[Relevant Documents: First Joint Report of the Health and Social Care and Housing, Communities and Local Government Committees, Long term funding of adult social care, HC 768, Eighth Report of the Communities and Local Government Committee, Session 2016-17, Adult social care: a pre-Budget report, HC 47 Ninth Report of the Communities and Local Government Committee, Session 2016-17, Adult social care, HC 1103.]
Motion made, and Question proposed,
(1) for the year ending with 31 March 2019, for expenditure by the Department of Health and Social Care:
(a) further resources, not exceeding £61,592,567,000 be authorised for use for current purposes as set out in HC 957 of Session 2017–19,
(b) further resources, not exceeding £3,634,818,000 be authorised for use for capital purposes as so set out, and
(c) a further sum, not exceeding £62,184,741,000 be granted to Her Majesty to be issued by the Treasury out of the Consolidated Fund and applied for expenditure on the use of resources authorised by Parliament; and
(2) for the year ending with 31 March 2019, for expenditure by the Ministry of Housing, Communities and Local Government:
(a) further resources, not exceeding £17,571,313,000 be authorised for use for current purposes as set out in HC 957 of Session 2017–19,
(b) further resources, not exceeding £4,003,853,000 be authorised for use for capital purposes as so set out, and
(c) a further sum, not exceeding £12,311,628,000 be granted to Her Majesty to be issued by the Treasury out of the Consolidated Fund and applied for expenditure on the use of resources authorised by Parliament.—(Rebecca Harris.)
It is an honour to speak in this estimates day debate on the 70th anniversary of the NHS. I am privileged and proud to have worked in the NHS for 24 years before coming to this place, and I would like to start by saying thank you to all those who work in the NHS. The principle behind it is as strong now as it was on the day it first opened its doors: it should be free at the point of delivery, available to all, and based on need, not the ability to pay. That is as important now as it ever was; it is truly the thing that makes us most proud to be British. This is not just the anniversary of the NHS, however; it is also the 70th anniversary of the National Assistance Act 1948, which swept away the poor laws and introduced our system of social care, so it is absolutely right that we should be having this joint estimates day debate.
I absolutely welcome the uplift in funding announced by the Prime Minister, but I would like to talk about how we will get the most from those funds, and also how we will pay for this. One of the key challenges that we have long faced is that although the NHS is free at the point of delivery, social care has been means-tested from the outset. That has created a huge challenge in bringing the systems together and providing the integration that patients expect but often find, to their surprise, is not there. Moving towards more integration would have great benefits for patients, and would create savings and a much more logical, patient-centred approach for both systems. I urge the Minister to look closely at the report of both Committees into social care, in which we touched on that issue and made recommendations, which I will talk more about later.
My hon. Friend is providing an excellent introduction to this debate. Does she agree that both Front-Bench teams could look at the example of Torbay Council—the local authority we share—which now has an integrated care organisation that brings together adult social care and the NHS for the benefit of our local residents?
Indeed; Torbay has led the way. When the Health and Social Care Committee visited Norway and Denmark, we were shown slides from Torbay, because its approach, referring to a Mrs Smith and actually trying to envisage how everything would work around the patient, has been hugely influential abroad as well as at home.
Health and social care within Greater Manchester has been devolved to the Mayor. Does my hon. Friend agree that Greater Manchester will hopefully lead the way in demonstrating the opportunities presented by combining health and social care?
Yes, and I am going to say more about that, because Manchester has benefited from transformation funding. I want to talk about not only the benefits of integration, but how we can ring fence transformation funding. I welcome my hon. Friend’s comments.
Returning to the recent announcement, a £20.5 billion a year uplift by 2023-24 for NHS England is welcome and represents a 3.4% average increase over five years. Importantly, it is front loaded, with 3.6% in the first two years, and comes on top of £800 million that has already been promised to fund the Agenda for Change pay rises. However, the announcement should not be the end of the story, because it refers only to NHS England and does not include social care, public health, capital or, importantly, training budgets—staffing is crucial to making all this work.
Of course, the Prime Minister acknowledged that and promised to come forward with a settlement for social care and public health in the autumn. However, we need to be clear right from the outset that we must have a social care settlement that reflects demographic changes, because we will need an increase of 3.9% in funding just to stand still. If we want to do something to address quality and to allow social care to do more, we need to go substantially further. That will be essential if we want to get the most out of the settlement that has already been announced for NHS England.
