Larry Elliot says this morning:
Without wanting to sound too hyperbolic, what happens in the first half of this year is going to shape politics for some time to come. A combination of falling unemployment, easing inflationary pressures and steady retail sales would calm the coalition's jitters about the economy, and allow ministers to claim that they are sorting out the "mess" inherited from Labour.
Conversely, if the jobless total rises by Easter, inflation edges above 4% and consumers save rather than spend, Labour will be able to say that it is the coalition that has messed things up, killing off growth with its ill-timed and harsh austerity programme.
And that's really not far from the truth - and I suspect Larry knows as well as I do that the former is much less likely than the latter.
And usually in politics that would be enough to sway the issue one way or another. But these are not usual times and although it goes against my normal policy I am reproducing this morning's cartoon from the Guardian for very good reason:
This week the government publishes the Health and Social Care Bill. For all practical purposes it might be called the Privatisation of the National Health Service Bill. That is what it is seeking to achieve. Worse, by demanding that European competition law applied to the NHS, by demanding that the lowest bid always get the work, by demanding that all work be open to private bidding, and by demanding that GPs who do not have the capacity to undertake these tasks manage them it guarantees three things.
First is the breakdown in the relationship between the various tiers of healthcare provision in the UK. As a result there will be no relationship of trust between GPs and hospitals anymore.
Second there will be no relationship of trust between patients and GPs, because patients will know the GPs are not dealing with their best interest because they will be managing budgets as their first and highest priority.
Third, when there is only room for one district general hospital in an area ( for example, that in Kings Lynn, which is the nearest one to me, is 40 miles distant from any other hospital in any direction) then to begin to piecemeal undermine the services it provides breaks down the integrity of the whole, undermining the whole credibility of health services in the community. And yet that is exactly what is threatened.
Fourth, the prospect of future training is almost virtually destroyed, because those will be cherry picking in the private sector will not be budgeting for training the vast number of staff who are required to undertake such activity every year if the continual flow of new staff is to be available to them. They have always enjoyed the opportunity of cherry picking from the NHS in the past, and will budget on this for some time to come. We therefore undermine our long-term well-being in this process.
Fifth, given that the NHS will be shrinking in real signs because the budget available to it is insufficient to meet the demand that will arise, if there is to be capacity diverted to the private sector some existing NHS services supplied by the state must close as a matter of fact. So we will have hospitals without intensive care. Accident and emergency units without cardiac backup. And so on. The market is absolutely appalling at dealing with externalities which is exactly why the NHS has survived on the basis of cross subsidisation for the supply of the service as a whole. And yet the model that is proposed will destroy this. Hospitals will be closing soon.
The economy will be critical to the success or failure of this government, but the NHS reforms could destroy it quicker than anybody can imagine.
That is why this issue is so important. And the Tories are so mad to pursue it when they said it was something they would not do. The result is for once it's not just the economy that might make or break a government, it may be the NHS too.
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Thanks again for providing such a tidy comprehensive tool to link to … your hard work on this blog is very appreciated!
“Fifth, given that the NHS will be shrinking in real signs because the budget available to it is insufficient to meet the demand that will arise,”
I am afraid this undermines the whole of the rest of your argument because it tcitly accepts that NHS spending is increasing in nominal terms, but also in inflation adjusted terms, but the problem is that NHS measured demand (a term used by NHS managers to define the level of actual demand that they can afford to treat) will not keep pace with the actual demand of a growing and aging population. Given the current financial situation, the government is right to look for ways to increase productivity in the NHS (which has fallen over the last few years).
@Alex
Please define NHS productivity
I entirely agree that vast amounts of money have been wasted in trying to create an internal market for the NHS – none of which was necessary
I think vast amounts more will be wasted in trying to create a real market for the NHS, which will be an outright disaster and copy the USA where 50% of all spending on healthcare is wasted on admin. that is a lack of productivity on a colossal scale
But let’s look at frontline activity. if we have more frail elderly people who are to quote medics ” of their legs” and who need one-to-one attention in their homes and cannot get to a surgery is that a loss of productivity, or a change in the nature of demand? And how do you know?
I agree there has been more labour input into the NHS in the last few years but entirely because of absolutely diabolical neoliberal false market dogma and nothing else. We could solve this. We could revive a genuine National Health Service. Now what’s wrong with that?
Well said, a well written article.
Your example is a change in the balance of demand. How do we know? Because there is a small army of statisticians monitoring these things in the Depratment of Health and the NHS that. Forecasting “NHS demand” is not difficult because that is simply what the NHS is prepared to pay for. Forecasting true demand is not very difficult either because the numbers are so large that they tend to be consistent year on year with reported numbers trending consistently with the age, general health and size of the national population.
