News

04.07.12

Grim NHS spending forecasts mean free services may have to go

Some free NHS services may need to become paid-for or the public will have to have their taxes hiked to pay for them, according to a detailed investigation into future health and social care spending.

The Institute for Fiscal Studies and Nuffield Trust plots future spending scenarios for the NHS inEnglandand examines their consequences for other public service spending and for taxation.

Report co-author Carl Emmerson, deputy director of the IFS, said: “The current spending plans that run to March 2015 are tighter for the NHS than any delivered in the last fifty years, and the outlook for spending on public services beyond this suggests that, if it grows at all, NHS spending is not likely to keep pace with the amount that it has been estimated it needs to keep pace with the costs of an ageing population.

“Serious consideration should be given to the options for the NHS, which include reviewing the range of services available free at the point of use and reconsidering the level of taxation needed to finance them.”

Nuffield Trust chief economist Anita Charlesworth, who is leading the research programme seeking to assess the scale of the financial challenge facing the NHS over the next decade and how it can be met, said: “Asking the NHS to take a more equal share of the pain across the public services amounts to an unprecedented productivity challenge.”

NHS Confederation chief executive Mike Farrar said: “The figures from this report back our recent calls for Government and NHS leaders to urgently start the difficult yet necessary dialogue with the public about why the health service needs to change frontline care.  

“We need to be honest about the action necessary to deal with a decade of spending squeezes and the rising cost of healthcare.”

He specifically suggested that the NHS workforce may need to fall to ensure the whole service is “fit for the future”.

Visit www.ifs.org.uk/publications/6229

Tell us what you think – have your say below, or email us directly at [email protected]

Comments

Steven J Burnell   04/07/2012 at 14:46

Remove the Politics (government & professional) & it cannot be beyond the wit of man to design & deliver an integrated, sustainable, high quality Service focused on improving the Health of our Nation for £100Bn per annum.

Keith Hackett   04/07/2012 at 15:00

The courage comes from Government and Health. The issue is that rising raw material costs; rising healthcare costs of a maturing population that is increasing as a percentage of the whole population and, the reciprocal reduction of tax revenue means that free healthcare for all, will be a thing of the past within a generation. Further, it will require a generation to change public opinion to accept that private health insurance of some form will be necessary for all those of working age who are employed. There is but a short window of opportunity and to continue to ignore this is foolish.

Sam Arkim   04/07/2012 at 16:15

If the NHS is to survive cost needs to be aggressively taken put. The NHS at the moment has absolutely no control at all of its suppliers having outsourced purchasing to DHL. It needs to move towards open sourced software instead of taking the pain of learning the new Microsoft Ribbon. It needs to move back to generic products... You want a NHS Hip replacement to get a Stanmore, Chandley or Exeter (all out of patent and now cheap as chips). The NHS needs to drop is obsession with the "dangers" of Latex. Health & Safety means not letting a young lad die from de-hydration, not worrying about if a mask has latex in its retaining band.!! But most of all it needs to stop employing bloody consultants at £1k per day. Only pay them when they actually produce something or better still have a central pool of NHS trouble shooters learning and sharing their knowledge. The NHS will never retain capable experienced staff when they know they can swan off to PWC after 5years and sell themselves back to the NHS (for a few meetings interface sessions) a couple of months per year.

Rose   22/08/2012 at 15:28

The NHS is already the most cost effective way to provide health care to the population, compare us across the world and the NHS delivers value for money and high quality healthcare for all regardless of ability to pay. The nearest competitor is Sweden who also have a similar government funded system. Can we stop presuming the NHS is a bloated black hole for cash and start realising that it's the anti public-anything ideology of this governments that is promoting the myth of an overpriced health service? You want private healthcare? Seriously? Its costs more than twice as much per person in the US than the NHS does in the UK. I do hope I never have to rely on charity hopsitals to treat my illness.

David Wallace   31/08/2012 at 11:21

Nothing ever comes of people within any organisation taking different or opposing views, we all agree that with an ageing population times will be hard and that the best placed people to reduce costs and maximise productivity are the managers within the NHS. However they have to come into the real world and look at how other businesses are being managed, procurement, facility management, outsource contracts and their management, financial management and pre-planning. The NHS has become a bloated black hole for cash just look at the rise of PFI agreements, the varying cost of the same treatments across the UK, more management consultants than any other industry. Recognise that there are areas of concern work together to deal with them and remain the NHS or in ten years?

