Budget cuts NHS spending by £400m a year

The government has cut NHS spending from 2011 onwards by as much as £400m a year.

In his budget announcement chancellor Alistair Darling said that PCT allocations for the next two years will remain unchanged from the 5.5% growth rate announced.

‘Some have argued that we should cut public services immediately,’ he told the House, ‘rather than invest and grow our way out of the recession. That would be the wrong thing to do’.

But he also announced that public spending as a whole would grow by 0.7% from 2011 - well down from the the 1.1% rate previously expected.

If the DoH received its fair share of such cuts, it would mean health spending was £400m lower than expected in 2011/12.

Dave Prentis, general secretary of union Unison, warned against ‘damaging cuts to public spending’.

‘If the government wants to grow its way out of recession, public services must be the roots,’ he said.

‘And if you cut the roots, growth withers.’

Mr Darling also repeated yesterday’s announcement that public sector efficiency savings would rise from £5bn to £14bn a year by 2013/14. The DoH said that it would contribute an extra £2.3bn in savings in 2010/11.

But Northern Ireland's health minister Michael McGimpsey warned that such savings would inevitably impact upon patient care.

‘This must not be allowed to happen,’ he said. ‘The pace of the efficiency drive is too quick and is causing too much pain.’

Mr Darling predicted that the economy would contract by 3.5% this year, but bounce back to a 3.5% growth rate by 2011.

Other announcements included in the budget included a new top tax rate of 50% on those earning more than £150,000 a year, and limits on pension tax relief for the same income group.

Dr Richard Lewis, Welsh secretary of the BMA said: ‘We're pleased to see this rise in the cost of purchasing alcohol, but in our view, it doesn't go far enough.

‘Doctors have been campaigning for some time for higher taxes on alcoholic drinks, but crucially, this increase should be proportionate to the amount of alcohol in the product.

Today's rise announced by the chancellor won't necessarily end irresponsible promotional activities like happy hours and 2-for-1 offers, or the deep discounting carried out by supermarkets. A minimum price for alcohol, which we advocate, would put a stop to such practices, at the same as enabling pubs and bars to better compete with supermarkets.'

RCN chief executive and general secretary Dr Peter Carter said: 'Nurses will welcome the chancellor's commitment not to cut front-line services as a quick fix for the economic situation. However, the NHS is making a large contribution to the cost savings announced in this budget, and we cannot allow the quality of healthcare to suffer for the sake of short term savings. The NHS is vital in protecting the people on the sharp end of the economic downturn.'

Unite assistant general secretary Gail Cartmail said: ‘No area of the public sector - education, health and local government - will be spared these ‘efficiency' savings. It doesn't make sense to curb budgets as people hit by the recession need public services all the more.

‘We are seriously concerned by the costs of privatisation. The NHS is the most obvious example where the privatisation agenda has been aggressively promoted by private healthcare companies.

‘The first candidate for ‘efficiency savings' should be these misguided excursions into privatisation in all its guises.'

jonn.elledge@haymarket.com

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