Health and Social Care Budgets

Meg Hillier Excerpts

Tuesday 14th March 2017 Westminster Hall

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

I beg to move,

That this House has considered budgets for health and social care.

It is a pleasure, as ever, to serve under your chairmanship, Mr Bailey. I thank the Backbench Business Committee for granting this important debate about the funding of health and social care. I pay tribute to my fellow Committee Chairs—the hon. Member for Totnes (Dr Wollaston), Chair of the Select Committee on Health, and my hon. Friend the Member for Sheffield South East (Mr Betts), Chair of the Select Committee on Communities and Local Government—for their work, including with my Committee, to shine a light on the challenges of funding our health and social care system for the next generations. I also pay tribute to the Select Committee on Public Administration and Constitutional Affairs for its work in this area. The fact that four Select Committees, and three in particular, are focusing their attention on the issue demonstrates its importance to the nation and to the long-term health of our citizens.

The Public Accounts Committee’s view and concern, which is well documented in a dozen reports produced by us in this Parliament alone, is that there is a challenge with the funding settlement for the national health service. I will not repeat all the arguments that I made in the Chamber during the debate on the estimates the other week, but we are also in the grip of a crisis in social care. The NHS accounts are showing the strain again as we approach the year end.

Last year, as I am well documented as saying, the Comptroller and Auditor General put an extraordinary commentary on the Department of Health accounts, which were laid on the last day of Parliament’s sitting. Extraordinary measures were taken to get them into balance—again, I will not mention them all, but it was a difficult adjustment. The permanent secretary at the Department of Health has acknowledged that that was not good enough, and that such one-off measures should not be repeated. We are now hearing concerns that NHS trusts are delaying paying their suppliers in order to ensure that their budgets balance. We know that, once again, capital funds will be raided and converted into resource funding to keep the NHS on track.

My Committee has discovered that funding in every area of the NHS is facing increasing demand, including specialist services, diabetes and discharge from hospital, which we have considered. The increasing age of the population and advances in medicine mean greater demand on our national health service. When the Government tell us that they are putting more money into the NHS, we must treat that with caution: more money without consideration for the number of people using the service and those who will need it in future is not always enough. Not only is the money not meeting current need, but it will not meet the growing demand.

I will speak briefly, as I am aware that 15 or so Members are scheduled to speak in this debate. The Budget came up with some solutions, as the Chancellor sees them, for funding the NHS. Our concern is that, once again, piecemeal funding is being offered rather than long-term solutions. The Chancellor talked about putting £2 billion into social care, £1 billion of it in the next financial year, starting in April. However, the Local Government Association estimates that more than £1 billion every year is needed to fund the gap in social care. The 2% council tax, often vaunted as a great solution, is a challenge in some areas, particularly where the council tax base is low. My own local authority has increased council tax to cover it, which of course means that local taxpayers are helping fund the system.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I congratulate my hon. Friend on securing this important debate. Dementia Care, a charity based in my constituency, has deep concerns about the current and future funding plans for social care. Dementia Care believes, and I agree, that funding should be based on need, not on a local area’s ability to raise council tax, which clearly disadvantages people in areas such as Newcastle. I know that my hon. Friend shares this view, but I wanted to reiterate on the record that charities providing vital services up and down the country share her concerns.

[Meg Hillier]

I know that my hon. Friend the Member for Sheffield South East will discuss the funding of social care in more detail.

[Caroline Lucas (Brighton, Pavilion) (Green)]

I, too, congratulate the hon. Lady. Does she agree that Ministers are engaged in wishful thinking? The ability to reduce the number of hospital beds relies on the availability of better and more social care, yet in Brighton our sustainability and transformation plan footprint means that we are being forced to find another £112 million in efficiencies specifically in social care. It just does not add up, and it is not sustainable.

[Meg Hillier]

One concern that our Committee has uncovered is the pressure to make 4% efficiency savings. That figure was used in the last Parliament, but has now been acknowledged to be too stiff a target. However, we are also seeing a move to 4% efficiency savings in STPs. That is challenging to achieve while going through transformation. One would expect the Public Accounts Committee to be no slouch in considering where efficiencies can be found, but even with efficiencies there is just not enough money in the system. It is being squeezed.

One welcome aspect of the Budget—I hope that the Minister can give us more detail—is that there will be a Green Paper later in the year on the future funding of social care; again, I know that my hon. Friend the Member for Sheffield South East will want to talk more about that. There are also other bits of money: £100 million to support 100 new on-site GP triage projects at accident and emergency departments in hospitals in time for next winter; £325 million in capital funding to support the implementation of sustainability and transformation plans that are ready to proceed; and a multi-year capital programme for health. That all sounds like a lot of money, but relative to the total NHS budget, it is a very small amount, and the concern is that it is not long-term and sustainable. That is what our Committee said. A long-term plan is necessary for funding the NHS.

