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IFS reaction to the Budget

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Stephanie Flanders | 13:26 UK time, Wednesday, 23 June 2010

I am sitting in the bowels of a University of London building listening to Robert Chote dissect Mr Osborne's Budget.

Paramedics pushing patient on trolley into hospitalSo far the most striking figure from the IFS post-mortem briefing is this: applying the planned squeeze in public spending evenly across departments would require an average cut of 14% in real terms by 2015-16.

The only reason we are talking about 25% cuts for most departments is the decision to protect the NHS.

That is a very expensive bit of protection. The chancellor this morning said that we could soften the blow for the Home Office and the rest by signing up for further benefit cuts instead. As the scale of the cuts becomes clear, I wonder whether the NHS will be put back on the table as well.

Update 1405: According to the IFS, unprotected departments like the Home Office and environment could have their budgets cut by as much as a third, if the NHS and overseas aid budgets are protected from real cuts, and defence and education are cut by less than others, as indicated by the chancellor.

The think tank calculates that this real cut for every other department would fall to 25%, if the spending review could identify another £13bn to cut from the benefit bill.

The total benefit bill is £270bn, but that includes the basic state pension and local authority-financed expenditure. There is about £154bn that could plausibly be cut.

Protecting ONLY the NHS and aid, and cutting this same £13bn from benefits, would reduce the average cut for other departments to 20%.

Update 1440: On the basis of the inflation forecasts included in the Budget, the IFS reckons that the decision to uprate most benefits in line with the CPI measure of inflation will amount to a 5% cut in these benefits, in cash terms, by 2015.

That is because the CPI typically rises more slowly than either the RPI or the other index previously used for uprating some benefits. The CPI excludes housing costs. It is also calculated slightly differently (for the aficionados, it's the difference between an arithmetic and a geometric mean).

So this is indeed a cut in benefits - which accumulates over time. But that should not be a surprise - given how much (nearly £6bn) that this one measure is expected to raise.

However, the government will be more embarrassed by another IFS conclusion, that the changes in benefits announced yesterday will significantly raise the number of households and individuals in the UK facing very high marginal tax rates on their earnings.

That was always inevitable, given that the Treasury was trying to save money by targeting benefits and tax credits more closely on lower income households. That necessarily means taking money away more rapidly as earned income goes up, meaning very high effective tax rates on that income.

However, it is not good news for Iain Duncan Smith and also many senior Liberal Democrats who, before the election, made much of the fact that the poorest people in society can face the highest tax rates. Thanks to yesterday's Budget, there are going to be a lot more of them.

Update 1500: As I noted here yesterday, the charts showing the impact on households of different incomes of the Budget included pre-announced changes such as Labour's National Insurance change, due to come in next year.

That turns out to have had an even larger impact than I thought.

Excluding those previously announced changes, the IFS says that the Budget yesterday was not progressive. The richest households did not pay relatively more.

Yesterday's Budget looks even more regressive when you consider the impact later in the Parliament, when the benefit changes have greater effect.

This is, again, inevitable, given the Budget's reliance on raising indirect taxes like VAT, and on cutting spending on means-tested benefits.

This conclusion would be even clearer, if it were possible to incorporate the housing benefit changes into the calculation (which, sadly, it isn't.) And - of course - we can say the same of the spending cuts to come in the autumn.

Comments

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  • Comment number 1.

    With regard to the health service - surely there is a distinction between 'front line' services and 'managers'

    Keep the people who do the work - aggressively cut the one's who make work harder for the real stars (nurses/doctors/surgeons) and to keep themselves in a job..

  • Comment number 2.

    14% real cut is totally achievable. In private companies it is often the case that 10%+ of costs can be taken out without affecting product quality and that is in companies rather more efficiently run than the public sector.

    The problem is that this requires govt to take a hard look at what the public sector actually does and ask the really difficult question: should this be done by govt or not. The easiest way to cut spending is not to trim across the board but to cut entirely some things which govt currently do.

    The problem with the public sector is that it is a lot of small empires who steadily built up by doing more and more things. For example, at the DTI (or BIS as I think it is now called) I can fully understand the need for the insolvency service and the need for a department to keep employment rights at a level we desire, but what does the rest of the dept do, and is it something that should be done by govt.

  • Comment number 3.

    Surely there's a case for protecting front line NHS services, while trying to achieve efficiency savings by removing useless layers of management.

    While like most people I love the NHS, I'm aware of how much waste it involves. George Osbourne must be aware of it too.

    Or would any mention of NHS cuts be a bridge too far for his coalition partners?

  • Comment number 4.

    Time to ask whether we've really had value from the average £14,000 per household (£315bn) increase in public spending over the last decade.

  • Comment number 5.


    As a management consultant I've been appalled by the "service" provided by the NHS in the last year or so in dealing with my wife after an ankle break. Most of the individual staff are caring and professional in intent, which makes the exceptions all the more unpleasant ("you should think yourself lucky it's free, so we'll process you throught he system our way" attitude).

    But there is something severely wrong with the way hospitals operate. Telling patients, already anxious about an operation, to arrive at 07.00 but "may not operate until 17.00" is plainly ridiculous. Another day-patient left in the middle of an anxiety attack having been completely ignored in a waiting area for half an hour after being told her friend could not go to the ward with her - after being explicitly being told to bring a friend in her admission letter. All this at one of central London's best-known hospitals. At all of them the number of staff is impressive, the productive activity level depressing.

    The sooner the NHS, front-line or not, is subject to a "root and branch" review the better.

  • Comment number 6.

    I wouldn't put it past this bunch of toffs to put health back on the table. As for Clegg, no leader has told more porkies during election campaign than him.

    I have voted LibDem a few times in the past but never again as long as he is in charge.

  • Comment number 7.

    The problem is that the UK is in such dire financial straits, it will take drastic action to get the country back on track not a bit of cheeseparing here and there. We need to cut £150bn p.a. just to stop our debt from increasing. This budget has given us the chance to stop promising ourselves more than we can afford and we should plan to completely eliminate the annual deficit by the end of this parliament.

    Our total debt load has already risen to over £700 billion — and it's on track to double in just the next five years. A government debt of nearly 80 percent of GDP (and increasing) – numbers that put us on the same level as the Club Med countries facing severe sovereign debt crises.

    The NHS needs to share in the cuts, there is a huge amount of waste.

    All foreign aid should be stopped - we can't afford it.

    Ireland last year slashed pay for state workers by between 5% and 15%, and is now taking a knife to social security and healthcare spending.

  • Comment number 8.

    I do think that the NHS will have to be put back on the table at some stage. It is hugely expensive but also is going up in cost of approximately 6-7% year up until 2010. That appreciation is of course unsustainable. At some stage this, or a future, government will have to take the brave step and reduce what the NHS offers.
    I think the debate will soon have to be what is it that NHS should be and, importantly, what should it not be. Not just with primary care but also with the enevitable cost of an aging population and the costs of dealing with an expanded elderly in a proper manner.
    Of course this is not just a UK problem, all western democracies are facing the same socio-economic problems that are all derived from 40 years of entrenched state provided support systems that once were affordable but now frankly are not. Society will need to change it understanding of the lengths that the state can afford to go to in providing healthcare, education, housing etc..... Tough questions that have been avoided for a long time and paid for on debt, which as we all know has come to a head.

  • Comment number 9.

    A few weeks ago I visited a friend in hospital. At the nurses station outside his ward were 13 people of whom only four were in medical dress. Who are all these people? Take a scythe to them

  • Comment number 10.

    let's hope so

  • Comment number 11.

    The fact that NHS spending has been ring-fenced does not mean that no staff will but cut from the NHS. It is perfectly possible to carry out a review and make staffing decisions accordingly.

