A few months ago, Audit Scotland released a report on the funding of NHS Scotland which rightly received significant press coverage. The headline finding was the SNP are reducing the health budget in real terms by 0.9% between 2013/14 and 2015/16.
Understandably, opposition parties tried to make as much as they could of this revelation, highlighting the contradiction between the statistics and the SNP’s rhetoric of “protecting NHS budgets” – something which I have covered on this blog previously.
Just as understandably, the SNP sought to “manage the story” by giving “their side of the story” and attempting to justify the statistics. In this case, it fell to Health Secretary Shona Robison:
The Audit Scotland report outlines that the NHS revenue budget – frontline spending – has increased in line with this Government’s commitment. The capital budget meanwhile fluctuates from year to year depending on on-going capital infrastructure projects. The reduction in 2015/16 is largely due to the completion of the new Queen Elizabeth University Hospital in Glasgow, which was funded from the capital budget.
There’s nothing unusual or even anything particularly wrong in any of this, it’s fairly standard politics. A negative story is released and the subjects of that story attempt to mitigate its impact.
Of course the government’s response doesn’t actually answer the conclusions of the Audit Scotland report, it doesn’t even try to. Instead it tries to do just enough to give their supporters a nice line with which to refute the accusations, something that can be easily remembered and easily repeated.
As is so often the case, the government’s line is then parroted and embellished by collusive online supporters – in this case here and here from Wings. These help to get the government’s message out there, cementing the consistency of the rhetoric and ensuring that any use of the “Scottish Government cut health spending” line can be quickly undermined.
Even months after the report was issued, this tiresome pattern is still being repeated – as you can see with the comments responses to this Herald letters’ page.
There is nothing factually inaccurate in any of these arguments. The SNP *is* cutting the overall health budget by 0.9% in real terms by 2015/16 and this is primarily caused by a 53.6% cut to the capital budget whilst the revenue budget is *increasing* over the same period by almost 1%. These facts are clear from the Audit Scotland report.
But they don’t tell the whole story. Revenue budget, the money that is spent on every day front-line services, might be seeing a real-terms ~1% increase but this is less than the corresponding increase in the NHS south of the border. The spending on NHS England, which dictates the Barnett consequentials that are added to the Scottish Government’s block grant, has increased and continues to increase by a greater proportion than Scottish NHS spending – and this is not an isolated finding, even before the general election the IFS had reported the same thing.
And this while the overall budget in England has been cut by 55% more than Scotland’s.
The Scottish Government’s half-truth that this reduction is merely because of the completed Queen Elizabeth “super hospital” in Glasgow doesn’t stack up either. For a start, why does the completion of one large project prevent the now freed-up cash from being spent on a new project? Instead of re-allocating that money into improving infrastructure, the SNP government decided to use it elsewhere.
Capital investment is important, something the Scottish Government are keen to laud when they’re spending the money; patting themselves on the back for infrastructure which will provide “increased efficiency, shorter waiting times and better continuity of care“. Why are these goals suddenly unimportant when they cut the capital spend?
The same Audit Scotland report which details the spending cut also makes clear just how important *continuing* capital investment is:
Capital investment is important in enabling boards to plan and deliver the 2020 Vision, by investing in new healthcare facilities, maintaining and modernising existing facilities that will be required in future, and disposing of those that are no longer needed…
The annual financial targets for capital budgets, and uncertainty about future budgets, hinders NHS boards’ effective planning of capital projects…
The NHS needs the right buildings and facilities to achieve the 2020 Vision and provide healthcare that meets future needs.
How the completion of one hospital in Glasgow suddenly became an accepted excuse for a capital spending cut of over 50% is beyond me.
Meanwhile yes, Scottish NHS revenue budgets have increased but, again, nowhere near in line with the NHS south of the border.
So whilst the Scottish Government is technically correct that they have increased revenue budgets in real terms, they have done so at a level which lags pitifully behind the increases from the coalition and Tory governments in England.
The usual response to this is that the Scottish Government’s budget is being cut, invariably referred to as Westminster austerity, and that budgetary constraints are being forced upon Scotland. This is the predictably tiresome excuse Stuart Campbell uses in the first Wings article linked above – complaining that “Holyrood’s total budget has fallen 10%” and “under exceptionally tough circumstances the Scottish Government has worked miracles in defending the NHS”.
Referring to a 10% cut, Stuart can only mean the Scottish Government’s DEL in comparison to the 2010 figures, which begs two questions:
- Why are we supposed to consider DEL cuts since 2010 as an excuse for a health spending cut since 2013?