Returning to the hon. Lady’s point about public health not being part of the recent announcement, has she seen the 2017 review that highlighted that there is a return of over £14 for every pound spent on local and national public health policies? It therefore makes economic sense to invest in public health, not to cut it in any future announcement.
I absolutely agree. This is about not just funding for public health, but the policy levers. We do not need lots of talk about the “nanny state” that denigrates important national public policy drivers, because although we need funding for local services, as the hon. Lady says, this is also about the policy environment that is necessary to make important changes. Investing in public health makes a huge difference for people.
One of the problems here is that when the public are asked where they would like the priorities to fall, we often hear, understandably, about the importance of cancer outcomes, mental health and emergency waiting times. Public health is often bottom of the list because nobody necessarily knows when their life has been saved by a public health policy. The reality is that the major changes and achievements relating to life expectancy have arisen largely thanks to public health policy, but we rarely turn on the television and see a programme called “24 Hours in Public Health”, which is a shame.
In the air quality debate last Thursday, I touched on the need for health in all policies. From active transport to quality of housing, is that not where we need to drive public health?
The hon. Lady is absolutely right. Health in all policies means using every opportunity to maximise public health. When Departments work together, such as on the childhood obesity strategy, we need maximum engagement across the whole of Government to make that effective. The way it was put to us when the Committee visited Amsterdam was that it should be viewed as a sandbag wall, and if any part of it is missing, we are not going to achieve what we want. That applies to all of public health.
To echo the point that has just been made, the hon. Lady will be aware that I presented a ten-minute rule Bill in April about having health in all policies. Does she agree that the Government should reinstate the Cabinet Office Sub-Committee on public health so that the entire machinery of government can come together to ensure that we do everything possible to keep people well, rather than having a service that treats people when they are sick?
Absolutely. It is essential that we use every mechanism at our disposal to ensure that Departments work together. Public health is mostly delivered in the community, so we need that to happen at the local level, too. Councils should be reaching out into their communities and ensuring that they use every opportunity to deliver health in all areas when it comes to prevention.
One of the most welcome aspects of the funding settlement is that it is long term. For too long we have limped from one short-term sticking plaster to another, so I particularly welcome the fact that we now have certainty over five years combined with a 10-year long-term plan. In the Minister’s response, I ask her to reflect on the recommendation from the House of Lords Select Committee on the Long-Term Sustainability of the NHS for an office of health and care sustainability to do long-term horizon scanning. That means not just future demographic challenges, but long-term workforce planning, which has always been a huge challenge within the health service. Brexit, for example, has implications for not just the workforce, and there are many other challenges ahead, so it would be helpful to have an independent body that could consider such things and help to work out the necessary long-term funding.
My final points are about how we fund the new system. I would be delighted if there was a Brexit dividend, but I am afraid that I do not believe that there will be. I think there will be a Brexit penalty. The difficulty with people thinking that everything might be solved by a mythical future fund means that we are not levelling with them right at the outset that we are all going to have to pay for it. The challenge should be about how to distribute the cost fairly. That is the key point here.
I want to stop here to thank the citizens’ assembly that worked with my Committee and the Housing, Communities and Local Government Committee. I also thank the Chair of that Committee, the hon. Member for Sheffield South East (Mr Betts), for the Committee’s diligent work on this issue.
Going back to fairness, when I was in practice, it always came as a huge shock to my patients when they realised that if they had what might be really quite modest assets, they would have to fund all their social care. That shock was striking when the citizens’ assembly considered the matter. If we are to move to a properly funded system, it must look at the quality of social care, which is precarious in nature, and at the provider challenge. We must be realistic, and we have to make it clear that somebody has to pay. We cannot just put it off to future generations; we have to think about it and explain to the public what that means.
That is why, unusually, our Select Committee makes recommendations to both Front-Bench teams, because the failure to address this has been a political failure. On the one hand, measures suggested by the Labour party have been denounced by my party as a “death tax” and, on the other, my party’s suggestions have been denounced as a “dementia tax”, and that means we get nowhere.
