Cutting the NHS to fund defence is bad politics and bad policy

Raiding £500m from the health and schools budgets to fund defence might please Tory MPs but the voters won't like it.

David Cameron and George Osborne have long rejected calls from figures such as Vince Cable and Liam Fox to end the protection of health spending in order to limit cuts elsewhere. But the NHS ring-fence is looking less secure today. Ahead of June's Spending Review, the Telegraph reports that Philip Hammond is in talks with the Treasury about transferring up to £500m from the health and schools budgets to reduce the expected cuts to defence. The Defence Secretary, you'll recall, has previously publicly demanded that welfare is cut again to protect the MoD. But with the Lib Dems vetoing any further cuts to welfare (bar those to pensioner benefits, which David Cameron has pledged to protect), Hammond has been forced to look elsewhere. 

Cameron has already demonstrated his willingess to raid other departments' budgets to fund defence by suggesting that aid spending could be used to meet the cost of peacekeeping and other defence-related projects. It's thought that the government would justify any decision to divert resources from health and education to defence by pointing to the hundreds of millions of pounds a year the MoD spends on health care for armed forces personnel and the education of their children. But while the move will prove popular with Tory MPs, who are furious that defence is being cut by 7.5 per cent, while aid is being increased by 37 per cent, it is likely to be judged less favourably by the public. 

As a ComRes/ITV News poll published in February showed, health and education are the two most popular spending areas, with defence trailing in sixth place (behind police and law enforcement, welfare and transport). It was partly for this reason that Cameron and Osborne chose to ring-fence the NHS and schools budgets. At last week's PMQs, Cameron made much of his commitment to protect health spending, contrasting it with Labour's decision not to pledge to do so before the 2010 election. "The right hon. Gentleman’s answer is to cut NHS spending, whereas we are investing in it," he declared. A decision to now do otherwise would offer Labour an easy political hit. 

It is also doubtful whether the NHS, which is already required to make unprecedented efficiency savings of £20bn over four years, should be cut for the purpose of reducing cuts to defence. The above-average levels of inflation in the health service mean that it requires real-term increases in spending just to stand still. But under pressure from his recalcitrant backbenchers and the National Union of Ministers, Cameron may yet give away. 

David Cameron with British soldiers based at Lashkar Gah in Helmand Province, Afghanistan. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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How Theresa May laid a trap for herself on the immigration target

When Home Secretary, she insisted on keeping foreign students in the figures – causing a headache for herself today.

When Home Secretary, Theresa May insisted that foreign students should continue to be counted in the overall immigration figures. Some cabinet colleagues, including then Business Secretary Vince Cable and Chancellor George Osborne wanted to reverse this. It was economically illiterate. Current ministers, like the Foreign Secretary Boris Johnson, Chancellor Philip Hammond and Home Secretary Amber Rudd, also want foreign students exempted from the total.

David Cameron’s government aimed to cut immigration figures – including overseas students in that aim meant trying to limit one of the UK’s crucial financial resources. They are worth £25bn to the UK economy, and their fees make up 14 per cent of total university income. And the impact is not just financial – welcoming foreign students is diplomatically and culturally key to Britain’s reputation and its relationship with the rest of the world too. Even more important now Brexit is on its way.

But they stayed in the figures – a situation that, along with counterproductive visa restrictions also introduced by May’s old department, put a lot of foreign students off studying here. For example, there has been a 44 per cent decrease in the number of Indian students coming to Britain to study in the last five years.

Now May’s stubbornness on the migration figures appears to have caught up with her. The Times has revealed that the Prime Minister is ready to “soften her longstanding opposition to taking foreign students out of immigration totals”. It reports that she will offer to change the way the numbers are calculated.

Why the u-turn? No 10 says the concession is to ensure the Higher and Research Bill, key university legislation, can pass due to a Lords amendment urging the government not to count students as “long-term migrants” for “public policy purposes”.

But it will also be a factor in May’s manifesto pledge (and continuation of Cameron’s promise) to cut immigration to the “tens of thousands”. Until today, ministers had been unclear about whether this would be in the manifesto.

Now her u-turn on student figures is being seized upon by opposition parties as “massaging” the migration figures to meet her target. An accusation for which May only has herself, and her steadfast politicising of immigration, to blame.

Anoosh Chakelian is senior writer at the New Statesman.

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