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Investment into primary care and community NHS services could have significant gains for the wider economy, according to the findings of new independent analysis.
The new research, commissioned by the NHS Confederation and conducted by Carnall Farrar found that for every £1 invested in community or primary care, there is up to a £14 return back into the local economy through gross value added (GVA) – the measure of the total value of goods and services produced in an economy.
In the five years between 2015 and 2019 those localities in England that most increased NHS spend in primary and community care experienced far higher GVA growth in their areas than those that spent the least on these services.
The analysis makes the link between the historic lack of sustained financial investment in some health care settings and the effect of the government’s austerity drive.
The research also shows that with £1bn potentially generating £14bn in growth, the additional taxation revenues would have more than paid for the original NHS investment. The particularly high returns in primary and community care reflect the raised level of contact these services have with local people and their local economy.
Investment into primary care benefits not just patients but wider society
Matthew Taylor, chief executive of the NHS Confederation said: “These significant findings show clearly that investment in the NHS, particularly in primary and community care, is very beneficial to the wider economy.
“While we know that bringing down waiting lists is important, if we only focus on what happens in hospitals then the risk is that we are constantly fighting an unwinnable war at the most downstream end of the care process. Instead, we need to start delivering on the long-term aspiration to shift resources upstream into prevention, primary and community settings. This new kind data makes an unarguable case for which forms of investment have the greatest potential benefit not just for patients but for wider society.
“The message for the government as its starts to consider is autumn statement is clear: without the necessary investment upstream in prevention and in primary and community care it will be difficult to make the crucial shift to preventing ill health in the first place or to maximise the wider benefits of health spending.”
This latest analysis ‘Creating Better Health Value’ delves deeper into NHS investment, examining local variations in health service spend and identifying which care settings can deliver the most economic output when their funding is increased.
Ben Richardson, Managing Partner at Carnall Farrar added: “Recognising the vital importance of the NHS and its profound impact on society, we are pleased to be able to tap into its rich data to produce meaningful insights.
“In this instance we were able to demonstrate a link between health spending and economic growth, which suggests that money spent on health isn’t just cost, it’s an investment that generates a substantial return in economic growth.
“We suggest two potential mechanisms through which NHS spend increases local GVA. The first mechanism may be that spending, especially on primary and community care, supports in keeping people healthy – or as independent as possible – which in turn maximises workforce participation and productivity. The second mechanism may be that investment in the NHS creates jobs which generate economic growth, reflecting the NHS’ role as an employer and anchor institution.”