Where the parties stand on the NHS

Former NHS chief executive has issued warning on parties' promises

Updated: 
Where the parties stand on the NHS

Former NHS chief executive Sir David Nicholson has issued a warning about political parties' manifesto promises on healthcare.

Here are some of the questions being asked about the health debate:

:: What are the parties promising on health?

The Conservatives and Liberal Democrats are both pledging to deliver an £8 billion-a-year rise in the budget for NHS England, over and above inflation, by the end of the next Parliament in 2020. Labour says it will spend £2.5 billion a year above current Government levels.

:: How are they planning to pay for it?

Labour says its "Time to Care" fund will be paid for with a clampdown on tax avoidance schemes, a mansion tax on homes worth more than £2 million and a new levy on tobacco firms.

The Lib Dems say they will maintain a £2 billion contribution already announced by the coalition Government, and will raise further cash by capping pensions tax relief for the richest pensioners, aligning dividend tax with income tax for those earning more than £150,000 and scrapping a Conservative shares-for-rights scheme.

The Conservatives have yet to explain where they will find the money, stating in their manifesto only that they will be able to "because of our long-term economic plan".

:: But hasn't the NHS been protected from cuts for the last five years? Why does it need more money now?

Along with international aid and schools, the NHS was "ringfenced" by the Coalition to protect it from cuts imposed to reduce the deficit. Total spending on the NHS in England for 2014/15 was £113.3 billion and this is due to rise to £116.4 billion in 2015/16. This represents an annual increase of 0.9% a year since 2010/11, after inflation is taken into account. It contrasts with real-terms cuts averaging 20.6% in non-protected areas like police, local government and transport between 2010/11 and 2015/16.

However, the average real-terms annual rise in NHS spending under the Coalition has been the lowest in any Parliament of recent times, well below the 5.7% maintained by Labour from 1997 to 2010 and the 3.2% yearly hikes delivered by Tories between 1979 and 1997.

:: Where does the £8 billion figure come from?

A major review by Sir David's successor as NHS chief executive, Simon Stevens, last year concluded that the service was heading for a £30 billion spending gap by 2020 on current trends.

Mr Stevens' Five-Year Forward View suggested that £22 billion of this gap could be filled by efficiency savings and threw down the gauntlet to politicians to provide the further £8 billion needed.

:: So what is Sir David worried about?

He fears it will be very difficult for the NHS to deliver £22 billion in efficiency savings. And he worries that, if politicians promise to deliver the £8 billion requested by Mr Stevens, they will regard that as fulfilling their side of the bargain, leaving NHS managers to take the blame for any future shortfalls.

:: Will it be difficult to deliver the savings which Mr Stevens recommends?

Achieving £22 billion over a five-year period will certainly require an acceleration in the pace of efficiency savings. Over the long term, the NHS has managed an average of 0.8% "productivity gain" each year. In recent years, this average has been raised to around 1.5%-2%.

The Five-Year Forward View found that 0.8% annual savings would deliver only £9 billion by 2020, and 1.5% annual savings around £14 billion. To achieve the desired £22 billion would require annual savings of 2%-3%, it concluded.

:: So how does he suggest they go about doing that?

The Forward View insisted that up to 3% annual efficiency savings were "possible" provided NHS England's managers "take action on prevention, invest in new care models, sustain social care services, and over time see a bigger share of the efficiency coming from wider system improvements".

However, unions have questioned whether the scale of savings is deliverable. Unite warned that the £22 billion target would need a programme of improvements in health prevention, staff retraining and integration of health and social care which would be "impossible to deliver in five years".

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