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Robbing Peter to pay Paul: why the spending review may leave all our services poorer

Robbing Peter to pay Paul: why the spending review may leave all our services poorer

It would be unrealistic to see George Osborne’s talk about ‘frontloading’ part of the government’s promised £8bn as anything other than a sticking plaster. The NHS faces a £30bn shortfall in the next 5 years, and Simon Stevens’ £22bn ‘efficiency savings’ are unachievable in a service already cut to the bone. The money is needed, but let’s not pretend it is adequate.

Dr Clive Peedell says:

“The slow NHS train crash continues and nothing can be done with this level of funding. Brace yourself for longer waiting lists, longer queues in A+E, the disintegration of General Practice and poorer public health, whilst the promised money disappears in the wrong direction.”

Robbing Peter to pay Paul: why the spending review may leave all our services poorer

The headlines show George Osborne claiming to be the saviour of the NHS and in a position to demand a seven day elective service. It is clear this is a publicity stunt to add weight to Jeremy Hunt’s ‘24/7’ demands. But the amount pledged will not even be enough to keep a five day service safe if it doesn’t go into front line care.

Where the money is coming from and going to is important. He is cutting the public health budget which pays for smoking cessation clinics and other vital preventative measures at the same time as Jeremy Hunt and Simon Stevens talk about the need to address the causes of our health problems. That makes no sense. Student nurses are to lose their bursaries, which will do nothing to address staff shortages and high agency costs. This is spin over substance, headlines over facts.

If the Tories were to address the NHS’ real needs, there would be continued funding increases for the NHS at about 3-4% to try and get NHS spending somewhere near the EU and OECD average – about 10% GDP.

The Clinical Commissioning Groups spend an estimated 2.5% of their budget on management consultants, with the Department of Health and NHS England adding an unknown amount of their own for similar uses which do not address the immediate and pressing issues. Simon Stevens has said he wants part of the money to create IT projects to streamline services to achieve his £22bn ‘efficiency savings’. He has already taken over £2bn a year from the hospital budgets to pay for the Better Care fund, how much more does he need? We need funding for real front line services, not more management consultants and transformation projects.

Historically the NHS budget has increased by an average of 3.7% per year to keep pace with healthcare inflation (population increase, new treatments and technologies). The current NHS England budget is £101 billion. That means next year’s annual increase will just about match the average NHS budget increase. However the NHS financial situation means that this year it could end up over £2 billion in the red so already that will gobble into the £3.8 billion. Changes in the pension arrangements are estimated to need an additional £1bn a year. £400 million of this money is not new money it’s being transferred from other health budgets. Money has been transferred out of the NHS ‘ring-fence’ into Local Authority provision, such as the £800 million for 0-5 year olds. Once it is taken out it is no longer protected, if indeed it ever was.

In reality this isn’t even enough money to keep pace with health inflation for even one year. And on these figures the years to come will get even worse.

Published on behalf of National Health Action Party

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