    You also have to be careful when cutting "backroom" services .v. front-line. For example, by cutting 1 admin post, you might tie several nurses up doing even more paperwork than they do already. Which leaves less time for the nurses to do their "real" jobs

  • Comment number 12.

    Ther NHS was a marvel of social provision. It gave healthcare to a nation impoverished by depression and war. It was a solution for the battered people of 1947. 2010? Should we be able to queue up for GP appointments for minor ailments without bearing some cost? Should the state provide free bed and board while we are in hospital? Should infertile couples be allowed free fertility treatment? We presume it of right - but there's the rub. What we do not pay for we do not value. In 1947 serious illnesses were rife, dyptheria, polio, typhoid. Now the predominant illnesses: cancer, heart disease, diabetes are influenced by lifestyle choices. The population will not work to minimise its exposure to the risks: smoking, drinking, poor eating habits, lack of exercise whilst it continues to suck on the NHS safety blanket. As a mature society we must learn to pay for the consequences of our choices - if we want medical interventions that will keep us going until we are 110 we should pay for them. I do not believe that a gradual solution to this will work - it needs a new government with a mandate to require that people between 18 and 60 make payment for their basic medical care and take out insurance for more serious conditions. As a nation we need to move on from 1947.

  • Comment number 13.

    Ah! So it's not just about economics - it's political too! There'e a surprise. Isn't it about time the politics of it all - in the larger sense of what kind of society the coalition is heading us for without our choice- is actually subjected to some discussion?

  • Comment number 14.

    The budget reflects the indifferent and arrogance of the Tories who don't have to worry about money. They are all rich, priviledged people who don't understand what its like to be under financial threat. They resent the distributionist nature of the previous government and enabled by the Lib Dems they are trying to demolish the state.

    All this about 'having no other path' to follow other than crashing the coutnry into recession and despair is RUBBISH. They are using the world recession to justify shrinking the state. They did exactly the same thing under Thatcher who hated the poor and working classes. Wouldn't be long before they are using large families and single mothers to forge and justify their policies. We put up with a lot of privatision on the basis of Jaguar being successful and cutting benefits because the average working man owned so many shirts.

    Under the Tories suicide went up dramatically in young men, homelessnes too. They want to bring the working people to heal so they are frightened of losing their jobs and become slaves the fear of unemployment. The last Tory government cut employment rights from being accrued until you had been with a company for two years. My boss used to sack people just before that deadline. It was a horrible time for this country, so unfair.

    All this WILL happen again and Cameron has already used the 'scrounger' word. This I can see them for what they are - indifferent, uncaring, experts in blaming other people - finding a bad story to justify their evil deeds and making sure they're the only winners. They think the electorate are stupid.

    Nick Clegg, son of a Banker, Cameron, son of a stockbroker, Osborne, Baronet - and it goes on. They're in it together for themselves and people like them. We, middle England, are to suffer the consequences.

  • Comment number 15.

    I agree that the health service will face cuts, not now but down the line and it'll be interesting to hear how the Condems justify it. What I don't understand and perhaps someone could explain is why Foreign Aid is also ringfenced when everyone knows that it never gets to those who need it but ends up in the back pocket of the powers that be in various countries. I know we were a colonial power and it's probably a govt. guilt trip as to why we persevere with it but I've done a bit of travelling in the 3rd world off the beaten track and spoken to locals and the big moan is the aid never gets to those that need it most or if it does it's not what was promised. Surely we could cut back therefore stopping the corruption that obviously goes on in certain countries we give aid to. What's the point of trying to promote jobs and equality in other countries if it means job losses and a bigger rich poor divide in our own. I dunno maybe I am missing the point but I don't want the money I pay in tax ending up in a despots pocket.

  • Comment number 16.

    It would be useful to know how much departmental budgets (NHS and others) have risen in real terms over the last few years so that we can put the 25% cuts in perspective.

    Of course you cannot just simply go back to the level of services a few years ago, especially because of the extra staff employed in the meantime, but the comparison would give some good indications. Will spending go back to the levels before Labour came to power for example?

  • Comment number 17.

    Absolutely no-one I know cares for protecting NHS spending since most of the money given to it is squandered with mind-blowing inefficiency.

    We could give the NHS the entire budget and within a year it would have wasted it all and be begging for more with no improvement in services.

    Quite simply the NHS budget should be slashed by 10% a year for the next 5 years.

  • Comment number 18.

    There is huge bureaucratic waste in the NHS. The bigger the organisation the more waste there is. This is a fact of life in the private and public sector alike. I appreciate that it may be good politics to protect the health budget (and David Cameron has indicated that it is his priority), but it is not necessarily good policy. In essence we are protecting a huge amount of administration in the NHS by cutting front line policemen. I think the government should look again. A recent report has suggested that the increased health spending in Scotland vs England has not lead to any significant health benefits for Scots. This is just to indicate that the NHS certainly has inefficiencies that can be used for savings without damaging front line services.

  • Comment number 19.

    I expect adding the NHS to the carvery was seen as a political step too far at the moment. That may change. There is a certain symmetry. If you recall, initially after 1997 Labour dressed themselves in haircloth, slavishly following the previous Conservative governments financial commitments, to prove how prudent they were. As circumstances changed that went dramatically out of the window. I fully expect the same to happen with the Coalition government. So far Cameron/Clegg are keen to be seen as protecting the NHS. However, as the practical difficulty of achieving the cuts elsewhere is realised and the targets missed, so by necessity the NHS will come under closer scrutiny. Deeper cuts in the pensions/safety net will, as you say, be on the menu too.

  • Comment number 20.

    I hear that in one large hspital in Surrey there are over 120 committies and it takes up to 20 people to get involved to make one appointment for some.
    Perhaps before guaranteeing to protect the NHS spend this should be looked at. I would prefer to hear that NHS service and output will be improved rather than a promise that spending will be kept.

  • Comment number 21.

    "As the scale of the cuts becomes clear, I wonder whether the NHS will be put back on the table as well."

    Trouble is, to even mention cuts to the NHS is political suicide.

    It need not be, but even with no cuts, efforts should certainly be made it more efficient.

    For example, my 12 year old son had a general anaesthetic yesterday as an out-patient to remove most of his remaining baby teeth (They just won't come out, and are being pushed askew by his adult teeth protruding through).

    Reception procedure - Great
    Doctor - Attentive and keen to make my son at ease, him never having been to hospital before.
    Paperwork - Poor. His discharge note was written on a multi-copied form that I would be ashamed to use in our office, even internally.

    There were two other areas areas of concern though:

    STAFF - two reception staff had little to do apart from booking people in. They spent most of the 2 hours I was there talking about all and sundry, and nothing to do with the job. Even one receptionist would be too many unless she was given other time-filling duties.

    RECOVERY - poor organisation. We received information sheets in advance of the procedure saying that nausea can be evident when recovering from the anaesthetic. He did feel sick but then we discovered there were no sicky bowls. Nor nor were there any absorbent tissues either to wipe away the bloody saliva dribbling from his mouth. I had to use a packet of pocket tissues that I fortunately had in my jacket while nursing staff went to find some.

  • Comment number 22.

    I work in a role close to a PCT and am bemused by the notion that the NHS has been ring fenced. We are being asked to find large immediate savings which will undoubtedly hurt health and social services to older people ( always the easy target). Older peoples services have been trimmed, sliced, economised on, efficiency saved and eligibility thresholds pushed ever upwards for years and years. There is no fat to be saved, but because old people are numerous they are always easy pickings for salami slicing of costs.

  • Comment number 23.

