New report raises taxing question about NHS funding
A new report, ‘Securing the future: funding health and social care to the 2030s’, has said that to meet the growing healthcare demands of a larger, older population, more money will need to be spent on the NHS and taxes will need to be raised.
Analysis by the Institute for Fiscal Studies and Health Foundation found that spending on healthcare will need to rise by an average of 3.3 percent a year to maintain NHS provision at current levels and four percent per year if services are to be improved.
Additionally, the research suggested that the level of social care funding will need to increase by 3.9 percent a year to meet the needs of an ageing population and an increasing number of younger adults living with disabilities.
The organisations conclude that to meet these needs, taxes will need to increase.
Looking back over the past, the study found that Government spending on health has risen from three percent of national income in the 1950s to over seven percent today without an increase in the overall tax burden because of cuts to other areas of public spending, particularly in defence.
Highlighting how further raises to higher health spending can be financed will struggle to be raised through big cuts to other areas of public spending, the report determines funding would need to found in the tax system.
Identifying that taxes would be required to rise by between 1.6 and 2.6 percent of GDP (between £34 billion and £56 billion), the increase would be the equivalent to £1,200 and £2,000 per household claims the report.
The announcement comes on the 70th anniversary on the NHS, with the Health Service having faced eight years of tighter and more stringent budget controls and spending settlements under austerity measures.
Questions over funding of the NHS have been making headlines recently, with various pressures coming to light including calls from the British Healthcare Trades Association and Newlife Charity to prioritise disabled children’s unmet equipment needs.
Commissioned by the NHS Confederation, which represents NHS trusts, the Government has announced plans that an ‘NHS assembly’ will be established for stakeholders can work towards achieving plans for the Health Service’s future.
Niall Dickson, Chief Executive of the NHS Confederation, commented: “This objective and the independent report makes clear that the next 15 years are going to be even more challenging than the last. Unless we tackle the funding issue and build up the workforce, we will see the further strain on NHS finances and services.
“Yes, there are more efficiencies to be made and our services need to be much better at supporting people in the community, but if we want a high-quality NHS and care system we will have to pay for it”
Recognising that the amount needed to raise would bring the tax burden to historically high levels by UK standards, the report emphasised that it would not be especially high by continental European standards, stating that it could not see how needs could be met with increasing either income tax, VAT or National Insurance Contributions.