This is important as last month's OBR forecast (no monthly breakdown of this yet) expects a big increase in receipts by 2029/30 from higher inflation, boosting the public finances.

That may materialise, but it’s concerning that it hasn’t yet - one watch out for in the new year

What's going on? Could productivity in individual trusts really be bouncing around so much? Definitely raises questions about how informative this measure is - we've always found it surprising how high and low some of the changes are
[2/2]

Yes I think that's very fair. The government used to make a defence price index, but stopped publication a number of years ago.

I think another nuance here is that we often talk about defence spending in terms of % of GDP. That makes sense for some types of questions. But (real) GDP is also much higher, so in real-terms we already spend lots more on defence - and that's probably closer to what matters for capabilities

We made that exact chart for our recent IFS Green Budget chapter on defence spending
(ifs.org.uk/publications...)

It also matters for how we think about productivity. The NHS is rightly focused on delivering hospital activity more productively, but it should also ensure that the right activity is being delivered for patients to complete their pathways, rather than simply more activity.
11/11

Ultimately, this matters for two reasons. First, for a govt focused on elective waits, it is clearly a concern that increases in hospital productivity and elective activity are not corresponding to equivalent falls in waits. More is needed to understand what is driving this.
10/11

On the other hand, hospitals faced strong incentives to increase activity and productivity in this period, which could be driving this pattern. But other policy efforts, like patient-initiated follow-up appointments (PIFU) pushed in the opposite direction.
9/11

This growth in the amount of activity happening before a patient leaves the waiting list is not obviously driven by patients being more complex to treat, but that could play a role. It could also be hospitals are delivering better quality treatment.
8/11

It’s not clear why patients are receiving more hospital activity before they leave the waiting list than the year before. This divergence hasn’t been so large in recent years before 2024–25, and we see it happening for almost all medical specialties.
7/11

For example, the number of outpatient appts grew by 9% in 2024–25 yet the number of patients leaving the waiting list only grew by 4%. This is a big deal: if the number leaving the waiting list had grown at the same rate, the waiting list would be ~1 million lower by now.
6/11

It also isn’t the case that lots of patients are joining the waiting list, counteracting increases in activity. Demand growth remains muted. Instead increases in elective activity have failed to translate into similarly large increases in patients leaving the waiting list.
5/11

So what explains this difference? We can quickly rule a few factors out. Productivity hasn’t come from squeezing hospital resources, nor has it all gone to increasing emergency activity. Hospitals delivered a lot more elective activity in 2024–25 than in 2023–24.
4/11

This divergence between productivity growth and waiting list performance is visible at the trust level too. Lots of hospitals have seen productivity growth in 2024–25, for example, without a corresponding improvement in waiting times.
3/11

NHS England figures suggest that productivity grew by 2.7% in 2024–25. But the waiting list fell from 7.5 million to just 7.4 million between Mar 2024 and Mar 2025, and the % of patients waiting <18wks increased from 57.2% to 59.8%. This is not stellar progress.
2/11