Every year since the NHS was founded spending has gone up in cash terms to cope with rising costs and population.
So technically every year has been the “highest-ever”.
But the issue that matters to the NHS is the value of the money – what can it buy in staff and services?
If spending is falling behind inflation and cost pressures – as it has each year since 2010 – to simply quote the cash value is willfully deceptive.
Back in the summer of 2018, to mark the 70th birthday of the NHS, Theresa May announced that funding for the NHS in England would be increased by £20.5 billion in real terms by 2024 – an average of 3.4% per year.
The cash increase to follow this up was formally announced in last November’s budget, and the extra funding begins this year.
The budget allocation includes an amount to allow for inflation, and an extra £1.25bn each year for specific pensions pressures. That’s why the total appears to increase by £34bn, rather than £20.5bn – from £115bn this year to £149bn in 2023-24.
This is the misleading higher figure Johnson and ministers are now trumpeting.
But the Philip Hammond’s Budget statement made clear what it was worth (Table 1.7): “In June, this government committed to a new multi-year funding plan for the NHS in England, equating to £20.5 billion more a year in real terms by 2023-24”.
The Health Foundation damned the increased funding with faint praise, arguing that the money would merely “help stem further decline in the health service”.
The Institute for Fiscal Studies described the planned increases in health spending as “modest in the context of easily the tightest decade for the NHS since its founding.”
The Health Foundation and other critics have also pointed out that increases of at least 4% a year on average are needed in order to meet the NHS’s needs and see any improvement in its services.
Anita Charlesworth of the Health Foundation earlier this year echoed the same view: “Healthcare funding has grown by an average of 2 per cent a year since 2010…. less than the overall rise in public spending, and below the estimated increases needed to address the lack of investment in staff and public health over recent years.”
The £20.5bn increase also only applies to the part of the health budget controlled by NHS England. So other parts of the Department of Health and Social Care budget – including the education and training of doctors, nurses and health professionals and the public health grant income to councils for sexual health and children’s services – get no increase, and will FALL in real terms.
In other words, the accurate figure for the planned spending rise over five years is £20.5 billion – or less if inflation rises – in real terms.
By claiming it is ‘£33.9 billion extra’ ministers are exaggerating its real value … by 65%.
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