Is the NHS Underfunded? What does underfunded mean?

The NHS is underfunded.

This is such a widespread belief, that I don’t know anyone who would challenge that statement.  Instinctively I believe it too, if only because over the last few years the Government has fibbed outrageously about how much it is putting into the NHS which they wouldn’t need to do if funding levels were as good as the Government claims.

It is certainly true that NHS funding is growing more slowly that it was at the start of the century.   I covered some of this in an earlier blog, but it is worth repeating that since 1947 the NHS budget has increased by 4% per year on average above inflation.  A lot of that increase in budget took place in the New Labour years – between 1997 and 2008 the NHS Budget tripled.  At the moment it is growing by 1% above inflation.   This leaves a funding gap of roughly £22bn which the NHS needs to find through efficiencies over the next few years.  This is the biggest saving programme the NHS has ever been asked to find.   At the last election Labour promised a much more better financial settlement for the NHS, but sadly while their funding promises were bigger than the Tories their fibs were larger too.

While all of this is going on the Government continues to promise more and more from the NHS.   More generous Cancer Funding.   7 day services. 

Of course this just tells us the size of the increase, to get a better picture we need to see total Healthcare expenditure compared to similar Nations.   This is the OECD data for 2016:

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This puts the UK in the top 20 nations for Healthcare spending, above the OECD average (9.7 vs 9%) (I have included non-OECD countries like India which participate in the OECD data collection process as well to give the widest range of comparators).

It is probably worth pausing for a moment to stare in astonishment at the USA data which is completely out of step with the rest of the table.  Even after the modest attempts by Obama to restrict healthcare costs and widen coverage the USA is still a total outlier.

If the NHS data looks higher than you were expecting that it because the OECD have recently changed how they look at Healthcare spending to include Social Care spending.   Not all OECD countries have adopted this new measure, which makes a big difference to spend:

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The UK is more generous in funding Social Care compared to other countries than it is in funding Healthcare.

This however just tells us spend.  What we need to know is what this money achieves.   One of the claims frequently made about the NHS is that it is more efficient at allocating resources than pure free market systems like the USA.   Again, instinctively I agree.   There are lots of aspects of healthcare such which can be organised more cheaply and effectively as a State run National service than left to market forces.   Only core OECD countries provide life expectancy data, so I used WHO data for the rest.

This lets us explore the ratio of GDP spend and life expectancy to see how they co-relate:

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Sadly this tells us less than I hoped, as countries with low levels of healthcare expenditure get a lot for their money.  Small increases in healthcare expenditure have a big impact on poor countries, it is a lot more expensive to improve the health status of rich populations, particularly ones with high levels of obesity.

It does however highlight exactly how awful the USA is for healthcare, and that there is a Public Health disaster taking place in South Africa.  You can download the entire dataset and have a play with it if you like – the link is at the end of this blog.

It’s better to look at it as graph, showing spend vs Life Expectancy.   Countries below the curve are getting shorter lives than they are paying for. Countries above the curve are getting longer lives than they are paying for.   Turkey is doing so much better that I suspect that there data is bollocks.

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The UK is doing slightly better than we would expect given it’s level of funding, but only if you look very closely, the advantage is actually slight.  A awful lot of this is do to Social Care funding.   If you went back to the old definitions which excluded Social Care the UK’s performance leaps up above the average.

This is the Commonwealth fund assessment of relative systems performance stripping out the Social Care data:

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We can see that reflected in the data for healthcare resources:

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The averages for Pharmaceutical expenditure are distorted by the USA which spends a staggering $1100 per capita on prescription drugs.   That strange anti-hair loss drug Donald Trump is taking doesn’t come cheap.

The UK delivers an above average life expectancy with below average resources.

Essentially we are getting a good deal from our Health Service, but a much worse deal form Social Care -in fact pretty much all of the efficiency gains that we make from having the NHS are wiped out by the high cost of Social Care. 

The 1947 Act makes a distinction between Health and Social Care.   We all have Social Care needs – we all need to feed ourselves, house ourselves, provide for our own welfare.   We don’t however have the same Healthcare needs.  That’s why there is a difference between Healthcare which is free at the point of use and provided by the state, and Social Care which is only provided in limited circumstances when the individual can’t take care of themselves and is means tested.

At this point I should declare my own position.   I’m a 1947 loyalist. I believe in the principles of the 1947 Act.  I even have my own copy of it, and a copy of the original Beverage report.   

Providing Health and Social Care is expensive, and people intensive.   Politicians regularly claim that technology will make healthcare more efficient such that fewer Drs and Nurses can provide more care.   As I explained a few months back this isn’t efficiency – it is reducing quality:

The costs of providing Social Care have gone up in the UK.   Lots of Local Authorities have got rid of all of their own In-House provision and have left the market to take care of it.   I don’t mind Private Providers delivering Social Care – this has been going on for as long as there has been an NHS.  I do however think that moving to totally Outsourced provision is a mistake as it makes it harder for Local Authorities to set prices and make the market.  Having run Health and Social Care I would never willingly have an all In House or All Outsourced Social Care model.   I am certain that the shift to Local Authorities acting as Commissioners, not Providers of Social Care has made it harder to control costs.

