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7 July 2010

Why the NHS shouldn’t be spared from cuts

Protecting the £110bn national health budget entails unjustified cuts elsewhere.

By George Eaton

This morning’s Independent reports on growing anger among Conservative MPs over the coalition’s costly pledge to ring-fence spending on the NHS. We can expect opposition to intensify as the autumn spending review (due on 20 October) draws closer.

A Tory backbencher is quoted as saying: “MPs are getting a reaction in their constituencies about the cuts to the school-building programme. They are wondering why the NHS should be protected when the future of our children is apparently not.” It’s a good point. The Tories’ promise to protect the NHS (and International Development) from cuts has everything to do with politics and nothing to do with economics.

The decision not to touch the £110bn NHS budget (the development budget is a far smaller £6.2bn) is part of the reason why other departments of key importance (Transport, Housing, Local Government) are now facing savage cuts of up to 33 per cent.

There is a good argument for treating the NHS with care: factors such as an ageing population, drug prices and technology make inflation in the health service roughly 3 per cent higher than in the rest of the economy. But, as in the case of education, this should make the NHS a candidate for limited cuts (about 5-10 per cent), not for no cuts at all.

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To his credit, Andy Burnham, the former health secretary and Labour leadership candidate, has argued as much: “The effect is that he [George Osborne] is damaging, in a serious way, the ability of other public services to cope: he will visit real damage on other services that are intimately linked to the NHS.”

So far, Labour has failed to land any hefty blows on the coalition over spending cuts. The party’s message (when one is discernible) is always hindered by the question: what would you cut? Coming out against ring-fencing could help the party to answer this question.

It could be Labour’s Nixon-in-China moment: only the party of the NHS can be trusted to cut with care. It is time to expose the Tories’ pledge for the political positioning that it is.

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