Nel   19/09/2012 at 22:51

The NHS is run on goodwill with many staff (not Boards) working very long hours for which they are not paid. If the NHS is to continue to be free to all then ALL must contribute. We must be the laughing stock of the world - many can come here from abroad and within days have established an address and are entitled to free heath care without ever paying a penny into the system which provides it. The public must also start to realise what they have and what every visit to GP, hospital or prescription drugs or operations actually cost. Even for those who have paid into the system, many get far more out of it than they have ever paid in.

Liz   31/10/2012 at 23:13

In response to Nel's comment on 19/09/12 about us being the laughing stock of the world, I sent the following e.mail in June 2012 to Mike Farrar of the NHS Confederation, "I listened with great interest to an article on Radio 4 this morning in which Mike Farrar was discussing the current restrictions imposed on the NHS, and the need for re-organisation and indeed closure, of certain hospitals and their facilities. I am a UKBA Immigration Officer, and the founder member of the NHS Liaison Unit formed some six years ago in an effort to tackle the very difficult and emotive subject of “health tourism” which is costing the NHS dear (in the £millions). From small beginnings we have come to liaise with most of the major hospitals in the UK; from my experiences over these past 6 years it seemed that much can and should be done to protect the dwindling NHS resources, and to this effect a joint UKBA and DH consultation has led to the introduction (from 01/11/11) of a new Immigration Rule, the “NHS debtors” rule, which seeks to assist the NHS with regard to the many overseas visitors who have not qualified under any of the “exemption” categories, yet have obtained hospital treatment for which they have not paid. The amounts of money are staggering; in light of the current financial constraints for both government and the NHS, I wonder how much longer resources will last". I did not receive a reply. A complete overhaul of access to both Primary and Secondary care is needed (and long overdue) in order to stop the NHS hemorrhaging millions it cannot afford.

Frontline Health Employee   07/11/2012 at 13:10

It would help if the DoH actually spent its budget on healthcare rather than forcing people to make 'efficiency savings' so it can give £3bn back to the treasury! The bloated black hole is a convenient myth (like gold-plated public sector pensions). It is political propaganda to make the public sector sound expensive when in fact replacement with private provision will be because the private providers need to make a profit.

Barbara   22/01/2013 at 14:06

My grandmother could not afford health care. I own the NHS. I have paid NI all my working life. Who gave anyone the right to sell off my security of healthcare? Where has the money gone? I accuse! If governments stopped invading poor countries to rob them of their assets we would be a healthier and happier nation. Time for an English Spring.

Dave Jackson   22/01/2013 at 14:15

The UK government is the 15th-18th in the world for spending on healthcare per citizen (depending on the figures you use). What do we expect? You get what you pay for and the NHS is cheap! The governments of the USA, Germany, Sweden and France all spend more per citizen than we do. The government wants to know what we should copy from these countries? How about increasing expenditure to US government levels (i.e. the amount excluding private expenditure by US citizens), which would increase the NHS budgets by over 40% per citizen. http://www.guardian.co.uk/news/datablog/2012/jun/30/healthcare-spending-world-country

Southy   10/02/2013 at 21:21

Increasingly complicated PBR rules, including provider to provider recharges for pathway tariffs, along with ever growing numbers of audits and targets and unquantifiable CQUINS and QIPP plans all require and use huge resources, which mean that financial investment is being moved away from the operational frontline. These front line services are still being asked to make 'efficiency' savings! The NHS restructure is creating more 'top heavy' management structures with 'responsibility' payments for some whilst there are no corresponding reduction in salaries where responsibilities have decreased! Have many wte's gone in the bottom line of restructured commissioners, SHAs and FT developmental Trusts?

Alison   15/09/2014 at 15:44

I don't understand why the Institute for Fiscal Studies thinks it is a problem to raise taxes so as to pay for our wonderful health system. I have no issues with paying more taxes. We live in a democracy, therefore we pay taxes so as to share the burden and then ALL of the population can have free health care.

Janet Day   29/10/2014 at 17:55

Other countries have found that a small charge to see a GP or to visit hospital causes a dramatic drop in demand, as it deters the thousands of time wasters

Tostig   13/11/2015 at 13:47

I worked in the NHS for 30 years. I left when I was asked to say things that were patently not true, i.e. that cuts in staffing had not affected the standard of service. I wouldn't want to see charging for appointments, but I would like to see a small charge levied on DNAs. People need to value the NHS more and see it as a communal asset. Turning up for appointments or responsibly cancelling, is a social, not just a personal obligation.

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