Spin doctors' treatment bad for health
Dobson plays double your money!
So desperate was the plight of the NHS after decades of cash starvation that even a relatively moderate cash injection, suitably hyped by the spin doctors and sympathetic mass media, appears to have worked wonders.
While they were in opposition Frank Dobson or his upwardly-mobile minister Alan Milburn would have made instant mincemeat of any comparable Tory announcement. Now in government they happily use the same techniques – and brush aside the hypocritical protests from the Tory benches.
It worked a treat. "Beyond our wildest dreams" was the response of one pressure group to Gordon Brown’s announcement of an extra £21 billion over three years for the National Health Service. The Mirror newspaper, which in May declared that Health Secretary Frank Dobson should be "Bloody ashamed", now proclaims him a hero.
It seems positively churlish in these circumstances to look Gordon Brown’s gift horse in the mouth, but it is the only way to see how people are being misled.
The sums add up very differently on closer inspection. From a budget of £37 billion this year, NHS spending will increase to £46 billion by 2001-2, an overall increase of almost £9 billion, bringing annual increases of around £3 billion in cash terms, before allowance is made for inflation.
This is far from generous. Pundits had been warning that an increase of less than £8 billion would represent a real terms cut, given inflation running at 2.5% or more and rising pressures on NHS budgets. The NHS Confederation, representing Trusts and health authorities, had pressed for a £10bn increase over three years.
Only by assuming that the budget might otherwise have remained frozen, and adding together each successive year’s "increase" (£3bn 1999, £6bn 2000, £8.8bn 2001) – and then doing the same for social service budgets as well – can we make the total add up to £21 billion.
Not all of the money is what it seems. The total of £8 billion which Health Secretary Frank Dobson proclaims as the "fund" for the modernisation of hospitals, clinics and GP premises turns out to be the total of all projected capital spending on the NHS until 2002.
This headline figure is padded with an estimated £2 billion of Private Finance Investment (25% of the total) – which is not only not government money, but also represents a long-term cost to the NHS Trusts, which will have to pay hefty interest and leasing charges on the new facilities for at least the next 30 years!
Another £800m turns out to be estimated income from the sale of NHS land and buildings.
Perhaps this might be seen as quibbling. After all, a £9 billion increase by 2002 represents, according to government figures, an average real-terms increase of 4.7%, beginning with a substantial 5.7% increase next year.
But following on two years in which the current government has broadly adhered to extremely low budgets set by the Tories, the outcome will be an increase averaging around 3.5% over the five years of this Parliament. By comparison the 18 years of Tory government saw real terms increases averaging 3.2% (though the budgets tapered off sharply in the Major years).
These projections of course hinge crucially on the government’s assumptions on inflation, which may be unsafe.
Inflation tends to be higher for NHS goods and services, and the assumption of a further 3-year freeze in the value of NHS pay – enforced in part by changes in the terms of reference of the supposedly "independent" pay review bodies for nurses, professional staff and doctors – is likely to increase the already severe shortages of qualified staff, especially with 20% of the existing NHS nursing workforce due to retire within two years.
Even if we assume the pay limits are successfully enforced, and the inflation targets are achieved, the resulting increase falls far short of a bonanza for health spending.
Health economists have generally agreed that a 3% real terms increase each year is required to meet the growing costs of caring for rising numbers of frail elderly patients, new drugs and new medical technology.
Gordon Brown’s hand-out – if it is distributed where it is most needed – ought to mean that health authorities should be able to keep their heads above water, but it is by no means enough to fill the gaps in a service which is currently attempting to squeeze down spending by £700m this year to balance the books by April 1999.
The £438m increase in social services spending next year falls well short of the £750m which social services directors recently said was required to cope with growing pressures of caring for more frail elderly people, and adds to the cash crisis facing many council departments.
This short-sighted economy seems certain to perpetuate the problem of "blocked" hospital beds as local councils run out of cash to place elderly patients in nursing homes: 140 beds are already "blocked" in this way in Gloucestershire.
The other obvious casualty of the new situation is mental health services. Early indications from ministers last year suggested that a cash injection of up to £500 million might be available over three or five years.
But the promised announcements have been postponed, and the funds for vital developments – not least the development of new 24-hour nursed accommodation for patients with chronic and severe mental illness – appear to have evaporated.
Whether the limited flow of funds can be directed to ensure that Tony Blair’s promise on waiting lists is fulfilled remains unclear.
What is certain is that however much it is hyped, the 3-year settlement is not enough to tackle the underlying problems – and the combination of measures could lead to the opening of gleaming new, privately-financed hospitals for which there are no nursing staff available.