The NHS Budget

The National Health Service is struggling to cope with this winter’s pressures. The stark reality is that it will never be possible for the NHS to meet the demands of a growing population, an aging population, and the irresistible costly advance of clinical science. The position is even more challenging when the cost of healthcare is combined with the cost of social care, increasing for much the same reasons - together with today’s growing expectation that ‘the State’ should take ever more responsibility for the frail elderly rather than it be a family responsibility. We must be realistic about that which is possible. 

Let’s try to understand why funding the NHS has become such a challenge in recent years. The NHS was established 70 years ago. From 1948 to 2010, the annual NHS budget increased by an average of 4% per year - in real terms. From 2010, the annual NHS budget has continued to increase in real terms, but only marginally. Because of the reasons noted in the first paragraph, this real terms increase actually puts financial pressures on the NHS which has never happened over an extended period before. The consequence is an inevitability that difficulties meeting the exponentially growing demand would emerge. That’s where we are now, and where we will be next year as well, despite evermore Government injection of more money.

What deeply frustrates all of us is wasted spending. And there has been so much wasted spending. Over recent days, we have seen much written about partnerships between the Public and Private sector to deliver new capital projects. There is nothing inherently wrong about a joint arrangement involving public and private investment, but there were many very bad deals done in the late 1990s and in the early 2000s. We were signed up to spending many £billions on these deals - contracts signed by previous governments that the current Govt cannot escape from. And we see shocking waste closer to home in Shropshire. For example there was the dreadful decision to build the new Women and Children’s Hospital in Telford, which cost £26 million, and will now probably be moved to Shrewsbury. And we have seen over £4 million spent on what’s called a ‘Future Fit’ process, planning for reform - reform that is desperately needed. 4 years later, the ‘preferred option’ has not even gone out to public consultation.

My personal view is that more money (even more money) will have to go into health and social care. It’s what the public say they want. But the Government will have to be open about the consequences of such a decision. It will mean significantly less spending on other budget heads. There are calls for an hypothecated NHS tax. Personally, I see this as just a gimmick to disguise the raising of taxation. If we are going to invest more billions into our NHS, the Government should transfer money from other budgets, and be clear about what is happening.
Any injection of money, no matter how much, will make little significant difference beyond “kicking the can down the road”. Another £10billion and we would in the same position in a couple of years time.
To finish this blog post, I will return to a thought I floated a few months back, when contemplating how we could reduce the ongoing bitterness hanging over from the EU Referendum. The most contentious aspect hanging over from the referendum campaigns is the supposed ‘promises’ on the side of a bus used by the Leave campaign. Forget what it said precisely. Let’s consider acting on what many people believe. Let’s agree to invest £350 million per week more into health and social care that the budget that applied on 23rd June 2016. I accept it might not fully reflect Govt budget priorities. But it would shoot a very big fox that has been causing much damage across our nation since Brexit Day. And anyway, I do think we will not be far short of a cash injection on that scale by actual Brexit Day - whatever date that Brexit Day is.