Weak growth continues and some health services (or service levels) are cut

Public sector borrowing requirements and GDP growth rates largely determine cash availability, and previous growth in health and social care spending cannot be maintained. If GDP were to decrease or see modest growth, the reduction in cash availability would affect service provision. This idea combines with an increase in demand on healthcare due to an ageing population and rise in chronic illnesses.

There is a continued shortfall for the English NHS. Previous studies have indicated a likely funding shortfall of around £20 billion. This would require major improvements in productivity, efficiency and effectiveness.

UK public spending on the NHS has increased faster than economy wide inflation since the 1950s, with long-term trends in growth of around 4 per cent per annum. As a proportion of national income, spending has also more than doubled in 60 years. The real-term freeze currently placed on the NHS makes the financial situation incredibly challenging for a service that has relied on 4 per cent year-on- year growth.

There are concerns that the future is even bleaker if the economic crisis continues against a backdrop of increasing demand for care services, and services are cut as GDP decreases or grows at a modest rate. It is likely that total public spending will continue to be under extreme pressure and face real term cuts. If welfare provision is kept as it is now, welfare spending would have to increase. Even in the optimistic hope that productivity improvements are made, it is probable that access to and quality of care will deteriorate. A shift in how we manage demand is necessary in order to address budget constraints. Other considerations on funding models for health and social care is required.

UK demographic changes also add pressure to social care spending, and there are increasing demands to change the way social care is funded. In 2010, the Dilnot Commission reported the current system of funding was ‘not fit for purpose’ and proposed an overhaul of the system to make it simple, fairer and sustainable.

Proposed workforce impact

• There may be an oversupply of certain roles based on the services that are cut.
• There could be an increased number of providers operating in the private health market, such as increasing GP corporate federations.
• There will be increased demand for medical generalists as specialisation becomes more expensive.
• A decrease in available GP sessions and session times occurs.

Sources or references

• Interviews with healthcare professionals as part of the CfWI’s Medical and Dental Student Intakes project, 2012
• King’s Fund, 2010, Improving NHS productivity: More with the same not more of the same
• Crawford, R and Emmerson, C, 2012, NHS and social care funding: the outlook to 2021/22
• Commission on Funding of Care and Support, 2011, Fairer Care Funding: Report of the Commission on Funding of Care and Support
• http://hm-treasury.gov.uk/forecasts
• http://budgetresponsibility.independent.gov.uk/

Additional research questions

• What would be the first services that would be cut?
• Could we use the roles delivering cut services in other ways or are these roles too specialised?

Some of the information in this section is provided by stakeholders and expert groups, and does not necessarily represent the views of the CfWI.