If we are to avoid having the same discussion in five years’ time, we need to be clear about how we will get this across the line. That will require, particularly in a hung Parliament, the co-operation of both sides of the House. I therefore urge both Front-Bench spokespeople to commit to working together.
Members on both sides of the House have repeatedly said that we are prepared to form a parliamentary commission to go out and engage with the public, rather as Adair Turner did on the difficult issue of pensions, regarding what fairness means. We cannot offload this entire cost on to a relatively shrinking pool of working-age employed adults. We need to have a conversation that reaches out to everybody and asks, “What is the fair payment?”, and in return we must make sure those extra payments are earmarked for the NHS and do not just disappear into wider Government funding.
How we do that will mean conversations about national insurance with the self-employed, and it will mean conversations with people in retirement about their own contributions. We cannot put the cost entirely on to young people, many of whom are already, in effect, paying a graduate tax of 9% on everything they earn over £25,000. That would not pass the fairness test.
I am afraid that least fair thing of all would be for us to duck this challenge and leave even more people without the care they need, with disastrous consequences for them, for their loved ones and for their carers, because it falls into the “too difficult” box. This is difficult, but we need to grasp it, explain it to people and come to a decision.
Order. I just say to Members that they have six minutes each.
It is an honour to take part in this debate in the week we celebrate the NHS’s 70th birthday. I thank the hon. Member for Totnes (Dr Wollaston), the Chair of the Health and Social Care Committee, of which I am proud to be a member, for all the important work she does.
Many of us have been active, particularly in the past week, in doing lots of work on our local health services and in campaigning on national things. Today’s debate is important because it comes in the wake of a number of reports. We have obviously had the report from our Select Committee, which considered the long-term funding of adult social care. In the past few weeks alone, my colleagues on both sides of the Committee and I have attended the presentation of reports on the funding of health and social care from the Institute for Fiscal Studies and the Health Foundation, co-ordinated by the NHS Confederation. We have seen reports from the Institute for Public Policy Research and a number of others.
Collectively, all those reports, including our own, have raised the challenges that our health and social care system faces, and those challenges are not news. We are not sharing a new story, and, in the context of this debate, it is not just about the money that is available for our NHS. Ultimately, we are all here because we want to ensure that we continue to have a national health service that is free at the point of use for all who need it, and that goes hand in hand with the provision of social care.
In my city of Liverpool, we have seen social care devastated in the eight years since 2010. We have seen our Government grant slashed by 60%. Social justice is a real issue, because we know that the north of England has been particularly and disproportionately hit by cuts to local authority budgets. Those cuts have been larger in the most deprived areas. Looking at the figures, we see that the 30 councils with the highest levels of deprivation have made cuts to adult social care of 17% per person, compared with 3% per person in the 30 areas with the lowest levels of deprivation.
That cannot be right, and it pains me, particularly when I speak to constituents on a weekly basis who are affected by this, because they have seen their social care packages taken away, or now cannot access them, or they have seen family members stuck in hospital because there is no social care package for them when they are ready to leave, and/or they are turning up at the doors of A&E because they are not receiving social care in their home.
Will my hon. Friend comment on the social care precept that local authorities can use to raise additional funding? In the poorest areas, because the council tax base is so low, the precept does not generate sufficient money to fill the gap and provide social care.
I thank my hon. Friend for that important contribution. To give an idea of what it is like in Liverpool, we do not raise enough in council tax to cover our social care bill alone. That is before we consider all the other services that our local authority has a responsibility to provide in our area. This is a critical issue. The onus has now been transferred to local authorities, with all the costs that come with it, and it is particularly difficult. We have seen a reduction of 7% in the total number of people in receipt of a care package, yet in the same period we have seen demand for support—measured by the number of referrals and requests for help—rise by 40%.
It is important that in this debate we are considering not just the funding that goes to health—we have heard the hon. Member for Totnes speak eloquently about the funding announcement and some of the challenges in what is not included. In particular, we are waiting to see what funding there will be for social care. We cannot divorce social care funding from the NHS. The two go hand in hand, and this is a critical issue—our Select Committee heard evidence on that only today.
