NHS spending should not escape the impending budget cuts that will affect the rest of the public sector, a think tank has said.
The report by the Adam Smith Institute has called on the government to reduce its spending by £90bn by 2015, and says that the NHS should take its share the burden of these cuts.
Chancellor George Osborne is due to put a figure on the overall reduction in the government’s £670bn annual expenditure needed to repair the hole in Britain’s public finances when he delivers his emergency budget on 22 June.
But prime minister David Cameron has already committed the government to defending the NHS, along with schools and overseas aid, from cuts, and few commentators expect the axe to fall as heavily as today’s report recommends.
The Party is Over - a blueprint for fiscal stability argues that the government should eliminate Britain’s deficit over the course of this Parliament in order to avoid a Greek-style collapse in confidence.
Author Nigel Hawkins calculates that this would involve reductions in public spending of 3% a year across all Whitehall departments over the next five years.
He argues that no budget should be ringfenced and that even the health budget should be subject to an annual reduction of around 2% a year. Further cuts would have to be made within the current year, beyond the £6bn already announced by Osborne, in order to reach the goal of eliminating the deficit.