National Health Service: Sustainability

Lord Patel Excerpts

Thursday 9th July 2015 Lords Chamber

Moved by

[Lord Patel]

That this House takes note of the sustainability of the National Health Service as a public service free at the point of need.

[Lord Patel (CB)]

My Lords, it is a great pleasure to open this debate. I was a little concerned that, because of today’s Tube strike, our numbers might be devastated, but I am pleased to see that they are not—too much.

I am grateful to all noble Lords who will be taking part, many with a long experience in health. I am particularly delighted to see the noble Lord, Lord Mawhinney, in his seat and taking part in the debate.

Health is determined by a complex interaction of individual characteristics; lifestyle; and physical, social and economic environment—that is, your genetics, your epigenetics and your lifestyle. To keep the citizens of a nation healthy needs a strategy with appropriate policies and resources to address all these interactions. A system that keeps the citizens of a nation healthy needs to be a partnership of individuals, the wider community and the state.

While the state has a role in all aspects of health—prevention, healthcare and social care—the limits of that role have to be clearly defined and can be arrived at only by a wide consensus that includes the public, wider stakeholders and the state, each recognising and accepting their responsibility. What we have today in the NHS is primarily a service that treats patients when they are ill—some say a “sickness service”. It is clear that, when it comes to prevention, both the state and the individual need to do more—and I would say that the individual has a greater responsibility.

The consequences of not tackling disease prevention are grim, in terms both of individual misery and state resources. It is also clear that a changing demography—with a population increase—and increasing life expectancy will lead to an increase in the number of people needing social care.

The association of lifestyle with disease is well known, and yet in the UK 70% of the population is inactive, and 26% is obese, which will increase to 40% by 2025. This will result in 4 million people with diabetes. Some 70% of the population have poor diet and 21% smoke. Some 27% of men and 18% of women drink alcohol well above the safe limits. Some 40% of disease is related to lifestyle, including cancers and Alzheimer’s. The scale of preventable illness is staggering. An effective national plan—dare I say, which we do not have—for preventable illness could reduce mortality by 25% by 2025. Otherwise, the impact of lifestyle-related diseases and changing demography will put an even greater strain on resources.

The projected scenario is that there will be, apart from diabetes, 2.9 million people living with a long-term condition and 4 million living with cancer. By 2026, 1.4 million people will have dementia, costing about £3.5 billion a year. Some 4.5 million people will need help with daily living and 17 million people will have arthritis and other joint conditions. Providing social care will take a greater proportion of resources. The cost of care alone could consume 2.5% of GDP. A survey that showed that only 26% of older people think that they need to make provision for their social care demonstrates a lack of public concern and involvement.

I now come to the current state of the NHS: the care part of the health equation. The founding of the NHS, 67 years and four days ago, was heralded as a great piece of social legislation—and so it was. The public’s love affair with it has not diminished. At its launch, the annual budget was £280 million. In 2013-14, the NHS spend was approximately £116 billion—close to 9% of GDP—and the pressure on resources continues. The demand for care is not diminishing. Financial problems are now endemic among NHS providers. Even the previously best-performing trusts are heading towards deficit. Some 89% of trusts are forecasting deficits, faced with increasing demands, cuts in tariffs and the withdrawal of performance payments. Provider deficit could top £20 billion this year. The Five Year Forward View of Simon Stevens was a commendable document that I will return to later because it tries to address some of these issues. It predicts a need for extra funding of £8 billion a year by 2020-21. I know that the Chancellor yesterday said that he will fund it by £10 billion—but he included £2 billion already given to the NHS.

At the same time, the service has delivered already in the last Parliament £20 billion-worth of efficiency savings, mostly through limiting staff salaries, cutting administration costs and the lucky break of blockbuster drugs coming off patent. An ambition to deliver further efficiency savings of £22 billion a year by 2020-21 through productivity gains of 2% to 3%, if it can be achieved, will be challenging. Further reducing staff salaries and holding pay rises to 1% for the next four years, as announced yesterday, and reducing the price paid for treatment is an option likely to lead to a further decrease in morale and less commitment from staff, leading to poorer-quality care, poorer outcomes and, dare I say, less likelihood of getting the productivity gains proposed.

Historically, the NHS has never achieved productivity gains above 0.4% year on year. Achieving productivity gains of 1.5% will result in a shortfall of £16 billion; there will be a £21 billion shortfall if the gains are only 0.8%. In this scenario, the NHS will need an annual budget of nearly £200 billion by 2030 and one-fifth of the nation’s entire wealth by 2060.