The Minister has heard about this on many occasions—one of my hon. Friends will be raising this later, too—but the sleep-in care crisis is a particular issue for social care. Not only do we have this chronic underfunding in the care sector but we are also seeing a complete lack of Government guidance on payments for historical sleep-in care shifts. Social care providers, many of them in the charitable and voluntary sector, are facing a back bill of £400 million, and one provider has already been forced to close. A recent survey found that two thirds of those charities are now at risk of going out of business, and the Government urgently need to address the situation.
I listened closely to what the Minister had to say at Health and Social Care questions, and I hope she might have a new answer for us today, because this situation cannot continue. We had a meeting in Parliament where we heard at first hand from not only providers but people in receipt of care, some of them personal budget holders who will be personally liable to Her Majesty’s Revenue and Customs when they are expected to pay back this historical claim. I hope that the Government and this Minister will share with this House exactly what they are going to do on that, because time is ticking by and by March of next year these providers are expected to pay, as I understand it, £400 million. That could be a serious further detriment to the care sector.
I wish to finish by talking about something a little different, although echoing some of what we have just heard, on the issue of prevention and how we keep people well, which is important in the context of this debate. As I have said, many things have not been included in the Government’s announcement of the funding that is coming to our NHS. We do not know about transformation funding, capital spend or funding for Health Education England for the education of staff. All these elements are very important, but of particular importance is public health spending, which has been decimated over the past few years, to the extent where, as we have heard just today, smoking cessation services have been cut by more than 30% in the past year alone. That is just one example and it is not commensurate with the reduction in people smoking in our country. We need to think actively and urgently about how we have a wholesale reappraisal of how we keep people well in this country.
I want to ensure we have a national health service in 70 years’ time. It is all very well celebrating the anniversary today, but when it is increasingly contending with lifestyle-related disease, we have to be doing everything possible to keep people well, and that starts from conception. We have to address the whole area of what we do for the under-fives, as that is completely ignored at the moment and its funding has been decimated again. I urge the Government to share with the House what they are going to do to keep people well.
I, too, wish to address the issue of adult social care and the excellent joint report—admittedly, I say that as a Committee member who helped to produce it. The issue is of immense concern to many of my constituents, not least the poor souls I have had to help, who were trying to fight this battle, which Members will recognise, somewhere between NHS funding and social care. May I also strongly support the remarks made by my hon. Friend the Member for Totnes (Dr Wollaston) about the principle of our bringing our Committees together? That collaborative principle, which we have shown in Committee, is one I hope both our Front-Bench teams, Labour and Conservative, will now follow. Frankly, the public are tired of party political point scoring on this issue.
I wish to touch on two subjects in the five and a bit minutes I have: integrated healthcare and funding. The Secretary of State has rightly highlighted one principle, namely that we should have whole-person, integrated care, with the NHS and social care systems operating as one. I strongly agree with that. I have seen too many people caught in that system I described, somewhere between NHS funding and social services, and trying to fight that battle with those two fundholders. That binary system has to end. It will not be easy, but the report highlights a number of practical steps. However, I say to the House that for the process of integration to work properly, those two separate funding streams have to become one. Whatever operational or managerial changes are made, if there continue to be two separate funding streams, patients will not experience the benefits. If one accepts that principle of a single funding stream, it is only logical that both clinical and social care be delivered free at the point of use.
I know that that is a major decision and a major financial commitment, but it is essential if the public are to see integration as being of practical benefit. After all, at the moment they see a lottery of disease. They see that if someone gets a major heart problem, the NHS will pay, no questions asked, but if they get dementia and need personal care, the state will look to them and their family first before considering whether or not it should contribute. People feel that that is wrong, and I agree with them.
Let me turn to the vexed question of funding. I am a natural low-tax Conservative. I always think we should remember that when we talk about public spending, we are deciding how to spend other people’s money. But on this occasion if we are going to reset this system for the long term, we have to be honest: these changes will involve paying more, one way or the other. No single tax can solve this problem, as my Committee discovered. That is partly because of scale: the health budget alone is £121 billion. Secondly, the revenue generated needs to be flexible enough to cope with the periods of boom and bust, so drawing revenue from a range of sources is wiser. Thirdly, the current system operates at both a national and local level. That is why the Committee rightly looked at things such as council tax at a local level, where we need to replace the temporary surcharges with a complete overhaul of council tax, including re-banding. The current bands and the fact that, for the most part, the valuations date back to 1991—both the Minister for Care and the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Richmond (Yorks) (Rishi Sunak), who are here today will understand that—show how overdue that reform is. Using council tax as a local element to this would generate additional revenue and would do so on a year-by-year basis. Of course, council tax is also adjustable to meet local demands, so council tax is one element of this.
