Friday, November 22, 2024

As long as the NHS ‘wins’, the public will always lose

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What kind of signal does that send – if ministers talk about reform but in practice keep splashing the cash?

There is broad consensus that more capital spending – and investment in infrastructure, including hospitals – is long overdue. It is understandable that Ms Reeves wants to expand her ability to get some of these projects off the ground. 

But it’s the day-to-day spending that continues to cripple the UK’s finances. The health service now makes up 44pc of day-to-day public spending. Those pressures are only set to increase, as ageing demographics shift the balance between retirees and working-age people who finance the pay-as-you go system.

Reeves may be able to change her fiscal rules to put more money into infrastructure, but without wholesale reform of how the NHS is structured, financed and funded, those extra hospitals aren’t going to divert Britain from its current track of mass over-spending, as those day-to-day pressures only ramp up.

One of the biggest pitfalls of the austerity years in the early 2010s was the disproportionate levels of cuts that took place across departments. While the NHS budget continued to go up in real terms, departments such as Justice took a brutal beating. 

This was a cycle that Labour said it would break. But with the Budget looking increasingly like more of the same, this Government is under even more pressure to deliver the start of its “reform or die” plans – or risk even further decline. 

Kate Andrews is economics editor at The Spectator

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