The NHS has to heed our credit rating warnings

The announcement from Moody’s this morning on the UK’s credit rating is another warning that spending cannot stay as it is on public services, and this of course includes health, the biggest burden. As I wrote for the Daily Mail yesterday:

The fundamental reason for change (i.e. what should be made clear but isn’t with the Health Bill) is that we cannot afford the NHS to carry on as it is! We need to plan and improve it so we can look after the sick and elderly in the future without the NHS being a massive tax-burden.

So the first time-bomb we need to diffuse is the economic one. The credit rating agency Standard and Poor have given us warnings. Firstly we have at least 20 hospitals that are in such a financially bad way that they will need massive subsidies of tax-payers money to keep them viable. Secondly, they have also warned that rising health costs with no policy change will mean that within the next 3 years, some G20 countries will have their healthcare-related credit downgraded. We could be one of them, especially if the economy doesn’t grow and our health spending does. If we are downgraded, the cost of borrowing rises and spending on health and social care would have to be slashed.

Therefore we need to welcome more private investment in the NHS, from providers, research and from individuals. To do this the Bill enables hospitals to raise their private income cap. This will mean that they can increase income from private patients, take part in more research and clinical trials, offer office or laboratory space to e.g. small biotechnology companies. All with NHS services being protected by law.

The Bill also encourages more services to be delivered by independent companies (who pay their own overheads, staff pensions and development costs), thus saving the NHS money.

One of the big mistakes over the past months has been for the coalition to allow there to be both perceived public-private fight and real anti-business sentiments. The NHS already spends 28% of its budget in the independent sector, depending on it for everything from IT support to drugs to physio. It is an example of a fantastic partnership. Yet investor confidence is rock bottom. Those who risked setting up new businesses in the past to support the NHS have had precious little political support or appreciation. Those that want to supply services are still being stymied by banks delaying their lending decisions – what use to take 3 months now takes 12 – by which time circumstances have often changed.

I am no fan of businesses who give themselves big bonuses or make excessive profits. But the NHS has to welcome both ethical business support and more private patients. I’d like to know from where else opponents think they are going to raise the money without jeopardising our entire economy.

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About Julia Manning

Julia Manning is a social entrepreneur, writer, campaigner and commentator. She is based in London and is the founder and Chief Executive of 2020health, an independent, social enterprise Think Tank whose aim is to Make Health Personal. Through networking, technology, research, relationships and campaigning 2020health has influenced opinion and action in fields as diverse as bioethics, alcohol, emerging technologies, fraud, education, consumer technology and vaccination. Julia studied visual science at City University and became a member of the College of Optometrists in 1991. Her career has included being a visiting lecturer at City University, a visiting clinician at the Royal Free Hospital, working with south London Primary Care Trusts and as a Director of the UK Institute of Optometry. She specialised in diabetes (University of Warwick Certificate in Diabetic Care) and founded Julia Manning Eyecare in 2004, a home and prison visiting practice for people with mental and physical disabilities using the latest digital technology, which she sold to Healthcall (now part of Specsavers) in 2009. Experiences of working in the NHS, contributing to policy development, raising two children in the inner-city and standing in the General Election in Bristol in 2005 led to Julia forming 2020health at the end of 2006. Julia is a regular guest on TV and radio shows such as BBC News, ITV’s Daybreak/ GMB, Channel 5 News, BBC 1′s The Big Questions, BBC Radio, LBC and has taken part in debates and contributed to BBC’s Newsnight, Panorama, You and Yours and ITV’s The Week. She is mum to a rugby-mad son, a daughter passionate about Shakespeare, and wife of a comprehensive school assistant head-teacher. She loves gardening, ballet, Zimbabwe, her Westies Skye and Angus, is an honorary research associate at UCL and a Fellow of the RSA.
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