The NHS, the Spending Review and George Osborne

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George Osborne has the aura of a man who is the master of all he surveys. It is an aura that has been hard won but could be easily lost as the government’s reverse in the House of Lords over tax credits shows. The Chancellor faces far greater challenges in other areas of public spending as the Spending Review nears completion.

The outcome of the Spending Review, to be announced on 25 November, will reveal the government’s priorities for public services for this parliament. The broad outlines of further deep cuts in most forms of public spending with the exception of protected areas such as health care are well known. The Conservative party made its intentions on deficit reduction crystal clear during the election campaign while also limiting its room for manoeuvre by pledging not to increase headline tax rates.

The precise consequences for unprotected areas of spending, such as policing, criminal justice, social care and the array of local government services, are unknown but are certain to be severe. In local government, for example, leaders of all political hues have warned that they will only be able to maintain services where they have statutory obligations unless the scale of cuts in spending is adjusted. For their part, police constables have highlighted the risks to public safety and national security of expected reductions in their budgets.

By comparison, the NHS seems relatively well off with small real-terms increases in spending already promised. The view from the Treasury is that no more money than that pledged during the election campaign is available even though there is mounting evidence of serious financial distress in the NHS in England. With the Chancellor apparently not for turning, the message has gone out that the NHS must live within its means by redoubling efforts to reduce waste and inefficiency, for example by cutting spending on costly agency staff.

It is here that George Osborne faces his biggest challenge in the late-night discussions that lie ahead. More than any other public service, the NHS is highly prized by the public, particularly by older people who are more likely to turn out during elections and who form an important part of the core vote for the Conservative party. The sense that the NHS may not be safe in the hands of the Conservatives lingers on despite the relative protection afforded to it and will resurface if growing financial pressures start to impact adversely on patient care.

To make the case for additional funding over and above the increases already announced is not to deny the scope for using existing budgets more efficiently. As we have argued, tackling variations in clinical care is particularly important to release resources for investment in new drugs and treatments and has been recognised in the appointment of Tim Briggs to lead work in this area at the Department of Health. Doing this, however, takes time and requires skills that are currently in short supply, which is why the NHS needs the breathing space that extra funding will bring.

For a politician widely tipped as the next leader of the Conservative party, the Chancellor must balance his reputation for sound management of the economy with the provision of adequate funding of the NHS and closely associated social care services. The funding commitments already made, while welcome, will not be adequate as large and growing deficits in the current financial year demonstrate.

The alternative of holding the line on these commitments remains an option but demands a degree of honesty with the public about the consequences for patient care that is rarely in evidence. The minimum requirement is for additional funding to deal with this year’s deficits as well as the front loading of the extra funding already promised and protection for social care.

The outcome of the Spending Review will of course be shaped by many factors, most importantly the views of the Prime Minister and the legacy he wishes to leave. But it is hard to overestimate the influence of the Chancellor whose political future in large part now rests in his own hands. None of the choices he faces are easy given the platform on which the government was elected, but there should be no doubt about the implications for the public and politicians of an NHS unable to balance its budget in the face of rising demands.

This week’s report from the Organisation for Economic Co-operation and Development shows that the UK spends less than the OECD average on health care and is performing poorly on a number of measures. Meanwhile, the latest Ipsos MORI polling indicates that public concern about the NHS is at its highest level for 13 years. These two findings should be a timely wake up call for the Chancellor as he finalises his spending plans.


George Coxon

Various inc care home owner, mental health & commissining advisor,
Comment date
06 November 2015
In that social care continues to be regarded as an unprotected area therefore fair game in being hit still further with cuts on the 25th. Might there be potential to seek intervention from the Lords to advocate on behalf of fellow older people many of whom rely on social care?

Despite all the headlines and representations on behalf of older old people, many living alone, increasingly relying on family and friends support, vulnerable, at high risk of avoidable & expensive hospital admissions and being restricted choice and access to the right help 'when the time is right' there seems a real danger of even greater disregard of their needs. Admittedly we all have some self interest / vested interest in this issue whether for our work, business viability or more generically our own future needs and those of our loved ones!

Joan Carter

Comment date
06 November 2015
Is the inefficient NHS really among many other public services so highly prized?

Infrastructure, housing, education, security, economic regeneration and environment and Liberty, many factors needed for prosperity and active independence all factors necessary for a sustainable healthcare system available for those very limited episodes in a lifetime when absolutely required and care at or towards the very end of life.

The NHS should get off the current poverty trap mantra and instead own and drive the responsible consumer and community sponsorship deal which Simon Stevens is so rightly underpinning the care services future upon.

Michelle Bradshaw

General Manager Children and Families,
Bridgewater Community Healthcare NHS FT
Comment date
07 November 2015
The NHS should not lose sight for the need for preventative work. The treasury has slashed public health budgets . The impact of this won't be immediate , but it will be felt. We need to move away from breeding dependency on th service , and move to personal responsibility . We have little space for this in our disease focused service. Some rethinking is useful.

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