The Tories haven’t broken their promise on the NHS. They’ve just broken its terms
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Version 0 of 1. “We will increase spending on health in real terms every year,” is what the Conservatives promised in their 2010 general election manifesto. Probably more than any other pledge, it defined David Cameron’s attempt to win back enough trust for the “nasty party” to return to power. It was (sort of) successful. The commitment – reiterated as a “guarantee” in the coalition agreement with the Liberal Democrats – is one of the central issues on which the party’s record will be judged before the general election this May. It is crucial in addressing Labour’s question: “Can you trust the Tories with the NHS?” So why is it nearly impossible to work out the answer? Trawling through the evidence is like reading a cheap detective novel: each time you think you have found the solution there is a twist. The mystery can be solved, I think. But that ends up being less important than the iniquity uncovered: initially failing to publish clear and comparable spending figures; ultimately deceiving the public with those same accounts. Over 20 years as a journalist I’ve witnessed taxes “buried” in complicated budgets; incomplete or late replies to basic questions; elementary information apparently not being gathered; data series changed or terminated, often at convenient points; baselines, assumptions and inputs altered with no obvious signposts. The story of NHS spending over this parliament is a timely opportunity to expose this pattern of behaviour. Working out where to start the investigation is the simple bit, in this case a web address. National Statistics call the annual Public Expenditure Statistical Analyses “definitive”. Chapter one lists each year’s allocation to health and NHS England – both the “nominal” amount handed over, and more fairly comparable “real” figures adjusted for inflation. From there it gets unnecessarily complicated. In the early years of the coalition Labour claimed, almost daily, that the Tories had failed to increase health spending, citing the Department of Health budget, which had then fallen, in real terms, in 2010-11 and 2011-12. The coalition countered that it had not. It is not entirely clear how they made their calculations, but having never specified a baseline year, they could start with the 2010-11 budget inherited from Labour, eliminating half the problem. Also, Labour was using figures for whole departments, which included the declining Food Standards Agency allocation, making it plausible the NHS was getting more money. But that was then. Debate before the forthcoming election will be argued over different accounts: the most recent published in 2014. Two years later spending figures have been revised for policy changes and returned overspends; they have been priced in more recent (higher) prices; the FSA has been excluded and, with lower than expected inflation, the increase in spending looks better every year. These spreadsheets appear to show that after a slight fall in that disputed first budget, spending has risen in real terms each year from £105.6bn to £110.6bn this year, and a projected £110.8bn from April. Well officially they do. But there are a few more twists in the tale. Firstly reorganising the NHS has cost £1.5bn by government calculations, or £3bn, according to Labour. Either is a tiny fraction of more than £500bn spent over the parliament but a significant chunk of the sometimes minuscule annual rises. One year the increase was just one-seventh of one percent. Ministers say restructuring will save £6bn this parliament, but predictions are only as good as the models and assumptions used, and very hard to prove. There is a more troubling distortion though: the NHS budget has been inflated, throughout this parliament, by money it has to give local authorities for social care, public health and better coordination between their services. Early on, the coalition ended the practice of the NHS paying councils for “personal social services”, transferred the budget to the local government department, and stripped it out of previous health spending for fairer comparison. Almost immediately, however, a new and expanding set of transfers was set up – but again defined as “NHS (health)” spending. The King’s Fund think tank has calculated that handing over this money reduced the direct spending power of the NHS by nearly £1bn in each of the first two years, rising to £2.6bn this year and more than £5bn next year when transfers are bundled into the Better Care Fund. The analysis, based on 2013 figures and published in the British Medical Journal, concluded real funding for the NHS would decline 1.4% this parliament. If “betrayal” sounds too strong, the author and King’s Fund chief economist, John Appleby, wrote that “piecing together the breaks in spending and overlaps [was] tedious”, involving analysis of NHS accounts, Treasury spending round figures, personal social services budgets and NHS England board papers. If this is not an attempt to distort the NHS budget, why not make it transparent? Revisions to inflation and spending will have altered that 1.4%. But the conclusion remains the same: even if funding for health has risen, NHS spending has fallen. The DoH logically argues “money spent on social care benefits the NHS”, and calculates that next year the £5.3bn Better Care Fund will improve care for vulnerable people, avoid 160,000 emergency admissions and save £500m. For public health, the NHS also handed over responsibility and staff with the money. But there is no certainty the money is spent as intended – NHS managers reportedly refer to the “pothole fund” – and nobody can be sure it’s having the intended effect. For all the official justification, the NHS chief financial officer, Paul Baumann, politely warned his board in 2013, the transfers would “require disinvestment in other services”. Then there is the evidence of the many healthcare trusts falling into debt, unpoliticised insiders warning of a pending crisis – problems exacerbated by demand rising far more quickly than headline budgets. So the government has met its pledge, there is no breach of contract: but there has, surely, been a breach of faith. This matters now, when voters are being asked whom they can trust with our healthcare. Unfortunately this pattern of behaviour has repeated itself under both Labour and Conservative/Liberal Democrat governments. We need to find a way to hold them all to account. |