Everything comes second to the socialist NHS

It’s a sign of the times: even Jeremy Hunt thinks the point of economic growth is to boost health spending

Virtually every British politician these days – no matter how half-heartedly – acknowledges that the country is in desperate need of more economic growth. But to what end?

You’d hope the answer would be to raise living standards, not least because they are deteriorating at a record pace right now. This week the Office for National Statistics revealed that real wages fell 3.2 per cent between November last year and January this year: the biggest fall since the financial crash. The Office for Budget Responsibility backed this up on Budget day, forecasting that real living standards will fall almost 6 per cent over 2022 and 2023 – the largest two-year decline since its records began in the 1950s.

Alas, no. Rising living standards was not the answer given by Jeremy Hunt after he delivered his Budget. Speaking to BBC Radio 4’s Today programme yesterday, the Chancellor gave a very different reason for pursuing growth: it was “going to pay for the NHS in the long-run”.

Depressing, but not at all surprising. After all, what debate these days doesn’t put the NHS at the very heart of the argument?

Look at the back-and-forth between the Tories and Labour post-budget. Of all the crummy announcements on Wednesday – public sector net debt still rising, the tax burden on track to hit a post-war high – the Opposition has decided to hone in on pensions, and the Chancellor’s decision to abolish the £1m Lifetime Allowance.

Britain’s pensions policy was well overdue a shake-up. Ditching the Lifetime Allowance is at least a start. The cap on total pension pot size has not only acted as a disincentive for professionals across a range of different sectors to stay working as they near retirement – it is a major distortion in the system, which puts the onus on workers to calculate lots of factors (including inflation) to make sure they don’t go over the limit, which results in serious tax penalties. In short: it is a big disincentive to save money.

But that is not how the Tories are defending their policy change. Instead, they are emphasising how it will make it more likely that doctors will stay working for longer. Meanwhile, Labour is up in arms that removing the cap applies to anyone other than doctors.

It’s to the Government’s credit that it didn’t start selecting winners, as Labour would have it do. But this is a decent policy change because of the incentive it creates for everyone to work, and to keep working, over their lifetimes – not just those with a medical degree.

Why does everything have to be justified on the basis that it will help the NHS? Especially when the NHS is failing its patients so badly? UK healthcare spending as a percentage of GDP now ranks fifth highest in the OECD, yet the system isn’t delivering even the most basic forms of care. Some 7.2 million people are currently sitting anxiously on the waiting list.

If we are to be generous to the Chancellor, his comments to the national broadcaster this week reflect a tough truth: that we need to prepare for healthcare costs to rise in the future. Dealing with a bigger bill is not going to be a Uk-specific problem, but an issue for developed countries across the world, as changing demographics and ageing populations require more resources.

But what will Britons get for the money? The social health insurance systems across Europe are much better at delivering for their patients. It’s a very different proposal – to be asked to pay more to maintain the ability to see your GP on the same day or schedule necessary surgery within a week – than it is to see your taxes soar and still to be told you still can’t get access to care for weeks, if not months on end.

The Government insists that it wants to make improvements. The Hewitt Review, commissioned by Hunt last autumn to look into NHS governance and efficiency, found its way into ministerial hands on Wednesday, according to the Health Service Journal.

But regardless of its findings, expectations should remain low. Despite a few positive noises, there has been little indication so far from the Government (with a general election always on its mind) that it is prepared to make meaningful reform to the NHS. Hunt dished out billions more last autumn, on top of the £13 billion the service is already getting to play Covid catch-up, without any promise of change. It seems ministers are nowhere near ready to do what’s necessary to get patients faster, better care.

So long as the NHS remains on track to take up 44 per cent of day-to-day public service spending in a few years’ time, it is the de facto elephant in the room when discussing the economy. It’s the vicious cycle of British politics: the more money the NHS eats up, the more politicians will focus on it.

Without reform, any talk of economic growth will remain inextricably linked to the NHS. It would be a very welcome shift if we spoke about economic gains in terms of wages, living standards, or individual prosperity. But political calculations have been made. And for now, those things must come second to the money-guzzling, socialist relic – better known as our beloved NHS.