Tories forced to admit NHS spending has fallen after official warning

The Conservatives quietly update their website after the UK Statistics Authority orders a correction.

Last week, the Conservatives were rebuked by the chair of the UK Statistics Authority, Andrew Dilnot, for falsely claiming to have increased real-terms spending on the NHS "in each of the last two years". In response to a complaint from the shadow health secretary, Andy Burnham, Dilnot stated that, contrary to recent Conservative statements, "expenditure on the NHS in real terms was lower in 2011-12 than it was in 2009-10". The most recent Treasury figures show that while real-terms spending rose by 0.09 per cent between 2010-11 and 2011-12, it fell by 0.84 per cent between 2009-10 and 2010-11. A significant cut followed by a paltry increase means that spending in 2011-12 (£104.3bn) was lower in real-terms (and in cash-terms) than in 2009-10 (£105.1bn).

Nonetheless, at PMQs the following day, David Cameron refused to concede that there had been any inaccuracy. "It is a very simple point. The spending figures for 2010 were set by the last Labour government. Those are the figures we inherited. All the right hon. Gentleman [Ed Miliband] is doing is proving that his government were planning for an NHS cut," he said.

But while Cameron publicly insists that nothing has changed, the Tories have quietly updated their website to reflect Dilnot's letter. Having previously claimed to have "increased the NHS budget in real terms in each of the last two years", the health section of the site now states, "we have increased NHS spending in real terms since 2010-11 and will continue doing so."

Before

After

Burnham is set to ask the Speaker to bring Jeremy Hunt to the Commons on Wednesday to correct the record in person.

David Cameron makes a speech to doctors and nurses on NHS reform in 2011. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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I was wrong about Help to Buy - but I'm still glad it's gone

As a mortgage journalist in 2013, I was deeply sceptical of the guarantee scheme. 

If you just read the headlines about Help to Buy, you could be under the impression that Theresa May has just axed an important scheme for first-time buyers. If you're on the left, you might conclude that she is on a mission to make life worse for ordinary working people. If you just enjoy blue-on-blue action, it's a swipe at the Chancellor she sacked, George Osborne.

Except it's none of those things. Help to Buy mortgage guarantee scheme is a policy that actually worked pretty well - despite the concerns of financial journalists including me - and has served its purpose.

When Osborne first announced Help to Buy in 2013, it was controversial. Mortgage journalists, such as I was at the time, were still mopping up news from the financial crisis. We were still writing up reports about the toxic loan books that had brought the banks crashing down. The idea of the Government promising to bail out mortgage borrowers seemed the height of recklessness.

But the Government always intended Help to Buy mortgage guarantee to act as a stimulus, not a long-term solution. From the beginning, it had an end date - 31 December 2016. The idea was to encourage big banks to start lending again.

So far, the record of Help to Buy has been pretty good. A first-time buyer in 2013 with a 5 per cent deposit had 56 mortgage products to choose from - not much when you consider some of those products would have been ridiculously expensive or would come with many strings attached. By 2016, according to Moneyfacts, first-time buyers had 271 products to choose from, nearly a five-fold increase

Over the same period, financial regulators have introduced much tougher mortgage affordability rules. First-time buyers can be expected to be interrogated about their income, their little luxuries and how they would cope if interest rates rose (contrary to our expectations in 2013, the Bank of England base rate has actually fallen). 

A criticism that still rings true, however, is that the mortgage guarantee scheme only helps boost demand for properties, while doing nothing about the lack of housing supply. Unlike its sister scheme, the Help to Buy equity loan scheme, there is no incentive for property companies to build more homes. According to FullFact, there were just 112,000 homes being built in England and Wales in 2010. By 2015, that had increased, but only to a mere 149,000.

This lack of supply helps to prop up house prices - one of the factors making it so difficult to get on the housing ladder in the first place. In July, the average house price in England was £233,000. This means a first-time buyer with a 5 per cent deposit of £11,650 would still need to be earning nearly £50,000 to meet most mortgage affordability criteria. In other words, the Help to Buy mortgage guarantee is targeted squarely at the middle class.

The Government plans to maintain the Help to Buy equity loan scheme, which is restricted to new builds, and the Help to Buy ISA, which rewards savers at a time of low interest rates. As for Help to Buy mortgage guarantee, the scheme may be dead, but so long as high street banks are offering 95 per cent mortgages, its effects are still with us.