Reeves to provide ‘huge funding’ for NHS in budget

Reeves will present the budget on Wednesday.

• Pramod Thomas
• 29 October, 2024

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By: Pramod Thomas

CHANCELLOR Rachel Reeves will announce billions of pounds in funding for the NHS in Wednesday’s (30) budget that will go towards buying new equipment for hospitals and increasing the number of operations.

Prime minister Keir Starmer has said tax rises will be necessary to rebuild Britain’s public services, pledging no return to austerity despite a difficult fiscal inheritance after Labour won a July election.

“I am putting an end to the neglect and under investment (the NHS) has seen for over a decade now,” Reeves said.

“We will be known as the government that took the NHS from its worst crisis in its history, got it back on its feet again and made it fit for the bright future ahead of it.”

The chancellor said there would be £1.5 billion ($1.95bn) for new surgical hubs and scanners, and £70 million for radiotherapy machines.

It said there would be enough funding to deliver an extra 40,000 elective appointments a week, including £1.8bn invested by the government since July.

Reeves will announce the final figure on Wednesday.

The state-run NHS has endured some of its hardest winters recently as it struggled to cope with backlogs in elective procedures delayed by Covid and industrial action.

“Our NHS is broken, but it’s not beaten, and this Budget is the moment we start to fix it. The chancellor is backing the NHS with new investment to cut waiting lists, which stand at an unacceptable 7.6 million today,” said Wes Streeting, health and social care secretary.

“Alongside extra funding, we’re sending crack teams of top surgeons to hospitals across the country, to reform how they run their surgeries, treat more patients, and make the money go further.”

Starmer has promised to deliver a 10-year plan to fix the NHS in England, after an independent report said it was in critical condition.

He has agreed pay deals with health workers, ending a series of strikes the previous Conservative government blamed for extending waiting lists.

The finance ministry said the extra funding would help the NHS meet a commitment that 92 per cent of people wait less than 18 weeks to start treatment.

Meanwhile, the pound held steady on Tuesday (29), while sterling options rose to their highest since the start of the month, reflecting a modest degree of nervousness among traders a day before Reeves presents the new budget.

Reeves will deliver the new Labour government’s first budget in 14 years on Wednesday, two years after then-prime minister Liz Truss’ tax-cutting plans sparked a crisis in the bond market.

She plans around £40bn worth of fiscal measures, according to government sources, mostly from tax increases plus cuts to some public services, to meet her pledge to cover day-to-day spending without borrowing.

ING strategist Francesco Pesole said there was no political risk premium priced into the pound right now, while speculators are sitting on a fairly substantial bullish position in sterling futures, which could quickly get unwound if there is any disappointment stemming from the budget.

“Sterling continues to look vulnerable ahead of tomorrow’s budget event and next week’s US election, and risks remain skewed to a move to $1.2800-1.2850,” he said.

Modest, but steady economic growth, along with a continued decline in UK inflation have reaped only one rate cut so far from the Bank of England this year.

Sterling is still the best-performing major currency against the dollar in 2024, with a near 2 per cent gain.

(Reuters)