- If the Scottish Government has “worked miracles” then what superlative would Stuart use to describe the Tory / LibDem coalition which far exceeded Holyrood’s NHS spending record whilst facing 55% deeper cuts?
Of course, there’s a good reason that nationalists always want to refer to budgetary changes since 2010.
Perhaps a debate for another time but the SNP always use 2010 as the benchmark because it was the high-point of Labour’s pre-election spending and saw record DEL delivered to Holyrood, meaning that stats using “cumulative cuts since 2010” are conveniently eye-watering.
Surely it would be more appropriate to compare health budgets since 2013/14 with DEL since 2013/14? And when we do that, we see that the Scottish Government DEL is actually increasing, in real terms, by 0.7% for 2015/16 (see note 1 below).
So not a 10% cut and it’s worth noting that the Scottish Government aren’t projecting a 10% “cumulative cut since 2010” to become reality until at least 2016/17 whilst a comparison with the DEL in 2007, when the SNP came to power, would reveal a cumulative real-terms cut so far of just 2.2%, slightly more than the 2.1% drop in Scottish GDP but well below the 10% real terms drop in Scottish tax revenue in the same period . But now we’re just playing with figures which, ironically, is exactly what the Scottish Government and Wings have done in trying to deflect from the negative results of the Audit Scotland report.
It can simply no longer be denied that the SNP Government has chosen to cut health spending; nor can it be denied that whilst the revenue budget has increased marginally in real terms, it has not done so at the same rate as NHS England.
I’m sick of saying this but that is the Scottish Government’s prerogative, it is their choice and no-one else’s to assign their budget in this way. There may be very good reasons to re-direct that money elsewhere. Perhaps a voter would prefer a government that has spent their taxes on subsidising the council tax freeze or providing free university tuition to students from high-earning families but it should be acknowledged that it is the Scottish Government’s conscious decision to do so and a choice which leaves a serious funding shortage in our health service.
The very first conclusion in the opening page of the Audit Scotland report highlights the ongoing financial pressure that our NHS is subjected to. Pressures which will continue to increase as we face the inevitable impact on an aging population that is living for longer with more complex and more expensive chronic conditions.
We should be discussing these issues and contributory factors such as lifestyle and dwindling sporting participation in all age groups. We should be discussing mental health and palliative care. We should be discussing the exponential growth in the cost of medication. We should be debating what we want from the NHS and whether it can, or even should, continue to be the comprehensive service it has become; and, if so, what it will take to fund this. We should be honestly discussing the tax implications of that choice and whether we are willing to pay more to ensure the health service’s survival.
In other words, we need exactly the sort of debate that Norman Lamb is leading calls for in England: a non-partisan cross-party commission into health and social care in England – “a Beveridge Report for the 21st Century”.
I’d like to see the opposition parties in Scotland calling for the very same here. I’d like to see my own party, the LibDems, lead the way. I’d like to see Willie Rennie raise this in Holyrood, reference the SNP’s spending record and prove that they have not matched spending increases in England; but use it not just as a stick to beat them with but constructively to pressurise the government to convene a similar commission and not just put up a desperate smokescreen about capital spending.
Whether or not that’s possible in a political environment that is all about the constitution? I doubt it.
Figure 2 – sourcing. Scottish NHS figures taken from Audit Scotland report page 9. NHS England statistics for 2013-14 and 2014-15 taken from HM Treasury Country & Regional Analysis 2015 Table A.11. NHS England statistics for 2015-16 taken from Department of Health Spending Review. HM Treasury GDP deflators used so that all figures are in 2014/15 values. Note that the results are different to the IFS report as the budgets have changed in the interim.
Note 1- the increase here is sourced from the DEL figures given in Tables 1.01 of the 2015/16 Scottish Government draft budget and 2016/17 Scottish Government draft budget. Using Total DEL figure of £29089m for 2013/14 from the former and Total DEL of £30141m for 2015/16 from the latter; and using HM Treasury GDP deflators (with 1.4% adjustment for 2015/16) adjusts those values to 2014/15 prices of £29505m for 2013/14 and £29725m for 2015/16 – a 0.7% increase. NB: ScotGov budgets make comparisons using “Total Fiscal DEL” which excludes “non-cash DEL”, “financial transactions” and “capital borrowing limits”. Excluding these values for the comparison results in a 1.6% reduction from 2013/14.
Note 2 – I should state here that I do not think NHS England is adequately financed either. It is clear from all the statistics, reports and results achieved south of the border that there is a funding problem for the health service across the UK. I should also say that there are clearly some successes within NHS Scotland which should not be ignored but anyone claiming that the NHS does not need additional money should perhaps visit one of their establishments at the earliest possible opportunity.