The current financial pressures are despite more than 20 major reorganisations and policy changes, mostly to cut costs, over the past 20 years—and these continue. Most recently, further policies to cut costs include: the reversal of safe nurse-to-patient ratios; the removal of some clinical targets; reducing the cost of agency nurses; and reducing the cost of having consultants and the pay of senior managers. The recent Carter report addresses efficiency and productivity gains that could—I use the word “could” because that is what the document says—save £5 billion in procurement per year. We have had three previous reports on procurement in the NHS.

Not only do we have financial pressures but the performance of the NHS in terms of outcomes is not good. Although the NHS is rated very highly by the Commonwealth Fund for several parameters—no doubt the Minister will remind me about that—it is also rated second from bottom for avoidable deaths. Recent similar findings have been reported in a Health Foundation report for cancers, vascular disease and lung disease. There are 25,000 excess deaths associated with diabetes and 2,000 child deaths can be avoided. There is great variation in care throughout the country.

Primary care does not fare any better, with long waits for appointments in some areas, late diagnoses leading to an increased number of deaths, and a dwindling workforce. It is difficult to see how a seven-day service in both the primary and acute sectors can be delivered without higher costs, with patients with long-term conditions resorting to attendance at A&E because of the lack of community care. The separation of community care from hospital-based services and social care inhibits integration, makes the delivery system weak and fragmented, and thwarts innovation in care. The NHS has never been great at innovating for service delivery. While I accept that not all is bad in the NHS—we must not throw away all the good things that it has—the system as a whole is not performing well.

Is the current system sustainable? There are some who would say, “Yes, but it needs more resources”. Others would say, “Yes, if only we can produce the efficiency and productivity that is there to be had. It needs to improve”—there is room to do so, I agree—“and cutting waste will solve some of the problems”. Others feel that we need to look for a new settlement, for more durable, long-term solutions that will keep the citizens of this nation healthy for as long as possible in their life—a new system where prevention, care and social care are a continuum; in which the individual, the community and the state have a commitment and a shared responsibility; where people with long-term conditions are able to manage their own illnesses; where individuals plan for their own health and are helped to plan for their social care if they need it; and which can adopt new ways of care and embrace innovation.

The history of the past two and a half decades tells us that political parties will continue to manage the health service according to their ideology—managing scandals and giving a bit more money—but with no long-term planning as there will be no political consensus. We need a wider dialogue with the public, stakeholders and politicians to explore a new settlement, a new way of delivering care and social care, and, above all, a strategy to prevent illness. We need a national consensus that recognises and accepts that individuals, communities—including employers—and the state have a role in health and contributing to it. To do this, we need an independent national commission that is free to look at all the issues, not just at financing the service. The current system is not sustainable. I have no doubt that changes will be brought about. If we persist in the same way as we have done for the last 20 years we will see a gradual shift to a two-tier system: those who can pay will get care; those who cannot will not. The variations in care will get wider.

I hope that today’s debate can start a wider conversation. If that happens, I, for one, can imagine that the logical conclusion will be that we need an independent commission to explore a new way, a new settlement for health that is compassionate and caring, and where all citizens have a stake to contribute to make their life healthier. I think that Simon Stevens’ Five Year Forward View is a good strategy and a good point on which we can build.

I have two simple questions for the Minister. First, does he agree that the current system is unsustainable? Secondly, does he agree that all I have said about current and future scenarios is true? I beg to move.

--- Later in debate ---

[Lord Patel]

I thank the Minister for his response, and I am encouraged by his last comments. A 10% gain is still a gain—I would not have expected him to agree. By the way, I did not use the words, “royal commission”. I asked for an independent commission. I understand why political parties may not like the idea of a royal commission, but I am encouraged by what the Minister said.

I am grateful to all noble Lords who have taken part. It has been an excellent debate and the stature of those who have spoken indicates the interest in the subject. I do not think that the matter will be left today, just for another debate. I have to say to the noble Lord, Lord Hunt, that I get the feeling that political parties want to keep the health service in some trouble all the time, so they can use that for the next election.

[Lord Hunt of Kings Heath]

My Lords, the noble Lord is far too cynical.

[Lord Patel]

I wonder what makes me cynical.

Motion agreed.