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Every day of the year but one, the National Health Service deals with a storm of financial pressures – a £2 billion provider deficit, swingeing ‘efficiency’ cuts, and soaring demand. And then on budget day, it falls asleep and dreams a happy dream.
Or at least that’s what the chancellor hopes.
Last November, he said in his spending review: ‘We have a clear plan for improving the NHS. We’ve fully funded it.’
On Wednesday, when he gives the budget, expect a similar tone. Expect that other NHS to briefly shimmer before us. That solvent, happy place. A place I’d rather like to work.
So exactly how ‘fully funded’ is the NHS? We’re going to have to deal with a lot of figures here, so here’s a guide in advance. We’ll start with an enormous figure – that’s what the NHS needs. Then we’ll go to one that’s a fraction of that, but a tidy sum. That’s what the government says it is spending. Then we’ll end up with a much, much smaller one. And that’s what we’ll get, with more strings attached than a puppet centipede.
Here goes: the NHS in England will be £30 billion per year short of what it needs by 2020. It’s a shocking, but uncontested, figure from the NHS Five Year Forward View.
In November, the chancellor said he had ‘fully funded’ this plan with £10 billion spending, plus £22 billion of efficiency savings. And the savings would come from…? He only mentioned a cut in ‘Whitehall’ spending (more on that later), and the mean-spirited withdrawal of student nurse bursaries.
There seems no-one outside government who believes those efficiency savings can be found, given that the current ‘efficiencies’ have achieved little except penalise staff with years of real-terms cuts in their pay and driven NHS trusts into a record deficit.
Now, £10 billion is hardly a drop in the ocean. Nor indeed is £8 billion, the actual increase in spending, as £2 billion of it had been announced in the previous year’s autumn statement.
But take a closer look at the £8 billion and I am reminded of when Reginald Perrin, the stressed sales executive in the 1970s sitcom, approached his fearsome boss in the hope of being given three weeks’ holiday. At the end of a very difficult conversation, he was packed off with a half-day instead.
The first thing you can do with this £8 billion is halve it. This is because the chancellor has redefined health spending for his own rhetorical convenience. He has drawn an artificial distinction between NHS England, which has been promised the real-terms increase, and the rest of health spending.
So while NHS England has been promised £8 billion, other health spending – disingenuously referred to as the Department of Health’s ‘Whitehall’ budget, but which includes public health, and education and training, has been cut savagely.
Combine the real-terms increase with the cuts, and you get the real increase to health spending, which is £4.5 billion.
So how will this money be spent? The government talks a lot about ‘transformation’. I’m suspicious of their transformations, but if they mean investment in improving and integrating services, then great. The only way to achieve fundamental change in the NHS is to invest in its future, not subject it to a death by a thousand cuts.
But whatever transformation is, there won’t be much money for it. In 2016/7, the NHS will receive an additional £3.8 billion. Of this, just over £2 billion is for the sustainability and transformation fund.
This fund will do two distinct jobs. ‘Sustainability’ is about patching up the dire state of NHS trust balance sheets (with hefty strings attached) and gets more than three-quarters of the fund. Transformation is left with £339 million, to cover not just the new models of care but policy commitments like access to GP services, mental health prevention… and seven-day services.
How much money does this leave for genuine innovation? About tuppence. The fund might have more money for investment in future years, but that depends on other commitments.
Quite apart from the non-£10 billion, the cake that turned out to be a cookie, we have the huge deficit identified in the Five Year Forward View that cannot be blithely wished away by ‘efficiency savings’.
Lord Carter reported last month that the NHS could save £5 billion a year, but made clear that a significant proportion of the savings could not be made unless delays in transfer – bed-blocking, essentially – were managed more effectively. And with cuts to social care, these transfers tend to become more, not less, likely.
A clampdown on agency spending might save another £1 billion a year, the NHS predicts, although half of trusts have cast doubt on whether they can meet the nationally imposed caps. Given the government’s consistent attacks on staff morale, the need for agency staff is unlikely to diminish.
It seems every idea to improve efficiency is undone by destructive policies elsewhere. The Holy Grail would surely be to reduce demand on the service. That’s difficult, but you make a start by enabling people to lead healthier lives. To which the government has responded by slashing public health budgets.
Health spending – even using the dodgy definition the government has recently coined – has not been as badly affected as other areas. But the government spends a lower proportion of its GDP than the European Union average, less than Greece or Portugal. Health spending is a political choice.
The government has ducked the choice as to whether the NHS is resourced to the standards people want and to which it has promised. Instead, it has left the NHS itself to sort out the multi-billion pound mismatch.
It is self-evident that cuts made to patient care can harm outcomes for our patients, just as investment can improve them. But I’m just as concerned about the act of looking for these cuts – the debilitating pressure the NHS is under to constantly reach the unreachable, to meet illusory efficiency targets, and cut day after day while the government boasts of huge investment.
We can’t let that happen to the NHS. We have already seen its A&E waiting time performance fall to its worst ever. We saw what happened in Mid Staffordshire when financial considerations were placed ahead of patient safety and quality. There can be no greater warning than that. That was a ‘transformation’ that we must never see again.
Mark Porter is BMA council chair
NHS funding and efficiency savings - analysis, including a new briefing paper
I am tired of hearing the BMA whinging with no real solutions. How about you at start talking about demand management for one? why are elderly demented patients being given Iv antibiotics and hospital admission from nursing homes ( I speak from experience of my own relatives in multiple cases). I'm not prepared to pay extra taxes to temporarily keep people alive who have no quality of life. Where is the public debate on this? Noone even asked me if I wanted my mum ( or gran or dad or auntie or my husbands gran for that matter) to be admitted and given Ivs! Why dont you start talking solutions!!!!!
The BMA continue to mislead the public and especially their members and the medical profession. These strikes are unethical and harming patients the NHS and the profession. Junior doctors are in fact paid well and no one is 'forcing' them to work more than the 48 hrs a week allowed by the EU working time directive. The new contract does not require them to increase their hours or make them more tired! rather the reverse. Junior Doctors are going to be paid more and their hours reduced and spread more evenly over seven days a week. They are not going to be 'forced ' to work every weekend/evening. If the BMA really help the Junior Doctors wish to save the NHS then they should seek to stop their members from doing exorbitantly lucrative locums (which are bankrupting the NHS) at evenings and weekends in other hospitals and trusts as well as doing full time work in the hospital and Trust in which they are employed. (they keep silent about this practice which is illegal and unethical) If a doctor refuses to respond to a patient in need of emergency care as will be occurring en mass at the end of this month, then he/she would normally , (and should be), reported to the GMC and his/her licence revoked. The BMA is leading the profession down the drain and is dragging the NHS with it. Are the BMA asking doctors to strike from their private agency locums in the next 48 hrs, not on your life!? Do as many as you like for as much money as you can screw out of the private Agency/NHS trust.
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