Digitising the National Health Service (NHS) and publicly funded adult social care across the UK could require up to £21bn in investment over the next five years, according to a study commissioned by the Health Foundation. The research, carried out by PA Consulting, assessed the funding needed to meet government ambitions for a digital transition in healthcare.
The total estimate includes £8bn in capital expenditure, £3bn in one-off revenue costs, and £2bn in recurring annual spending. Of this, England would account for £5bn in capital, £2.25bn in one-off costs, and £1.5bn in yearly operational expenses. These figures cover both NHS services and residential adult social care across the UK.
The research assessed the cost of closing the gap between current digital capabilities and policy ambitions for NHS and adult social care digitisation, as outlined in UK policy documents from 2021 to 2024. Although most of the analysis predated the current Labour government, its ongoing rhetoric suggests a continued, if not stronger, commitment to achieving these digitisation goals.
The report highlights the need to invest not only in hardware and systems like electronic patient records and cybersecurity, but also in training, software updates, and ongoing optimisation. While some of the cost may be met through existing budgets, the Health Foundation said it is likely that additional government funding will be required.
“The shift from analogue to digital is at the heart of the government’s ambitions for NHS reform in England,” the Foundation noted. The forthcoming NHS 10-year plan, 2025 Spending Review, and the Casey Commission on social care are seen as key moments to advance these reforms.
Historical challenges in NHS digitisation
Despite multiple attempts to digitise services over the past two decades, progress has been limited. Reviews by the National Audit Office and the Health and Social Care Select Committee found that implementation often fell short of policy targets. For example, the National Programme for IT launched in the 2000s aimed to ensure every patient in England had an electronic health record by 2010. Yet, some NHS trusts still lack full coverage.
In social care, digital adoption has grown, with 75% of Care Quality Commission-registered providers in England now using digital records. However, many remain reliant on paper-based systems. Challenges include outdated infrastructure, workforce digital skills gaps, and inconsistent implementation. The report also cited over 13.5 million hours lost each year due to malfunctioning or inadequate NHS IT systems.
The Foundation called on policymakers to articulate a clear vision for digital health, back it with adequate funding, and create a plan to realise expected benefits. It also urged better tracking of current digital spending to assess return on investment and effectiveness.
Chancellor Jeremy Hunt has earmarked £6bn for NHS modernisation over five years, including £3.4bn to boost productivity through digitisation. The government expects long-term savings of £35bn, although analysts warn that immediate relief for cost pressures and backlogs is unlikely.
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