The IFS said £400m was brought forward for the DHSC from later years at the 2025 Autumn Budget, much below the £16bn top-up in 2024-25 and £8bn in 2023-24.

Last year was the first year since 2013-14 the DHSC neither made a claim to the Treasury Reserve (a contingency for unexpected spending pressures) for operational NHS pressures, nor raided capital budgets to pay for more day-to-day spending.

The IFS said the reduced top-up was partly due to the more generous spending plans for 2025-26, along with improved productivity.

In addition, there was a significant slowdown in activity growth to stay within budget, with elective admissions up by just 0.4% in 2025–26, compared with 9% in 2024–25. Growth in diagnostic tests also slowed from 8% to 3%.

Since the DHSC budget is currently planned to grow more slowly over the next two years than in 2025–26, the IFS said the Government may face a difficult choice between sticking with these budgets or finding more money to improve services quickly enough to achieve its ambitious performance targets.

David Williams, deputy director of policy at The NHS Alliance, said: ‘This new analysis from IFS highlights the tension the NHS has been navigating between driving down waiting lists and staying within budget. There are no easy solutions to be found.

‘Last year, NHS organisations had to make some difficult trade-offs and delivered £11bn of savings – the highest amount on record. But staying within budget involved making cuts to services and staffing levels in some areas, and that inevitably had an impact on how many procedures and operations they were able to do.

‘Members also tell us that they expect the challenge to be even greater this year. They will need a clear and consistent set of priorities, political backing to make difficult decisions, and financial support to cover unforeseen costs.'