Prime Minister's NHS Funding Plan Receives Brexit Backlash

Prime Minister's NHS Funding Plan Receives Brexit Backlash

  • Alex Jones-Casey
  • 18 June 2018
  • Posted in: Health & Social Care, Management & Leadership

It’s world-cup season; so, it seems fitting to sum-up the government’s latest NHS funding ‘plan’ with what researchers found to be the sixth (out of 30) most irksome football pundit clichés:

‘If that was on target, it would have been a goal.’

In normal circumstances, announcing extra funding for the National Health Service is guaranteed to court gratitude from the press, the electorate and the NHS itself.

However, we live in anything but normal times.

Since Monday, Theresa May’s strategy for delivering a real-terms annual increase of 3.4% until 2023-24 has taken criticism from, seemingly, anyone with a wi-fi connection or in close proximity to a television screen. Amongst the detractors are:  

  • Traditionally conservative newspapers like the Daily Telegraph (‘Stealth Tax to Pay for NHS Boost’) and The Times (‘Black Hole in May’s Cash Plan for NHS’)
  • Conservative MP and former GP Sarah Wollaston – ‘The Brexit dividend tosh was expected’
  • Former Prime Minister Tony Blair – ‘This (New Labour’s) programme of investment and reform was supported by a clear and specific increase in in national insurance – unlike the plans announced today which appear to be dependant on mystery tax increases and a mythical Brexit dividend’.
  • Director of the Institute for Fiscal Studies, Paul Johnson – ‘As a pure arithmetic point of view over this period, there’s no money’.

The main point of contention in all instances is the Brexit dividend, or lack thereof, that the PM is citing as a source of the funding; because it doesn’t exist. The Financial Times captured the sense of bemusement gripping the commentariat in the first line of a Q&A story the publication ran yesterday: question: ‘Is there a Brexit Dividend’ answer: ‘No’. Though some of the most cutting criticism of the PM’s funding plan came from her own backbenches – specifically, from two Conservative MPs who were, before joining parliament, practising clinicians:

‘The Brexit dividend tosh was expected but treats the public as fools. Sad to see Govt slide to populist arguments rather than evidence on such an important issue. This will make it harder to have a rational debate about the ‘who & how’ of funding & sharing this fairly.’ Dr Sarah Wollaston MP
‘As a GP, I’m happy to see more money for our health and social care. We need to spend more as our population ages. But we must be honest about how we are going to pay. There is no evidence yet that there will be a ‘Brexit dividend’ – so its tax rises, more borrowing, or both.’ Dr Phillip Lee MP 

Foreign Secretary Boris Johnson was decidedly more excitable by the proposals:

‘Fantastic news on NHS funding – a down payment on the cash we will soon get back from our EU payments. #TakeBackControl #BrexitDividend’      

The notion of a Brexit dividend derives from the difference between the government’s payments to the EU as part of a divorce settlement and the money the UK would have been paying into the EU coffers as a member – equating to £3bn for 2020/21 and rising to £5.8bn by 2022/23. The UK government has already pledged to replicate funding commitments to projects currently financed by the EU – support for agriculture, research and development projects, local government subsidies and potentially continuing to pay into pan-European regulatory agencies will account for a majority of the ‘dividend’ brought about by Britain’s departure from the EU – leaving very little, and certainly not enough to finance the proposed budget increase.

‘The Conservatives will always be the party that keeps tax as low as possible and spends the proceeds responsibly. It is our firm intention to reduce taxes on British businesses and working families.’ So reads lines 10 – 12, page 14 of the Conservative Party’s 2017 manifesto. All indications are that this pledge will be joining the reintroduction of fox hunting and grammar schools on the bonfire of proposals that were included in the manifesto that the government will be unable to follow-through on. In a pre-recorded interview for the Andrew Marr Show aired on Sunday, the PM alluded to ‘contributing more as a country’ being a factor in the funding increase – something Chancellor Phillip Hammond won’t be pleased about. The PM even name-checked Hammond in a speech at the Royal Free Hospital in London on Monday where she elaborated on her Marr Show interview, stating:

‘The commitment I’m making goes beyond that Brexit dividend. Because the scale of our ambition for our NHS is greater still. So across the nation taxpayers will have to contribute a bit more in a fair and balanced way to support the NHS we all use. We will listen to views about how we do this, and the Chancellor will set out the detail in due course.’

A clash between the Chancellor and the Secretary of State for Health and Social Care, Jeremy Hunt, over how much to increase NHS funding by has, seemingly, been won by Hammond; who championed the 3.4% as opposed to Hunt’s preferred ‘at least’ 4% - closer to the figure given by NHS chief executive Simon Stevens of 5%. Whilst it may appear that Hammond has come out on top, he is the man responsible for finding £20bn of additional funding from an economy bracing to lose up to £15bn per year from public finances by 2023, a Brexit dividend that is either negligible or non-existent and a country that has already been promised no new tax increases.

To borrow from another tired football cliché: you can't win the title in July, but you can lose it.

  • NHS budget
  • further NHS funding
  • NHS England
  • central government
  • finance
  • Article Author

About Alex Jones-Casey

Alex is a Conference Producer at Open Forum Events, joining the company in the summer of 2017.
 
As a Conference Producer, Alex is responsible for generating ideas and constructing plans for future events with the intention of providing actionable discussion and strategy for public-sector workers and stakeholders.
 
A recent graduate of Teesside Univer…