Spring Budget leaves more questions than it answers, say NHS bosses

Earlier today, the Chancellor, Jeremy Hunt, announced the government’s Spring Budget. Amid the junior doctor, nursing and ambulance strikes, NHS leaders were hoping Mr Hunt would reveal how the government plans to address the ongoing pay disputes.

He noted that high inflation is “the route cause of the strikes”, and with it predicted to fall to 2.9% by the end of 2023, he said the government will continue to work to settle these disputes, but “only in a way that does not fuel inflation.”

Mr Hunt did not give any further detail about how the government plans to resolve this dispute, ignoring calls from NHS leaders and unions to better fund the workforce.

Matthew Taylor chief executive of the NHS Confederation, said: “The reality is that this budget leaves more questions than it answers when it comes to the NHS.”

He highlighted some positives from the budget, including the pension reforms, energy support and a freeze on fuel duty, but says it does not “provide any further clarity on how the government is going to address” the staffing crisis.

Mr Taylor said without further clarity on funding plans for the NHS, the health service “will be in permanent crisis management mode”.

No new funding for NHS or social care

Last week, the NHS Confederation said urgent action is needed in five priority areas to limit the high demand on services and avoid storing up more problems for the future.

These key areas were: funding the workforce plan, paying for a pay rise for NHS staff, investing in NHS infrastructure, clarifying social care funding and fixing local government health funding.

While Mr Hunt said the long-awaited workforce plan would be published soon, he did not give any detail of when it will be published and what we can expect from the plan.

He did not mention whether NHS staff can expect to receive a pay rise, and he did not announce any further funding for NHS infrastructure, social care or local government health departments.

Mr Taylor said a lack of extra funding was a “concern” to health bosses, as without extra money, the NHS will find it difficult to address the elective care waiting list – which currently stands at 7 million.

The NHS Confederation has previously highlighted that for every £1 invested in the NHS, the country sees a return of £4. Investing in the health service therefore benefits the economy as well as staff and their patients.

Mr Taylor says without “new money”, NHS employers will be forced to pay their staff higher salaries, without the ability to increase staff numbers.

This could seriously undermine their ability to catch up on the elective care backlog. Not enough staff could exacerbate other drivers of unrest – overwork and burnout – creating further issues,” he said.

A pension tax reform

The Chancellor did announce, however, that he would stop senior NHS clinicians from reducing their hours or retiring early by increasing the pensions annual tax-free allowance from £40,000 to £60,000 and scrapping the lifetime allowance entirely.

Mr Hunt said the new ‘pension tax reform’ will stop more than 80% of NHS doctors from receiving a tax charge.

The BMA has welcomed the announcement, saying it will “significantly address” the issue and will provide the most experienced doctors with an incentive to continue working for the NHS.

However, chair of the BMA Pensions Committee and chair of the Consultants Committee Dr Vishal Sharma said the changes don’t address all of the issues, and some doctors will still be adversely impacted by the annual allowance – particularly the tapered annual allowance which hasn’t been “meaningfully modified” in these reforms.

“Consequently, a minority of doctors will still need to navigate the complexity of the annual allowance, an allowance which we believe is completely unsuited to defined benefits schemes such as the NHS. This will mean some doctors will still need to think carefully before taking on additional shifts or doing overtime. We hope to continue our constructive discussions with Treasury in order to find a way forward to address this outstanding issue,” he said.

The leader of the opposition, Keir Starmer, has also criticised the new policy, saying it will only benefit the wealthiest in society. He said: “We needed a fix for doctors, but the announcement today is a huge giveaway to some of the very wealthiest. The only permanent tax cut in the budget is for the richest 1%. How can that possible be a priority?”

Speeding up the approval process for medicines

Hunt also announced that from 2024, the UK’s drug regulator, the MHRA, will move to a “swift new approval process for the most cutting-edge medicines and devices.”

The government will provide an extra 10 million of funding over the next two years to put in place the “quickest, simplest regulatory approval process in the world for companies seeking rapid market access.”

Mr Hunt said the move will make the UK a more appealing place to invest and will speed up access for NHS patients to the very newest drugs.

The budget document says the MHRA is exploring partnerships with trusted international agencies, such as the US and Japan. This could mean that if a drug was approved for use in one of these countries, it could be automatically approved for use in the UK.

But critics are concerned this could lead to less rigorous drug testing, which could impact upon patient safety.