Can the Government’s proposed NHS reforms meet the efficiency challenge facing the health service while maintaining quality of care? This briefing paper presents a comprehensive analysis of the Government’s NHS White Paper: Equity and Excellence: Liberating the NHS, and the 2010 Spending Review.
The Government’s NHS reforms will be implemented in a period of significant financial challenge. As the 2010 Spending Review sets out, the NHS will receive 0.4 per cent real-terms growth over the next four years – 0.1 per cent a year. This compares to an average real-terms increase of 5.7 per cent per year from 1997/8 to 2009/10. This is the lowest four-year increase for the NHS since the 1950s.
The Spending Review also allocates £1 billion a year from NHS funding to social care: the real-terms change in NHS funding over the next four years, net of the social care support, is therefore a reduction of 0.5 per cent.
Unless the NHS can keep a tight grip on pay and price inflation, this will mean a reduction in the volume of health care services delivered
This briefing paper, which draws on national and international evidence, broadly supports the Government’s direction of travel but concludes that the NHS is challenged with delivering reforms in the face of increase demand and reduced funding.
It warns that unless the NHS can keep a tight grip on pay and price inflation, this will mean a reduction in the volume of health care services delivered.
The Nuffield Trust analysis also raises the issue of budget surpluses (also known as end-year flexibility). Stocks accumulated will now have to be made within the settlement outlined in the Spending Review. This change could have important implications for future budgeting.
This briefing will be of interest to health care policy-makers, senior managers and clinicians, academics and others interested in the NHS reform agenda.