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The productivity of the NHS fell in the three months until September and was almost 20% below its pre-Pandemic level, which raises concerns about increasing pressure on the expenses of British public services.
The productivity of health care, a measure of the efficiency with which work and capital are used to provide NHS services, fell from an annual rate of 2.4% in the third quarter of 2024, according to data “In development” published by The Office for National Statistics on Monday.
It was estimated at 18.5% below its pre-countryic peak in the last quarter of 2019, the agency said.
The figures mark the first time the Ons Reported quarterly data on the productivity of health care and highlights the challenges that the government faces when it pushes to reduce NHS waiting times and improve the performance of the service in the midst of stretched public finances.
In the fall budget, Chancellor Rachel Reeves announced an increase of 22.6 billion pounds sterling in the daily budget of the NHS over two years and an increase of 3.1 billion pounds sterling in her investment budget.
It also set the health service and Whitehall departments a productivity target of 2% in 2025 “using technology more efficiently and joining the services through the government”.
Although greater efficiency in public services can facilitate financial pressures, Monday data suggests that productivity is evolving in the opposite direction.
Bart Van Ark, director general of the British, said that “despite the increase in spending on public sector inputs, the response of production growth has been low in the past two years” and called the government to “Determine how to use these resources better”.
The overall public service productivity fell by an annual rate of 1.4% in the third quarter of 2024 and was estimated at 8.4% below its level in the fourth quarter of 2019, before the pandemic, said the ‘Ons.
However, the agency’s productivity data is riddled with problems and is now labeled “official development statistics” due to the low response rate for labor market study, on which the figures are partially based.
The ONS said that Monday data did not take into account changes in the relative quality of these services because many of these quality factors require data that is not yet available.
Andrew Bailey, governor of the Bank of England, said on Thursday that he could not say to what extent the fall in the measured productivity of the public sector was a “real phenomenon”.
During a press conference, he warned against the “solid conclusions” of the state of productivity in the public sector “because there are many conventions on the way in which these things are measured”.
However, the low productivity performance of the United Kingdom has raised concerns among decision-makers, as it reduces the ability of the economy to produce goods and services and could maintain high inflation.
Regarding the future pathway of interest rates, productivity growth “is important because it is the speed limit for the economy in terms of supply,” said Clare Lombardelli, deputy for the deputy on Thursday Boe, during the press conference.
Productivity growth was for everyone because “is the only way to get a long-term real income increase,” she added.
