George Osborne set to appear on BBC’s Andrew Marr show this morning at 9am to reveal details of autumn statement
1.50pm: Shadow health secretary Andy Burnham has criticised Chancellor George Osborne’s NHS spending commitment as “crisis money” and said it was already beginning to unravel after HSJ reported the detailed breakdown of how the £1.95bn will be spent.
Mr Burnham said: “Before he’s even delivered it, George Osborne’s autumn statement is unravelling. He has not found an extra £2 billion for the NHS, as he claims, but instead is proposing to recycle funds already in the Department of Health budget. This is crisis cash because of the fragile financial state of the NHS after the Government’s £3 billion reorganisation.
“The Chancellor’s spin is of no help at all to an NHS in real crisis now. Osborne is offering nothing to ease the pressure this winter and only false promises for the future. This will only reinforce the view that Cameron and Osborne simply can’t be trusted with the NHS.
“Labour’s plan is fully funded and will give the NHS £2.5bn a year over and above the plans left by this Government.”
12.45pm: HSJ Editor Alastair McLellan has said NHS England chief executive Simon Stevens should be congratulated for the way he hasnegotiated with the government.
In a leader written today following the announcement from Chancellor George Osborne that the NHS would receive £2bn recurrent fundingm, HSJ’s editor says: “Simon Stevens is to be congratulated for successfully resetting negotiations on NHS funding, but he knows that the work has just begun.”
12.24pm: HSJ has learned details of how the government’s new investment in the NHS will be spent and where it comes from.
The £1.95bn will be injected into the NHS in 2015-16 - but only a quarter of the total will be spent on transformation, with the rest set aside to maintain existing services.
HSJ has also learned that £550m of the £1.95bn will be funded by underspending by the Department of Health within its existing budget, meaning more than a quarter of the “new” money has previously been allocated to health - although it would not have formed part of the NHS commissioning allocations.
The £1.95bn is recurrent spending, meaning it will be built into the baseline funding for the NHS beyond 2015-16.
HSJ understands that of the £1.95bn total:
- £1.5bn will be spent on frontline services, with the funding routed conventionally into clinical commissioning groups’ and specialised commissioning allocations.
- Around £200m will be spent on health economies, such as Staffordshire, which are under extreme pressure financially and clinically - and therefore in need of reform. However some of the sum could also be used to pump prime investment in more financially healthy areas already beginning to adopt the new care models detailed in last month’s NHS Five Year Forward View.
- The remainder will pay for expanded and enhanced primary and out of hospital care. This ring-fenced investment will be repeated in each of the five years of the next Parliament – producing a total budget of £1.1bn. It will be funded by fines levied on banks for misconduct in the foreign exchange markets.
10.32am: NHS Providers, formerly the Foundation Trust Network, has responded to the Chancellor’s announcement of extra funding for the NHS in 2015-16.
Chris Hopson, chief executive of NHS Providers, said: “We strongly welcome £2 billion extra funding for the NHS in 2015-16. The government has recognised the size of the financial gap the NHS was facing next year and has responded positively to requests to fill that gap, despite the tight overall public expenditure position.”
He added: “Speaking to the secretary of state this morning, we have reinforced the importance of this £2 billion being used to deliver existing performance commitments, rather than new ones, and for it to flow through the mainstream 2015-16 NHS funding mechanisms so that it fully reaches the NHS hospital, mental health, ambulance and community frontline where it is needed.
“We all know that this still provides a huge challenge for the NHS to meet in 2015-16 and beyond so it is important that we all work together to squeeze every penny of value out of this extra funding.”
10.08am: Chancellor George Osborne will deliver his autumn statement to MPs in the House of Commons on Wednesday.
10am: The £2bn investment for the NHS will be added to the baseline funding for the NHS says the Conservative Party.
It adds that the £1.1bn fines from banks will be spent over four years on GP services.
The Tory Health twitter account tweets: “0.25bn of it is baselined in for next year. Rest of fines over following 3yrs. All in addition to 1.75bn new 15-16 funds.”
9.58am: Central and North West London Foundation Trust chief executive Claire Murdoch tweets: “will any of this reach community and mental health services?”
NHS Confederation chief executive Rob Webster tweets the investment means “the current hole is filled permanently. Excellent news.”
9.53am: George Osborne has finished his interview.
Asked for his reaction Shadow Chancellor Ed Balls said Labour’s £2.5bn Time to Care fund “will go ahead.”
9.51am: George Osborne tells Andrew Marr he met NHS England chief executive Simon Stevens yesterday and agrees with the Five Year Forward View. He says the investment in the NHS is a “down payment on his plan.”
9.49am: Osborne confirms the investment in the NHS is year on year saying: “This money is not a one-off, it will be added to the baseline funding”
9.47am: Osborne says he can afford the increase in NHS spending because of the “hard choices” made on the economy and the country can now afford to spend more.
9.44am: Osborne tells Marr £1.1bn of bank fines will be spent on upgrading GP services to provide advanced care close to people’s homes.
A tweet from the Conservative Party Treasury account says the £2bn announced today will be baselined and will therefore increase NHS budget every year.