    Cutting cost in the NHS is not easy - there has been over the last 20 years a change in the way staff - particulalry Nurses are trained and paid. My wife did here SRN in 1976-79 she was paqid peanuts and had to live in. She also started on the wards on day one ( well apart forma a calssroom briefing or two). Now Nurses go to Uni for a year before they see a ward. Nurses now do not do the basics they are now Health Professionals who do not get their hands dirty - that is the Job of the HCA Health Care Assistant. This has meant that Nurses whilst still doing a wonderful Job are not doing any of the things they used to - so someone else has had to be employed to do that Job - that is where a significant rise in the cost of the NHS staff bill has come from. Nurses were effectively apprentices - paid lowly as they learned. But this meant the NHS pay bill was kept lower as well and of course value for money was really very good. If we could turn the clock back that would help massively - but of course it isn't going to happen.

  • Comment number 24.

    Yep! Like I said yesterday, 3m unemployed - here we come. While we're at it, let's chuck in lining the pockets of the Toffs and soup kitchens for the rest of us. I hope the Lib Dems can sleep at night - shame on you!

  • Comment number 25.

    The NHS has already been hit. It certainly is not 'ring fenced'. The Trust I work in has to make 10% cuts this year across all departments - an email detailing this has been circulated to all staff this morning. This will mean job losses and ultimately a decrease in patient care and an increase in waiting lists and waiting times.

  • Comment number 26.

    To be clear management in the NHS costs just 3% - that's three pennies in one hundred - of the total spend. The biggest source of waste in the NHS is US. Like all free goods we overconsume, we make lifestyle choices that expose us to avoidable illnesses, it is us who are dysfunctional not the managers who run an overstretched service. The problem of the commons explains the bind we are all in quite nicely. There was a piece of common land which the local villagers used to pasture their sheep. The land would adequately feed a 100 sheep and each sheep would bring $100 to the owner. But a sheppard from another village thought 'I will put my sheep on that land' but as a result the land was just a bit overgrazed and as a result each sheppard got just $99 at market for their sheep. The incomer was happy as he got $99 but the village lost $100 overall in value. Another sheppard saw the opportunity and brought his sheep - he got $98 at market, but so did everyone else. This carried on until the land was useless. That problem occurs whenever something is free - it's overconsumed. There are only two solutions - appoint a dictator to select who can graze their sleep or charge the sheppards for the privilege. With the NHS we have been tinkering with the first option (NICE at al) but it doesn't work. Now is the time to choose the other option.

  • Comment number 27.

    I work in the NHS. It should not be excluded from cuts and the targets should not have been removed. management only accounts for 25 of the NHS budget so you can cut it by 50% and more and still not make great inroads into the budget. There are literally thousands of non management and non front line roles in the NHS which could go and many other so called front line jobs such as matrons , nurse managers etc who do not contribute to the role of the NHS. they spend their whole life at meetings and sitting on committee after committee which achieve nothing except more paperwork. The number of directors is at least 3 times an equivalent private company and they are higher paid. there are billions waiting to be saved in the NHS but

    a) where do the people go - there are no jobs only the dole queue
    b) the NHS has a redundancy policy of one month for every year.
    Considering the length of time people have worked for the NHS , it
    will cost a great deal of money to get rid of staff plus paid up
    pensions.

    There is a great deal of inefficiency, wastage especially in purchasing , doctors not working their contracted hours etc but the big money is in staff. The big challenge is how to reduce staff , keep the service levels for critical care (e.g. not stomach bypasses ) and not put hundreds of thousands on the dole. The NHS management are empire builders and are not capable of paring down the system so who can do it?


  • Comment number 28.

    Like, I suspect, many others, I have good experiences of the health service marred by imperfections. New IT has the potential to solve some of the difficulties I've seen, but huge and futile amounts have been spent on IT failure.

    They've already cut promised hospital building. The NHS isn't immune, but the administrators don't need to panic, yet. I'm half-wishing the Chancellor had done something to scare them.

    The problem is, my list of "how to waste money" comes with the benefit of hindsight. I'd rather have a bit more slack in the system than rely on accurate prediction of demand. I've been the unexpected accident.

  • Comment number 29.

    Hello Stephanie, did I not say in a previous posting that to ring fence anything could cause some departments to be so heavily cut as to render them disfunctional? The penny now seems to be dropping. Talking of unintended consequences, housing benefit cuts are beginning to look draconian. They have to be careful with this, some people could be really hurt. Regards, etc.

  • Comment number 30.

    Just to clarify the NHS position - from someone inside the system - if the NHS gets CPI (say 2-2.5%)cash growth each year rather than cuts - it will need (and is looking to find) circa 15% - 20% efficiency over the full Parliament. This is because natural inflation in the NHS is at least 6% each year. By inflation we (inside NHS) mean cost not price growth - why so high - population growth of course but also in the past people died in their 60's - quick deaths like Heart Attacks - now 80's is normal and Dementia / Cancers kill us and hips knees etc need replacing etc etc - Drug costs are much higher - in the past preventative use of statins was not something we thought about / IVF was a dream and Transplants were rare - now they are all expected as are drugs that cost £20k a month to prolong life during Terminal illness. So yes the NHS is rightly protected but yes efficiencies are possible and are factored into thinking. The alternative is rationing and eliminating nice to haves like IVF and long term payback things like preventative statins - what do you want as a society?

  • Comment number 31.

    The debt should also be considered, as over time about 1 in 5 of tax revenues will be servicing the debt. This is interest paid to the banks. The very banks that were saved by the taxpayer, who in appreciation will be bleed by the bankers. Usually when a business goes bankrupt there are attachments to future earnings and that should be done with the banks. Remember, everyone was made whole except those individuals who lost retirement accounts and investments, the big boys were all taken care of. These very banks will abandon the nations that saved them and head off to Asia where there are growing nations to abuse. If the governments were not so corrupt the people might expect a fair shake, but that is not going to happen. As the cuts come down, the bankers will be once again handing out bonuses, and although supposedly the taxpayers own large shares of the banks they don't seem to be able to get a break on the interest.
    Fools and their money are soon parted.

  • Comment number 32.

    The bank levy is paltry - £2.5billion is only twice what the RBS alone paid in bonuses a couple of months ago - this levy could and should have been much higher. Then there's the tax that people 'avoid' paying - some estimates of the amount that could be recovered by HMRC if it had the power to challenge avoidance schemes that contravene the spirit rather than the letter of the law put it as high as £25 billion per year- and this is from people who are PROUD of not paying tax; yet cuts to the NHS, which protects almost all of us will almost certainly, to use Osbourne's favourite word, become 'unavoidable'. We're all in this together? I don't think so.

  • Comment number 33.

    Who are these people that make cuts to the NHS politically impossible?

    Have they ever been in a hospital?

    Every time I've been in one it seems to be full of people with not very much to do apart from chat to each other.

  • Comment number 34.

    The NHS up to 1979 spent between 4% and 6% of its budget on management. Thanks to Tory and market philosophies, not reversed by Labour to their eternal shame, management now takes up 25% of the budget. When you add into that the fraud that is the excessive cost of PFI, the NHS is not funded as well as it could be and too much money is being wasted.
    Three things to do: 1) scrap all PFI contracts - most are "owned" by the banks or by companies with huge balance sheet "leverage" - that's debt to you and me - and we own most of the banks so I am sure an accommodation could be reached; 2) scrap the internal market and 3) get rid of the ludicrous choice agenda. Then you will be able to cut the non-essential costs of the NHS genuinely without cutting front-line services.

  • Comment number 35.

    Gee it took until 3pm to work out that when you strip out Labour's actions it is a highly regressive Tory - Lib budget.

    Bank Levy goes no way to insuring against their previous collapse and future threat.

    It does seem they have put in figures over varying specific time-frames deliberately.

