Healthy passage to India

How the UK has been in discussions about flying NHS patients in order to cut waiting times

Britain has been in high-level discussions with India about the possibility of flying NHS patients there for treatment to cut waiting times, India's minister of health, Anbumani Ramadoss, told a conference of doctors in London last month.

Ramadoss told the conference, organised by the British Association of Physicians of Indian Origin (BAPIO), that he had had informal talks with Hugh Taylor, permanent secretary at the Department of Health, and had discussed the possibility of NHS patients being treated in India.

A source close to the Health Secretary, Alan Johnson, confirmed that the offer had been made by the Indian minister, but said such a proposal was not under consideration by the Department of Health. A spokesman added that the British government's position remained that there was no right for NHS patients to receive treatment outside the European Economic Area (EEA).

But Ramadoss insists that the permanent secretary's "response was positive". He told the conference he was "confident" that the next few months could see the NHS opening out.

Sending patients for treatment outside the UK is not a new idea. Since January 2002, almost 600 patients have been funded by the NHS to travel to France, Belgium and Germany for treatment. This is arranged at the discretion of primary care trusts.

However, the ultimate decision to travel to the EEA rests with the patient. "Patient choice in cases when the NHS cannot provide a service quickly has been seen as one way of bringing waiting lists down, especially where the NHS system has failed to improve despite more resources," said Professor Ewan Ferlie, director of the Centre for Public Services Organisations at Royal Holloway University. So far, those seeking destinations for quicker treatment have been restricted to Europe. "India is going too far - literally," added Ferlie.

Professor John Appleby, chief economist at the King's Fund, the influential health policy think-tank, believes that sending patients to India would not necessarily be cost-effective. Though the cost of treatment may be lower than in Britain, travel, accommodation and other costs could add up to a substantial amount, he thought. "This is a complicated solution to an issue which is somewhat diminishing in intensity," he said.

The idea that India could become a viable destination for NHS patients has its supporters. Dr Ramesh Mehta, president of the BAPIO, said that India could offer the same, if not better, quality of treatment than patients receive in Britain or the EEA on two counts: "First, Indian hospitals are offering to provide for families who accompany the patient, which European hospitals do not do. And the second point is obvious - treatment is so much cheaper."

Last year, some 150,000 foreigners travelled to India and paid for their own treatment. But the health services of some countries do send patients considerable distances for treatment. Tanzania is one. In the past five years, nearly 200 Tanzanians have travelled to India for heart surgery. Canada is another. Patients can be reimbursed for treatment abroad, provided they have approval from the provincial authority.

"I'm pro-choice, and I think patients should be able to choose where they get treatment," said Nick Bosanquet, professor of health policy at Imperial College London. But he expressed reservations about how popular India would be with patients. "It's positive for those who might go to India anyway, like people from the Asian community, for instance, or people who want to go there on holiday. But the distance, travel difficulties and the question of how to organise aftercare may not appeal to everyone." Numbers suggest otherwise. Last year, more than 70,000 British patients went abroad for treatment, India being a favoured destination.

"They spent their own money to do this and that's simply not fair," said Mehta. "Patients deserve quick treatment, and if they can't get that in their own country, they should be paid to get it somewhere else. The fact that so many went to India last year shows that patients are telling the NHS what needs to be done."

This article first appeared in the 18 February 2008 issue of the New Statesman, Naughty nation

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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.