9.40am: Shadow Chancellor George Osborne now on Andrew Marr show to discuss his autumn statement due next week where he is set toannounce a £2bn invetsment in the NHS.
“It is possible for the country to live within its means.”
He tells Marr he will not make “unfunded giveaways” and repeat the mistakes of past “Labour chancellors.”
9.38am: HSJ senior correspondent David Williams tweets: “Last time Osborne announced “more” money 4 councils it was double counted NHS cash. Need 2 know where £2bn is coming from.”
9.35am: For context around the NHS funding debate this morning - HSJ reported earlier this month that the NHS provider sector had plunged further into the red with a collective deficit of £630.2m halfway through the financial year, according to figures from Monitor and the NHS Trust Development Authority.
Increased demand and the financial pressure on trusts are taking a toll, with accident and emergency, routine surgery and cancer targets all missed between July and September.
Foundation trust finances have deteriorated with a deficit of £254m six months into 2014-15, more than four times the planned deficit of £59m.
The trust sector has a combined deficit of £376.2m, against a planned deficit to the same point in the financial year of £317.2m.
For the full financial year 2014-15, the provider sector overall is forecasting a deficit of £553.3m, nearly £109m worse than planned.
9.30am: Ed Balls tells Andrew Marr: “Most people think that a tax on properties over £2m is fair to save the NHS.”
He says Labour will have to make tough decisions and he will have to make some unpopular decisions.
9.22am: Shadow Chancellor Ed Balls is on Andrew Marr show now and says the Conservatives are responding with “crisis money” adding“we don’t know where the money is coming from, is it a long-term investment.”
He added the Labour Party are promising a costed investment in the NHS on top of Tory spending promises which is a “long term plan”.
9.20am: One of the biggest cost pressures on the NHS in the past 18 months has been on staffing, where the number of nursing staff has increased by more than an estimated 5,000 since August 2013 in hospitals.
This has pushed many trusts into financial pressure and agency spending has risen by £300m in the last year.
The increase is a 27 per cent rise from £1.1bn in 2012-13 to £1.4bn for 2013-14, a report by foundation trust regulator Monitor
9.14am: Shadow health secretary Andy Burnham has got his response in early to the Chancellor’s £2bn NHS investment.
In a statement Mr Burnham said: “David Cameron chose to put NHS finances on a knife edge when he wasted £3 billion on a damaging reorganisation. That’s why the NHS is in today’s fragile financial position.
“This is exactly the same pattern we saw under the last Tory government: winter crises, followed by emergency bailouts.
“Labour will rescue the NHS with a £2.5 billion a year Time to Care fund - on top of Tory spending plans - to fund new staff, including 20,000 more nurses.
“NHS patients are already seeing waiting times and cancer care heading downhill on this Government’s watch - people will fear that much worse will be in store next year. It is clear you can’t trust the Tories with the NHS.”
9.11am: Last week the Kings Fund called for the NHS to receive a £2bn increase in spending next financial year in order to sustain services.
9.08am: The Chancellor’s announcement comes in the context of tighter NHS spending this year with many organisations such as the Foundation Trust Network and NHS Confederation warning next year will be pivotal for the NHS.
In July HSJ reported Department of Health spending rose by 2.6 per cent in real terms in 2013-14 the greatest annual rise in health spending of the current parliament.
Experts warned that this was accomplished by eliminating in a single year almost the entire underspend the NHS has carried for the past eight years.
This left the health service with little “headroom” to manage even greater financial challenges ahead.
The DH’s total departmental expenditure rose in cash terms by £4.6bn in 2013-14, compared with £2.4bn in each of the two previous financial years.
9am: Mr Osborne will also endorse the NHS Five Year Forward View of how future NHS services will be organised and run.
The chancellor has reportedly been discussing the plan with Simon Stevens, chief executive of NHS England, who drew up the proposals along with NHS bodies Monitor, the CQC, the Trust Development Authority, Health Education England and Public Health England.
Mr Osborne is expected to say: “I endorse this Forward View as the way to deliver a world class and universal NHS that is sustainable for the long term.”
8.59am: Mr Osborne is likely to say the £2bn will be used to buy new facilities and make the health service more efficient for taxpayers and more effective for patients.
“Here’s a simple truth: You can’t have a strong NHS without a strong economy to pay for it. If you don’t have a long term plan for the economy, you don’t have a plan for the future of the NHS,” he will say.
“We have both. It’s because our economy is growing, and we’ve kept a tight control on the finances, that we can do more for the NHS.
“This will support the day-to-day work of our incredible nurses, doctors and other NHS staff; but it is also a down-payment on the future of our health service.”
8.55am: The BBC has reported Chancellor George Osborne is to announce an extra £2bn for the health service across the UK next year.
The money will be pledged by Mr Osborne in Autumn Statement on Wednesday and will be promised to help stop the NHS tipping into overall financial deficit in 2015-16.
He is expected to tell MPs the government can pay for it because of the “growing” economy and its “tight control” of finances.
8.50am Good morning and welcome to HSJ Live. Chancellor George Osborne is due to appear on the BBC Andrew Marr show this morning to reveal some details of his autumn statement next week when he is expected to unveil a £2bn budget increase for the NHS.