    The claims that it was George Osborne's inevitable march into N0.11 that prevented a sovereign debt crisis in the UK, simply hilarious. Do they honestly expect us to believe that it was his very presence on the political scene pre-election that saved Britain – I think it was page 96 that Vince Cable pointed too, to justify this claim, but it does clearly say that they cannot not measure such a thing as market expectations, they cannot reliably give a figure, that this assumption is based on a whole range of other assumptions. The OBR do not say they are incorrect, merely that they kinda believe this might be the case, given it is a Tory creation I am inclined to believe the OBR is a political construct, not impartial, and should be funded by Tory HQ not the tax payer. Are we going to find come election time the OBR telling us that market expectations are such that we should not vote for who we want (e.g. someone other than the Tory’s)

    The failure of Govt financing to implode could not be due to the consistently revised downward borrowing requirements, not the fact that tax measures where going to be introduced, not the fact that we have some of the longest dated debt in relation to the G7, triple AAA status, and a lower % debt to GDP than many other European, G20, and particularly G7 countries on past, current, and future (guestimations).

  • Comment number 36.

    34. At 5:09pm on 23 Jun 2010, Tyto alba wrote:
    The NHS up to 1979 spent between 4% and 6% of its budget on management. Thanks to Tory and market philosophies, not reversed by Labour to their eternal shame, management now takes up 25% of the budget

    I would be interested to see the source for this 'claim'

    The NHS spend in 2009 was £110.5bn

    So, where is the evidence that the cost of management was £27.625bn?

    Surely you must have the evidence to post such a claim?

  • Comment number 37.

    16. At 2:25pm on 23 Jun 2010, rogerstone26 wrote:
    It would be useful to know how much departmental budgets (NHS and others) have risen in real terms over the last few years so that we can put the 25% cuts in perspective.

    Of course you cannot just simply go back to the level of services a few years ago, especially because of the extra staff employed in the meantime, but the comparison would give some good indications. Will spending go back to the levels before Labour came to power for example?

    If we cut spending to 2002 levels, there would be no deficit

  • Comment number 38.

    Don't forget that the increase in the NHS budget is false, as the expenses are increasing greater than inflation due to an aging population, need for more staff etc.

  • Comment number 39.

    I am past retirement age but have to continue to work as my private pension has been so reduced over the last 12 years or so. I have 3 children and so far 2 grandchildren so for goodness sake stop the whingeing and lets get out of this mess that, what was it, 72% of the population voted for ''ie New Labour'' We shouldn't make our children and granchildren pay for the mess that Tony Blair and Gordon Brown gave us.

    Why do we have to give so much of our taxes to foreign aid when I see so many foreign leaders living in more than luxury to the detriment of their own people and we seem to be financing this.

    With regard to the NHS why won't the Government and millions of you out there not accept and agree that there are so many middle managers that have been appointed over the last 12 years that probably earn £40-£50k pa that have all built up their own departments which cost even more. There are thousands of managers employed just to manage the statistics that new labour wanted to produce. It is a fact and billions could be saved without any reduction to front line nurses etc.

    The CEO of a hospital is recently reported to be earning £175K pa this is some £75k more than he was earning 4/5 years ago. What has changed that he should have this sort of increase.

  • Comment number 40.

    I am astonished by all these people who tell us how inefficient the NHS is. I have had occasion during the past ten years to use 3 local NHS hospitals. On no occasion did I get the impression that they were overstaffed. Indeed, A&E and CDU seemed to be seriously understaffed. I have nothing but praise for what these hospitals have achieved with their current level of spending, and I have seen nothing to suggest that they are over-managed or over-bureaucratic.

    That said, when my wife was in urgent need of diagnosis and treatment of a life-threatening condition, the advice of NHS staff was that we should go private so as to minimize delay. That we did, and while private hospital treatment was excellent, the difference in staffing levels was striking. The private hospital simply had a much higher staff to patient ratio, and more of those staff were highly experienced.

    We still have gross inequalities of access to high quality health care in this country. Any cut in NHS budgets is certain to reduce the number of people who receive the health care they need.
    A price worth paying for fiscal stability? It depends what price you put on human life and suffering…

  • Comment number 41.

    13 - there was an election - the socialists lost - get over it

  • Comment number 42.

    Overseas aid should have been cut to zero.

  • Comment number 43.

    So Kim Jung Dave is promising public sector benefit changes - so much for waiting for the independent Hutton report - like his VAT promise - he is hoodwinking the British public. The tories are a disgrace to british politics.

  • Comment number 44.

    14

    I think you want the fiction section

  • Comment number 45.

    The only way that waste will be purged from the NHS would be to put it out to private contractors, competing for business, with everyone covered by real national insurance. We would save billions, and you would have a decent chance of being treated like a customer rather than a burden.

  • Comment number 46.

    A lot of elderly people vote Lib Dem and Conservative - They're the main users of the NHS - hence the NHS protection and pension boost yesterday.

    Once the other departments have been cut by up to 30% over the next few years, it will make the waste of the NHS stand out even more.

    I really don't understand the overseas aid being ring fenced - no doubt its down to a coalition agreement with the Lib Dems. A large check of it goes to India, which has a Space program and Nuclear weapons!

  • Comment number 47.

    39 Working pensioner - more power to your elbow between you and an England win you have made my day

  • Comment number 48.

    46

    What a load of nonsense...the NHS is currently protected whilst Andrew Lansley sorts it out

    Your theory is just madness

  • Comment number 49.

    40 - chazzacant - so you have discovered that private health care is better that the NHS - thank you for sharing this extraordinary news. Next you will be revealing to the nation that rich people can afford more "stuff".

    Instead of socialists complaining that it is a disgrace that some can afford private health care, I believe that it is a disgrace that more people in the UK cannot afford it.

  • Comment number 50.

    This horrible government has shown its true colours. We are heading for a societal meltdown. What I find most galling is that Osborne and his Lib Dem lackey Alexander have never had real jobs and yet have the audacity to enforce such savage cuts on those most in need. Perhaps I missed it, but I heard nothing mentioned about slashing MPs pensions, benefits and allowances? Funny that.

    The reason why, so far, the masses aren't revolting is simply because they haven't yet seen the effects of these policies, but they will.

    Rightly or wrongly, the public sector has been keeping this mickey mouse economy going. It grew, NOT at the expense of the private sector, but IN PLACE OF it. Where exactly are all the private sector jobs going to come from? I will tell you - there won't be any. It fails to recognise that globalisation and technological advances require less labour and even when they do, businesses locate in China, India or Eastern Europe because it is cheap. But, this flawed thinking fails to comprehend that there is a global contraction taking place, so if anything global consumption will fall.

    Given this, if you slash jobs in the public sector, this will lead to a mass contraction in spending, debt defaults, mortgage repossessions, which will lead to more job cuts in the private sector. It is an evitable downward spiral.

    Labour offered us the slow path to hell through eventual bankruptcy. This lot offers the fast and painful path via mass unemployment and civil unrest.

  • Comment number 51.

    50

    You are worried, and this is not necessary

    Osborne has a real job, if you think that Chancellor is a real job

    After 5 years of bad medicine, we will be ready to grow once more, with a more balanced economy, and without the crazy deficit inherited from Gordon Brown...you know, the man who hasn't turned up for work for 7 weeks, yet STILL get's paid a full salary



  • Comment number 52.

    "given that the Treasury was trying to save money"
    Has anyone ever been allowed to look closely at "the Treasury" - I should imagine that there are massive inefficiencies within that department potential for huge savings of public money. Unfortunately I do not have the capacity to read and absorb all the publicity but I cannot recall seeing that department being on the protected list or mentioned as an area for cuts.
    Also has anyone ever totalled the cost of all the "press officers" and their departments paid out of the public purse? Again I'm sure that there is potential to save a very significant amount of our money with no loss of efficiency.
    Just a couple of areas that seemed to have slipped under the net and there are without doubt lots of other examples.