But the big driving force behind the increase in costs is the National Minimum Wage.  Staffing costs are the vast majority of the costs of Social Care provision and the NMW has had a massive impact.  Anecdotally one of the worst sectors for using dodgy employment practices to avoid paying the NMW are in the Care sector.

The debate at the last General Election around Social Care saw the 2 main parties on unfamiliar territory.   The Conservatives proposals to increase the amount individuals have to contribute to their own care, and reduce the amount they can retain to hand down to their families are consistent with the 1947 NHS Principles.   As a 1947 loyalist this makes me happy.   From each according to their ability, to each according to their need.

The opposition to these proposals by the Labour Party puts them on less sure ground compared to the 1947 Principles.  The Labour Party’s plans for a National Care Service is the biggest shift away from the 1947 Act that Labour have made.   As a 1947 loyalist I’m not convinced that this is the right direction at all.   If we are going to invest more Government spending into the Health and Social Care system I would rather it went into the NHS, then be used to reduce the amount people have to contribute to their own Social Care Costs.

This only leaves one question?   Is there any Healthcare metric which doesn’t make the USA look terrible?


If we build more Council Houses won’t loads of Teenage Girls get Pregnant and move into them all?

Apologies that this blog is a week later than I intended.   

This is a bit ironic, as this blog is about waiting lists, specifically housing waiting lists, and the delay in publishing the blog is because of how long I had to wait to find out how long people have to wait for Social Housing. 

I had wanted to write about housing for a while, partly because I wanted to explore the mythology of Teenage Pregnancies and Council Housing, but also because I recently discovered that someone I went to University with had become homeless.  I didn’t understand how a 40 something graduate could become homeless even in a City with as bad a housing problem as London.

I am pretty good at navigating the increasing dysfunctional and bureaucratic remnants of the British public sector, digging out bits of information.  In fact mostly my blogs are about the difference between how things look from Whitehall compared to how they look from an Industrial Estate just outside Durham. 

Housing however almost defeated me.  In fact I still don’t have some of the data that I wanted to write this blog.  Partly this is because successive reorganisations in Local Government and the NHS have made it almost impossible to construct a meaningful time series.

But mainly because Housing is the most awful, the slowest, least responsive, most frustrating, most illogical bit of the British state I have ever engaged with.  Incredible as it sounds it is worse than Universal Credits.  Worse than Job Seekers Allowance.   Worse than the HMRC Excise Movement Control Service helpline.

Worse than the Child Support Agency. 

To give you an example of the kind of mad bureaucracy I encountered – when I approached the organisation who manages County Durham’s social housing to ask for some data they explained that the only way to find out who many Social Housing properties were available would to apply for Social Housing.  They would then assess my housing needs, and tell me how many properties they thought were suitable for me.

This is one of a series of maddening emails.

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It took several weeks to get them to accept that I didn’t want to have my housing needs assessed, I just wanted to know how many properties were available.    Frustratingly each email they sent me had, at the bottom, a list of hard to let properties that they were promoting, in case anyone wants a 1 bed flat in Horden. 

You might notice that I use the phrase “the organisation who manages County Durham’s social housing”.   Local Authority housing in Durham has been transferred out of the Council and into Housing Associations, who between them run Durham Key Options which helps match people to properties.   I have tried to use the term Council House when talking about the past, and Social Housing when talking about the present to reflect that transfer.  Apologies if this is incorrect. 

After 5 weeks of obfuscation I was able to identify roughly 10,000 people currently looking for Social Housing in County Durham.   There are currently just under 800 properties available from Durham County’s Social Housing providers.    Most of the properties are semi-detached houses which were built en masse under the auspices of the County Architect in the 1950s, and are a lot nicer than the houses that private developers are building at the moment, if a bit tired looking.   It was impossible from the data available to identify how long on average it takes to house someone in County Durham – it looks like it varies hugely – if you want a 3 bed semi in Peterlee or Easington there are 100s to choose from.  If you want to live in central Durham there are none available.    Big chunks of Durham City’s Council Houses were bought up under right to buy are now let to Students or post-Grads at the University.    If you are waiting for a house in Durham your wait will be incalculably long.

The fact that it is impossible from the published data to work out the waiting times to go with the waiting list data is very worrying.  As anyone who has worked in the NHS will tell you  – it’s not how many people on the waiting list that matters – it’s how long they are waiting.

Just to complicate matters lots of the people on the waiting list are already in Social Housing, but want to move to a different kind of property, or a different area.   The bedroom tax, which penalises Social Housing tenants with spare bedrooms encourages people to stay on the waiting list, waiting for a house in the neighbourhood with the “right” number of bedrooms to become available.   

The link between Council Housing and teenage pregnancy is one of the most pervasive myths in social policy.   There is a profound belief that teenage girls get pregnant so that they can jump the Council House waiting list.   There is an equally profound belief that being a teenage mum is A BAD THING, although if I was going to spend all of the life on  the National Minimum Wage and I wanted kids, I would have them before I entered the labour market for financial reasons.

