I imagine moving to digital would allow more radios to use the same bit of spectrum, and might make them physically smaller as well.
Sadly, no. The digital radios issued to the Police are larger, less effective, and suffer from very nasty distortion. Being digital, they either work or don't work - there's no "fringe" operation. There are huge swathes of the country - including within cities - where the radios simply don't work. TETRA was a poor solution to a problem that didn't really exist!
Incidentally, the flooding of the TETRA system during the Kings Cross Tube Station fire led to many unnecessary deaths because of the complete failure of the radio system.
NBFM is a good option, but -bizarrely - AM is actually better! For the same reason that aeronautical radio is still AM - operators can hear two (or more) calling stations at the same time. This has proved to be crucial in aeronautical situations. FM prevents this - the strongest signal always wins (see "capture effect").
If they want reliable communications with efficient spectrum use, they should consider some form of SSB (single-sideband AM). The communication channel bandwidth is marginally smaller than for a Narrow Band FM signal, and intelligibility is similar. The technology is well known and has been manufactured and used since the 1950s. Modern DSP chippery makes modulation and demodulation of this mode child's play, and if privacy is wanted, there are many trivially simple scrambling schemes that can be used to deter the casual eavesdropper. Use of band I (50 - 80MHz) would assure good penetration into buildings and good range.
4G LTE is a complete and utter mess in this country. No company has anything approaching effective coverage, and the resistance of the public to the location of masts that they perceive as "dangerous to health" guarantees that coverage will continue to be sporadic - even in cities. It's NOT the solution.