Experts within and outside the NHS welcomed the chancellor’s vow for a better funded health service but raised concern that cutting other public health budgets and forcing trainee nurses and midwives to take out student loans would hinder efforts to prevent ill-health.
Professor John Appleby, chief economist at the King’s Fund, said that Osborne had delivered “a good settlement for the NHS” given the cuts imposed on so many other government departments.
However “seen in the context of unprecedented financial pressures and rising demand for services, it falls a long way short of the new settlement needed to place the NHS and social care on a sustainable footing for the future”, he said.
Osborne’s accession to a request by NHS England’s chief executive, Simon Stevens, to “frontload” the £8bn extra that ministers have pledged by 2020 was good news, said Appleby. “A significant chunk of this will be absorbed by additional pension costs and dealing with provider [hospital] deficits, leaving little breathing space to invest in new services and unlock productivity improvements.”
Under Osborne’s plan the budget for the NHS in England will rise from £101.3bn this year to £119.9bn in 2020-21.
Rob Webster, chief executive of the NHS Confederation, which represents hospitals, said giving such a sizeable slice of the £8bn upfront in 2016-17 and 2017-18 “gives the NHS a fighting chance to transform the way that care is delivered to patients. This money must now be used to change the way care is delivered across the service – in hospitals, primary care, mental health and community services”.
Stevens now knows how much his organisation will receive for each of the next five years to help him implement the “five year forward view”, his vision for a revamped NHS able to cope with the pressures of a growing ageing population.
Mike Birtwistle, a health policy analyst at a consultancy, Incisive Health, said the £3.8bn was the minimum needed to ensure that Stevens’s blueprint, which has become the government’s roadmap for NHS policy, remained credible. It was also “a win for Jeremy Hunt at a time when he needed one” he added.
Anita Charlesworth, chief economist at the Health Foundation, said that despite Osborne’s apparent largesse, health spending per head would remain static.
“The total health budget is rising by £4.5bn in real terms over the next five years, an increase of less than 1% a year above inflation. This means real terms health spending per person will be broadly the same at the end of this decade as it was at the start, despite the growing needs of an ageing population. The share of UK GDP devoted to publicly funded health will fall from an internationally low 7.3% in 2015-16 to just 6.7% of GDP in 2020-21,” Charlesworth pointed out.
Osborne reiterated the need for the NHS to make £22bn of efficiency savings by 2020-21, a target described as “heroic” by Norman Lamb, a Liberal Democrat health minister until the election. Senior NHS figures privately say that the service cannot deliver such large savings.
The extra £600m Osborne earmarked for improving three areas of mental health care – talking therapies, help for new mothers and those undergoing a crisis – was widely welcomed.
However, unions representing nurses and midwives criticised his plan to phase out public funding of students in both professions. They fear it will deter applicants to degree courses who do not want to rack up significant debt.
Osborne insisted that the move would increase the supply of nurses. But there are also concerns that it will exacerbate existing shortfalls in both areas.
“The ring-fence to nursing student funding has been removed and a precious link between the NHS and its nurses is potentially at risk, making it harder to plan for the future workforce. The RCN is certain that anything that makes people worse off or deters them from becoming nurses, would be a big loss to our society,” said Janet Davies, the Royal College of Nursing’s chief executive.
Cathy Warwick, her counterpart at the Royal College of Midwives, said axing bursaries for student midwives and nurses was “extremely worrying. The cuts are likely to deter many potential students from entering the profession. [It] will inevitably make midwifery an unattainable and less attractive profession to thousands of potentially excellent midwives”.
The medical royal colleges representing surgeons and general hospital doctors in England jointly warned that shrinking public health spending “will only increase the pressures facing the NHS and significantly undermine any initial potential savings”. Appleby claimed that: “Cutting the public health budget is a false economy, undermining the government’s commitments on prevention at a time when the need to improve public health is becoming increasingly urgent.”
Critics argue that cutting back on efforts to reduce sexually transmitted infections, for example, will prove more costly in the long run because more people will get them and need NHS treatment.
The chancellor also committed the government to spending up to £150m on a new dementia research institute, which universities will bid to host, over £400m on a new “science hub” in Harlow, Essex, and to fully integrating health and social care in England by 2020.
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