Is the NHS reform overhaul merely cosmetic?

The government has accepted "core" changes to its NHS reform -- but the coalition's NHS headache is

The Health Secretary Andrew Lansley has confirmed significant changes to the government's NHS reforms, following a 10 week "listening exercise".
This looks like a significant victory for the Liberal Democrats, who resoundingly voted against moves to introduce greater competition. Reportedly, Nick Clegg was cheered by his MPs last night when he told them their demands had been "very, very handsomely met". In another victory for Clegg, the bill will return to committee stage in the House of Commons, meaning that it will not become law until next year.

At a joint press conference with David Cameron and Lansley, Clegg said that the government now has a plan "we can all get behind". The two key changes are watering down Monitor's role in promoting competition, and relaxing the 2013 deadline for reform.

While this is a significant step forwards, however, the coalition's NHS headache is not over yet. Cameron now faces the challenge of winning over Tory backbenchers who are angry at the way Lansley has been treated. It is believed that he was subjected to unfair briefings, given that his white paper on health was agreed by Clegg and Cameron last year.

However, Lansley and Cameron have both stressed that while the detail has been modified, the fundamentals of the plan -- giving greater commissioning powers to GPs and allowing greater competition in the health service -- are unchanged.

Gary Gibbon suggests that even these changes to the detail could be merely cosmetic:

Changing the terms for Monitor, the NHS regulator, is an interesting one too. I just asked a very senior member of the NHS Future Forum what was the difference is between an economic regulator and a sector regulator. "There's no difference," he said. If Monitor is no longer about "promoting" competition, what is its role on competition I asked. "Enabling" competition, came the answer. These are "totemic" changes, he said. You don't need a regulator to "promote competition" if you've created the space for competition. It'll just come, like breathing.

My source said the Forum frequently felt it was trying to put the original plans into politically acceptable language, not make radical change to the original Lansley reforms.

All this could be wishful thinking by supporters of the original reforms but I pass it on.

Conservative MP Sarah Wollaston, a former doctor and critic of the original bill, described these new proposals as "a change in emphasis". The Lib Dems are certainly entitled to their jubilation at these concessions -- but at this stage, it is impossible to tell what this will mean in practice.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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Autumn Statement 2015: George Osborne abandons his target

How will George Osborne close the deficit after his U-Turns? Answer: he won't, of course. 

“Good governments U-Turn, and U-Turn frequently.” That’s Andrew Adonis’ maxim, and George Osborne borrowed heavily from him today, delivering two big U-Turns, on tax credits and on police funding. There will be no cuts to tax credits or to the police.

The Office for Budget Responsibility estimates that, in total, the government gave away £6.2 billion next year, more than half of which is the reverse to tax credits.

Osborne claims that he will still deliver his planned £12bn reduction in welfare. But, as I’ve written before, without cutting tax credits, it’s difficult to see how you can get £12bn out of the welfare bill. Here’s the OBR’s chart of welfare spending:

The government has already promised to protect child benefit and pension spending – in fact, it actually increased pensioner spending today. So all that’s left is tax credits. If the government is not going to cut them, where’s the £12bn come from?

A bit of clever accounting today got Osborne out of his hole. The Universal Credit, once it comes in in full, will replace tax credits anyway, allowing him to describe his U-Turn as a delay, not a full retreat. But the reality – as the Treasury has admitted privately for some time – is that the Universal Credit will never be wholly implemented. The pilot schemes – one of which, in Hammersmith, I have visited myself – are little more than Potemkin set-ups. Iain Duncan Smith’s Universal Credit will never be rolled out in full. The savings from switching from tax credits to Universal Credit will never materialise.

The £12bn is smaller, too, than it was this time last week. Instead of cutting £12bn from the welfare budget by 2017-8, the government will instead cut £12bn by the end of the parliament – a much smaller task.

That’s not to say that the cuts to departmental spending and welfare will be painless – far from it. Employment Support Allowance – what used to be called incapacity benefit and severe disablement benefit – will be cut down to the level of Jobseekers’ Allowance, while the government will erect further hurdles to claimants. Cuts to departmental spending will mean a further reduction in the numbers of public sector workers.  But it will be some way short of the reductions in welfare spending required to hit Osborne’s deficit reduction timetable.

So, where’s the money coming from? The answer is nowhere. What we'll instead get is five more years of the same: increasing household debt, austerity largely concentrated on the poorest, and yet more borrowing. As the last five years proved, the Conservatives don’t need to close the deficit to be re-elected. In fact, it may be that having the need to “finish the job” as a stick to beat Labour with actually helped the Tories in May. They have neither an economic imperative nor a political one to close the deficit. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.