NHS funding: civil servants decide, ministers hide?
With more money promised for the health and social care system, Kieran Lucia explores who gets to decide ‘how much is enough?’
“We have given the NHS more than the extra money they said they wanted for their five-year plan."
Theresa May, Prime Minister, 2016
How much money does the NHS need? The question has been an ever present in the background of health policy conversations since the start of the “longest period of austerity” in the NHS’s history in 2010.
But a less asked, but perhaps more important question is “who gets to decide how much is enough”?
The last official “answer” came in the Five Year Forward View (FYFV), driven by Simon Stevens, and negotiated by him with Numbers 10 and 11 directly. Numerous caveats aside, the FYFV presented an answer to the question: the NHS needed £8bn additional funding from the Government by 2020/21.
The 2015 General Election, and the politics of health until very recently, were framed by this answer and the way it was formulated. The Government (“we”) had given the NHS what “they” asked for, it was now up to “The NHS” to deliver.
The Prime Minister has publicly stated that she wishes to change this, and all indications point to the fact that the Government is intending to reward Simon Stevens’ year-long campaign for a financial ‘70th birthday present’ for the NHS this summer. In return, he’ll be expected to deliver another long-term plan. So, we can expect the same story to be told. The Government will “give” the NHS what “they” ask for. A deal between NHS England and the Government will provide the de facto “answer” to the funding needs across the sector.
But the lessons of the FYFV should make us question whether this approach is capable of generating a sustainable funding deal across an increasingly integrated health and social care sector. As is now widely acknowledged, the FYFV rested on unrealistic expectations for efficiency savings in the NHS. The resultant funding settlement exposed public health and social care budgets to cuts, as well as staff to a pay freeze, which undermined many of the central tenets of the FYFV. It underestimated how much money the NHS needed, and it failed to provide an integrated settlement across the health and social care system.
There are two reasons this is no surprise.
Firstly, the reorganisation that followed the Health and Social Care Act ensures that negotiations over a spending settlement are between the NHS on one side and the Government on the other. This arrangement (as it was designed to) seeks to de-politicise the question of “how much funding is enough” for the Government. With the onus on the NHS to answer the question, to develop a long-term costed plan, ministers are only required to decide how big a cheque they are willing to sign. In other words, the political pressure that comes with proposing an answer is outsourced from politicians to civil servants in NHS England. In the eyes of politicians (if not the media and the public), the failings of the FYFV were laid at the feet of Simon Stevens. The Government had given what “they” asked for.
Secondly, no matter how many caveats to protect social care or public health funding are written into the next long-term plan, NHS England has no mandate or ability to negotiate a wider funding settlement across health and social care. A less political CEO than Simon Stevens may not even try. NHS England will always be pressured to accept the best financial settlement for NHS England.
In short, the responsibility for deciding how much funding the health and social care system needs has been passed from politicians in Government to NHS England, a body which, through no fault of its own, has no mandate to deliver a funding settlement for the whole of health and social care.
Integrated planning and funding, across budgets and government departments, will be essential to delivering joined-up, whole-system care. By definition, an arm’s length body of one department is poorly suited to the job.
It might be an easy choice to outsource the task to NHS England again, but it would be the wrong one. Fortunately, Theresa May has already created a Department with the right name to bring together the disparate budgets and interests of the health and social care sector. It now needs to be allowed to do its job and take the lead in planning and negotiating a whole health and social care settlement in future.
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