30 November 2001
Bolstered by an interim report from former NatWest bank chief executive Derek Wanless, which ruled out alternative methods of funding, Brown said that in future 'a significantly higher share of national income' would have to be devoted to funding the NHS.
The chancellor indicated there would be significant increases in funding over the next three to four years, presaging the likelihood of tax rises, a stance endorsed by Prime Minister Tony Blair the following day.
At Prime Minister's Questions, Blair committed the UK to increase NHS spending to European Union average levels by 2005. According to the Institute for Fiscal Studies, this would cost an extra £10bn per year.
The extra funding announced by Brown and the Wanless report were widely welcomed, though many warned it would take time to turn the health service around.
Nigel Edwards, NHS Confederation acting chief executive, called for patience. 'A debate about the funding, but not supply, would miss the point over the short term and cause increasing frustration,' he said.
'It will take time to improve the NHS because we need more doctors, nurses and beds and, put simply, these are not grown on trees. It takes six years to train a doctor, three for a nurse and 15 for a consultant. We need to find a way to understand and live with this reality.'
British Medical Association chair Ian Bogle said: 'The NHS has been underfunded for so long that pouring money into the system is like watering parched earth.
'Every investment in new capital equipment – new scanners, new operating facilities and new wards – needs to be matched with investment in the recruitment and retention of doctors and nurses.'
Under the previously announced plans, the NHS budget in England for 2002/03 was set at £54.8bn. This will now rise to £55.7bn – a boost of £900m. The rest of the £1bn boost is divided between Scotland, Wales and Northern Ireland.
According to figures published by the Treasury after the chancellor's statement on November 27, the budget for England in 2003/04 will now be £59.3bn – just £200m more than previously announced.
In his statement, Brown also unveiled a community investment tax credit to encourage the regeneration of rundown areas during his pre-Budget statement.
The government will match every £100m of private investment with £25m of public funds, in an effort to kick-start local businesses and create jobs in deprived areas.
PFnov2001