  • Comment number 53.

    One of the main mistakes of the last labour government was to think that it could influence/direct everything that happens economically from No 11 Downing St and HM Treasury.

    The IFS is of interest but the key issue of Mr Osborne's budget is also how will the following react:

    Banks ... will they take on more risk again with their lending?
    Consumers ... will those with jobs feel more confident to go out and spend more?
    Industrialists... will they start investing again after Labour scared them off with a mis-application of Grecian 2000?

    Crucially, can more real private jobs be created, for British workers in the private sector, on the back of this budget? Probably not by itself and radical measures are needed to get millions of British workers back into work?

    What matters most ... what is most important GDP or full employment?

    I think a choice has to be made ... the two are not necessarily aligned and ... in social terms ... an individual can stand more economic pain if they have a job.

    The new Chancellor has to set out the budget because the nation's finances are in such a mess (I still have not seen a clear statement as to how much these measures can reduce the UK structural deficit overall ... we seem to be drowning in data now without a big picture summary)

    ... but I can't see how the UK can make any progress until all politician's set some clearer priority objectives ... and well being for most individual's is not measured by GDP when the UK economy is supposedly growing but this is confusing the overall macro-economic picture with sentiment about household incomes.

    To my mind , this just indicates theat the GDP model is bad for many reasons and encourages the worst kind of cyclical self destruct government behaviour - 'GDP growth policies' ... encouarge 'boom and bust'.

    Setting some new strategic socio -economic objectives alongside GDP or as part of a reformed GDP model could make the Chancellors jobs easier, reduce the pain of adjustment to a sensible sized public sector ... and highlight new approaches to public spending and economic good practice.

    No doubt there is much more to come yet from the coalition government so it may be that the traditional GDP model may need to be reviewed reformed and ceratinly be explained better ... particularly if e.g. the economic growth is in the financial sector with a mnaly inetrnational focus that has only indirect benefit to the UK economy.

    GDP is misleading ... particularly for the UK with an enlarged public sector and an enlarged financial sector.

    Where is the strategic and structural thinking ... is our GDP growth going to be the additional cost of imported products and materials and balance of payment deficit ... this may influence our GDP but probably does little for the 8.2 million econmically inactive?

    Government/private sector partnership public labour schemes are needed ... to ensure that the unemployed /inactive are offered employment ... otherwise how are these people supposed to have an income and exist?

    The IFS may have a reaction to the budget ... but does their reaction actually benefit those who need help?

    Aaprt from and OBR ... does the government have an active strategic planning unit for the UK economy ... looking at population, infrastructure, tax base etc etc. To my mind that is as important as the OBR ... and be given a transaprent, national profile.

    How can departmental cuts be decided upon and the population be engaged if this strategic planning requirement is not seen to be in place?

    The IFS sound very 'hollow' to me.



  • Comment number 54.

    52

    Well, the Euro preparation unit has closed

  • Comment number 55.

    I don't see why the NHS should be ringfenced. My husband and one of my daughters are employed by the NHS at opposite ends of the spectrum, one being a hospital porter and the other a "senior manager" both work hard and earn every penny of their salaries but both tell me of the wasteful practices that exist in the NHS. My husband tells me of patients transfered from one hospital in the trust to another and then the patients notes arriving by taxi an hour later. This is commonplace not just a one off. My daughter tells me of battles with surgeons because theatres are standing idle and waiting lists growing because they give priority to private work or won't work Friday afternoons or Saturday mornings and all the other old archaic practices that are set in stone. Perhaps every hospital should have a "why" person (perhaps the private sector could do this) with authority to to go into a hospital and ask why is this done like this, why does this cost so much and cut out much of the slack. Then tackle the staff budget if it needs it. There must be lots of government departments where bad practice drains away money, this should be tackled first.

  • Comment number 56.

    I would sugest many front line NHS staff would more happily accept the payfreeze/cut if they were allowed to do there jobs with out the endless audit trails and paperwork taking priority over patients. With an end to the 9-5 buissness culture of the modern NHS were administrators and managers see them selves as the priority.
    What will happen is cuts will hit front line workers like Doctors and Nurses loosing their jobs whilst managers save their's. I wonder how many NHS managers will be receiving bonuses this year?

  • Comment number 57.

    Well if Ken Clarke is reading this, as far as the ministry of Justice is concerned the savings are identifiable and he could make them tomorrow by just simply removing the NOMS body. It really makes little difference to front line delivery staff or service users.Simply roll the clock back 3 years and your department is on the home base with cuts, You show the boys in charge how it should be done, and enough brownie points for yourself to get promotion to leader of the Tory party.
    Mind you that may be something you may not want to touch after this lot starts to bite...

  • Comment number 58.

    NHS trusts have to deliver from £15Bn to £20Bn in "efficiency savings" from 2011 to 2014. David Nicholson, NHS chief executive, told health service finance directors behind closed doors. So, so long as George Osbourne does not announce them from the despatch box they do not exist.

    The cuts would are equivalent to up to six per cent of the current NHS budget. Trusts are being told to ensure that 1% of their budget next year is 'spent but unallocated' in an accountancy trick to ensure totalling £840 million across the NHS will become "free".

    If that is to be the scale of the cuts in a 'ringfenced' department then what does "35%" really mean. The truth is that the biggest efficiency savings the NHS could make are likely to be in not paying private contractors unless they deliver goods and services. Like the Greater Manchester Surgical Centre in Trafford: signed a £70m contract with South African company Netcare to carry out 9,000 operations a year while fewer than 6,000 took place. A nett saving of 33% was achievable by keeping the private sector out of the NHS. Primarily, the waste was on corporate welfare and capital export. Similarly £2.4 billion could be saved on buying out the contracts of 53 PFI hospitals - assuming the same saving as Norfolk and Norwich University hospital calculated they would make for buying out their PFI contract. Similarly the BMJ reports that estimated spending on management consultancy to the wider NHS for 2008 was over £300 million.


    The real scandal is that the budget is transferring billions of taxpayers money to shareholders and banks to shore up a problem created by the banking system's failure to manage itself efficiently or effectively. If an NHS manager were to walk into a bank, I am sure they could find far more efficiency savings that would benefit the Taxpayer than most people might imagine.




  • Comment number 59.

    So much for a fair progressive budget, the poor then the middle classes are hit the hardest, the rich richer and the poor poorer.
    It will be very interesting to see the next set of elections to see how the Lib Dems do, if I were a Lib Dem candidate I would be just a tad worried. Will the top ten percent of earners come anywhere close to being hit in comparison to the bottom ten percent? After all the top ten percent have left the bottom ten percent behind year on year for the last thirty years!
    According to the PCS union there is 120 billion pounds that could be collected from tax aviodance schemes and tax evasion, yet what has been done about this, answer nothing!

  • Comment number 60.

    55

    May I suggest that they write to Andrew Lansley, the Health Secretary, and tell him their views of wastage, then something might be done about it

  • Comment number 61.

    #51. At 6:52pm on 23 Jun 2010, Kevinb wrote:

    "50



    After 5 years of bad medicine, we will be ready to grow once more, with a more balanced economy, and without the crazy deficit inherited from Gordon Brown...you know, the man who hasn't turned up for work for 7 weeks, yet STILL get's paid a full salary"


    Gonna be a lot longer than five years castor oil my friend. Remember the debt thing, we're only hacking at the deficit which I'm still not convinced will be reduced by as much as forecast due to lost revenue. There's still nearly £1Trillion of debt and associated interest to be picked at. People seem to have forgotten the debt will need refinancing at various points in the future along with the rest of europe's debt mountain and if the collective austerity measures drive us all into a prolonged recession it aint gonna attract many investors is it?

