The UK government has revised its cost projections for the NHS's Federated Data Platform (FDP), which is underpinned by Palantir's technology, to over £1 billion for a seven-year period. This represents a substantial increase from the initial estimate of £480 million. The updated figures, presented at a board meeting in March, detail a planned £485 million rolling budget for the project over four years from 2023/24 to 2026/27, including £340 million in revenue and £145 million in capital spending. The first year's budget alone is £122.3 million, with £85.4 million for revenue and £36.9 million for capital expenditure.
Despite the rising costs, a project assessment anticipates that the FDP will deliver substantial returns. The program is expected to generate £780 million in benefits over a seven-year appraisal period, achieving a benefit-cost ratio of 4.92. This means that for every £1 spent, nearly £5 will be returned, with £3.92 representing pure financial upside. These returns include £60 million in direct financial benefits and £55 million in non-cashable benefits annually by the end of the decade, alongside £38 million in wider societal benefits.
The overall estimated cost for the entire program, including expenditures outside the public sector, is £1.04 billion according to the most recent government major projects portfolio report. The FDP program formally began in 2022, with the rollout of the system commencing two years later following the award of a potential £500 million deal to Palantir. Early pilot projects have shown positive results, such as a 36% reduction in long-term hospital stays at North Tees and Hartlepool Trust, despite increased patient admissions.
NHS England maintains that no company involved in the FDP, including Palantir, can access health data without explicit NHS permission. All data remains under NHS control and is strictly used for direct care and planning, not for research or sharing of GP data into the national platform. The contract for the software, awarded to a group led by Palantir, also includes support from Accenture, PwC, NECS, and Carnall Farrar.