I am sure that at some point in the past someone has got pregnant just to get a Council House, however I always thought that this was a classic moral panic – more speeches had been made denouncing it than there were people who had actually done it.

If Council House waiting lists were being gamed significantly by Teenagers you would be able to see a relationship between areas with long waiting lists for Social Housing and Teenage Pregnancy rates.  Long waits should match high rates. 

When I ran a Primary Care Trust I used to point out that the areas around County Durham and Teesside with a very high Teenage Pregnancy rates were the easiest to get a Council House (Easington, Hartlepool), and the areas with the lowest Teenage Pregnancy rates were those where all of the Council Housing had been sold off and waiting lists were infinitely long (Durham City, Yarm).    In fact looking around the North East of England the more Council Houses were sold off the lower the Teenage Pregnancy rate was.  Well done Maggie Thatcher!

I was therefore planning on writing an article mocking the link between teenage pregnancies and social housing when I saw this:

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And this.

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The orange and red lines at the bottom shows Teenage Pregnancies.    

Looking at the UK as a whole the fall in Teenage Pregnancies and the fall in Social Housing waiting lists looks like they match.   My rather neat inverse relationship looks to have broken down in the years since I left the NHS

Apparently after I stopped working for the NHS Teenage Pregnancy rates improved.  This is a co-incidence.   

Before we go any further it would probably help to explain how the Teenage Pregnancy rate is calculated.   It is based on the number of babies born to mothers who were teenagers at time of conception per 100,000 population.   It’s not related to the proportion of babies born to teenage Mums, which has been declining for a century.  The average age of Prima Gravida is now over 30, and has been increasing

That’s is how The Daily Mail can have a moral panic about Teenage Pregnancies:

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AND a moral panic about the growing number of older Mums at the same time.

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The clue to the increase and subsequent fall in Teenage Pregnancies can be seen in this graph:

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Apparently after I was born women across the UK decided en masse to stop having kids.  This is also a co-incidence.  

While the proportion of babies born to teenagers has been declining Britain has experienced a baby boom, with an increase in pregnancy rates across all categories.   As the baby boom has ended, so the the number of teenage mums has fallen.   In fact if we measure the teenage pregnancy rate as the proportion of total babies born to teenage mums the rate has been falling since my Dad was born.

The rise and fall in teenage pregnancy rates was driven by a baby boom across all aged groups, and this increase in fertility had nothing to do with teenagers.  The whole moral panic about the epidemic of Teenage Mums, was just an opportunity for Left and Right to wag their fingers at a social problem, which may not have ever existed.

The Teenage Pregnancy rate, however, wasn’t the only bit of data which looked well dodgy.   The fall in Social Housing waiting lists looked very odd too, certainly it is at odds with most of the headlines in the papers which talk about a housing crisis.   When the coalition government came in waiting list swiftly rose to 1.8m nationally.  Now they have fallen to 1.2m.  

The bulk of the reduction follows the 2011 Housing Act.  Local Authorities were given the powers under this Act to prioritise housing families with local connections.  In reality Local Authorities with a high demand for housing have used this criteria to remove people who don’t have a local link from their waiting lists  – in the most extreme case Hammersmith council cut their list from 8,171 people in April 2012 to just 768 in April 2013. 

I am well familiar with people in the Public Sector gaming the system – manipulating performance data to make a particular organisation look good.  The bogus fall in Housing waiting lists is one of the nastiest, most cynical bits of gaming I have ever seen.   And I worked for the Finance Performance Operations team at Department of Health – “The Evil Weasels”.

Just to add to the mess the movement of housing stock from Councils to Housing Associations blurs the picture even more, making it harder to match the published data to real houses.

There is no doubt that there is a crisis in the provision of housing in all categories across the UK, for ownership and for rent.   We don’t build enough houses, and people like me with access to capital can take advantage of this to make money.

But regardless of the state of the Housing Market things are made worse by the obfuscation, figure fiddling, and bureaucracy from the Housing providers who I encountered.   

This is the same phenomenon that blights DWP and the NHS.  If the Minister doesn’t care whether they tell the truth to Parliament then the Senior Civil Servants don’t care whether the information they give the Minister is true or not.  If the Minister says whatever suits their career, then Senior Civil Servants will tell the Minister what suits their career.  Not all Senior Civil Servants are this cynical, but after years and years of reductions in Public Sector administration those who dislike cynicism have taken the money and left, while those happy to connive have thrived.

And if the Senior Civil Servants don’t care if the information is true or not, then the middle managers who compile the performance data won’t care either.   And the teams in the Job Centres don’t care if the right person gets their benefits sanctioned, just so long as the performance data looks good on the form.

There are lots of good people who work in Housing and DWP who really do care about doing the best for the people they interact with.  But if Politicians care more about tackling imaginary moral panics – Teenage Mums, Benefit Scroungers – rather than addressing the real problems then a culture of cynicism corrupts the whole system.

Which is how a middle class 40 something Graduate ends up homeless.