The New Hospital Programme – Report Summary

This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.

Author: Committee of Public Accounts

Related inquiry: New Hospital Programme

Date Published: 17 November 2023

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The New Hospital Programme (NHP) was intended to be a landmark programme, addressing the escalating backlog of investment in hospital buildings by delivering 40 new hospitals in England by 2030. The programme has been marked by slower progress and higher costs than promised, a lack of transparency in scheme selection, and until a few months ago uncertainty about overall funding, scope and timetable. It is now clear that NHP will not deliver all 40 new hospitals by 2030 and is highly unlikely even to construct the 32 new hospitals (under its 2020 definition) that it is now aiming to complete.

The Department of Health and Social Care (DHSC) was aware in 2020 that there were seven NHS hospitals built entirely of reinforced autoclaved aerated concrete (RAAC) which had become structurally unsound. Yet only two of these seven were selected for inclusion in the programme at that time. In May 2023, DHSC reset NHP and included the other five RAAC hospitals. In all seven, costly mitigation measures are required to keep services running until new structures can be built. The 2023 programme reset had the effect of delaying eight other hospitals, which DHSC now will not complete until after 2030, a major disappointment for people living in those communities.

An important feature of NHP is DHSC’s aspiration to develop new cheaper and faster approaches to hospital construction. This includes a new standardised hospital design called ‘Hospital 2.0’. Resourcing and design capacity issues have hampered the progress of Hospital 2.0 and development of the design and process is now running at least five months behind schedule. The delay to Hospital 2.0 has impacted the programme in two key ways. It has reduced the time available to pilot the new design in real-life scenarios, risking baking-in and replicating design and construction problems across England. The delay has also hindered meaningful engagement between NHP and the construction industry on the details of the design and the commercial pipeline of work. There are big questions about the industry’s capacity and appetite to build the required number of hospitals in the new way and to a very tight timetable.

Most worryingly of all, the latest version of Hospital 2.0 is based on assumptions that appear very likely to produce hospitals that are too small. The NHP team is assuming future bed occupancy rates of 95% and reductions in length of patient stay that are unsupported by research it commissioned. The assumptions look particularly heroic in the context of the UK’s growing and ageing population, while there is as yet no social care plan in place to alleviate the increasing pressure on hospitals.

DHSC and NHS England have generally failed to build capacity within the NHP team. With 62% of NHP posts filled using consultancy services in February 2023, the programme has been over-reliant on consultants, creating risks of lack of continuity and capability at the heart of the programme as well as making it more expensive.

The Government indicated in March 2023 that the maximum capital funding available to deliver 32 new hospitals by 2030–31 as well as completing eight pre-existing schemes would be £22.2 billion (made up of the original funding up to 2024–25 of £3.7 billion plus an additional £18.5 billion from 2025–26 onwards). The Committee sees multiple affordability challenges which DHSC needs to grapple with, including the fact that changes to the assumptions underlying Hospital 2.0 to make the design fit for purpose will likely increase costs.