    Don't be fooled by long term bonds and staggered maturitites, the whole lot will need refinancing in time and I'm struggling to see investors coming west of Mumbai that far down the line. Especially seeing as the IMF will have its claws in the soft fleshy bits of least five European states by then.

  • Comment number 62.

    58 Hubert - The issues with private contracts, especially the Trafford example, indicate to me poor negotiation and contract skills. Maybe public sector mangers and politicians should be kept out of the public services? Who signed the PFI contracts on our behalf?

  • Comment number 63.

    And there's more...

    I recon vast amounts of money could be saved in the Welsh economy. Instead of a referendum on tax raising powers for the assembly, perhaps a re run of finding out whether the people want the assembly now. I'll bet that once the no campaigners explain the cost of this place then this particular bunch of scroungers will be sent packing. What an extraordinary, useless, expensive bit of political arm candy that place is. The economy could in part be saved by moving some civil service departments out of Whitehall and into the province. Other areas of the country may benefit from this type of movement as well.

  • Comment number 64.

    58 wrote

    NHS trusts have to deliver from £15Bn to £20Bn in "efficiency savings" from 2011 to 2014. David Nicholson, NHS chief executive, told health service finance directors behind closed doors. So, so long as George Osbourne does not announce them from the despatch box they do not exist.

    The cuts would are equivalent to up to six per cent of the current NHS budget. Trusts are being told to ensure that 1% of their budget next year is 'spent but unallocated' in an accountancy trick to ensure totalling £840 million across the NHS will become "free".

    Errrm..maths a bit wobbly there

    The anticipated NHS spend is £119bn 2010, £122bn 2011, and £125bn 2012

    Making £366bn.

    Therefore £15bn would be 4% and £20bn 5.3% based on 2010 to 2012 figures

    As NHS spending is increasing in real terms overall, the £15bn will be more like 3% and the £20bn more like 4%

    Not maybe crucial, yet the facts should be presented accurately

  • Comment number 65.

    61

    I share the thrust of your point, and this is precisely why the cuts need to be deep and now

    I genuinely believe we will be in a much better position than we think we will in 5 years time

    Maybe there will need to be some sovereign debt write offs along the way....

  • Comment number 66.

    59. At 7:41pm on 23 Jun 2010, weredoomed wrote:
    So much for a fair progressive budget, the poor then the middle classes are hit the hardest, the rich richer and the poor poorer.
    It will be very interesting to see the next set of elections to see how the Lib Dems do, if I were a Lib Dem candidate I would be just a tad worried. Will the top ten percent of earners come anywhere close to being hit in comparison to the bottom ten percent? After all the top ten percent have left the bottom ten percent behind year on year for the last thirty years!
    According to the PCS union there is 120 billion pounds that could be collected from tax aviodance schemes and tax evasion, yet what has been done about this, answer nothing!

    This is part of the project Cable is working on....give the coalition a chance, they have only had seven weeks for goodness sake

  • Comment number 67.

    When I was a child 50 years ago, I went into hospital. The hospital was run by a Matron and each ward was run by a ward sister. The consultants ran the medical side of things assisted by doctors. The administration was run by someone called a Lady Almoner. I was looked after, I had medical treatment and my GP called on me at home. I recovered very nicely.

    I am not suggesting that we try to turn the clock back but has anyone ever done a cost-benefit analysis on the hoards of managers that we now have? The stark reality is that even if they do produce some benefit, we cannot afford them.

    When is everyone going to wake up to this reality?

  • Comment number 68.

    To kevinb

    It is the poor that are to shoulder the majority of the pain, followed by the middle classes in the present budget, to be fair progressive or balanced, then to quote George Osborne Nick Clegg or David Cameron, we are all in this together, but we are to wait for the the top of the tree to shoulder any real share. the Lib Dems have been on a road to Demascus conversion in seven weeks regarding Vat, why not prepared for the fair treatment of all?
    The other thought that occurs, by their fruit you shall know them.
    So far what George, Nick and David claim is a fair progressive budget is not fair or progressive, to wait for a day in some obscure future for the top to feel pain when the poor are hit with pain in a specific time is not fair or progressive.

    I feel I must compliment you on your productivity, the number of your posts here are mightily impressive in number, where do you find time to do any real work?

  • Comment number 69.

    68

    The poor have the most protection, you are just wrong to say that they bear the most pain

  • Comment number 70.

    #40

    "whilst A&E appeared understaffed"

    That's because Consultants don't like to work in A&E. It is a bad place to work to get career progression and pots of dosh. It also spoils attendance at the golf course and means shift work. That's why there are rarely any consultants about!

    Equally try being a consultant in geriatrics - that will really get you noticed in the profession. Consultants like doing glamour things like IVF, Cosmetic surgery and things that make lots of money (such as TV programs on IVF to enhance your private fees as you become well known).

  • Comment number 71.

    69. At 8:34pm on 23 Jun 2010, Kevinb wrote:
    'The poor have the most protection, you are just wrong to say that they bear the most pain'

    Really? So the treasury published chart at the bottom of this article is wrong?

    http://news.bbc.co.uk/1/hi/business/10379857.stm

  • Comment number 72.

    69
    There is a broad agreement that the poor have been hit the hardest, followed by those in the middle, apart from those in the tory and Lib dem parties.

    Excluding those previously announced changes, the IFS says that the Budget yesterday was not progressive. The richest households did not pay relatively more. I suppose the IFS is wrong though! there are others, but I will not waste any more of my time.

    There is none so blind as those that will not see.
    Or to put it another way, You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time.

  • Comment number 73.

    Having recently started working in the NHS, having previously worked at a Local Council, allow me to give you a reality check. The Primary Care Trust where I work is less professional and efficient than the Local Council. This is because it is subject to much less scrutiny.
    Local Councils nowadays operate very much in the public eye and are heavily scrutinised. The Audit Commission inspects them; Local Councillors also watch carefully and meet regularly to discuss issues; specific services like childrens' services are inspected regularly by external agencies, and local newspapers are always on their case. And of course local citizens all have an interest in where their Council Tax goes. In addition, many Councils also conduct regular customer surveys to measure how well they are doing. Take, for example, a Local Council web site. It is inspected annually by SOCITM for usability, content, and how accessible it is to sight-impaired users. In addition, the Council must survey customer response to their own web site as well. How many private sector organisation web sites are subjected to such scrutiny?
    The NHS, by contrast, has a much easier time of it, with very little in the way of scrutiny of administration or management costs or efficiency. As a result, things are more sloppy, wasteful and inefficient. And that's often, I'm afraid, among the front-line staff. Record-keeping is terrible in the NHS - information is frequently duplicated, mishandled or lost. Communication between GP surgeries, hospitals and NHS trusts often breaks down.
    There is no customer care or service ethic - we must fit in with the system, not the other way around. Others have mentioned here cases where hospitals ask you to arrive at 7am and then you wait literally all day to be seen by a doctor. How much is that costing the national economy? How much is it costing the hospital to have you sitting around all day?
    Let's face it: the rest of Europe, Australia, Canada, Japan all deliver better healthcare because they have privatised it with a proper organised national health insurance programme. And yes, each time you see a doctor, you have to pay a small amount. Why not? Instead of cutting all those other "luxuries" from the public sector, the government should recognise that the one luxury we REALLY cannot afford any more is free healthcare for all.

  • Comment number 74.

