The NHS crisis that none of the parties will discuss: how to pay for it

With a £30bn funding gap, all parties need to decide whether they would raise taxes, cut spending elsewhere, or impose patient charges. But don't expect them to tell us.

If there's one NHS issue that none of the parties are prepared to confront, it's that of funding. The common view is that the health service has been shielded from austerity by having its budget ring-fenced, but in reality the reverse is the case. Owing to the above-average rate of inflation in the service, the NHS requires real-terms rises just to stand still. As a recent Social Market Foundation paper noted, "A ‘flat real’ settlement for the NHS is mot what it sounds like since it is defined with reference to an irrelevant price index. To keep up with rising input costs, growing demand, and the public’s expectations for an adequate healthcare system, growth in spending on health has historically outstripped GDP growth." 

By historic standards, the NHS is undergoing austerity. Since 1950, health spending has grown at an average annual rate of 4%, but over the current Spending Review it will rise by an average of just 0.5%. As a result, in the words of the SMF, there has been "an effective cut of £16bn from the health budget in terms of what patients expect the NHS to deliver". Should the NHS receive flat real settlements for the three years from 2015-16 (as seems probable), this cut will increase to £34bn or 23%.

If they wish to avoid a significant fall in the quality and quantity of services, this government and future ones are left with three choices: to raise taxes, to cut spending elsewhere, or to impose patient charges. The third of these is proposed by the think-tank Reform today, which calls for a £10 charge for GP consultations, £10 fines for missed appointments, the introduction of a means-tested system for end of life care and an increase in prescription charges from £7.85 to £10 (with exemptions for those on low-incomes). It estimates that these measures would raise around £3bn a year, with research director Thomas Cawston commenting: "Few will want to debate higher NHS charges but the funding outlook for the service makes it unavoidable. Prescription charges are the easiest route to new revenue, with exemptions for people on low incomes built in." If this seems heretical, it's worth remembering that our "free" health service hasn't been truly free since Labour chancellor Hugh Gaitskell introduced prescription charges for glasses and dentures in his 1951 Budget (although they have now been abolished in Scotland, Wales and Northern Ireland).

But perhaps unsurprisingly, the Department of Health has responded by dismissing the idea out of hand. A spokesman said: "We have been absolutely clear that the NHS should be free at the point of use, with access based on need. That is why we have increased health spending in real terms alongside £20bn of efficiency savings to make sure the NHS continues to provide excellent care."

Labour, meanwhile, spying an opportunity to cause political mischief, has commented: "Patients will be alarmed that friends of Number 10 want to see charges for GP appointments and hospital care.

"Labour froze prescription charges before the election, but they have increased year on year under David Cameron. They are now creeping towards £10, as these plans want, and are adding to the cost of living crisis.

"The Government must come clean on any plans to charge for NHS care. They have already lost people’s trust over the crisis in A&E and thousands of axed nursing jobs – this will only add to it."

But this merely defers the question of how we will ultimately pay for a health service of the standard the public both expect and deserve. Will any party grasp this nettle before 2015? Don't count on it. 

Jeremy Hunt delivers a speech during his visit with David Cameron to the Evelina London Children's Hospital on July 5, 2013 in London. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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“Trembling, shaking / Oh, my heart is aching”: the EU out campaign song will give you chills

But not in a good way.

You know the story. Some old guys with vague dreams of empire want Britain to leave the European Union. They’ve been kicking up such a big fuss over the past few years that the government is letting the public decide.

And what is it that sways a largely politically indifferent electorate? Strikes hope in their hearts for a mildly less bureaucratic yet dangerously human rights-free future? An anthem, of course!

Originally by Carly You’re so Vain Simon, this is the song the Leave.EU campaign (Nigel Farage’s chosen group) has chosen. It is performed by the singer Antonia Suñer, for whom freedom from the technofederalists couldn’t come any suñer.

Here are the lyrics, of which your mole has done a close reading. But essentially it’s just nature imagery with fascist undertones and some heartburn.

"Let the river run

"Let all the dreamers

"Wake the nation.

"Come, the new Jerusalem."

Don’t use a river metaphor in anything political, unless you actively want to evoke Enoch Powell. Also, Jerusalem? That’s a bit... strong, isn’t it? Heavy connotations of being a little bit too Englandy.

"Silver cities rise,

"The morning lights,

"The streets that meet them,

"And sirens call them on

"With a song."

Sirens and streets. Doesn’t sound like a wholly un-authoritarian view of the UK’s EU-free future to me.

"It’s asking for the taking,

"Trembling, shaking,

"Oh, my heart is aching."

A reference to the elderly nature of many of the UK’s eurosceptics, perhaps?

"We’re coming to the edge,

"Running on the water,

"Coming through the fog,

"Your sons and daughters."

I feel like this is something to do with the hosepipe ban.

"We the great and small,

"Stand on a star,

"And blaze a trail of desire,

"Through the dark’ning dawn."

Everyone will have to speak this kind of English in the new Jerusalem, m'lady, oft with shorten’d words which will leave you feeling cringéd.

"It’s asking for the taking.

"Come run with me now,

"The sky is the colour of blue,

"You’ve never even seen,

"In the eyes of your lover."

I think this means: no one has ever loved anyone with the same colour eyes as the EU flag.

I'm a mole, innit.