Funding of the National Health Service

The National Health Service in the United Kingdom is funded by taxation. Many groups argue that the NHS is underfunded.

In 2016 the systems were 98.8% funded from general taxation and National Insurance contributions, plus small amounts from patient charges for some services. About 10% of GDP is spent on health and most is spent in the public sector. In 2019, the UK spent roughly 10.2% of GDP on healthcare compared to 11.7% in Germany and 11.1% in France. The money to pay for the NHS comes directly from taxation. The 2008/09 budget roughly equated to a contribution of £1,980 per person in the UK. Some 60% of the NHS budget is used to pay staff. A further 20% pays for drugs and other supplies, with the remaining 20% split between buildings, equipment, training costs, medical equipment, catering and cleaning. Nearly 80% of the total budget is distributed by local trusts in line with the particular health priorities in their areas.

When the NHS was launched in 1948 it had a budget of £437 million (equivalent to £ billion in 2018). In 2016–2017, the budget was £122.5 billion. In 1955/56 health spending was 11.2% of the public services budget. In 2015/16 it was 29.7%. This equates to an average rise in spending over the full 60-year period of about 4% a year once inflation has been taken into account. Under the Blair government spending levels increased by around 6% a year on average. Between 2010 and 2017 spending growth was constrained to just over 1% a year. A 2019 report said that a study by the 'Centre for Health Economics' at the University of York found that between 2004/05 and 2016/17 the productivity of the NHS has increased nearly two and a half times as quickly as the larger economy.

In 2016 it was reported that there appeared to be support for higher taxation to pay for extra spending on the NHS as an opinion poll in 2016 showed that 70% of people were willing to pay an extra penny in the pound in income tax if the money were ringfenced and guaranteed for the NHS. Two thirds of respondents to a King's Fund poll, reported in September 2017, favoured increased taxation to help finance the NHS. Between 2010 and 2017, there was a cap of 1% on pay rises for staff continuing in the same role. Unions representing doctors, dentists, nurses and other health professionals have called on the government to end the cap on health service pay, claiming the cap is damaging the health service and damaging patient care. In 2017, the pay rise was likely to be below the level of inflation and to mean a real-terms pay cut. In 2017, the House of Commons Library research predicted that real-terms NHS funding per head was to fall in 2018–19, and stay the same for two years afterwards.

International comparison

In May 2018 it was reported that the NHS was under-resourced compared to health provisions in other developed nations. A King’s Fund study of OECD data from 21 nations, revealed that the NHS has among the lowest numbers of doctors, nurses and hospital beds per capita in the western world.

Workload

In January 2018, The Guardian said that GPs faced excessive workloads throughout Britain and that this put the GP's health and that of their patients at risk. The Royal College of Physicians surveyed doctors across the UK, with two-thirds maintaining patient safety had deteriorated during the year to 2018: 80% feared they would be unable to provide safe patient care in the coming year while 84% felt increased pressure on the NHS was demoralising the workforce.

Public opinion

A YouGov poll reported in May 2018 showed that 74% of the UK public believed there were too few nurses.

International performance

In September 2019 it was reported that cancer survival rates in the UK had been rising fast but probably still lagged behind the best results internationally, mainly because of late diagnosis.

Advocacy for increased funding

Various groups have advocated for increased NHS funding.

Discussion

In January 2018, The Guardian said that GPs faced excessive workloads throughout Britain and that this put the GP's health and that of their patients at risk. The Royal College of Physicians surveyed doctors across the UK, with two-thirds maintaining patient safety had deteriorated during the year to 2018: 80% feared they would be unable to provide safe patient care in the coming year while 84% felt increased pressure on the NHS was demoralising the workforce. Jane Dacre said, "We simply cannot go through this [a winter when the NHS is badly overstretched] again. It is not as if the situation was either new or unexpected. As the NHS reaches 70, our patients deserve better. Somehow, we need to move faster towards a better resourced, adequately staffed NHS during 2018 or it will happen again." In June 2018, at a time when the NHS was short of doctors, foreign doctors were forced to leave the UK due to visa restrictions. A study reported in November 2018 found that a fifth of doctors had faced bullying from seniors in the previous year due to pressure at work.

In May 2018 it was reported that the NHS was under-resourced compared to health provisions in other developed nations. A King’s Fund study of OECD data from 21 nations, revealed that the NHS has among the lowest numbers of doctors, nurses and hospital beds per capita in the western world. In May 2018, it was said that nurses within the NHS said that patient care was compromised by the shortage of nurses and the lack of experienced nurses with the necessary qualifications. A YouGov poll reported in May 2018 showed that 74% of the UK public believed there were too few nurses. In June 2018 it was reported that the NHS performed below average in preventing deaths from cancer, strokes and heart disease. In September 2018 it was reported that staff shortages at histology departments were delaying diagnosis and start of treatment for cancer patients. In England and Scotland cancer wards and children's wards have to close because the hospital cannot attract sufficient qualified doctors and nurses to run the wards safely. In November 2018 it was reported that cancer patients and child patients were having to travel very long distances to get treatment and their relatives had to travel far to visit the patients. In wards which had not closed staff sometimes worked under stress due to staff shortages. It was also predicted then, that Brexit was likely to aggravate those problems. In November 2019, it was reported that due to the shortage of nurses the NHS was then relying on less qualified staff like healthcare assistants and nursing associates.

