Shifting NHS spend away from hospitals ‘can’t wait’, says health secretary

The health and social care secretary last week said the proportion of the Budget going on these services should increase under the NHS long-term plan.

However, many are expecting a substantial amount in the first years to be spent dealing with trusts’ deficits and debts, which are mainly in acute providers, and increasing their funding to keep up with costs.

Meanwhile, the Budget last month said the mental health sector would also increase “as a share of the overall budget over the next five years”.

Mr Hancock – in a wide ranging interview ahead of this year’s HSJ Summit event – told HSJ that, regardless of other priorities, growing primary and community services’ share needed to start in 2019-20.

He said that while the share of funding going to the acute sector would fall – and accepted that they faced pressures – the NHS’s new funding settlement meant there was enough to achieve his commitment.

He said: “My view is that increase in proportion can’t wait, because you can’t do prevention after the fact. [A&E] admissions are rising by 6.6 per cent a year. This is clearly unsustainable, so we’ve got to do more in the preventative space. For the whole system to be sustainable over the long term.”

Mr Hancock acknowledged that was despite clear “pressures on the hospital side” but insisted: “Actually a lot of those pressures can be best managed by trying to stop people getting to hospital in the first place.

“If you just direct all of the [spending] increases into hospitals to deal with that increased demand, then we’re never going to get ahead of it.”

There is no published breakdown of NHS spend on different types of services, but a report by the Institute for Fiscal Studies and the Health Foundation published in the summer said: “Spending on hospitals rose much faster than spending on primary care during the 2000s, and spending on primary care has actually fallen since 2010 in real terms.”

NHS Digital figures indicate that spending on general practice has slightly increased its share of the total over recent years, though not in each year individually. Community health spending is even more opaque, but many believe it has been falling.

Meanwhile, Mr Hancock indicated that public health budgets – which are outside the £20bn NHS spending deal agreed in June – would not be amended for 2019-20, when they are due to fall in real terms. He said: “Next financial year’s budgets are already set and haven’t been changed.”

He said future public health budgets were the subject of “a spending review discussion” and revealed “we are also currently undertaking an exercise to evaluate the value for money for the wider public health spending because we’ve got to make sure that’s spent as well as possible”.

The health and social care secretary said future years’ capital budgets were also “clearly a question for the spending review”.

He revealed that the decision last month to publicly fund two private finance initiative contracts which were frozen following the collapse of Carillion – in Liverpool and the Black Country – had left his department with a capital funding dilemma.

“I had to bring them onto the balance sheet and that has eaten up another chunk of the capital budget,” he said. “So therefore we are having a conversation as you would expect with the Treasury ahead of the spending review next year about how big the capital envelope will be going forward, and how long the envelope will run for.”