The NHS must evolve – or face a painful death

Published by The Guardian (2nd June, 2014)

Politicians have a poor record of fighting the wars of the past rather than facing up to those of the future. Now we see this again amid panic over Ukip winning a protest election, with corrosive talk over the supposed curse of immigration. The desire of people to come to Britain is a gratifying sign of economic success, yet Westminster is convulsed as parties vie to appear hostile to hard-working migrants.

They ignore an issue of far more profound consequence to national wellbeing: the looming implosion of the health service. Yet as Lord Ashcroft revealed in his latest electoral analysis, nearly as many voters mention the NHS as immigration as the issue that determines their vote – and as financial pressures grow, this will rise up the agenda. It is worth mentioning in passing that the two issues are inextricably linked: Britain’s beloved NHS would instantly collapse without the one in four doctors from abroad, let alone all those foreign-born nurses, midwives, porters and cooks.

The cold financial facts that confront the service are frightening. The NHS budget when launched in 1948 was about £9bn at today’s value; today, it is more than 12 times bigger and rising 4% a year in real terms as new treatments arrive, society ages and needs become more complex. By next year’s general election, two-thirds of hospital trusts fear they will be in the red; by the following election, the Nuffield Trust predicts the NHS must spend almost £30bn more just to stand still.

This is only for starters – after that, the figures become even more alarming. It is, as its new chief executive says, a defining moment for the NHS – it has to evolve fast or face a painful death. Yet this debate remains trapped in the past, with the institution still pathetically over-sanctified despite a series of horrific care scandals showing the damage this myopic stance can cause vulnerable patients. Cancer survival rates remain comparatively poor, social care often grotesquely inadequate, and we spend more per head on healthcare than Iceland – yet have double its mortality rates for under-fives.

But woe betide anyone proposing change to this sacred body, whether to curb costs, ration treatment or offer innovative ideas for salvation. Lord Warner, the former Labour health minister, recently sought to stir debate by proposing a £10 a month ‘membership’ fee to stave off bankruptcy. This provoked predictable howls of outrage – yet fees for prescriptions and dental care already undermine the original NHS concept.

“Privatisation” is the dirtiest word in the health lexicon, used by ultra-conservative medical unions to defend their interests, even though up to one-third of NHS-funded staff work in profit-making businesses. Labour paved the way for thousands of hernia and hip operations to be performed by private providers when in office; now it uses this word to shut down debate. It is flirting with an “NHS tax” – perhaps a 1% rise in national insurance – to find fresh dividing lines with Tories and repeat Gordon Brown’s trick from a decade ago. This is sticking-plaster policy. It would raise about £4bn, less than one year’s rise in costs.

Take a look at Hinchingbrooke hospital in Cambridgeshire, the first privately run NHS hospital, which highlights continuing inefficiencies. It cut costs 6% a year, stripping out £11m in waste in just over two years; incredibly, this included £3m procurement savings by ordering its own supplies rather than using NHS bulk purchasing. It did this by handing responsibility for services to frontline staff – and has just been rewarded with a national award for patient care, as well as consistently improved services and waiting lists.

Similar savings can be seen with personal budgets for patients with complex needs. One parent of a disabled child told me it took two visits from a community nurse and several emails just to get deliveries of latex gloves until she could order them online for £3.99 a pack. No wonder Hisham Abdel-Rahman, former chair of Hinchingbrooke’s British Medical Association branch, who now runs the once-failing hospital, admitted he was wrong to oppose privatisation. “You have to shake the system by challenging it,” he told me. “And you can only challenge it if you let fresh ideas come in.”

But the right, too, must remove its head from the ground: cutting costs, driving efficiencies and improving poor productivity alone will not come close to saving the health service. Forget ring-fencing; we need to talk about tax. For if the health service really needs £30bn more in seven years’ time, and charging is unacceptable, that is equal to a 7p rise in income tax at a time when whoever wins next year’s election will be scrabbling around for public sector savings.

This is tough medicine to swallow. One idea that might sweeten it slightly came from Paul Kirby, former No 10 policy chief, who suggested converting national insurance – a relatively progressive tax – into a dedicated NHS tax. It raises just over £100bn, roughly the current cost of the health service. The Treasury would hate this hypothecated tax, but it might just focus minds enough to kickstart a rational debate over the cost, funding and provision of modern healthcare.

Both left and right say they love the NHS. Now the diagnosis is so clear, they need to stop playing cheap politics and start finding ways to save our sickly patient.

Categorised in: Health, home page, Public policy