Where Is the "New Money" for the NHS To Go? The Government Must Not Hand Over Public Funds to Private Capital! Being Classed as "Wreckers" Will Not Silence the Workers' Opposition!

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Where Is the "New Money" for the NHS To Go? The Government Must Not Hand Over Public Funds to Private Capital! Being Classed as "Wreckers" Will Not Silence the Workers' Opposition!

Where the "new money" for the NHS, announced in the Budget, will end up is a central issue. It is a question that very quickly the electorate were asking. With the government having been trailing both tax increases and a programme of "investment with reform" for some time, it is a very great cause for concern.

The Chancellor, as had Tony Blair, rejected the policy of "hypothecation", in other words that the increase in National Insurance Contributions should be "ring fenced" for the health service. His argument was that it would make public services subject to unpredictable changes in revenues. However, the issue is that revenues should be guaranteed for the health service, so the situation now is one where the increase in NICs is guaranteed, for as long as the government determines, but not the increased investment in the health service to meet the people's needs for health care. But he also made the point that the "reforms" must be transparent, with the appointment of an independent auditor, to "account for the money allocated to the NHS, where it has been spent and what the results of the expenditure have been".

In the wake of this, and Alan Milburn's announcements on the NHS reforms, the director of the Audit Commission, Sir Andrew Foster, warned that the government is taking a "risk" by launching the Commission for Healthcare Audit and Inspection while radically reforming the structure of the NHS. He said that while he welcomed the establishment of CHAI, the new body would face enormous challenges bringing together the wide range of responsibilities envisaged for it in Delivering the NHS Plan. "The acid test is to what extent the new body can establish itself as independent and evidence based. At a time of significant change in the NHS itself, actually changing the regulatory systems brings in a risk."

The real issue, however, is not how transparent the funding of the NHS is, but the Plan itself, and the principles on which it is based. Not only is the Plan at odds with the aspirations of health workers and professionals at many levels in the NHS, in that it has excluded and will exclude them from any decision-making role in the direction of the NHS, and continues to define health care provision in terms of its being a commodity and refining a "value-for-money" approach within a purchaser and provider framework. It is also likely to intensify the pressure on NHS staff, who are expected to shoulder responsibility and take the blame for the shortcomings of the health service, while being the subject of inspection after inspection.

Furthermore, within this framework, where will the "new money" end up? As the government's emphasis on "investment with reform" and "radical restructuring" indicates, the involvement of private capital is set to gather pace. This involvement cannot be justified. Such companies both straightforwardly pockets the public funds with guaranteed revenue streams and other means, and also contribute to the commodification of health care and make profits from the labour of health workers. This is not to mention the risk-free and monopoly position of the drug monopolies as well as other capitalist enterprises who supply goods and capital for the NHS. That "new money" is delivered straight to the coffers of such capitalist concerns is the great scandal of the direction in which social programmes is being taken.

A further issue is the "smoke and mirrors" illusion-making that the nominal increase in funding will all be reflected in increased investment in the NHS. The government has said, for example, that the costs of the public sector will rise by £1.2 billion a year simply through the increases in National Insurance.

John Appleby, director of health systems at the Kings' Fund, giving evidence to the Treasury select committee last Monday, argued that 40% of the £40 billion "extra" investment into the health service would be spent on the cost of price rises and increased pay demands to offset the costs of higher NICs. He said, "Unions, the BMA, will see much more money going into the system and they perhaps want a share of it. That's the sort of feedback and change in behaviour that makes predicting the future very hard indeed." Such sentiments have prompted the Treasury to pre-emptively call for future pay deals to be "responsible", as well as putting the onus on the workers to keep pay settlements low otherwise the impact of higher National Insurance contributions will be higher unemployment.

A proportion of the "new money" is also set to be used to encourage more private sector involvement in the NHS, as Health Secretary Alan Milburn declared in setting out his vision for the NHS. For example, in The Times of April 20, he called for a "pluralistic" system where the public or private status of the hospital or doctor is irrelevant.

Under his reforms a price will be set nationally for every NHS operation. Private companies will then be invited to compete against the NHS to treat any patient at those fixed rates. Next week health advisers will meet the company that runs healthcare in California, Kaiser Permanente, and other US management experts. They are to be offered consultancy fees to help to transform the way the NHS is run.

Alan Milburn said that the "NHS family" welcomed all high-quality providers so long as they met NHS standards, cost the same as NHS services and are subject to inspection. "It is a question of whether you think the NHS is its buildings or the system that says you are treated according to need not ability to pay, wherever it is in the system," he said. This is a false dichotomy. It is not irrelevant that the "providers" are making billions out of the NHS, and the workers' opposition to this situation cannot be blunted by unjustly claiming that this enrichment is necessary to bring about a health system that meets the needs of the people. Where is the logic in that? If money is being syphoned off from the NHS, how is that supposed to ensure the provision of health care irrespective of ability to pay? Funds taken out of the system remain funds taken out of the system.

It is private capital which is welcoming this approach. The Independent Healthcare Association said: "Alan Milburn reinforces our optimism as providers that the government is committed to engaging in full partnership with us."

What is equally ominous is that Tony Blair has said he is ready to follow Margaret Thatcher and confront the workers and their unions, as well as doctors' organisations, on their opposition to the health reforms.

In a television interview, Tony Blair said that the unions would not be allowed to knock the government’s reform plans off course. He said, "I have shown that where I have a disagreement with the unions and I believe the national interests requires us to do something they don’t want, I am perfectly prepared to take people on. But I don’t go into it with the attitude that I am spoiling for a fight with anybody."

Being classed as the wreckers is not going to silence the workers' opposition to the handing over the increases in taxing the people to private capital, as the government's NHS reform and restructuring promises. The government must stop handing over the national wealth to private capital. Furthermore, there is an alternative to taking yet more of the wealth produced by working people, in the form of taxes or NICs, under the argument that that NHS must be funded. For example, interest on government debt amount to £21 billion per annum, and a moratorium could be put on this payment. Expenditure on what is termed "defence" amount to £24 billion per annum, and cutting back on militarisation, aggression and intervention, and spending only what is necessary on actual defence would make other funds available. Even more fundamental is what happens to the total wealth created by the working people. If the whole of this were planned and under government direction, then truly the enrichment of a wealthy few could be ended and social programmes provided which meet the claims of the members of society.