Queen’s Speech

Lord Turnberg Excerpts

Monday 9th June 2014 Lords Chamber

[Lord Turnberg (Lab)]

My Lords, there was nothing in the Queen’s Speech about the NHS. Past experience suggests that may be a very good thing, but no one can be unaware of the serious financial problems facing health and social care over the next few years. Yet we also have this striking paradox that, according to the Office for National Statistics, we are the fourth wealthiest country in the world and we have more billionaires per square inch than anywhere else. So talk that we cannot afford an acceptable level of healthcare begins to sound just a little hollow. I know that it is unfashionable and distasteful to the Government—and, I fear, to my own party—to say that these services need more money. Furthermore, I have little doubt that we can afford it, as I will describe in a moment.

The year 2015 is frequently talked of as a “crunch” or “financial cliff” year, and after that the years ahead are talked of in even more gloomy terms of crisis and bankruptcy. It is not just me talking but a flurry of reports and predictions that have been produced in the last year or so that describe a fraught future for these services, and they are all accompanied by clarion calls for action of some sort. Yet there is this terrible sense that the Government are not listening and are simply ploughing on with their plans to make unrealistic savings, come what may.

After the Nicholson challenge of the last four years, in which savings in the NHS of £20 billion per annum have been made, mostly by short-term measures that are not sustainable, the long-term plan is to see even more draconian savings—£30 billion a year of them by 2021. Needless to say, no one in the service, where 40% of trusts are said to be already in deficit, believes that this is remotely achievable on current trends. Something has to give; there must be even greater efficiencies or more money. My thesis today is that we need both.

There is a surprising degree of agreement in the message that all the recent reports convey: a rising demand for health and social care by an ageing population with a frightening increase in the number of people with multiple long-term illnesses, including the burgeoning numbers with dementia. The reports point to the need to shift much more care from hospitals and into the community and to the desperate shortage of funds for social care as the severity of cuts to local authorities is being felt.

Of course, the service needs to change, not only in response to the economic pressures but in particular to the changing needs of society. There is little doubt that we should be providing better care in the community, more preventive measures, monitoring of vulnerable people, improving the desperately poor provision of health visitors and access to GPs at weekends and more rehabilitation facilities. These measures should reduce the pressure on acute hospitals, at least in theory. Focusing specialised services in fewer hospitals makes sense too, and providing more integrated hospital services may save money.

Such changes are absolutely vital, but the important point is that they cannot be made with the current level of funding. Where will the patients go when hospitals close and facilities in the community are not yet available? It requires new community services to deliver instantaneous improvements that equally instantaneously reduce the need for hospital admissions. As the King’s Fund makes clear in its report, the so-called Better Care Fund comes nowhere near filling the gap.

There are those who say pouring more money in is not the answer; it just goes into a black hole, they say. They are correct only if the service does not change at the same time, but it cannot change radically without more funds—hence the Catch-22 situation. Furthermore, the black hole idea ignores the evidence that the service improved dramatically when a Labour Government brought up the proportion of GDP for health to match that in the rest of the EU. It also ignores the proposals in the Wanless report of some years before, which concluded that funding for the NHS would have to rise to about 9.4% of GDP by 2021 to keep up with increasing demands.

Yet now the proportion of GDP for health has fallen from around 8% in 2010 to about 7%. Furthermore, the proposed further £30 billion a year savings will bring the proportion of GDP spent on the NHS down to 6% by 2021. Given our economic strength, which is fourth strongest in the world, how can we justify a plan to cut not just the amount we spend on health but its share of our national wealth from more than 7% to 6%? That is far lower than in any OECD country. There can be no justification for that and 6% is way off providing the 9.4% that Wanless recommended.

There have been several recent proposals on ways in which it may be possible to provide at least the transitional funds that would allow us to build up community services and then reduce hospital services. However, to my mind the only one that might fly is to have some sort of hypothecated tax, perhaps on the basis of a sales tax. But whatever mechanism is decided upon, it is a decision that must be made soon. We must level with the population now in advance of the election and not prevaricate.

It is unfortunate—and, I believe, disingenuous—that the current Health Secretary and the shadow Minister should run scared of saying anything about money. I fear that well before the next election they will come to regret that and will both have to recognise that it is not only transitional money that will be needed. I know that I will not be popular with my own Front Bench in saying that, but I do not think I am alone in wanting this or any future Government to come clean on what is needed for healthcare funding.