MPs slam government’s ‘misleading’ £10bn NHS cash pledge

31 Oct 16

The chair of the health select committee has accused the government of “giving the false impression that the NHS is awash with cash” through repeated claims that ministers have provided £10bn in additional funds.

In a joint letter, Dr Sarah Wollaston called for the NHS spending settlement to be reviewed for the years ahead in the Spending Review period to 2019-20 to ensure additional funding.

Writing to chancellor Philip Hammond ahead of the Autumn Statement with fellow committee members Ben Bradshaw, Dr James Davies, Emma Reynolds and Dr Philippa Whitford, Wollaston said the £10bn pledge did not stand up to scrutiny.

The boost (calculated from between 2014-15 and 2020-21) had been reached only by reductions in other areas of health spending outside NHS England’s budget, such as public health and Health Education England, according to the letter.

Wollaston stated that these reductions amounted to £3.5bn in real terms between 2014-15 and 2020-21, which meant the Department of Health’s budget would increase by only £6bn in real terms over this period.

“While this settlement may appear generous in comparison to some departments, the inflationary pressures for the health service are far greater in coping with a rapidly changing demographic and escalating demand,” the letter highlighted.

“The reality of taking such a substantial proportion of the additional money granted to the NHS from other areas of health spending is that this puts at risk the achievement of the Five Year Forward View,” it continued.

“The Five Year Forward View called for a ‘radical upgrade in prevention and public health’. Instead, we have seen reductions in public health spending. The long-term sustainability of the NHS depends on action to reduce the rate at which the demands placed upon it are increasing. All the indicators suggest that demand is continuing to grow and that we need to go further on prevention, especially if we are to make inroads into widening health inequality.”

The letter urged the government to review the NHS spending settlement and commit to ensuring that the health service had the resources needed to meet rising demand. It also called for further capital funding to be available to support NHS sustainability and transformation plans, and for action to address the “crisis in social care provision”.

According to the MPs, social care funding pressures are of more immediate concern, and evidence heard by the committee indicates that unless urgent action is taken to improve care, the NHS cannot be expected to deliver the Five Year Forward View.

A government spokesman said there would be a £10bn real terms increase in annual funding for the health service in 2020-21 for hospitals, GPs and mental health services.

"It is wrong to suggest otherwise,” he stated. "We have also allowed local government to increase social care spending in the years to 2020, with access to up to £3.5bn of new support by then."

Anita Charlesworth, the director of research and economics at the Health Foundation, said the letter summarised the current pressures well.

“The 2015 spending review increased NHS funding by just over £4bn in real terms – that's about half the amount the health service said was required in the NHS Five Year Forward View. This means that in 2020 we will be spending the same per person on the NHS as we spent in 2010, despite an ageing population and new technologies and treatments,” she said.

“Since the Forward View, pressures on the service have continued to mount –most notably as a consequence of relentless social care cuts, with local government funding for social care falling by an average of 2.2% a year in real terms between 2009-10 and 2014-15. As a result, more and more vulnerable older people are stuck in hospital as the care they need to go home safely is unavailable.”

Responding to the letter, Jane Payling, the head of health at CIPFA, said the £10bn should come with the fine print attached.

"But the bottom line is that the NHS is under tremendous financial strain and despite the government's pledge, CIPFA forecasts a further £10bn shortfall in its budget by 2020, as the NHS tries to plug the £22bn funding blackhole.

"It is vital that the financial shortfall is addressed as part of realistic long-term future planning for health and social care. CIPFA has called for an independent commission to look at the issues seriously and to recommend radical, future proofing options such dedicating a minimum level of GDP to health and social care through a ‘golden Ratio’"

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