Funding for health in the Spending Round was not enough to reverse the cuts

6 Sep 19

The short-term nature of the funding announced in the Spending Round will not help the NHS plan to transform services, says the King’s Fund’s Sally Warren. 

NHS, health

 

Among all the constitutional excitement happening in Whitehall, the chancellor has published the Spending Round for 2020-21.

But what does the announcement mean for health and care? The King’s Fund has repeatedly talked about three main priorities for health and care for the new prime minister – workforce, public health and adult social care, so let’s look at each in turn. (A fourth, capital, is outside of the Spending Round remit this time because these budgets have already been set for 2020-21).

First, Health Education England will receive 3.4% real-terms growth in funding – this growth broadly paying for the announcement this week of £1,000 for nurses and midwives working in the NHS for continuing professional development (let’s not get into why nurses working in social care shouldn’t also get access to these funds). 

This is probably as much as could be expected, but doesn’t give the certainty and funding for the expansion in medical and nurse training places desperately needed to begin to tackle the high levels of vacancies in health and care services.

It’s hard to see how this one-year settlement will provide the certainty needed to develop the final NHS People Plan which is expected by the end of the year.

The funding in the Spending Round this week is not enough to reverse the cuts of recent years, and will mean that vital treatments such as sexual health, smoking cessation and drug treatment services are not available to many of the people who need them.

Second, it’s disappointing that the least generous aspect of the health and care settlement today is the Public Health Grant – the part of the health and care system most focused on prevention and one of the Secretary of State’s top priorities. 


'The funding announced this week at best stops the current problems getting worse, but doesn’t undo the years of underinvestment, and will do little to overcome the workforce shortages endemic in health and care.'


The Public Health Grant will remain ringfenced for at least next year (good) and will receive a small, unspecified increase – less than any other part of health and care service delivery. 

The evidence base for action on prevention is clear, so this decision is short-sighted and out of step with the ambition for the NHS long-term plan to deliver a step change in action to prevent or delay ill health. 

The funding handed out on Wednesday is not enough to reverse the cuts of recent years, and will mean that vital treatments such as sexual health, smoking cessation and drug treatment services are not available to many of the people who need them. This will take a toll on people’s health and bring knock-on costs for the wider health and care system.

Last, but not least, is adult social care. Last because working out what the settlement will mean for this area is a bit tricky. There are lots of different pots of money to try to make sense of, so bear with me!

All the various different grants which were due to end in March 2020 will be rolled forward – good news. 

On top of that foundation emerge a few different sources of additional funds. The NHS’s contribution to social care through the Better Care Fund increases by 3.4% in real terms – in line with the overall settlement for the NHS long-term plan. 

A new grant of £1bn will go direct to local authorities for social care for all ages.

We can’t guarantee how much of that will go to adult social care rather than children’s services as that will be a local decision, but with a similar grant this year just over half went to adult services, so assuming £500 million will go to adult social care seems reasonable.

Councils are also given permission to use a 2% council tax precept for adult social care, which would raise another £500 million assuming all councils use it.

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So overall, between a combination of NHS contribution, (permission for more) locally raised funds and new grants from central government, it looks like growth of about £1bn for adult social care. 

That is to be welcomed – but it will only just meet what most in the sector said would be the bare minimum in 2020-21 to keep to system going.

It’s enough to meet demographic demand pressures, but it’s not going to be enough to increase quality, meet unmet needs, or give much stability to providers and the hugely under-valued social care workforce.

The hope will be that this keeps the system just on the right side of the tipping point – we shall have to wait and see.

We can hope this is enough to delay by one year the risk highlighted by the Association of Directors of Adult Social Care Services that some councils will start decommissioning services in the autumn.

The prime Mminister said he would fix social care – with this settlement he has at best stopped it getting worse.

So taken together, what are the big take home points? To be fair to the teams in Whitehall who worked flat out this summer to deliver a Spending Round at breakneck speed, this is a decent outcome.

A number of critical parts of the health and care system will receive the investment levels of the NHS long-term plan for one year (though before we get too carried away, it’s worth remembering that 3.4% is less than the long-term historical growth and less than is needed to both stabilise and transform services).

However, having some parts of the system being able to plan with five years of financial certainty and others with only one makes system planning really rather hard.

The government could have chosen to make longer term commitments to these parts of the health and care system, as it did, for example, for schools.

This lack of planning certainty will hold back strategic efforts to transform how services are delivered. Local sustainability and transformation partnerships will be expected to submit five-year strategic plans without knowing what capital, social care or public health funding will look like in 2021, let alone 2024.

And what will this mean for people who use health and care services?

The funding announced this week at best stops the current problems getting worse, but doesn’t undo the years of underinvestment, and will do little to overcome the workforce shortages endemic in health and care.

In relation to the NHS, we have previously said funding increases are not enough to meet standards of care and transform services.

The Spending Round’s numbers don’t change that. We need a proper multi-year financial settlement for all of health and care to really have confidence that the sector as a whole can plan for and deliver a health and care system fit for the future.

This blog was first published on the King’s Fund’s website.

  • Sally Warren, King's Fund
    Sally Warren

    Director of policy at the King’s Fund
    Before joining the Fund, Sally had extensive experience in health, care and population health policy and delivery, in central and local government. Sally was director for social care at the Department for Health and Social Care, director of programmes at Public Health England and deputy chief inspector (for social care and registration) at the Care Quality Commission. She was also director at the Cabinet Office, leading a project on social care funding for Budget 2017.

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