Spending review 2025: providers urge government to invest in primary care

The government’s 2025 spending review is “the single opportunity in this Parliamentary cycle to transform investment into primary care”, according to providers across pharmacy, general practice, dentistry, optometry and audiology — with clear implications for the future role and funding of pharmacy services.

Spending reviews, which are held every few years, determine future departmental budgets. In October 2021, the previous Conservative government set out spending from 2021 to 2025, including a planned 3.8% real-terms increase in year-on-year NHS spending.

The latest spending review — details of which were announced on 11 June 2025 — builds on the October 2024 Budget, extending projections to 2029 and allocating billions to the health service, life sciences and technology.

With significant funding now earmarked, there is growing pressure on the government to direct investment toward areas that will deliver the greatest benefit — with funding decisions that could shape the future of pharmacy.

How much money will the NHS receive in the spending review period?

Day-to-day NHS spending is set to rise by 3% a year in real terms between 2023/2024 and 2028/2029, reaching £226bn by the end of that time.

The Department of Health and Social Care (DHSC) will receive an additional £2.3bn in real-terms cash to invest in the NHS, including in new technology, hospitals and primary care.

Annual pay awards, which the government has said it is committed to, will need to be funded from the day-to-day NHS budget or be offset through other savings or productivity gains.

The government estimated its spending review funding could support 2% NHS productivity growth each year, unlocking £17bn savings over three years, which could then reinvested back into the NHS to improve patient care.

Its spending review policy paper said it would create “a cost-conscious culture that relentlessly roots out waste, drives efficiency, and protects taxpayers’ money”.

Will NHS funding ‘shift left’ along with government priorities?

The review reiterated the government’s commitment to moving care closer to home, outlining support for training “thousands more GPs”, but made no mention of pharmacy.

Leyla Hannbeck, chief executive of the Independent Pharmacies Association (IPA), said this was a “missed opportunity to put pharmacies first and save billions for the NHS in the long term”.

However, a spokesperson for the DHSC later told The Pharmaceutical Journal: “As we deliver our ‘Plan for change’ to rebuild the health service, pharmacies will remain a priority, so people get the care they need close to home.”

Speaking in Parliament on 17 June 2025, health minister Stephen Kinnock told MPs he was “working on” reforms to Pharmacy First to “get the allocation of funding right” for the service.

Community Pharmacy England (CPE) described the current funding model as “challenging” and, from June 2025, a new, variable payment has been introduced to enabled contractors to receive some payment at a lower threshold.

Kinnock said: “We have to make Pharmacy First work effectively, which means getting the allocation of funding right. That is what we are working on in terms of reforms. Now that we have the spending review and the package, that is what we will be delivering.”

Primary care providers, including CPE, joined forces on 16 June 2025 to call on government to support the sectors.

In a joint statement, they said there was “little capacity to deliver the reforms needed, and improve the care people receive closer to home, without further investment in primary care”.

The primary care representatives included those from pharmacy, GP, dentistry, optometry and audiology, and stressed that more than three-quarters of NHS interactions take place within primary care, making up the “sole NHS experience” for many of the 1.5 million patients treated by the NHS each day.

It blamed “an historic focus on specialist settings, bureaucracy, and poor workforce planning by NHS England – as well as funding cuts to some of our sectors”.

In a separate statement published on 11 June 2025, Janet Morrison, chief executive of CPE, said: “Pharmacies have an astonishingly strong record on efficiency — the best in the NHS — and they have even more to offer if they can be properly supported, funded and integrated into primary care.

“We do not yet have a clear path to the sustainable funding and operational model that community pharmacy so desperately needs, and which government has committed to… We want to see demonstrable action soon to show that progress is being made on the commitment to this future for community pharmacy.”

Although community pharmacies in England received a new funding settlement in April 2025, this only partially met the cost of running NHS community pharmacy services, as estimated by an NHS-commissioned economic review, published on 28 March 2025.

Up to £10bn planned for NHS technology and transformation

The overall funding uplifts include a total investment of up to £10bn in NHS technology and transformation by 2028/2029.

The government said this will:

• Begin to turn the NHS App into the digital front door to the NHS, enabling patients to manage medicines and prescriptions, receive NHS communications securely and increase their access to medical services such as tests directly;
• Deliver a single patient record, giving patients a unified view of their medical history and enabling two-way communication and active management of their healthcare.

From 2026/2027 to 2029/2030, up to £600m in technology funding will support the launch of the Health Data Research Service — a joint initiative by the Department for Science, Innovation and Technology (DSIT) and the Wellcome Trust, which was announced in April 2025.

Government urged to invest in medicines for cost-effective health spending

The spending review also outlined up to £520m life sciences manufacturing funding from 2025/2026 to 2029/2030 to build resilience for future health emergencies.

Richard Torbett, chief executive of the Association of the British Pharmaceutical Industry (ABPI), said the government was right to invest in the NHS amid tight budgetary constraints.

“The key question is how this will be spent — and whether it will be used to improve patients’ outcomes,” he said on 11 June 2025 in a statement from the ABPI.

“Over the past decade, accounting for inflation, the NHS budget has grown by a third in real terms (33%), while investment in the most rigorously cost-benefit tested part of health spending, investment in the medicines needed to treat people, has fallen from around 11% to 9% of the total health budget.

“The NHS must seize this opportunity to invest in the proven technologies and innovations that will support its reform agenda and improve patient outcomes. This means making sure patients can access the treatments they need and readying the system to roll out the new medicines that can prevent ill health and improve the lives of many more,” he added.

Torbett’s remarks underscore the need to align spending with value — with investment in pharmacy playing a key role in ensuring care is both accessible and available to patients.