Nursing staff and supporters at Waterloo Place, London, protesting the government's plans to change NHS junior doctor contracts, 6 Feb 2016

Are the Conservatives privatising the NHS?

“Strong and stable leadership” has been the mantra of Theresa May and the Conservatives since the election was called on 18 April, with minimal discussion of policies so far, including health. However, the importance and popularity of the NHS means that it is nearly always a key election issue, as we saw in the 2016 EU referendum.

Increasingly the service is referred to as “our” NHS, reflecting its standing as a universal public service that we all contribute to and benefit from. A key concern in recent years is that the NHS is being privatised by the Conservatives, risking a shift from services driven by medical need to services focussed on company profits.

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There are now 3.7million people on the English NHS waiting list, up 44% since 2012. The number of people waiting longer than 18 weeks is now a third of a million, up 163% since 2012.

The reasons are simple: rising demand from an ageing population resulting in the NHS treating 5000 more patients a day compared to 2010, coupled with the biggest squeeze in NHS funding since the service began in 1948. Funding isn’t keeping up with demand. Next year, there will actually be a per-person funding cut.

Despite the government’s own auditor (NAO) warning that NHS England’s finances “do not appear sustainable” and the head of NHS England, Simon Stevens, pointing out publicly that funding is insufficient, there has been no response from the government. The fundamental budget commitments under Theresa May remain the same as under David Cameron.

As I described in the previous post, the austerity agenda isn’t restricted to public service cuts, but has also seen a sharp increase in privatisations of state-owned enterprises. As the largest state-run service in the country, there is suspicion that the health funding short-falls are part of a wider strategy to break up and privatise parts of the NHS. The views of the health secretary, Jeremy Hunt, and of Theresa May herself, as well as Cameron’s privatisation reforms of 2013, have all lent support to this view.

Jeremy Hunt was appointed as English Health Secretary by Cameron in 2012 and has been retained by May. In 2005, Hunt co-authored a book on privatising the NHS.

The privatisation approach favours a free-market model, where each person is responsible for funding their own services. Funding from government is perceived as an imposition on the freedom of contributing tax-payers. State provision of public services is also seen as unacceptable: an individual’s choice of provider should be made from a competitive market of independent (usually private) providers. Healthcare in Britain fails on both tests: funding and provision are organised by the government via the NHS, with services free at the point of need for everyone in society.

Theresa May has echoed these views in the past.

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Theresa May

Too often the state is a poor provider of services, and its monopoly over the delivery of those services must end. A future Conservative government should therefore go further in increasing the number of charities, companies and co-operatives that deliver frontline services. And if allowing those organisations to make a profit means we have a more diverse supply side and better outcomes, then that is something we should consider with an open mind.

– Theresa May, May 2013

Of course, services like the NHS, although predominantly state-run, have always used private companies, for example GP practices and pharmaceutical companies. This model of provision, with the state retaining overall responsibility for outcomes, as well as control of commissioning (purchasing of services, equipment, drugs), has proved remarkably successful. May herself has acknowledged this, calling the NHS: “one of the finest health care systems anywhere in the world.” The evidence backs this up. Far from being a “poor provider of services”, the NHS regularly appears near the top of international comparisons of health systems. In the most recent one it came first, “scoring highest on quality, access, and efficiency.” The privatised US market system came last.

Nevertheless, in England the door is now open to a privatised market system. Despite pledging “no top-down re-organisation of the NHS” in 2010, David Cameron did just that on entering office. The NHS reforms (introduced in England in April 2013) require by law that NHS services are put out for competitive tender. As a result, the amount of health funding going to private companies doubled under the Cameron governments.

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Protesters rally against public sector spending cuts following the re-election of the Conservative party, 30 May 2015

Even with a proliferation of private providers, Theresa May has maintained that the NHS will remain “free at the point of use.” This implies that it wouldn’t need to be individually funded by each of us, but continue to be funded through our pooled resources via central taxation: the so-called ‘publicly funded-privately provided’ model.

For anyone in favour of a free-market approach, this public-private hybrid is only half a solution because it still requires general taxation to pay for it. Also, the amount of taxation is unlikely to go down, for two reasons. Firstly, the NHS is currently one of the most cost-effective health systems in the world, so the publicly funded-privately provided model would need to be even more efficient if there were to be any savings to the tax payer. Secondly, much of the cost increases of recent years result from rising demand from an ageing population. That demand will remain, regardless of the service approach.

David Cameron’s 2013 re-organisation of the English NHS however, does provide a possible route to a more comprehensive free-market solution with minimal taxation. The only services that are now legally required are ambulances and emergency care. A steady reduction in funding for all other health services could lead to a near-complete private system, as citizens have no choice but to purchase non-emergency services from the private sector.

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After seven years of funding short-falls under Conservative-led governments and four years after Cameron’s privatisation reforms, the NHS seems to be struggling to cope, even to objective government auditors. Investment isn’t keeping up with rising demand, resulting in longer waiting lists and longer waiting times. Despite this, there has so far been no change of course under Theresa May.

Meanwhile, under the legal framework and competitive tendering process in place since 2013, public provision is being replaced with private provision.

Are the Conservatives privatising the NHS? It looks like it to me. It’s just not a ‘big bang’ privatisation. It’s a quiet, piecemeal process, largely out of public view.


Image Credits
Death by a thousand cuts by John Gomez / Shutterstock.com
Theresa May
, licensed under CC BY 2.0
Wake up people! by 1000 Words / Shutterstock.com

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