“Let me make this clear – we will not be moving towards an insurance scheme, we will not introduce an American-style private system. In this country, we have this most wonderful, precious institution and idea. That whenever you’re ill, however rich you are, you can walk into a hospital or surgery and get treated for free. No questions asked. No cash asked. I will never put that at risk.” David Cameron 2011
The National Health Service is one of the proudest achievements of the UK. It was established along with the Welfare State immediately after the Second World War when Britain was virtually bankrupt and the national debt stood at just under 250% of GDP, over double that of today (it is 103% see OECD table ) Despite fiscal challenges far more severe than we experience now, both the people and the government of the day considered it not just affordable but absolutely essential. It has played not only an important part in improving the health of the nation, but has provided its citizens the financial protection during illness and sickness for it is based on the principle that healthcare is a human right not a marketable commodity.
Support for a publicly funded NHS remains overwhelming
That principle is now under attack even though it still commands considerable public support . In the 2014 British Social Attitudes Survey, 89% of the public agreed that the government should support a tax-funded national health system, free at the point of use, that provides comprehensive care for all its citizens. This is slightly higher than the 84% figure found in a YouGov poll in 2013
Despite the size of the NHS budget, we spend less than other developed countries as a proportion of Gross Domestic Product (GDP)
The NHS costs the public purse around £115 billion a year and the total expenditure of all departments is £670 billion a year . While the NHS is the second highest in terms of departmental spending, health expenditure amounts to 9.4% of GDP which is below average of EU member states at 10.2%. And among the industrialised countries of the OECD (including the UK), the average share of GDP spent on health was a whopping 12.6% (see the Nuffield Trust) .
Discussions about the affordability of the NHS or otherwise often overlook the significant amounts of money in unpaid taxes. Unpaid corporate tax alone amounts to an estimated £119.4 billion in 2014 – more than the total annual cost of the NHS. This is not just an issue for big corporations but for the multitude of small and medium UK businesses for whom tax evasion and tax avoidance are increasingly seen as ‘normal’ business practice.
The NHS is value for money
Compared to other national health systems – and despite much negative media coverage – our NHS comes out well above the average in terms of value for money and delivery of services. A study in 2014 by the Commonwealth Fund, a Washington based foundation ranked the our NHS as first out of 11 developed countries health services with a particularly high score for quality, access and efficiency[i]. The United States, based on a private health care model, costs nearly double that of the UK public health care system and came bottom .
What are the social and economic challenges?
Demographic trends towards an ageing population alongside increasing economic inequalities
There is a mismatch between the design of the NHS and the UK’s health and social care needs and the NHS is confronted by four transitions for which it is ill prepared[i]:
- A demographic transition to an ageing population with a high dependency ratio
- The increasing prevalence of chronic illness and disability with many people suffering two or more chronic condtions
- An economic transition with widening income and wealth inequalities
- A social transition to a public that expects a more responsive and personalised health service
The ageing population of the UK currently bears the brunt of a high burden of chronic disease, mental illness and disability, one that is significantly higher than in other western countries, such as France, the Netherlands, Norway and Sweden. Lifestyle is a major factor with tobacco use, obesity and physical inactivity playing all undermining public health. (The Lancet vol 385 Mar 14 2015: The National Health Service, Value for Money, Value for Many). It is important to note however that re-design should not automatically imply ‘privatisation’ or ‘marketisation’. There are other options – if the present government is willing to look at these.
The funding challenge
The end of tax funded NHS?
In addition to the market model as the ideal model for public services to emulate, successive governments have increasingly moved away from tax based funding of infrastructure projects such as the building of schools and hospitals, and have instead looked to private sector finance. This too, has a short but very troubled history as detailed under the section Policy responses by the present government.
Many policy experts and health professionals have been withering in their judgement of the incessant need to innovate and re-organise the NHS and argue that funding has been mis-directed over three decades of repeated and mostly unproductive organisational re-structuring and ill-conceived financial allocation regimes. One unfortunate outcome has been a hospital-centric NHS in which treating acute episodic illness is rewarded disproportionately more than disease prevention and maintenance of good health. Spending for hospital dominated secondary care has increased in real terms from £49.1 billion in 2003-4 to reach £68.8 billion in 2011-12 (a 40% increase) whereas that for primary care rose only 19.2% from £17.7 billion to £21.6 billion, respectively[Nuffield Trust: Anatomy of Health Spending].
Underfunding of social care
The government and other policy analysts will point out that with an ageing population we cannot afford a National Health Service as it is presently run. However pressures on the health service have been exacerbated by cuts to care spending spending by a fifth in 10 years. Research by the BBC showed that £1,188 was being spent in 2003-4 per person over the age of 65. By 2013-14 that had fallen to £951 once inflation is taken account – a drop of 20% – prompting experts to warn that vulnerable people were being failed. (BBC News 28 Jan 2015)
The consequences of under-investment in public health, primary care, community services and social care are clearly evident: pressure on emergency services an acute hospitals as primary and community services struggle to cope with rising demand.