The must-read stories and debate in health policy and leadership.

Piqued interest

It has long been recognised many trusts would never be able to pay back the huge bailout loans drawn down since NHS finances dropped off a cliff in the middle of the last decade.

But the plan for what to do with these debts — which total a whopping £10bn — is finally becoming clearer, with the loans set to be converted to “public dividend capital”.

PDC does not have to be repaid, but attracts an annual charge (currently 3.5 per cent), so it’s not quite a write-off. More like switching to an interest only mortgage.

On paper, this is a brilliant development for dozens of providers — especially those with debts of more than 50 per cent of turnover, such as Medway Foundation Trust and North Cumbria Integrated Care Foundation Trust (formally, North Cumbria hospitals).

Yet, in practice, it won’t change the situation a great deal. Many of the affected trusts are still carrying large annual deficits anyway, so were never going to be paying the loans off any time soon. And they will still face the annual charges, which, if they stay at 3.5 per cent, might actually be more than the interest they were paying on the loans.

Meanwhile, there will be plenty of finance directors who will interpret the policy as a reward for failure, while admitting there weren’t really any other viable options.

But Mark Bridgeford, who works in provider monitoring at North East London Commissioning Support Unit, seemed to capture the exasperated feelings of many readers in the comment section: “The contortions we go through to prove that a market based model to deliver a universal healthcare system is rational or efficient keeps many of us in jobs. But adds little to the greater benefit of the population.

“The bigger question is how on earth did we get into a position where the public wait longer for treatment, die sooner than necessary, and suffer more in the process because one bit of a service they fund ends up in so much debt to another bit of a service they fund, due to made up rules based on a mythical market principle.”

The long-awaited Migration Advisory Committee’s report on salary thresholds and a points-based visa system has been published and, perhaps unsurprisingly, social care has been left out in the cold again.

The committee is clear that, although the salary threshold for a tier 2 route should be reduced to £25,600, this is still not the appropriate route to solve the problems faced by those hiring low-skilled workers such as those in the care sector. It will, however, enable most overseas NHS workers to continue to work in the UK.

The MAC throws the ball back in the government’s court and says ministers should consider using a lower salary threshold if they are very concerned about the impact of a new immigration system.

MAC chair Alan Manning has also been clear in his comments, describing the need for “difficult, unavoidable trade-offs”.

While the NHS might breathe a sigh of relief for its own staff, the warnings are consistent that the impact on social care — and the domino consequences for the health services — are potentially catastrophic.