For the period between 2010 and 2018 the Health Foundation funded research by Birmingham University said there was insufficient and falling NHS capital spending that put patient care and put staff productivity at risk. The Health Foundation said that £3.5 billion more a year would be required to get capital spending to the OECD average. Spending limits were effecting service efficiency, and patient care. Shortages of equipment and equipment failures had an impact as did relying on ageing diagnostic equipment.

In September 2019 it was reported that cancer survival rates in the UK had been rising fast but probably still lagged behind the best results internationally, mainly because of late diagnosis. In March 2019 it was reported that death rates from breast cancer were falling faster in Britain than in any other of the six largest countries in Europe, and were estimated then to have improved beyond the European average. In October 2018, according to Breast Cancer Care, 72% of NHS trusts across the UK did not provide dedicated specialist nurses for patients with incurable breast cancer." In September 2019 it was reported that Cancer Research UK maintained that more NHS cancer personnel were needed to enable the UK to catch up The NHS in England was expanding early diagnosis services with the goal of increasing the proportion of cancers diagnosed early (at stages 1 and 2) from 53% to 75% in the decade to 2028. In September 2018, it was reported that the NHS was the first health service in Europe to negotiate coverage for novel CAR-T cancer therapy, with agreement reached within 10 days of its European marketing authorisation.

In 2018, British Prime Minister Theresa May announced that NHS in England would receive a 3.4% increase in funding every year to 2024, which would allow it to receive an extra £20bn a year in real terms funding. There is concern that a high proportion of this money will go to service NHS debts rather than for improved patient care. In June 2018 it was reported that there were calls for the government to write off the NHS debt. Saffron Cordery of NHS Providers said that hospitals needed help to do their work without being up in deficit, as two-thirds were in the year to 2018. It was also said that some expressed doubt over whether May could carry out this proposed increase in funding. The next day, Health Secretary Jeremy Hunt backed the extra £20bn annual increase in NHS funding and responded to criticism by stating that taxation would be used to carry out the funding and that details would be revealed when the next budget is unveiled in November.

In June 2018 it was reported that the Institute for Fiscal Studies had stated a 5% real-terms increase was needed for real change. Paul Johnson of the IFS said the 3.4% was greater than recent increases, but less than the long-term average. In July 2016, health experts maintained the money would "help stem further decline in the health service, but it's simply not enough to address the fundamental challenges facing the NHS, or fund essential improvements to services that are flagging." In November 2018, it was thought that inflation may erode the real value of this funding increase.

As part of the 2018 funding increase the UK Government asked the NHS in England to produce a 10-year plan as to how this funding would be used. On 7 January 2019, the NHS England published the NHS Long Term Plan.

In March 2022 Rishi Sunak doubled the annual efficiency target for the NHS in England. The 2.2 per cent target would deliver annual savings of £4.75 billion. At the same time the additional covid funding is being removed in 2022-23. At the same time Sir Charles Bean, recently leader of the Office for Budget Responsibility pointed out that "the rising trend in health and social care spending and pensions will be adding something like another £75 billion spending over the next five years, £150 billion, potentially over the next decade" as if treatments are available to keep people alive longer, then people will want them.

The Guardian says that data for 2020 suggests a change, and that the doctors' trade union and professional association, the BMA, say this was largely due to raised spending during the pandemic and the effect of Covid on the whole economy, since the GDP of the UK dropped more than that of all other G7 nations. The BMA also said in December 2022 that the NHS experienced "historical underfunding and under-resourcing" during the ten years before COVID. The King's Fund maintains the investment in services started in 2021 was badly needed, but despite it restoring key services and performance standards will require years. Shortages of workers and growing staff numbers experiencing burnout and thinking of leaving the NHS may stop progress. If the new funding is to be efficiently used the NHS will need a comprehensive and fully funded workforce strategy to ensure future supply of staff.

In July 2022, The Telegraph reported that Civitas found that health spending was costing about £10,000 per household in the UK. This, they said, reflected the third highest share of GDP of any nation in Europe. This was said to show that the UK "has one of the most costly health systems – and some of the worst outcomes". The findings were made before the government increased health spending significantly, with a 1.25% increase in National Insurance, in April 2022. Civitas said this showed evidence "runaway" spending as health spending in the UK had increased by more than any country despite the significant drop in national income due to the Covid pandemic.

References

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