Targets and trade-offs: NHS finance and performance ambitions in 2026/27
18 May 2026
Key points
- The NHS made significant improvements in the 2025/26 year, despite ongoing challenges from rising demand, constrained finances, industrial action and having to deliver on the government’s reorganisation of the health service.
- Improvements were seen across several key areas, including A&E waits, GP access, waiting lists for elective care and ambulance response times. The NHS also delivered on its financial plan without needing extra central government funding and there was a statistically significant increase in public satisfaction with the NHS in 2025, the biggest fall in dissatisfaction in a quarter of a century. These hard-won gains reflect the work of NHS leaders and staff in such challenging circumstances.
- The NHS will look to build on these gains in 2026, but is facing mounting challenges. Responding to a major new survey from the NHS Alliance, over 97 per cent of 235 NHS trust, integrated care board (ICB) and general practice leaders said the scale of the financial challenge in 2026/27 is set to be at least as challenging, if not greater.
- The NHS is facing further uncertainty from cost pressures that are not covered in this year’s budget, including expected strike action, rising inflation and the extra costs of the US-UK pharmaceutical deal.
- While NHS organisations continue to improve productivity and cut waste, nearly two-thirds (64 per cent) of NHS trust and ICB leaders said they will likely need to reduce or cut patient services this year to meet their financial plans. A majority of GP leaders (65 per cent) also said it was likely they would need to reduce routine or proactive care this year. There are concerns about
the impact this will have an impact on patient experience. - More than half of trust and GP leaders are expecting to make cuts to their clinical and non-clinical staff this year – a significant increase on last year.
- While the NHS ended the 2025/26 year in financial balance, which is a significant achievement given the challenging operating environment, NHS leaders responding to our survey say this has come at a high cost. Staff morale is a particular concern and the majority of trust and ICB (93 per cent) and GP (91 per cent) leaders say declining staff morale is a key area of concern this year.
- The focus on financial balance and hitting key waiting time targets has also impeded progress when it comes to delivering a more prevention and community-focused model of care. This remains a key ambition for the government and was central to its 10 Year Health Plan. Local NHS leaders continue to support the ambition but fear the primary focus on recovering services and balancing the books will slow progress.
- To help local NHS leaders deliver on the performance and delivery ask in 2026/27, they are asking for support from government in a number of key areas. First, they want political backing to make difficult decisions, particularly when it comes to reconfiguring local services where there is likely to be opposition from the public. Second, they need financial support to mitigate the impact of additional pressures such as rising inflation and industrial action – costs that are not factored into the 2026/27 budget. And, finally, they want greater clarity and consistency from government on what local leaders should be prioritising this year.