The NHS is being deliberately starved of funds, and this proves it

Support us and go ad-free

The long-running funding squeeze imposed by the government on the National Health Service has become so tight that it is now even affecting the payment of wages to hospital staff.

The extent of the problem is such that some hospital trusts around the UK have gone as far as to take out emergency loans from the Department of Health to keep paying salaries in the short term. Some of these loans are worth millions of pounds – ten of them are above £20 million – and require that the hospitals pay high rates of interest to the government, suggesting they are staving off a crisis today at the cost of an even greater crisis in the months ahead.

Under Jeremy Hunt, secretary of state for health, a scheme of “deficit loans” was introduced for hospitals in 2014. These are loans that have to be paid back with interest, in place of the permanent public investment used previously. The scheme was introduced in the belief that the need for repayments would discourage overspending.

Of course, it has never been demonstrated very convincingly that NHS deficits are a result of overspending, rather than underfunding. (They are not the same thing. Overspending involves investing in what is not necessary, whereas underfunding involves not having enough to invest in what is necessary.)

In fairness, the NHS did receive a much needed funding boost in chancellor of the exchequer George Osborne’s spending review last month. But, with the government’s plan for hospitals to hire more staff in a supposed bid to make wards ‘safer’, any abatement in financial difficulties is likely to be brief and swiftly offset. The government’s soundbite demands for a seven-day health service are also liable to add pressure on NHS finances sooner or later.

In the spending review, nursing students have been forced to fund their education through loans rather than through grants in future. With the worry that the timely delivery of wages is now in jeopardy, fully-qualified medical staff are joining the students in an uncertain financial future, while students themselves may well be wondering whether a medical career will be worth the pain. Why saddle oneself with years of debt, only to find that a steady salary is no longer guaranteed after graduating?

The deficits incurred by hospital trusts around the country are ominous; approximately three hospitals in every four are currently in the red and some projections suggest the hospital trusts network will have a shortfall for the year of over £2 billion.

Read on...

Support us and go ad-free

Richard Murray, policy director at the King’s Fund think tank, who used to work as an analyst at NHS England, is quoted as saying:

Most organisations are now in deficit. If you’d gone back five years that would have been inconceivable. Finance directors would have been sacked, there would have been hell to pay.

A spokesperson for the Healthcare Financial Management Association had this to say:

All providers within this system can expect to be subject to more scrutiny than in previous years and far more scrutiny than other providers. And for foundation trusts, the cost of receiving this support is the loss of some of their autonomy.

Interesting how that “loss of autonomy” rule did not apply to banks in anything more than name, when they received an enormous public bailout to rescue them from a complete meltdown in 2008, is it not? Once again, the private sector gets a playing field tilted in its own favour, while the public sector must play uphill.

There will be those who are quick to blame the surge in NHS deficits on “flawed practices” (usually left undefined) at an institutional level, but the historical evidence shows that the current deficit pattern is, in fact, a new development and unprecedented. The network of trusts posted annual surpluses more often than not until as recently as the financial year 2012-13.

The regulator, Monitor, has found one of the worst money drains to be an over-reliance of hospitals on costly agency staff to cover shortages in full-time personnel. This has been attributed by Labour to government funding cuts to training for nurses – a classic example of the false economy of austerity.

From this perspective, Osborne’s “generous” funding boost looks limited indeed. It is the darkest and coldest time of the year, which means it is also likely to be the time for the worst and widest ill health of the year. At this time more than any other, the NHS needs to focus solely on providing quality care and not on balance sheets. But the NHS deficit is likely to continue, meaning care will suffer, possibly with disastrous results. At that point, the government is likely to say that this proves public sector healthcare does not work, and embark on selling off what little of the NHS there is that remains untouched by the private sector.

As dismantling the NHS has long been the openly-secret wish of the current generation of the Conservative party, it is difficult to believe that what is happening is not precisely what the likes of Hunt and Osborne have been planning all along.


Featured image via Garry Knight on Flickr.

Support us and go ad-free

We need your help to keep speaking the truth

Every story that you have come to us with; each injustice you have asked us to investigate; every campaign we have fought; each of your unheard voices we amplified; we do this for you. We are making a difference on your behalf.

Our fight is your fight. You’ve supported our collective struggle every time you gave us a like; and every time you shared our work across social media. Now we need you to support us with a monthly donation.

We have published nearly 2,000 articles and over 50 films in 2021. And we want to do this and more in 2022 but we don’t have enough money to go on at this pace. So, if you value our work and want us to continue then please join us and be part of The Canary family.

In return, you get:

* Advert free reading experience
* Quarterly group video call with the Editor-in-Chief
* Behind the scenes monthly e-newsletter
* 20% discount in our shop

Almost all of our spending goes to the people who make The Canary’s content. So your contribution directly supports our writers and enables us to continue to do what we do: speaking truth, powered by you. We have weathered many attempts to shut us down and silence our vital opposition to an increasingly fascist government and right-wing mainstream media.

With your help we can continue:

* Holding political and state power to account
* Advocating for the people the system marginalises
* Being a media outlet that upholds the highest standards
* Campaigning on the issues others won’t
* Putting your lives central to everything we do

We are a drop of truth in an ocean of deceit. But we can’t do this without your support. So please, can you help us continue the fight?

The Canary Support us

Comments are closed