Committee publication · Correspondence · 8 July 2026
Correspondence from Baroness Merron- Mental health expenditure 30.06
Summary
Baroness Merron responds to the Health and Social Care Committee's March 2026 inquiry on mental health expenditure. She outlines government policy on the Mental Health Investment Standard (MHIS), confirming £16.1 billion forecast funding for 2026/27 (£140 million real-terms increase), describes Service Development Funding arrangements totalling approximately £300 million by 2028/29, and addresses concerns about capital allocation for mental health infrastructure.
Key findings
- Record mental health funding of £16.1 billion forecast for 2026/27, a real-terms increase of £140 million compared with 2025/26, with all ICBs expected to have met the MHIS in 2024/25
- MHIS operates as a minimum spend requirement on a flat real-terms basis for 2026/27–2028/29, with additional Service Development Funding of approximately £300 million by 2028/29 for NHS Talking Therapies, Individual Placement and Support, and Mental Health Support Teams
- £473 million capital investment allocated nationally for mental health, learning disability and autism over four years (approximately £2.8 million per ICB annually), with allocations non-ringfenced to allow ICBs to make cases for departing from notional allocations
- Government will remove independent accountant reviews of MHIS reporting from 2025/26, deeming additional assurance costs unwarranted as MHIS reporting is now well embedded
- Recurrent Service Development Funding is expected to transfer into ICB core budgets on a recurrent basis following full rollout, with three-year indicative allocations provided for planning confidence
Tone
ProceduralTopics
public-financemental-healthnhs-funding
Key actors
Baroness Merron, Layla Moran MP, NHS England, Integrated Care Boards (ICBs), Department of Health and Social Care (DHSC), Lord Darzi
Notable line
“… record funding of £16.1 billion forecast for 2026/27 - a real-terms increase of £140 million compared with 2025/26”
Key Quotes
“Mental health is a top priority for this government, with record funding of £16.1 billion forecast for 2026/27 - a real-terms increase of £140 million compared with 2025/26.”
“The MHIS operates as a minimum spend requirement rather than a cap. Where an ICB's overall allocation increases by more than inflation, the MHIS ensures that mental health spending does not fall behind in real terms …”
“With MHIS and SDF combined, there will be real-terms increases in overall mental health spend over the next three years.”
“… based on the latest available data, all ICBs are expected to have met the MHIS in 2024/25. Final confirmed positions will be reflected following completion of those reviews.”
“Allocations are not ringfenced. As such, ICBs and NHS regions are able to make the case for departing from their notional allocations as part of national approval processes …”
Source · parliament.uk record ↗