    Sir As Mr. Cameron has stated that there is to be tighter control on the public services pension scheme. Will he assure the general public that this will also be referring to the MPs who at the next election lose their seat and will expect to receive a substansial resettlement grant.
    With regard to pensions when the chancellor makes a statement in the budget, he will often refer to his right honorable friend who will at a later date make a further statement. As we are being open right from the start with nothing hidden in the small print!! he made reference to increasing the tax allowance by £1000 for low paid, but no reference was made to pensioners at 65yrs. or 70 and 80yrs.+. and their tax revenue code.
    Now is there some hidden agenda where he ups the pension rate but claws it back in tax.
    Cliff B

  • Comment number 75.

    69. At 8:34pm on 23 Jun 2010, Kevinb wrote:

    If you take the FT you might also want to take a look at page 11 amongst a number of other articles that appear to put the lie to this particular claim.

    You seem too smart to just take the budget speech at face value so I am surprised to see you asserting this so readily.

  • Comment number 76.

    71

    Yes it is

    Because it doesn't take into account the free stuff they get, and the fractions are so small excluding that, that it is meaningless

    Free school dinners, council tax relief, the list goes on

    So, try working things out for yourself instead of believing everything that you think suits you

    On this occasion, you appear to be in a round hole

  • Comment number 77.

    The working poor are going to be taken out of income tax eventually. These are the people who should benefit most from any changes made. Apart from mass killings and socialism for the rich, the fact that poor workers have been taxed to pay for those who will not work , was the most immoral aspect of the previous Labour government.

    Tough on socialism, tough on the causes of socialism.

  • Comment number 78.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 79.

    #1 yes a management cull, what would that achieve? Front line staff having to management tasks, that's what. Necessary evil.

    #67 Matron; modern job description: Supervisor/Manager.

    #62: It's not just me that reads about Public Sector contracts and thinks they all seem to be totally miss-managed. Great example is the Edinburgh Trams, Why oh Why when the contract was signed was it not a case of, you say you can do it for £500M, then that's what you get. That's how Telford's roads and bridges project worked. Although it kind of falls over when it's small companies that collapse mid-project and the owner gets sent to Debtors Gaol.


    And why has Overseas Aid been ring fenced?
    Our country is thrashing around looking for the paddle that was just dropped, it's time to save ourselves not lose it completely whiel trying to save others.

  • Comment number 80.

    64 - the 15 to 20bn is recurrent - i.e. each and every year not cumulative - so your correction was infact incorrect!!

  • Comment number 81.

    74 Cliff - pensioners should have the same tax bands as everyone else

  • Comment number 82.

    74

    THIS WILL BE IN THE NORMAL BUDGET.....

    You are reacting to a non-story

  • Comment number 83.

    75. At 8:57pm on 23 Jun 2010, Squarepeg wrote:
    69. At 8:34pm on 23 Jun 2010, Kevinb wrote:

    If you take the FT you might also want to take a look at page 11 amongst a number of other articles that appear to put the lie to this particular claim.

    You seem too smart to just take the budget speech at face value so I am surprised to see you asserting this so readily.

    It is my analysis, which takes into account FREE things that the poorest don't pay for, so I do not agree with the other articles, no

    They do NOT take these into account, and are therefore in error

  • Comment number 84.

    80. At 9:13pm on 23 Jun 2010, Chris wrote:
    64 - the 15 to 20bn is recurrent - i.e. each and every year not cumulative - so your correction was infact incorrect!!

    Says who?

    IF it is recurrent then it is even more inaccurate, not less

  • Comment number 85.

    5. At 2:10pm on 23 Jun 2010, EdinJar wrote:

    As a management consultant I've been appalled by the "service" provided by the NHS in the last year or so in dealing with my wife after an ankle break.

    =====================

    Over the past 2 years I have experienced the NHS with the old patients, and I can tell you that whilst there may be caring individuals, there are a considerable number who are anything but caring. The cost is in lives - I've lost 1 and almost lost a second relative to Hospital aqcuired infections, and the family literally had to stand guard over another to ensure that she was cleaned and fed, and the cleaning often fell to relatives. The NHS is a sacred cow, the sooner it is put down the better, I dread to think how many of the old it actually kills, but I suspect no politician would dare commission any investigation into that, as the results would probably be far too shocking.

  • Comment number 86.

    Why is International Development to be wholly protected from cuts?

    £7.8 billion is a lot of money....

    Even if the aid the UK gives has to be protected (I'm not convinced), DFID should be compelled to make a 25% cut in their internal running costs alongside other government departments. It's disgraceful that while cuts will be made in education spending in the UK, DFID will be funding education programmes overseas.

    LG

  • Comment number 87.

    The NHS is nothing more than an expensive employment scheme for health professionals.

    At its worst it is a vast, monolithic, aged structure that once employed caring and dedicated professionals whose main objective was to care for the sick and make them better.

    Now it employs jobsworth nurses, consultants and doctors who rate their terms and conditions over the main role which is to provide care for the sick

    The culture now is one of a 'job for life' mentality. Employee sick rates rocketing. LAzy, useless nurses whose only concern is gossiping about what they did on sat night rather than the care of the weak and the sick

    Patients are viewed with contempt rather than sympathy. An annoyance rather than a task to heal

    We pay their wages and sometimes it seems we owe them a living

    I cannot believe the NHS is ring fenced. Useless, lazy, timewasting, inefficient NHS employees. Closseted from the real world by unions and over-zealous politicians

  • Comment number 88.

    85

    My grand daughter was taken to A&E she was very close to death, A&E were fantastic, as were Yorkhill sick kids, the Doctors nurses and cleaning staff were brilliant. We as a family can not praise these hospitals enough for their skill and dedication.

    I suppose if we were to follow your advice we would find it very difficult to find the money to pay privately for such wonderful care.

    Perhaps we should follow the recent American system where if you don't have health insurance or are really wealthy then you and your family die of what would be trivial problems in this country.

    There may well be some hospitals that do not have such high standards, however with the number of managers and management consultants that have been hired by the NHS in past years, is it any wonder that there is no money left for Doctors, nurses and cleaners!

  • Comment number 89.

    The missing link is of course that the City and its associated financial institutions haven't been told that unless they start investing in and building UK industry then they'll nationalised. Oh hang on .. two of them were.

  • Comment number 90.

    One of the fundamental problems with the NHS is that it is a centrally planned service. This means that it doesn't respond quickly, if at all, to economic signals and this makes it chronically inefficient. As an example, Intensive Care Unit (ICU) beds are routinely in short supply. So, if money followed the patient, then the demand from patients for expensive ICU beds would be met with an increase in their provision, as hospitals would find it worthwhile to invest in them.

    There is a reason free markets are economically efficient and centrally planned economies are not. In a free market economy, supply and demand are kept in balance in the long term through the price mechanism. (IE the price of a good or service rises if it's in short supply and that sends the signal for new suppliers to enter the market, thus driving the cost back down.) When applied to health care, that doesn't deal with social inequalities, and a truly free market system would deny healthcare to those without the ability to pay (see the USA). However, there is a potential middle-way. And that is to have a basic safety-net insurance for the truly poor - to ensure all have access to a defined level of healthcare - while requiring others to either pay at least some of the cost of treatment or have insurance.

    Yes, there are all sorts of problems with this approach too, but perhaps we really do need to start considering whether we as a nation can continue to afford a totally free healthcare system, or whether a fairly priced one (perhaps with an annual or lifetime limit after which the state would pay the full costs) might be better all round (both in terms of cost to us and what's provided in terms of facilities).

    Something along the line of Singapore's model might be one to consider, where the state mandates saving for healthcare costs, you can buy top-up insurance for better levels of cover and service, prices for procedures are published so you can shop around and get the best bang for your buck, and there is a SAFETY NET to fall back on if costs would be catastrophic. Oh, and the government there explicitly recognises that humans are mortal and that we have to accept that.

