Chancellor’s budget boost to NHS frontline conceals £1bn cut
Funding for training doctors and nurses, buying equipment and new hospitals due to fall
Public health services and the education and training of nurses and doctors will be cut by £1bn next year as part of the government’s plan to boost the NHS’s budget by £20bn by 2023, it has emerged.
A leading expert in NHS finances warned ministers that their strategy of “robbing Peter to pay Paul” is a false economy that risks worsening already serious understaffing in England’s health service.
Prof Anita Charlesworth, director of economics and research at the Health Foundation, identified the £1bn loss of funding that will affect those two areas in 2019-20, as well as NHS capital investment, which the health service uses to refurbish its estate, build new premises and buy equipment.
Ministers are continuing their policy of squeezing the amount of money they put into the elements of the Department of Health and Social Care’s budget that are not protected in order to help fund Theresa May’s £20bn birthday present to mark the 70th anniversary of the NHS’s creation in 1948.
However, that has prompted concern that the approach is short-termist, driven by the need to tackle the growing overload facing the NHS, and will only add to demand for care in the long term.
“The NHS was the clear winner in the chancellor’s budget, but there is a big risk that it won’t feel like that in hospitals and GP surgeries over the coming year. Extra funding starts next year and rises to £20.5bn in 2023/24,” said Charlesworth, a former head of public spending at the Treasury. “This money is for frontline NHS services. It excludes wider areas of vital health spending where funding is also desperately needed: public health, workforce training and capital investment.
“Robbing Peter to pay Paul is tempting for any government short of money and facing multiple competing demands. However, it is rarely a sustainable strategy. The government is storing up problems for the future by only focusing on frontline services while ignoring other areas of vital health spending,” she added.
The NHS will not be able to modernise the way it cares for patients, improve quality of care or reduce waste unless it makes a priority of training new staff and investing in its infrastructure, she added.
Duncan Stephenson, director of external affairs at the Royal Society for Public Health, claimed key services aimed at reducing illness would be hit. “We have already seen significant cuts to public health budgets with the knock-on effect that this has on a whole host of vital services, from sexual health and smoking cessation, right through to drug and alcohol treatment. We will forever be having these debates unless we finally accept that investment in prevention will give us payback in the long term and ultimately save the NHS money,” he said.
Charlesworth also pointed out that the fine print of the budget shows that NHS England’s budget will go up by 3.3% next year, which is less than the 3.6% that the prime minister promised in the summer.
The government’s NHS boost involves such large sums that by 2023-24 it will be running a £20bn deficit, rather than the £3.5bn surplus it had planned, the Office for Budget Responsibility said. It went on: “The new multi-year settlement for the NHS raises the deficit substantially every year [until 2023-14]. Further measures announced in the budget raise borrowing in the near term but reduce it slightly in the medium term. Taken together, they turn the £3.5bn surplus in our pre-measures forecast for 2023-24 into a £19.8bn deficit.”
Paul Johnson, director of the Institute for Fiscal Studies, said taxes would have to rise at some point to fund the NHS. Health spending has grown as a proportion of all public spending from 23% in 2000 to 29% in 2010, when the coalition replaced Labour, and will continue to grow to a predicted 38% by 2023-24.
“At some point we will need to raise taxes to pay for health. There can’t be much further we can squeeze other public services to pay for it,” he tweeted.
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