NHS England and the £30bn Funding Gap

Simon Stevens (pictured) of NHS England will shortly be unveiling an NHS roadmap of sorts for the next parliament. Looming large is the matter of the claimed £30bn funding gap, an artefact of the Tory policy to stagnate NHS funding rather than commit to real-terms growth. As you’ll recall, the coalition government already subjected the NHS to £10bn worth of ‘efficiency savings’, the majority of which came from pay freezes and cuts to staffing and acute beds.

As Dr Clive Peedell puts it:

[Stevens] must make the point that flat funding of the NHS is a policy mistake […] per capita spend on the NHS has fallen under the coalition. Efficiency savings are effectively cuts and they have gone too far. Patient care and patient safety is at risk. The NHS clearly needs more investment and it needs to be at least a 4% increase year on year. This could be funded by addressing the […] internal market, that is estimated to cost the NHS at least £5bn per year.

We know from economic studies that an increase in healthcare funding would have a multiplier effect on the economy. That’s to say that for every extra pound put into the NHS, we’d see the overall economy benefit by several pounds. That’s because healthy people are productive people – investing in preventative measures and treating patients in a timely manner will help our economy recover. With the NHS currently one of the cheapest healthcare systems in the western world, we can clearly afford to fund it properly; in fact, with the benefits to people and to the economy so clear, we can hardly afford not to fund the NHS properly.

EDIT: Here’s further reaction from Clive Peedell to Simon Stevens’ report:

Stevens is a long way from securing the £8 billion extra by 2020 that he admits is needed to make ends meet even after extraordinarily ambitious efficiency savings of £22 billion.

None of the three main political parties is committed to raise NHS spending by anything like as much as £8 billion: the Tories are sticking rigidly to their planned further five-year freeze to 2021, the Lib Dems have offered two related injections of £1 billion from 2017, and Labour has promised £2.5 billion also in 2017 – by which point the financial crisis already brewing in the NHS will be boiling over into cuts and closures.

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