Productivity is easily measured and compared year on year as the cost per “episode” for a given tpe of episode. The biggest increase in cost has not come from market inefficiencies but from overuse of secondary care, typically OAP’s who stay in hospital when they could be cared for just as cheaply at home or in social care homes (in some cases they could be cared for less expensively at The Dorchester), and from overuse of agency nursing. In any inner London hospital, on completion of a specialist nursing training course, a qualified specialits nurse will quit the NHS and go back to the same hospital to work through an agency. The agency operates like a closed shop, with nurses costing upto 150% more than they would cost if they were on the NHS payroll.
@Alex
What an astonishing argument.
First you utterly ignore all the costs that have been imposed upon the NHS by those who forced a market system on it, driven by your own neoliberal mantra, all of which has been wasted money
Second, bed blocking has not been a problem at all for a long time because Labour made sure it was not. It is only now problem because a Conservative government is removing the funding for social care which means that doctors cannot now discharge patients from beds because there is nowhere for them to go to. That is entirely a Conservative problem.
But, most staggeringly, what you are saying is that nurses may not have freedom to contract and must instead except regulated low pay whilst capital can undertake activity of any sort it likes within the NHS. How clearly you show your prejudice, bias, and contempt for working people. This is exactly why you and your sort cannot be trusted with the NHS.
Do GP practices which take over NHS funding stand to make large windfall gains when they leave their practices or sell contracts on ? I dont think GP practices have the financial or business expertise to handle the issues arising from suddenly managing very large budgets. Big mistake.
“Second, bed blocking has not been a problem at all for a long time because Labour made sure it was not. It is only now problem because a Conservative government is removing the funding for social care which means that doctors cannot now discharge patients from beds because there is nowhere for them to go to. That is entirely a Conservative problem.”
It’s been a problem for many years. I have the numbers.
“what you are saying is that nurses may not have freedom to contract and must instead except regulated low pay ”
Actually no, and nurse’s pay is very generous compared to private sector pay. The problem is that trusts do not have flexibility to pay nurses the rate that would keep (as many as they need of) them as employed staff. Just avoiding the agency fees would save the NHS a fortune. Agency staff have a purpose because they allow hospitals to cope with variations in demand, but many inner city hospitals are mostly staffed by “permanent” agency staff.
And yet more private capture of public funds is being put in place. KPMG have now been appointed as “advisers” to GPs in London on how to run this system:
http://rd.kpmg.co.uk/mediareleases/24667.htm
My understanding is that Big 4 partners are charged out at £800+ per hour. This is more than a registered nurse earns in two weeks. We live in a society where an adviser for a day is “worth” more than a carer for two months – think about this when your loved ones are dying from cancer, your own health is failing or, god forbid, you’re getting old and you need someone to take you to the lavatory.
http://www.telegraph.co.uk/news/newstopics/mps-expenses/6989408/Andrew-Lansley-bankrolled-by-private-healthcare-provider.html
@Deeply Depressed
Yes, but the Big 4 partner’s tax is paying for the salary of the nurse or carer.
That is not to say the nurse or carer is worth less to society than a Big 4 partner – clearly they are worth much much more in many cases – merely to point out that if the Big 4 partner wasn’t earning £800/hr then you wouldn’t be seeing as many nurses.
So if the NHS does not spend £800 a day on an external accountant they will not be able to pay for its frontline staff.
I don’t follow that at all.
I’m not so sure that the big 4 partners create a net tax inflow to the treasury, given their focus on tax avoidance.
The rest of your argument doesnt really stand up to basic arithmatic
Big 4 partner £800 -> £200 tax income
NHS pay £800
Net flow £600 out to NHS
I’m sure there is some clever maths you could do to show me I’m wrong, but you are essentially saying the more the NHS spends, the more income which is available.
If this were true the ConDem health privatisation bill would be pointless from their own admission – all they would have to do would be to spend more money…
I’ve not heard any medical professional other than those likely to financially benefit from this bill say that it is a good thing
Its quite telling really!
@Trevor Border
This argument is utterly absurd
It assumes the nurse does not exist if the Big 4 partner does not exist
But they do
And so does the need for their service
Healthcare is not predicated on the existence of demand for financial services
Healthcare is predicated on the willingness of society to pay for it ahead of the bangles and baubles they might otherwise buy
And when Cameron threatens the NHS I think you’ll find they prefer the NHS to bangles and baubles
@Deeply Depressed
Sadly this is only the latest of a number of appointments by NHS and NHS trusts asking fo advice from consultants on commissioning. A quick Google for “consultancy London NHS xls” will show how much has been spent on McKinsey, Deloittes and others in London alone.