11.2 per cent, meaning one in nine staff members left each year. This is compared to 2009/10, when the rate was 9.5 per cent, just over one in 11 staff.
If the leaver rate had been kept down at 9.5 per cent, IPPR estimates that an average of 12,000 NHS staff could have been retained each year since 2010. Holding the number of new entrants constant, this would equate to around 150,000 additional staff retained cumulatively.
IPPR argues that the two major crises facing the NHS – low productivity and poor staff retention – reinforce each other. High staff turnover increases costs and impacts care delivery, while inefficiencies, such as outdated equipment, deepen staff dissatisfaction and lower productivity levels.
Low autonomy for NHS workers is a key underlying issue, the report finds. Decision-making in the NHS often lacks information and insights from frontline staff, leading to the wrong priorities and missed improvements. Money may be spent on hiring locum doctors when staff feel new computers are what is needed, or on top-up winter crisis funding rather than community services to keep people well.
IPPR argues for a new approach to NHS reform. Unlocking staff insights and giving them a greater voice could lead to meaningful changes at every level, the report says.
IPPR calls for reforms to incorporate staff voices in clinical service design and national policymaking including:
- Empowering frontline staff by establishing channels for service improvement led by Trust-level specialists, with protected time for all staff to participate
- Setting up representative staff boards in each NHS trust to put forward ideas from the wider workforce and consult on all matters affecting staff wellbeing, with a duty on main NHS trust boards to consult them
- Giving a staff voice in national workforce policy by reforming pay review bodies to include negotiation or embed a formal duty to consult with staff
Dr Annie Williamson added: “By addressing these issues [of low productivity and retention], we could unlock billions worth of better healthcare. More importantly, this would create a more efficient and sustainable health service, where staff voice is central to improving the quality of decisions throughout the NHS.”
Dr Parth Patel, Associate Director of Democracy and Politics, said: “We all know the NHS needs reform, but we keep getting distracted by the same red herring debates. The real issue is that we’re struggling to get the NHS firing on all cylinders again.
“Too many decisions are made at the top, while those on the front lines—who truly understand what’s needed—are left with little say. The status quo isn’t working. We need to empower NHS staff with a genuine voice and a real stake in the decisions that affect them. Only then can we unlock the NHS’s full potential again.”
