Its high time we devoted more resource to exposing the ways and means adopted by Westminster governments over the funding of public services in England and the negative impact these can have on Scotland.
How much do we NOT know?
We hear very little from the Scottish news media about financial scrutiny of governments in Westminster. In Scotland we have little or no exposure to investigations by the Public Accounts Committee (PAC) of the House of Commons or those by England’s National Audit Office (NAO).
This means that too often we are unaware of the financial competence or otherwise of Westminster. And therefore we are too often left unaware of consequences, direct and indirect, for the Scottish Government and for Scotland arising from Westminster’s financial conduct.
I’m obliged to TuSC btl contributor, David Howdle on 23 May for this important reminder for the whole electorate of Scotland: “… Scotland’s health spending is shackled to health spending in England”.
This remark triggered some digging to understand better the significance for Scotland of the Tory’s record. As many will know in general, what a Tory government decides is sufficient in terms of expenditure on health and social care in England directly affects the amount of money available to spend on public services, including health and social care, within the responsibilities of the devolved governments in NI, Scotland and Wales.
Of course this is within an important, wider context. It is one where the major levers that can influence Scotland’s economy and its associated tax base – all monetary and most fiscal levers – still remain with Westminster. And a context in which it is only the Westminster government that has the very substantial (essentially unlimited) borrowing and money creation powers.
I’d like to examine evidence from the PAC, the NAO but first, from the notable health think tank, The Kings Fund and from the fact checking service, Full Fact. The findings make clear that Westminster directly has caused significant harm to publicly-funded health and social care in England and negative consequences have flowed from this to Scotland.
This post comes shortly after the TuSC highlighted the PAC’s conclusion that the Tories (specifically the Ministry of Defence) had wasted £1.35 billion of taxpayers’ money on a mismanaged Defence Nuclear Infrastructure programme. And this was followed by the TuSC’s examination of PAC reports that reveal levels of financial waste and eye-watering budget over-runs on a series of rail infrastructure projects in England, including Crossrail and HS2.
Sources: https://talkingupscotlandtwo.com/2020/05/13/snp-mp-reveals-massive-1-35-billion-waste-of-tax-payers-money-by-uk-government/ and https://talkingupscotlandtwo.com/2020/05/19/westminster-government-with-money-to-burn-why-should-scotland-care/
Taking stock of the Tory record
In November 2019, the independent think tank, The Kings Fund, which focuses mostly on health and social care provision in England, submitted a paper to the PAC. The latter’s own focus at the time was the Tory government’s implementation of its long term plan for the NHS in England.
The Kings Fund submission gives an overview of the Tory’s record on health and social care since the time of PM Cameron and the Coalition government. It therefore provides a useful starting point – gives initial, general context – for any subsequent contributions on this theme for the TuSC.
In summary, this is the essence of The Kings Fund’s assessment:
CAPITAL FUNDING: under-investment has left the NHS in England with deteriorating facilities and equipment
- there is a maintenance backlog of £6 billion, including a £3 billion backlog on matters that present “high or significant risks for patients and staff”
- a recent announcement of a £1.8 billion increase in ‘capital spending power’ is not sufficient to address the scale of the issue. (Note use of the term ‘power’ here but is this extra money overall? We will return to this in a later article on health infrastructure.)
ADULT SOCIAL CARE: expenditure on adult social care in England has fallen: in 2017/18 spending was £700 million less in real terms than in 2010/11
- from projections on current trends, social care spending pressures will rise at c.3.7 per cent a year until 2030/31 – this represents the minimum short-term increase in social care spending required
- social care also requires significant reform and a new long-term funding settlement.
STAFFING: NHS trusts, primary and community care, and social care are all experiencing chronic staff shortages
- the gap between workforce supply and demand in acute and community health services could rise to between 250,000 and 350,000 full-time equivalent (FTE) employees by 2030.
PUBLIC HEALTH: since the 2015 Spending Review, the public health grant for local authorities has been progressively cut – now £850 million lower in real terms than in 2015/16
- as a result there have been local authority cuts to spending on e.g. drug treatment, smoking cessation and sexual health services
- spending reductions on preventative public health services have been greatest.
SHORTFALL: across all public health services, it is argued that a minimum of £1 billion that will be needed to restore funding in 2020/21 to the levels of 2015/16.
Can it be even worse?
The independent fact checking charity Full Fact reviewed the Tory government’s record on health and social care spending in July 2019. It covered similar ground to The Kings Fund but highlighted other telling aspects of the Tory’s legacy on health and social care.
RATIONING: it is reported that the Nuffield Trust, Health Foundation and King’s Fund argue that with tight spending in recent years coupled with increasing demand for services there is “growing evidence that access to some treatments is being rationed and that quality of care in some services is being diluted.”
STAFFING: in January 2019 the National Audit Office (NAO) is reported as concluding: “There is a risk that the NHS will be unable to use the extra funding optimally because of staff shortages.”
FINANCIAL PRESSURES: c.47% of NHS trusts in England – which provide secondary care – were in the red in 2018/19. The figure was 67% among acute hospital trusts—which make up the bulk of NHS trusts across England
- collectively they finished 2018/19 with a deficit of around £571 million: in 2017/18 the overall deficit was £960 million
- Full Fact argues that if you account for the one off savings the NHS made in the year 2018/19, temporary extra funding plus accounting adjustments, then the underlying deficit of these trusts is around £5 billion
- from the Nuffield Trust: “While it is true more money is coming into the health service in the year that has just started, this boils down to just £1bn extra for NHS trusts. That leaves them dependent on continued short term one off cost cuts and emergency funds: an impossible basis on which to plan a stable recovery.”
LONG TERM PERSPECTIVE: health spending grew at an average annual rate of c.3.7% from 1950/51 up to 2016/17, accounting for inflation
- the average growth between 2009/10 and 2014/15 under the Coalition government was just 1.1%
- the average growth between 2014/15 to 2016/17 under the next Tory government was still only 2.3%
FINALLY: Full Fact points out that demand for health services has increased over time. However, after adjusting figures to account for the size of the UK population:
- the average annual growth in per person spending between 1949/50 and 2016/17 was about 3.3%, but was just 0.6% between 2009/10 and 2016/17.
Over the period of Tory governments, including the Coalition administration, the evidence is stark: publicly funded health and social care services in England have been neglected both in terms of financial support for day-to-day activities and capital investment despite rising levels of need and public demand. It appears that the financial pressures have been either largely ignored or addressed only at levels below what the service providers and expert commentators believe to be necessary.
Scotland’s (and NI’s and Wales’) health and social care provision is not immune from similar needs and demands: decisions in Westminster which lead to the underfunding of health and social care in England have adverse knock-on effects on all parts of the UK.
In the next article we examine the views of the House of Commons Public Affairs Committee and the National Audit Office on the Tory’s financial management of infrastructure investment in England’s NHS. We show how the Tory government’s manipulation of the budget for capital expenditure has damaged England’s NHS and harmed Scotland.