NHS (Government Spending)

Margot James Excerpts

Wednesday 28th January 2015 Commons Chamber

[Chris Leslie]

If my hon. Friends will allow me, I want to make a little progress, but I will certainly give way again in a moment.

As a member of the shadow Treasury team, I want meticulously to explain the alternative course by which we will deal with the requirement for 20,000 additional nurses and 8,000 additional GPs, and the time to care fund of £2.5 billion. First, we would raise £1.2 billion from the levy on ultra-high-value properties—those worth more than £2 million—the so-called mansion tax.

Secondly, we would raise least £1.15 billion by closing three tax loopholes. The first is that hedge funds are avoiding stamp duty by getting tax-exempt investment banks to buy shares for them. At least £500 million is lost through that tax loophole, and we must close it. The second is that many large corporations, including some of the water utilities, are shifting profits out of the UK by borrowing large sums at high interest rates via their owners’ subsidiary companies through offshore stock exchanges. That is known as the quoted eurobond exemption. The third is that many employment agencies sign up workers to umbrella companies almost at random, and exploit tax reliefs on travel and subsistence without passing them on to the work force. Between £300 million and £600 million is lost to the Exchequer in that way. Those three tax loopholes must be closed.

Thirdly, we need to take £150 million a year from a new levy on tobacco company profits. That levy has worked in the United States, and we believe it is now appropriate in this country.

The sum of £2.5 billion is a significant investment that our NHS needs. It will also provide the time to care for the patients who deserve much more than the 15-minute chunks they have been getting recently.

[Margot James (Stourbridge) (Con)]

Leaving aside the fact that the previous Government were not much good at closing tax loopholes, I am sorry to hear that the Labour party has lost faith with one of the fundamental principles of the NHS, which is that it should be based on need and funded through general taxation. That is the most stable basis for funding our NHS, and the Labour party is taking a great risk with NHS finances by proposing otherwise.

[Chris Leslie]

That is rather interesting. The hon. Lady would criticise us if we said that we would do this through general taxation, but when we show where the money will come from—pound for pound—she criticises that as well. I want to hear the Conservatives say where they will get the extra money from for the NHS. I will come to that in a moment, but I will first give way to my hon. Friend.

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[Margot James (Stourbridge) (Con)]

Let me begin by reminding the House of a few facts. This Government have presided over an additional £12.7 billion of public spending on the NHS, which amounts to a real-terms increase of 4%. That is a singular achievement, given that there have been cuts in every other area of public spending bar two—cuts forced on us by the Labour Government’s appalling management of the public finances.

The public will judge as they find. Anyone who lives anywhere near the Welsh border will know that additional pressures on hospital services have arisen from the exodus of Welsh people in search of decent care. As Government Members have already pointed out, the Labour-run Welsh Assembly Government have cut the NHS in Wales by 8%. That contrasts very unfavourably with this Government’s 4% increase in spending on the English NHS. As I have said, the public will judge as they find.

I want to say a little about our spending on health services in comparison with that of other countries. We are doing quite well at the moment. The European Union average is 8.7% of GDP; the United Kingdom figure is 9.2%, 0.5% higher, and is identical to the Australian figure. We also get a very efficient return on our spending. I applaud the NHS, certainly in my area, for all that it does with that money. Our system is considerably more efficient than the United States’, which is a privatised system based on private insurance. It costs a great deal more to run, and health outcomes are poorer because of the under-treatment of people who are underinsured, and the over-treatment of people who are insured properly. The administrative costs of the American system are also excessive compared with those of the publicly funded NHS.

That is one of the reasons why I am so enraged by Labour’s lies and smears about our position on the NHS. We have no wish to privatise the NHS, even if we thought that was a good idea from an ideological point of view. I am an ex-business person, and if I took over the NHS, the last thing I would want to do is privatise it and create a system that would cost more to run and deliver worse outcomes.

[Grahame M. Morris]

I am sorry to interrupt the hon. Lady’s flow, but I want to defend the land of my fathers, Wales. I do not know whether the hon. Lady was present for the urgent question. We often measure the stress on the system according to the declaration of emergency and major incident plans. There have been 15 in England but, as far as I am aware, none in Wales.

[Margot James]

I do not want to cast aspersions relating to cover-ups and the like on some of the NHS management in Wales, but I think that some members of the hon. Gentleman’s own party have some salutary tales to tell on that front.

However, as was pointed out by my hon. Friend the Member for Sherwood (Mr Spencer), this is not just about spending; it is about how we control the budget and what we get for the money that we spend. I appeal to those who rate the Labour party on the basis of its health policies to reflect on its record. They should remember how much Labour was borrowing when it was running the NHS, and that it was spending money as though it were going out of fashion.

Under the last Government, the number of managers increased three times as fast as the number of nurses, and managers’ pay increased far faster than nurses’ pay. The management pay bill more than doubled under the last Government, but we have reduced it by nearly a fifth. There was absolutely no integration of health and social care under the last Government, although they had 13 years in which to put that right. Despite severe financial constraints, our record has been so much better than theirs, and that is the position I will put to my electorate when the time comes. We have produced 13,000 more doctors and nurses, and 21,000 fewer administrators and managers. That is what the public want to see. They know that this Government have the right priorities. In my area, that has translated to 353 more nurses and 84 more doctors in my hospital since this Government came to power. I congratulate our health ministerial team on not caving in all the time to producer interests—another facet of the last Government, with their command and control culture.

I want to mention a few of the things I am proud this Government have achieved within severe spending constraints. We have ended the indignity of mixed sex-wards. We have reduced infection rates dramatically. C. difficile infection rates have come down by a staggering 63%. The last Government grappled with this issue for 13 years, leaving a disaster when they left office. They had an appalling record. Another great innovation—one of many; I have not got time to mention them all—is the Cancer Drugs Fund, which has helped many of my constituents to get the treatment they were denied under the last Government, with all their spending largesse. That has also flowed through to the hospital sector—imaging and radiodiagnostic tests have increased by 34%. All these benefits have been achieved with very small real-terms increases in spend. That is what this Government have been able to do: deliver more with less.

[James Morris]

Under the previous Government, all the in-patient wards in one of my local hospitals, Rowley Regis, were closed, but during the last four and a half years they have reopened, and there has been lots of innovation and new services coming into that hospital.

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[Margot James]

That is a good example, and I know how hard my hon. Friend has worked in his constituency to assist in bringing about that improvement.

The polls clearly show that the public have very little confidence in Labour’s proposals to manage the economy. However, I want to make sure I do everything I can to get the public to cast a weather-eye over the Opposition’s plans for the NHS, and to remember which party introduced privatisation into the NHS, and why. I remember calling on an elderly lady who had been waiting almost two years for a cataract operation on both eyes. That was what the previous Government presided over, and in desperation they called in the private sector to reduce those waiting times. They could not bring about change within the NHS because of their target-driven management culture and their command and control-driven philosophy, so they had to bring in the private sector.

What we are seeing now is a tiny increase: the whole of the private sector accounts for less than 7% of total NHS activity, so we are talking about a small element that the Opposition are blowing up out of all proportion.

[Barbara Keeley]

Will the hon. Lady give way?

[Margot James]

I am sorry, but I am running out of time.

Labour’s record in government, when the producer interest held sway, stands as a salutary lesson which I hope people will remember.

No wonder there are serious divisions within the Opposition about their health policy, as was reported in the press only today. One Labour Front Bencher was anonymously quoted as saying that it would be a “fatal mistake” to increase the health budget without reforming it. I know there are some people with common sense on the Opposition Benches, but it is a shame they are not in control of health policy.

[Several hon. Members]

rose—