New private investment routes needed to replace crumbling hospitals and modernise healthcare

Sciana Fellow Nick Kirby reflects on the pressing need for investment in UK hospital infrastructure

Several years ago, I recall picking up the on-call pager at 5 am to read that the ceiling in one of the wards had just collapsed. Miraculously, no patients or staff were harmed, although the experience was clearly traumatic. This is not as rare an experience as we may think; according to NHS England, in 2022/23 across the NHS, there were more than 12,000 incidents where infrastructure failed and stopped clinical services.

Keeping people safe is the absolute minimum we should be guaranteeing. Not only does the quality of NHS estate increasingly jeopardise this guarantee, but it also undermines a broader spectrum of responsibilities and ambitions, including the quality of experience, efficiency of services, and an infrastructure where the NHS is best able to realise its potential as a world-leading partner in innovation and research.

Current infrastructure arrangements

A growing catalogue of reports illustrates the problem of current infrastructure arrangements in the NHS. In 2019, the Health Foundation published “Failing to Capitalise”, a report highlighting low capital intensity in the UK health service vis-a-vis OECD nations (0.27% of GDP in the UK, compared to 0.5% OECD average in 2016) and the continuing rise in backlog maintenance costs (£4bn in 2013 to £11.6bn in 2022) as particular concerns. In 2023, meanwhile, the OECD “Health at a Glance” report identified UK capital expenditure on healthcare as consistently below the OECD average. 

In the same year, the NAO reported that between 1999 and 2014, the NHS opened approximately 100 new hospitals built using the Private Finance Initiative. Only six new hospitals were constructed between 2015 and 2020. Over 100 hospitals applied for the final eight places on the NHS New Hospital Programme, highlighting the unmet demand for investment in hospital infrastructure. In 2024, Lord Darzi’s review concluded that the NHS was starved of capital in the 2010s, with an accumulated £37 billion under-investment. 

How we can move forward

Through Sciana: The Health Leaders Network, I have recently had the privilege of spending time with people from both the UK and other European nations to understand what some of the solutions to this challenge look like. 

Within the UK, few have captured the essence of this as well as the NHS Confederation. Understanding the routes through which we can secure investment to improve our infrastructure is an essential aspect of delivering improvement across a broad spectrum of priorities, including quality of care, service productivity, and the experience for patients and staff.

There are striking overlaps between the potential solutions being considered in the UK and what is being achieved across the European continent.

Take the aspiration we have in the UK for our health system to embed capabilities in research and innovation, through which we can better collaborate with partners in life sciences. In Denmark, there are models of public-private partnerships that have effectively delivered a modern healthcare estate, with a particular focus on innovations to improve outcomes for patients with metabolic diseases. 

Closer to home, the Welsh government has deployed a new Mutual Investment Model to access private finance for constructing a new cancer hospital, as well as wider public infrastructure across the transport and education sectors.

Realising our potential will require the ability to work across sectors, including health, education, and life sciences, as well as between public and private organisations, in the financing and best practice management of estates to deliver the modern facilities that our patients and staff deserve. 

For too long, we have failed to secure a predictable and long-term pipeline of infrastructure investment in the NHS. For too long, this has undermined quality and access for patients. For too long, we have been used to providing a quality environment for our staff that would be regarded as unacceptable in many other sectors.

It is a complex system leadership challenge—and implementing solutions is not easy—but making tomorrow better than today demands enquiry. Learning from places that have done this successfully over the last decade is where we can begin.

This article was authored by Sciana Fellow Nick Kirby. The views and opinions expressed in this article do not necessarily represent the views of their organisation(s), Sciana: The Health Leaders Network, nor those of the Sciana Network's three funding foundations.