9 NHS providers' assessment of their need for capital funding has been consistently greater than the funding available. NHS providers' annual assessment of their need for capital investment has been, on average, £1.1 billion higher than their spending limit in each year from 2016-17 to 2018-19. The Department prioritised demands given that the total of NHS providers' plans exceeded the capital limit available for the Department (paragraph 2.7).
10 Since 2014-15 the Department has transferred £4.3 billion from capital to revenue spending. The Department began transferring from its capital budget to its revenue budget in 2014-15. From 2016 it was given special flexibility by HM Treasury to transfer up to a maximum amount from capital to revenue in each year between 2016-17 and 2019-20. The Department has used all of this flexibility. It has transferred a total of £4.3 billion in the five years from 2014-15 to 2018-19. The Department was thus able to prioritise support for day-to-day spending on current services at the cost of foregoing longer-term investment in buildings and other long-term assets. In March 2019 the Department was unable to give a definitive measure of the impact on patients' services of repeatedly making these transfers (paragraphs 2.8 to 2.11 and Figures 8 and 9).
11 Capital investment budgets have not been fully used. There have been particular years where noticeable underspends have occurred. Between 2010-11 and 2012-13, there was an average underspend of £677 million (12%) against the capital spending limit. In 2017-18, £360 million (6%) was unspent. These underspends have occurred at a time when the UK has had lower levels of medical equipment per population than other countries, for example, 26th out of the EU28 countries for magnetic resonance imaging (MRI), and 27th out of the EU28 for computed tomography (CT) scanners (paragraph 2.12).