Before the NHS turns 70 on 5 July, the government will have revealed its broad ambitions for the “sustainable long term plan” and the accompanying “multi-year funding settlement” promised by Theresa May in March.
How big an increase in the health budget that settlement will provide is understandably the question receiving the most attention, but there are others worthy of examination.
When it comes to “how much”, the Treasury will know anything lower than 2.9 per cent real terms per year is likely to be rejected by the NHS, while those negotiating for health realise that anything above 4 per cent is likely to get short shrift from the chancellor.
Therefore, the final settlement will start with a three.
This is rich fare compared to the gruel the service has had to live on since 2010, but it is also below the average historic funding growth received by the NHS.
Next, people will want to know how long the new funding commitment will be made for and what shape it will take.
The message emerging from the negotiations is this is not going to be a transformative moment to compare with the 2002 budget
Within the corridors of power, the PM’s promise is often referred to as “a 5-10 year plan”.
This is not just people keeping their options open – it is also a recognition that there are, in effect, two plans being developed – one to take us to the end of this parliament and the other to the end of the next decade.
The 3 per cent commitment applies to the five year element.
In 2015, the funds released by George Osborne to support the implementation of the Five Year Forward View were significantly frontloaded.
This settlement will be more evenly distributed in recognition that it will take the NHS time to train and/or recruit more staff, as well as for any increased capital expenditure to make service change possible. If the settlement is nearer 3.0 than 3.9, there may be a desire to do some frontloading to more rapidly realise productivity gains.
The distinctive part of this reform package will be the “10 year plan” for longer term investments, particularly in workforce. Here all the negotiators are trying to avoid the mistakes made too often by past policymakers and ensure they plan now for medium and long term increases in demand. This will no doubt be informed by the workforce strategy being developed by Health Education England.
We should not expect specific funding commitments, but will hopefully get an unambiguous view on the number and mix of clinical staff the service will need by 2028, and a strategy for delivering them both.
What happens after July?
What happens once the PM has set out her ambition for the service, on or before the NHS’s birthday?
That largely depends on whether the NHS leadership views the level of money it is being offered as sufficient to deliver what the government wants the service to achieve.
A repeat of last year’s budget disagreements would be grim indeed and all parties are keen to avoid it.
The likeliest option is that in the late summer and autumn there will be intensive work on the details of the plan and funding package in time for the big reveal at November’s budget.
At this point, minds will focus on what the new cash might be spent on.
There is no chance of a significant increase in social care funding as part of the ‘NHS birthday present’
The clear message emerging from the negotiations is this is not going to be a transformative moment to compare with the 2002 budget and the Delivering the NHS Plan reforms, for example.
There will be less money (the economy is much weaker) and what the negotiators on both sides would characterise as more realistic ambitions.
There is still time for a radical new set of ideas to emerge but the consistent message is the new money will be used to restore access times and accelerate the ambitions encapsulated in the Five Year Forward View.
The most obvious opportunity to create line in the sand moment is within mental health, where access lags a decade behind the advances achieved in emergency and elective physical care. But already negotiators are pointing to the constraints that a limited workforce places on any dramatic change.
This is a situation repeated in many areas, and the short term solution of bringing in enough overseas staff to turbocharge NHS performance is hugely complicated by the conflicting views at the top of government towards increased immigration.
The NHS will not share its birthday with social care
One thing that is almost certain not to happen is any step change in the way health and social care are organised or funded.
Jeremy Hunt is genuine in his desire to achieve “full integration” between health and social care. However, there is no chance of a significant increase in social care funding as part of the “NHS birthday present” or any epochal change in the way the two sectors work together. That debate is still waiting for the promised social care green paper to kick it off.
HSJ reports today on the widening of the financial ringfence, which saw the Cameron government able to boost NHS spending, while cutting public health and education. Those areas of expenditure are likely to be brought back into the fold – but social care spending will remain outside.
As HSJ commented last week, integration (of primary, community, mental health and secondary care, as well as NHS and social care) will continue to be pursued through the development of the various flavours of integrated care system being rolled out across England.
The NHS leadership will continue to gently make the case for the legislation to place these new bodies on a statutory footing, without any real expectation of it arriving in the next few years. [Update 11:20 Tuesday - That said, the BBC’s political editor Laura Kuenssberg suggests this morning that legislative change might be packaged in with the plan. Watch this space - but we our sources tell us otherwise].
This proposed increased in NHS funding is a profoundly political choice which serves as another proxy war for the Conservatives
Revised financial incentives will instead take the strain of pushing reform forward.
HSJ makes these predictions in the full knowledge that the negotiations take place with and within a government that is weak, divided and distracted. Such negotiators do not always act rationally – even when their own best interests might be harmed.
The skilful brinksmanship practised by NHS England chief executive Simon Stevens has meant both 10 and 11 Downing Street now realise they cannot short change the NHS without consequences, or issue impossible demands and expect to be blindly obeyed. But in doing so, a few bridges have disappeared in smoke and flames. That Ms May has now “got religion” when it comes to the NHS is thanks to the efforts of Mr Hunt (and no doubt the bruising experience of the last 12 months).
This proposed increased in NHS funding is a profoundly political choice which serves as another proxy war for the factions within the Conservative Party. It is distinctly different from the joint venture that characterised the spending review of 2015 and is one of the reasons why, at this stage, the Department of Health and Social Care, rather than NHSE, is taking the lead.
Government could scrap 'NHS England ringfence' in long term plan
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How much will the government give the NHS for its 70th birthday?