After looking at this year’s accounts, we are concerned about the number of trusts in deficit; perhaps the Minister can update us on that. As of month 9 of this financial year, 74 of 238 trusts were in deficit, to the tune of £886 million total. Granted, that is less than the £2.5 billion last year, but it is still not a healthy situation. Raiding capital funds to pay for resource and other such measures is just not acceptable in the long term.

[Jason McCartney (Colne Valley) (Con)]

I commend the hon. Lady on working cross-party to find long-term solutions for the huge issues facing social care and the NHS. She highlighted the fact that capital money has been transferred to revenue. Does she agree that in places such as Huddersfield, in my area, that makes the prospect of looking for another disastrous private finance initiative deal to fund capital improvements more likely? The disastrous PFI at Halifax is now dictating disastrous changes at Huddersfield; services are being moved to fund that PFI deal.

[Meg Hillier]

The hon. Gentleman rightly highlights that the NHS is not new to challenges in dealing with capital projects. One of our concerns about taking out capital is that NHS buildings and equipment will deteriorate, costing more in the end. That is not good value for money, which is what my Committee considers. We should all be watching the situation. The consequences might not be apparent today, but they will become so as time goes on, and we as parliamentarians need to keep a close eye on what is happening in our local area. I am glad that the hon. Gentleman is doing so.

I will finish, as I am aware that an awful lot of Members want to speak. We must not forget that the situation has an impact on patients. For instance, the target for accident and emergency waiting times is 95%, but actual performance is just under 87%. Diagnostic waiting times have risen from 1% to 1.68%, and referral to treatment within 18 weeks has not reached its 92% target; it is just under 90%, at 89.41%. The number of people waiting more than 52 weeks for referral to treatment is 1,220. Those are just some of the figures demonstrating the impact of how NHS and social care finances are being managed and what is happening to patient outcomes.

[Ms Margaret Ritchie (South Down) (SDLP)]

I congratulate the hon. Lady on securing this much needed debate. Does she agree with me and other stakeholders that a comprehensive review is needed in which everybody—stakeholders, the Government and the Opposition—works together to find a way forward for a comprehensive funding solution?

[Meg Hillier]

The hon. Lady neatly brings me to my conclusion. That is what we need: a long-term, sustainable future for our national health service. The present situation will not last from Parliament to Parliament and from one governing party to another. We need to agree a way forward and have a national conversation. We did that with pensions. It was difficult, but we got there—I know that there are still issues, but we reached cross-party agreement. We cannot chop and change, and we cannot have Governments pretending that throwing a little bit of money at the problem in a Budget is a solution. We need a long-term, sustainable solution and a national conversation about what the NHS will deliver and what outcomes we want to achieve.

[Several hon. Members rose—]

--- Later in debate ---

[Meg Hillier]

I thank all hon. Members for their contributions to this thoughtful and reasoned debate. I do however need to challenge the Minister on his suggestion that there was strong support for the Budget measures. Let us not overplay it: there were “buts” in the speeches of nearly all hon. Members. Therefore, while those measures are a help, I think everyone agreed that they are not sufficient, because that is not long-term funding.

Let us be clear. We have had short-term funding though the better care fund, a recent announcement on money for GPs at A&E, the cash injection of £2 billion for social care front-loaded for the next financial year, and a precept increase of 2%. None of that is long-term sustainable funding. Let us also nail the issue of the £10 billion with which the NHS plan has been resourced. That has now been stretched by the Government over a six-year period, not five years—both my Committee and the Health Committee have highlighted that—while they continue to seek a 4% efficiency saving. It is not just the Select Committees saying that; the Comptroller and Auditor General said of the NHS accounts that there is not yet

“a coherent plan to close the gap between resources and patients’ needs.”

Ministers really need to get a grip on that.

Will the Minister write to the Select Committee Chairs, outlining in more detail not just the timescale for the Green Paper’s publication but the proposed plans for discussions around that and when it will be taken further forward? Will he also write to us about the Care Act, phase 2, which has come up in the debate, albeit not mentioned directly? The permanent secretary at the Department of Health could not give an answer to our Committee. He talked about it being postponed, possibly to 2020. It would be helpful if the Minister would write to say what is happening with that element of the Care Act.

There is a strong view that there is a need for a long-term solution, and the Budget measures are not yet that. Health and social care are interconnected, and hospitals are not a great place for older people to be in. We need to ensure that we have a long-term sustainable solution to keep people out of hospital, keep them well as long as possible and keep them independent. That requires long-term thinking, not the sticking-plaster measures that we keep seeing unveiled by all Governments at the time of elections, especially in the light of cuts.

Motion lapsed (Standing Order No.10(6)).