• Integrated Care Boards have been tasked with cutting running costs by 43%, delivering £908 million in annual savings, as they restructure to focus more clearly on strategic commissioning.
  • Planned workforce reductions are equivalent to around a third of the total ICB workforce, with an estimated £582 million spent on voluntary and compulsory redundancy payments.
  • The NAO recommends NHSE and DHSC should clearly define ICBs’ future roles, and ensure workforce reductions deliver sustainable savings without losing essential skills and capacity.

Integrated Care Boards (ICBs) have restructured, made redundancies and developed new operating models at pace to meet NHSE savings targets, but it is not clear yet if they have retained the necessary skills and capacity for effective strategic commissioning delivery, a new NAO report has found.1

In response to a 2024 review, NHSE announced that it planned to restructure ICBs to focus more on commissioning services, and aimed to reduce duplication and spending.2 NHSE has instructed ICBs to reduce their running costs by 43% from previous levels of around £2 billion to make total savings of £908 million a year.3 NHSE estimates that ICB running costs for 2026-27 will be around £1.4 billion, £200 million above the £1.2 billion target.

ICBs are now making changes to meet these running cost targets, with some ICBs needing to make much greater running cost reductions than others. Some ICBs have chosen to form clusters or merge to cover larger populations and pursue efficiencies.

Following clustering and merging, the total number of ICBs dropped from 42 to 25 ICBs or clusters by April 2026. ICBs surveyed by the NAO identified opportunities and benefits from clustering and merging.4

By June 2026, most ICBs surveyed by the NAO had also developed new operating models to reduce running costs and focus more clearly on their role as strategic commissioners. ICBs planned to make savings including by streamlining corporate services, removing duplication and making greater use of technology.5

A major part of making the savings will come from reducing ICB workforces. NHS England estimates that achieving a £908 million saving in running costs will require reducing posts by around 8,000 (full-time equivalent), around a third of total ICB staff. These redundancies have taken longer than originally planned and the restructuring has affected staff morale and relationships with local partners, and created risks to organisational capacity. ICBs spent £582 million on redundancies in 2025-26, including £401.5 million allocated by NHSE, with ICBs responsible for any further payments in 2026-27.

While ICBs have sought to limit disruption to frontline services, there are early signs of issues in some areas that may leave local authorities with gaps to fill and place greater onus on health and social care providers to manage frictions in the health system. A key challenge for ICBs will be making significant workforce reductions while retaining the skills and capacity needed to deliver their new strategic commissioning role and the ambitions of the ten-year health plan.

ICBs have had difficulties planning their future workforce because their role and responsibilities were still changing as restructuring began.

To help ensure the reforms deliver sustainable savings while maintaining the skills and capacity ICBs need, the NAO recommends that NHSE and DHSC should:

  1. clearly set out ICBs’ future roles and responsibilities, alongside robust arrangements for measuring performance, capability and the success of the reforms;
  2. ensure workforce reductions deliver lasting savings, while protecting essential skills and capacity and avoiding unnecessary redundancy costs if staff return elsewhere in the NHS; and
  3. help ICBs share good practice and maintain strong relationships with local partners, ensuring reforms across health, local government and other public services are joined up.

Read the full report

Restructuring of Integrated Care Boards

Notes for editors

  1. The report will be available from 00:01 on Wednesday 4th November on the following link: https://www.nao.org.uk/reports/restructuring-of-integrated-care-boards/
  2. Strategic commissioning is defined as an evidence-based process for planning, purchasing, monitoring and evaluating services over the longer term, with the aim of improving population health and reducing health inequalities.
  3. ICB running costs totalled around £2.3 billion in 2024-25 across 42 ICBs and £2.2 billion in 2025-26.
  4. ICBs responding to our questionnaire identified several benefits of clustering and merging. These included opportunities to reduce costs and duplication through changes to board, executive and management arrangements; support for sharing good practice; and the ability to work at greater scale, creating opportunities to streamline contracts and better understand and address variation.
  5. By June 2026, 13 of the 19 ICBs surveyed had developed their new operating model, while six had partly done so. The ICBs that were taking longer were mainly those that were clustering or merging so were facing additional challenges.