    Finally, I worked for the Audit Commission for a number of years, in Health and Local Government. Both would make you weep with their inefficiencies which are only sustained by taxpayers' money. But the NHS is worse, way worse, and it is largely down to the 'saints' on the front line and usually NOT the managers. Once a doctor becomes a consultant, many become lazy as they are largely unsackable and unmanageable, and private healthcare (which they are explicitly allowed) is so lucrative. And too many nurses are bone idle.

    I myself had private treatment in a NHS hospital in which I was working. A purely minor procedure which took 10 minutes. I knew how long a NHS session should last for a consultant (at least 3 hours) and I was due to see the consultant after that session. The session started at 9am. So how was I seen at 11.00 am? And this was a service that at the time had lengthy waiting lists.

  • Comment number 91.

    The important implications are:
    1. Most of the coalition complaints about debt and promises of 'fairness' we've heard from both Osborne and Cameron turn out to have been calculated inexactitudes on a grand scale.
    2. Since the 1930s, only the Japanese government has tried cutting so much in a recovery phase. Japan has been 'rewarded' by both 18 years of stagnation and its mounting sovereign debt now exceeding 200% of national income. Japan cannot find any way back to normality.
    3. Our government is GAMBLING that investment and consumer spending will be hardly affected - despite the Japanese precedent - and that those growths will sustain growing tax revenues.
    There is no mandate for either these deceptions or these policies. I suspect we're heading straight for a truly spectacular depression.

  • Comment number 92.

    Update 1500: As I noted here yesterday, the charts showing the impact on households of different incomes of the Budget included pre-announced changes such as Labour's National Insurance change, due to come in next year.

    That turns out to have had an even larger impact than I thought.

    Excluding those previously announced changes, the IFS says that the Budget yesterday was not progressive. The richest households did not pay relatively more.
    ----------------------------------------------------------------------
    Stephanie, it looks like I was right to be a bit suspicious about that chart. Can we have a new one, please, running from, say, £8k to £500K pa?

  • Comment number 93.

    Everyone I know who has worked in the NHS talks about huge wastes of money and inefficient practices. Two things stop real reform: the doctors, who on the grounds of "clinical judgement" see themselves as beyond management control, and the unions, which don't like change and support everything staying as is with maximum labour expended for minimum results. There is no "Can Do" attitude - remember those programmes with Sir Gerry Robinson trying to fix the NHS?

  • Comment number 94.

    73. At 8:52pm on 23 Jun 2010, Richard Holmes wrote:

    Why not? Instead of cutting all those other "luxuries" from the public sector, the government should recognise that the one luxury we REALLY cannot afford any more is free healthcare for all.
    -------------------------------------------------
    1. It's not free. A lot of the NHS is paid for directly.

    2. It's not free indirectly, either! Ever heard of a thing called tax?

  • Comment number 95.

    I am fascinated as ever by the polarised views about the NHS, which are often based upon "facts" that bare no relation to reality. It would be useful for the key information about the NHS and other public services to be more accessible and hence easier for people to understand.

    I find that when people "diss" the NHS, or say it should be paid for, they are often thinking from their own narrow view point - probably having not required serious care or being wealthy enough for private care. I wonder how many of these people have ever bothered to expose their lives to people who are less fortunate and depend on these services through no fault other than having a condition or injury that we are lucky enough not to have.

    The problems we face in the economy are not based upon actions taken to help others, they are based upon people looking after number one at the cost of others. Yes the public sector including the NHS could be more efficient, but not by the levels many have stated unless services are cut - services which we (or our families) may depend upon at some point.

  • Comment number 96.

    52. At 7:11pm on 23 Jun 2010, onefootin wrote:
    "given that the Treasury was trying to save money"
    Has anyone ever been allowed to look closely at "the Treasury" - I should imagine that there are massive inefficiencies within that department potential for huge savings of public money. Unfortunately I do not have the capacity to read and absorb all the publicity but I cannot recall seeing that department being on the protected list or mentioned as an area for cuts.
    Also has anyone ever totalled the cost of all the "press officers" and their departments paid out of the public purse? Again I'm sure that there is potential to save a very significant amount of our money with no loss of efficiency.
    Just a couple of areas that seemed to have slipped under the net and there are without doubt lots of other examples.

    ---------------------------------------------
    Department for Education should be in pole position for this. Do I recall correctly that the Treasury spend on schools goes to the DfE who take a slice - about 50% - before passing the rest to the LEAs? Then they take a slice. Guess what? Around 50%. Then they pass the balance to the nations' schools.

    What do the DfE and LEAs do with their share of the cash?

  • Comment number 97.

    The NHS is riddled with inefficiencies and should not remain exempt from economies. I have just returned from visiting a pal who is perfectly capable of being treated in one town but the 'parent hospital' for heart treatment insists on keeping him and several others in a holding bed until one comes free at the main heart hospital. The tories only reason for ring fencing the NHS is the real and malicious spin that the public sector unions would present to the public showing emotional fears exaggerated out of all proportion but relished by our media.

  • Comment number 98.

    The NHS is another bust model. It is simply galloping away on cost. A major cost element is new drugs and new treatments. An aging population needs more treatment. An increasingly obese and unhealthy population needs more treatment. The idea it can be protected is a bad joke, it simply cannot in its current mode. The medics fight the idea of a two tier treatment sytem on principle, despite the fact it would ease funding problems. The Trusts complain when funding for a patient treatment they cannot provide is routed to another provider who can. The funding is seen as theirs, not held on behalf of the patients treatment. The issue can stall for a few more years but it will hit the buffers like everything else based on increased consumption. I watched a debate about an old guy wanting a new heart, well somebodyelses they were no longer using. He complained bitterly that he wanted one. The problem is there are not enough other peoples hearts spare, there is a limited supply of ones with the right spec so it is inevitable that somebody has to do without and there has to be some methodology to say who gets what is available. Thats without the fact that heart transplants didnt even exist when the NHS was created. Then there is the George Best model where having gone thru his own liver he wants to go thru 2 more. But dont forget the best one, the bend with the wind politican model, where when having been judged insufficently effective or justifiable in cost by NICE, a lobby group pressurises via the media and a politican then demands it is provided. The one creditable act Blair undertook was upping cancer treatment to the European norm, which took a 3 fold increase in funding in that area. An area neglected by the Tories. But the idea the NHS has to be a cure all is simply a non starter. Next stop nanotechology, yes that was planned when the NHS was create I am sure. 250,000 wanting gastric bypass surgery because they cannot stop eating. Food was still rationed when they started thinking about the NHS. So it is just a bust model. Another reality cheque due shortly.

  • Comment number 99.

    Various - overseas aid. As the pound has had a 30 percent drop these infield budgets have seen a 30 percent drop already and some programmes are reported as struggling, I suspect that is why they are ringfenced. We are a G8 country so I assume we can help people in trouble to some extent. What I find more diffcult to understand is that until recently China was in receipt of aid, I presume this has now stopped, I havent looked for some time.

  • Comment number 100.

    Cuts can easily happen take a local council it buys for instance 120 baths a year for council housing at this time it buys all the same highish model bath for say £120 but it could buy baths with exactly the same spec for £80.That £40 saving on each bath. That alot of money wasted just on baths in one council. When your told u will be on less money next year u pull in your belt so local council and governmental departments will have to squeeze out the waste. The government could run all the services on 6 percent income tax on every pound earned but ther so much waste. Plus the arguement the rich should pay more but is not the best thing about the capitalist system its incentive to earn more but which higher taxs on higher earnings there less incentive.

 

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