The question for the new Health Secretary is how much to spend on immediate pressures and how much to throw at structural problemsby Anita Charlesworth / July 27, 2018 / Leave a comment
The new Secretary of State for Health and Social Care is a fortunate man. Not only has he just landed himself a top cabinet role, but his predecessor only just finished the very tricky job of persuading the Prime Minister to lock in more than £20bn of extra NHS spending over the next five years.
In his first evidence session with the Health and Social Care Select Committee, Matt Hancock signalled he clearly understands that beneath the good fortune he has a remarkably hard road to navigate.
The problem is that two apparently contradictory things are simultaneously true; £20bn is a huge amount of money, but £20bn is not enough. The extra money promised for the health service is just about enough to stop the NHS getting worse over the next few years but he will be expected to do a lot better than that; politics demands tangible improvement in the quality of care which is visible to the public. This really matters as the Chancellor has to announce how to pay for the NHS funding boost in this Autumn’s Budget.
Most economists would not consider the current Chancellor a fortunate man. Navigating the nation’s finances in a period of such economic risk and uncertainty on the back of eight years of austerity is about as hard as it gets in peace time. The Office for Budget Responsibility’s latest analysis of the public finances makes clear there is no Brexit dividend to pay for extra NHS spending. Further cuts to other public services are not realistic. Pressures beyond health are rising; the government has just announced pay increases for public sector staff including teachers and members of the armed forces. If the UK is to avoid an unsustainable debt problem, taxes will have to rise to pay for increased NHS spending.
The reason £20bn is not enough is that the UK has a growing and ageing population, with a rising burden of chronic disease. And the cost of delivering care is increasing. There is a new pay deal for NHS staff and new, innovative medicines are expensive. These demand and cost pressures will consume around three quarters of the extra funding.
As we’ve seen with the recent heatwave, emergency departments continue to face significant difficulties and are increasingly operating in winter crisis mode all year round.…