The Challenges Persist But Post Pandemic NHS Healthcare Productivity Improves

After COVID-19, the productivity of healthcare in England improves when hospitals are busier and staffed more, but waiting lists also rise.

Tuesday's report from the Institute for Fiscal Studies (IFS) said productivity in England's National Health Service (NHS) is beginning to improve 'tentatively'. The IFS said hospital activity had grown dramatically over the past year, yet staffing levels had not kept pace. This suggests new healthcare workers are being trailed but has yet to reduce the NHS's long backlog of treatment waiting lists by a serious amount.

One of the key areas that the new Labour led government under Prime Minister Keir Starmer promises to improve healthcare is productivity. It was one of the five missions the government articulated after it assumed power in July. In the spirit of that, Finance Minister Rachel Reeves was making a statement on quite aggressive growth in tax, spending and borrowing in order to rebuild public services, especially healthcare provision.

Olly Harvey-Rich, an IFS research economist, acknowledged that while any increase in NHS productivity is positive, it remains below pre-pandemic levels. A report revealed a 3.6% increase in NHS England consultants and a 6.4% rise in nurses and health visitors from January to July 2024. However, healthcare service provision improved significantly, with elective admissions up 10.3% and outpatient appointments rising 9.2%.

In most cases output growth in the public sector, which is largely made up of healthcare and education, remains about 3% lower than levels in 1997. As the NHS approaches the winter season, the administration is optimistic that these initial upturns will be sustained and will gather pace in the months to come.