Today announced details of an allocation of over 2bn of capital investment for the next financial year.

Capital funding is used to acquire and modernise land, buildings and equipment in the NHS and it can only be used for these purposes. These NHS allocations represent an overall increase of 19% over 2005/06 which matches the growth in capital funding awarded for Health in the 2011 Spending Review. The overall growth in the NHS allocation is made up of a 25% increase in operational capital investment which goes directly to NHS Trusts and Primary Care Trusts and a 13% growth in strategic capital which goes to Strategic Health Authorities for larger projects.

This extra investment is particularly good news for mental health trusts who receive a 50% average increase in operational capital compared to the previous financial year, this is double the level of increase in operational capital nationally. This reflects the need for more rapid modernisation of mental health services where the estate is on average older than other parts of the NHS. This funding goes directly to the Mental Health Trusts and so will allow local decision making to determine how best to modernise facilities.

This money will also help trusts to maintain investment in cancer and diagnostic equipment and facilities. Over 1,200 items of modern diagnostic and treatment equipment for cancer have been delivered since April 2011; this extra money will allow the NHS to continue these improvements for cancer patients.

Capital allocations to NHS Trusts, PCTs and SHAs are not ring-fenced for specific purposes. Local NHS staff decide on the right level of local investment to deliver improvements required for national targets and local priorities – for example, investment in scanners and other diagnostic equipment, to help make sure that by 2011 no patient waits longer than 18 weeks in their whole journey from GP surgery door to treatment.

Health Secretary Patricia Hewitt said:

“In 1997 we embarked on the biggest hospital building programme in the history of the NHS. Since 1997 the NHS has opened or begun construction on 88 new hospital schemes – including mental health and community facilities – and a range of specialist schemes.

In addition, nearly 3,000 GP premises have been refurbished or replaced and over 500 one stop centres established.

“Local NHS staff, who know the needs of local patients best, are best placed to make decisions about how to use this capital for investment in land, buildings and equipment. For example, this money will help the NHS modernise mental health services in North Derbyshire and South East London, modernise the children’s hospital in Bristol, and provide an extra building at Northampton General Hospital.

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