The strike is back on and Jeremy is straight out in front with claims of committing ‘extra funds’ to the NHS. Unsurprisingly this is rubbish.
juniordoctorblog explains how the funding spin is constructed and how they are getting away with it.
NHS Funding: Who’s telling the truth?
The funding situation of the NHS can be a tricky thing to get your head around, so it’s no wonder the British media struggle to report it accurately. As such, we often hear statements from the Government and leading health economists that seem diametrically opposite to each other, leaving media reporters, and by extension the general public, confused and unsure of what to believe.
For example, George Osborne in his latest Spending Review can announce a “half trillion pound settlement, the biggest commitment to the NHS since it’s creation”. Meanwhile, the chief economist of the King’s Fund, states the NHS is facing the “largest sustained fall in spending as a share of GDP”. David Cameron can say he’s invested “£10bn more into the NHS” while the chief executive of the NHS is aiming for “£22bn in savings” .
Surely these widely varying statements aren’t compatible? So who’s telling the truth?
In fact, all of these statements are correct. No one is lying…technically. To understand how, we first need to explore the concept of healthcare inflation, and how it has affected the NHS budget over its 67-year history. Healthcare inflation describes the long running trend for healthcare needs and costs to rise above the rate of general inflation, and above the average rate of growth in the economy.
One of the most important drivers of increasing healthcare costs is an ageing population. This isn’t a new phenomenon; throughout the last hundred years we have been progressively living longer and longer . We’re also spending a greater proportion of our lives in ill health , requiring greater medical care. Another cause of healthcare inflation is new technology – new medical discoveries, drugs and devices – and again, this is nothing new; research and innovation has always been a feature of medicine. So spending on healthcare has always had to increase to ‘keep up’ with these drivers. Before 2010, the annual NHS budget increased by 4% on average, in real terms, year on year since the NHS was created . In 1948, 3.6% of GDP was spent on health, and by 2010 that had climbed to 7.8%.
Historically, successive governments have justified these increases because health is important to the British public: a fundamental right, a key part of our wellbeing, an economic necessity for our productivity, and the bedrock of a fair and just society. So actually, increasing expenditure on health is appropriate if we as a nation feel that health is a priority to our wellbeing, and we’re willing to devote a greater proportion of our economy towards it. Nor is this pattern unique to the UK; healthcare costs have increased over time in all developed countries regardless of the type of health system . In fact, we spend less than most developed countries on healthcare , with better outcomes .
Returning to the present day, the NHS is clearly under pressure. But the Government would have you believe that these pressures exist despite robust investment in the NHS, and that’s where the real deception lies. Rather than being inevitable, the pressures are largely self-created as a result of funding decisions by the Government since 2010.
Yes, technically, there has been a funding increase, and yes, technically, the NHS is a ‘protected department’, ‘ring-fenced’ from cuts. But this increase has been negligible and far far below the demands of healthcare inflation. Over the last 5 years, the health budget grew by 0.8% per year , far short of the historical trend of 4%. Extrapolating this difference for a further 5 years works out as a 17% gap (£22bn per year) between needs and funding by 2020. So despite seeming like a ‘protected’ department, the NHS is actually having to make severe cuts, and that pressure is being felt by the overworked and under-appreciated staff of frontline services.
These realities are being hidden from the public, conned by effective spin to believe the NHS has been shielded from austerity. Osbourne’s recent boast of a “half trillion pound settlement” can simply be explained by multiplying by 5 a budget of over £100bn, for the 5 years of the parliament. “Biggest ever commitment to the NHS?” Yes, it is the largest absolute monetary spend, but then, every successive parliament has spent more on the NHS than the previous one , so this is meaningless. Cameron’s “£10bn investment” is a paltry sum when spread over 5 years. Yet for all these mistruths, the Prime Minister and his Chancellor are so skilled in PR and careful phrasing, they come out sounding like champions of the NHS, and it’s difficult for the media and the Opposition to challenge their over-simplified sound bites.
The lesson here is that using absolute monetary terms to describe health spending is flawed, because the issue is complicated so much by healthcare inflation. Perhaps a more meaningful way of assessing relative spending priorities is to look at health spending as a proportion of GDP: as a nation, how much of our economy are we prepared to devote to our health? On this measure, the NHS has been falling consistently since 2010 , and it wasn’t that high in the first place compared to other countries. With an economy that looks set to grow over the next 5 years , and austere NHS spending plans already laid out, the health service looks set to lose out further. Hospital trusts are already running deficits  in attempts to maintain current standards of care, but it won’t be long before the impact is felt with longer waiting times and poorer quality of care.
Is this what the British people want? Did the electorate vote for this? In 2010, one of Cameron’s defining campaign slogans was “I’ll cut the deficit, not the NHS”. Similar statements were made before the 2015 election. Given the highly persuasive Government spin, many simply aren’t aware of how the NHS is being starved. This systematic defunding of the health service would be democratically acceptable if, following honest debate, it truly reflected the views of British people. But that public debate never took place, and it’s one that our Government would rather avoid. In politics, it’s the spin that wins.
Image source: The Health Foundation
contributed to JDB by DrWJ