Approved: NHS Supply Chain Modernisation Programme

We are pleased to share that NHS Supply Chain has received approval from Government to proceed with our NHS Supply Chain Modernisation Programme. Chief Executive Officer Andrew New said that the approval will allow NHS Supply Chain to make a step change in its ability to serve the NHS and patients across England, by investing in IT and supply chain infrastructures through a multi-year programme.

This investment will be used to grow the value of our procurement and delivery services to meet the needs of all of our service users and stakeholders in a resilient and modern system-centric way.

It will also enable us to address our critical IT resilience risks, as well as delivering our commitment to return a minimum of £1 billion of recurring annual value to the NHS by 2030. 

Andrew New, Chief Executive Officer, NHS Supply Chain

We will do this by making three large scale changes: 

1. Replace our ageing Enterprise Resource Planning (ERP) and legacy applications IT infrastructure with modern cloud-based software, providing far greater reliability, greater information transparency and an improved user experience for our customers and our suppliers.  
2. Expand our logistics infrastructure to enable us to grow our capacity, hold a wider range of stocked items close to our customers, allow greater order consolidation taking complexity away from clinical settings and to do so in a more cost efficient and sustainable way than we do today. We will also build our capability to service the NHS and patients outside of acute settings enabling the ambitions of the NHS 10-year plan.  
3. Re-engineer our end-to-end business processes to provide more consistency in how we operate, improve transparency, and increase availability of data to enable better decision making.  

In a joint statement, NHS England and NHS Supply Chain
share their commitment to modernising the NHS.

As strategic partners, NHS England and NHS Supply Chain share a clear and united purpose: to enable the delivery of outstanding patient care across the healthcare system.

NHS England’s recent investment commitment in NHS Supply Chain marks a pivotal moment in our journey. It reflects a shared vision to build a resilient, sustainable, and innovative supply chain, one that ensures patients receive care in the right place, at the right time, supported by the best products and technology available.

This investment also acknowledges NHS Supply Chain’s central role in driving efficiencies and delivering savings across the system. By working collaboratively across the entire NHS, we have the potential to unlock over £1 billion in recurrent annual value by 2030 – the equivalent of funding a new hospital every year, reinvested directly into frontline care.

In addition, by adopting a single NHS procurement value and savings methodology, and supporting the ability for new technology that has been robustly assessed by one NHS organisation to be easily rolled out to others, we are able to ensure that procurement decisions are based on more than just product cost, with patient outcomes, sustainability and the total cost across the whole patient pathway key considerations.

NHS Supply Chain’s ability to fully support the NHS as a modern, flexible, and reliable supply chain has been constrained by limitations in capacity and technology. This multi-year investment commitment, endorsed by NHS England, the Department of Health and Social Care, Cabinet Office, and HM Treasury, will unlock a step change in our capabilities.

We are investing in modern IT systems and infrastructure which will enhance procurement and delivery services, ensuring they are resilient, responsive, and aligned with the evolving needs of service users and stakeholders. Now that we have had confirmation to proceed with the modernisation programme, we will fundamentally transform our commercial approach, fostering high-innovation partnerships that deliver system-wide value.

We will also make it easier to buy from us by introducing a simple, integrated pricing structure and work towards a single national price. We will look beyond cost, encompassing a broader set of attributes that matter to the NHS and its patients. Our new buying principles support our ambition to realise the benefits of purchasing as a national health service, leveraging aggregated purchasing, data-driven decisions, and clinically-led, patient-focused procurement.

As the NHS advances its strategic priorities aligned to the 10 Year Health Plan: bringing care closer to communities, embracing digital innovation, and focusing on prevention, NHS Supply Chain is actively enabling this transformation.

We are expanding capabilities to support care outside hospital settings, streamlining digital processes, and enabling remote diagnostics. We are also harnessing data to drive system-wide optimisation and support remote monitoring solutions, bringing support closer to the patient, where it makes the greatest difference.

We are building a future where NHS Supply Chain delivers products faster, more efficiently, and more reliably – with real-time order visibility, delivery flexibility, and smarter use of NHS buying power. Our vision is a future where the NHS gets what it needs, exactly when it needs it, where technology empowers decisions and supply chains are proactively managed, where end-to-end value is optimised, maximising the benefit to the whole NHS.

We will continue to provide regular updates at each stage of the programme, working closely with members of the NHS Supply Chain National Advisory Board and regional representatives to ensure change is managed consistently and effectively across the NHS. To support the success of this transformation, all future investment in local supply chain capability will now require approval from NHS England to ensure alignment with the national model.

Together, we are committed to delivering the supply chain our NHS deserves – a stronger, simpler and smarter service than today.