Posts Tagged ‘funding’

Labour needs to be straight about its plans for the NHS

24/10/2014, 01:38:13 PM

by David Talbot

“The NHS is on the ballot paper in May” declared the Labour leader at Prime Minister’s Questions as he sought to solidify his party’s clear advantage on this most important, and emotive, of issues. That the NHS is set to be centre stage at the forthcoming general election is partly due to naked politicking, and partly due to the dire forecasts for our health service. Both main combatants are well aware of the financial and demographic peril the NHS is in, but both continue to besmirch the debate with clichéd attacks on how the Tories can’t be trusted on the NHS or, a new variant of the same line, Labour are ruining the NHS in Wales.

It is essential that politicians are honest with the public about the scale of the challenges facing the NHS. This is particularly true of the Labour party who are prone to nostalgia and playing on sentiment, invoking the spirit of Nye Bevan and having a nonagenarian address party conference, for instance, but specifically because the party is making pledges which, deep down, it must know will be difficult or nigh on impossible to deliver. The NHS matters too much for short term electoral considerations; it is better that the party is frank, and dare say unpopular, with the public now rather than risk alienation, anger and a disintegrating NHS later.

Ed Miliband’s flagship announcement at the party conference last month was an eye-catching commitment to establish a new £2.5 billion ‘Time to Care Fund’. This unravelled not long after some fairly rudimentary scrutiny; it will be not be implemented in full until 2017/18 and Labour would need to first pass a Budget and then enact legislation before the mansion tax, levy on tobacco firms and tax avoidance levies would yield any income. And even then there are serious doubts the revenue raised would come anywhere near the £2.5 billion quoted.

It is not to say that the party is not coming up with a better vision for the NHS. Labour’s plan for a combined health and care service is unquestionably the right direction of travel, but it is not a cost or pain-free option. Andy Burnham may deny that there will be large-scale reorganisation, but unavoidably, and undoubtedly, there would be heavy financial and structural costs. A messy structural reorganisation of the administration of healthcare would clearly get in the way of healthcare delivery. What is important, what the public should not be fed, is the idea that it is not a reorganisation. It is exactly that.

The King’s Fund Barker report estimated that even after introducing a combined health and care service, spending would need to rise to around 11% of GDP to meet demand. This would still leave our health spending trailing the highest European spenders – but it would require double the spending increase that Labour is currently proposing.

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The Labour case for an NHS mutual

25/09/2014, 11:42:22 AM

In the first of an occasional series of Uncut posts that look at the policies and political positioning needed to win the next election, today we are looking at the NHS. Here, Frank Field sets out the policy case for a radical restructuring of how the NHS is funded.  

by Frank Field

A programme of fundamental NHS reform – on financing and ownership – could, paradoxically, convince the electorate of Labour’s financial competence and play a crucial role in rebuilding Labour’s fast collapsing core vote.

Labour has to combine two financially opposing objectives.  About two thirds of the structural budget deficit remains to be eliminated.  So, while cutting at twice the scale of the so-called ‘tough’ Coalition, Labour will face the mother of all NHS crises.  The Coalition’s pledge of maintaining the real value of the £95 billion NHS budget is now hardly a mirage.  Real cuts in the NHS budget have been in progress over most of this Parliament and there is an impressive array of witnesses reporting to this effect.

Differential NHS inflation, a growing aged population that makes disproportionate health and social care demands, and an abundance of advances in ever more expensive medical technology, will take an even greater toll on NHS budgets during the next Parliament.  NHS England estimates a deficit to end all deficits of £30 billion in 2020-21 – very nearly a third of current NHS expenditure.

The electorate senses the NHS is facing mounting difficulties.  They are willing to input additional monies into their NHS.  But, despite the supportive showing the polls for significant increases in NHS contributions, neither Labour nor the Coalition is currently prepared to address the issue.  They present getting through the election without seeking a mandate on NHS finance as what the clever boys do.

But, as events all too often show, the clever boys – and they are still largely boys in every sense of the word – have lost the plot.  Either the NHS is refinanced or, during the next Parliament, it will cease to exist as we have known it.

We can conclude that, as the collapse of the NHS as we have known it will send the electorate into a god almighty spin, there will be a major injection of new funds into the NHS during the next Parliament.  But, if the current cross-party evasion continues, the next government will have no mandate to raise new revenue.  Ever greater cynicism will be the result of what will inevitably be a broken promise. But will the current Tory position hold?

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