Treasury takes £1bn from health capital for defence

The health department’s capital budget is being cut by £1bn over the next four years, as the government moves funding to bolster defence investment.

Wednesday’s Budget revealed the department’s capital budget has been cut by up to £300m each year to 2029/30.

In June the government said the Department of Health and Social Care’s capital budget would be reduced by 1%, around £580m over four years, to partially fund the defence investment plan.

However, this raid has now nearly doubled. The Budget document said £3bn of the remaining £4.7bn needed for defence would come from “further reducing departmental capital budgets”, by another 1% from 2027/28 to 2029/30.

Several experts said it would have to be paid for by cutting back on major capital projects in the coming years, particularly the New Hospital Programme.

Hiba Sameen, lead economist at the Health Foundation, said: “After years of underinvestment, reducing funding for buildings, equipment and technology risks undermining the productivity gains needed to improve care and cut waiting times.”

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Source: HSJ, 28 October 2026