New figures from the King’s Fund, calculating the progress of funding for the NHS and social care since the banking crash of 2007-8 indicate how dramatically the brakes were applied from 2010 when David Cameron’s government embarked on a decade of austerity.
But it’s widely accepted that to cope with inflation, demographic change (a rising population and an increasing proportion of it in the more costly older age groups), technological change and other cost pressures real spending needs to increase by around 4% each year: and from 1958 to 2010 that was more or less the average (3.9%).
Since the Tory-led coalition took office in 2010, however, the rate of increase has remained consistently below this level, leading to a growing shortfall in funding, and this is set to continue.
Calculating from the King’s Fund figures we can see that had the Department of Health and Social Care received an annual increase of 4% from 2010, by 2021-22 – even allowing for inflation – its core budget would have been £180bn – £35bn higher than the actual figure, and just £11bn below the total spending including the £47bn Covid spending.
HCT calculations show the cumulative gap between pre-2010 average levels of increase and the austerity levels of actual funding reached £202bn this year: and if Rishi Sunak’s spending review allocations remain unchanged the gap will widen by another £84bn, to create a near-£300 billion shortfall in the 15 years to 2025.
By contrast when retired banker Sir Derek Wanless examined the long term funding of the NHS for the New Labour government in 2002, he found that by comparison with the European average UK health spending had fallen behind by £267bn – over the previous 25 years.
The current financial squeeze has made all the difference between an NHS that can sustain sufficient beds and staff, keep up with maintenance and invest in precautionary stocks of PPE – and today’s conditions of constant crisis.
The SOSNHS call for emergency funding of £20bn appears modest in comparison to the historic shortfall, but the campaign says it is urgently needed to restore NHS performance, increase capacity, reopen unused beds, and raise pay and expand the workforce.
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