NHS Funding Bill (Money Bill)

Lord Low of Dalston Excerpts

3rd reading & 2nd reading & Committee negatived & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords & Committee negatived (Hansard) & Committee negatived (Hansard): House of Lords
Wednesday 26th February 2020 Lords Chamber

[Lord Low of Dalston (CB)]

My Lords, the Bill commits the Government to increase funding for the NHS by £33.9 billion in cash terms by 2023-24, with NHS England spending increasing to £148.5 billion by 2024. This is the first time that a multiyear funding settlement for the NHS has been enshrined in law. It also provides a long-term settlement to underpin the commitments set out in the NHS Long Term Plan. This is an important element of the Government’s programme and should clearly be supported. But, while the additional funding for the NHS is to be welcomed, this will be adequate only if social care is also properly funded. If funding for social care is inadequate, knock-on effects impacting on the health service will be felt. Indeed, the NHS Long Term Plan clearly states that

“the wellbeing of older people and the pressures on the NHS are … linked to how well social care is functioning.”

When agreeing the NHS funding settlement, the Government therefore committed to ensuring that adult social care funding is such that it does not impose additional pressure on the NHS over the next five years. While the additional £1.5 billion promised for social care in the recent spending round for 2020-21 is welcome, this is the minimum needed to keep the adult social care system afloat this year. Indeed, it is questionable whether it is even that. Not all this funding is guaranteed for adult social care. Local authority funding has not kept pace with demographic pressures. Indeed, cuts in local authority funding have been a principal focus for cuts in public expenditure.

Looking ahead, there is a large funding gap to be bridged if the system is to be improved on a sustainable basis. Only last year, the House of Lords Economic Affairs Committee estimated that improving care quality and addressing unmet need alone would require an additional £8.1 billion in 2020-21. Without specific commitments to fixing the crisis in social care, spending on the NHS will be severely undermined. There is thus strong support for an amendment to the Bill requiring the Secretary of State to report annually on whether the allocation to adult social care is enough to avoid negative impacts on the NHS. As it is, following a decade of underfunding, the commitment in the Bill falls short of what is needed to respond to an ageing population and drive NHS standards up. The increase is 3.3%, despite the King’s Fund, the Nuffield Trust and the Health Foundation all stating that an increase of at least 4% is required to modernise the NHS and improve standards.

Age UK has two key concerns regarding the Bill. The first is that it does not apply to the whole of the healthcare budget. NHS England does not operate in isolation, and to improve the health of the population it is essential that new funding is accompanied by equivalent and sustainable investment in public health, social care and capital. Failing to invest now will increase the strain on the NHS and store up problems for the future. The second concern is that unless robust commitments are made to investment in the workforce, the funding provided in the Bill will be similarly undermined.

When it comes to improving population health, prevention is better than cure. Analysis by the Centre for Health Economics has found that spending on the public health grant is up to four times more cost effective than spending on the NHS. By investing in preventive services, it is possible to decrease the incidence of many common conditions that affect people in later life and reduce the burden on the NHS. The broken social care system harms everyone, not just those with an unmet need for social care. Delayed discharges from hospital due to a lack of social care costs our NHS an eye-watering £500 every minute. To help the NHS, the Government must secure the immediate future of care by investing to shore up the broken system and by setting out a long-term, sustainable solution.

Despite the importance of prevention, public health grant funding for prevention services from this April has not yet been announced. This means that providers are unable to plan, and some are even having to put staff on notice of redundancy as they are unsure whether contracts will be renewed. This uncertainty comes on top of historical funding cuts. Funding to local authorities for the public health grant has been cut by £700 million in real terms between 2015-16 and 2019-20, putting essential services for older people at risk. Areas with the greatest need have been worst hit, as was confirmed by Sir Michael Marmot just yesterday. Cuts to the public health grant have been six times larger in the poorest areas than in the wealthiest. Meanwhile, the 10 most deprived areas have shouldered 15% of the reductions to the public health grant. These cuts risk exacerbating the difference in healthy life expectancy between people living in the most affluent and those living in the most deprived areas, which already stands at 19 years. They also place the Government’s grand challenge on healthy ageing, which aims to improve healthy life expectancy by five years and reduce health inequalities, at significant risk.

If we want to improve public health, investment in the NHS alone is not sufficient. The Government must provide sustainable funding to the public health grant and develop a comprehensive strategy that lays out how it will improve public health for older people. It will additionally not be possible to fulfil the commitments laid out in the NHS Long Term Plan or make the most of the new funding provided by the Bill without urgent investment in the workforce. One in 11 vacancies in the NHS is currently unfilled. Last year, £5.5 billion was spent on temporary staff to cover vacancies and other short-term absences. If current trends continue, there will be a shortfall of 250,000 staff in the NHS by 2030.