The second element would be at a national level, because tax revenue will be needed to counterbalance the local council tax charges. That is why I strongly support the notion of a social care premium, which is in the report. Its sole purpose would be to transform and integrate our current health and social care systems. The Committee looked at two options in that regard, and Ministers may wish to look at how broad our consensus was, as it was an encouraging thing to see. One option would be for collection through the existing national insurance system, but separately identified on people’s payslips, with this charged to those 40 and above, including those over 65. That would be relatively easy to set up and run and it would be transparent for taxpayers.
The second option for a social care premium is a social insurance system like the one in Germany. The private sector—probably the not-for-profit insurers—would operate it, with all workers contributing to a pooled fund. I would like the flexibility of a German system, which would, for example, permit cash payments to families which better reflect individual needs in care.
The central point about a social care premium is that it would be acceptable to people if they could see that it would deliver the extra funds needed to integrate clinical and social care; address the rising demand, not least because of the increase in the number of those over 65; and end the healthcare lottery that people currently face. The report offers good ideas that will enable us not only to improve social care but to integrate it with clinical care. The key issue will be whether Ministers and their shadows are prepared to explore a collaborative approach to delivering those improvements.
I really do hope that Ministers will reflect on the report’s principles and individual proposals and that they and their Labour Front-Bench opposite numbers will step forward, perhaps in this debate, and spell out their willingness to work on a collaborative basis. If they do that, the report will have provided a lasting opportunity for real change.
The first thing that I wish to highlight is my continuing concern about how wholly owned subsidiary companies are being established in the NHS largely to avoid the payment of VAT, which is not what Parliament intended. Although I recently spoke to people at the Treasury about this matter and they did not seem too concerned about the loss of VAT, it is not what Parliament intended in the estimates. It should be of concern to many Members that trusts are being forced down that route.
I also wish to highlight the tremendous work that has been done in the past few years by many of the Select Committees—some of the Chairs are present—including the Public Accounts Committee, on which I was proud to serve for two years. They have drawn attention to the dreadful state in which the NHS has been left over the past eight years, with the lowest growth in spending in any comparable period in its history. That has left a huge backlog of issues.
After several years of warning, tremendous hard work by Committees and scrutiny in this place, we have the welcome announcement on funding. It is just short of the average rise of 3.7%, but we are grateful for what we have got. The Secretary of State has set five tests to
“show how the NHS will do its part to put the service onto a more sustainable footing”.
He has tasked the NHS with improving productivity, eliminating deficits, reducing unwarranted variation, getting better at managing demand and making use of capital. As well as those five tests, he also said that the NHS needed to be back on track on agreed performance standards, on locking in and further building on safety and on transforming care. He went on to say that the Government will transform cancer care and move money into mental health to deliver parity of esteem. That is quite a list.
Does my hon. Friend agree that mental health has not been given parity of esteem, despite the 2012 legislation?
I do agree, as would most Members, I think. There is a strong willingness in the NHS and in the Department to make it happen, but it is very hard to see it happening on the ground.
The Secretary of State said two interesting things in the interviews that followed the NHS funding announcement. First, he said that the money is contingent on the NHS’s delivery of a plan based on the issues that I just outlined. Secondly, he said that the Government would tell us, the taxpayers, in the autumn how we were going to pay for it. I am not a great fan of the monumental paternalism that seems to have overtaken the Government.
This is a huge missed opportunity to talk to the public about the service that they wish to have in this country and how much it costs—and I mean in respect of the entire NHS budget, not just social care. This could be an opportunity to share with MPs the reality in our health economies. Which areas are doing well? Which area is an outlier in costs, in meeting targets, in safety or in other health outcomes? I do not want any more dashboards or league tables, but I do want a way to improve the debate. I want to be armed with information and for us scrutineers to be able to use this opportunity to take what we know from the estimates and the Select Committees and translate that back into our local health economies.
In this debate, we will be talking about billions of pounds. We are having a very amicable debate here this evening; normally, we trade points over who would do better and how we would spend different parts of the money. Even those of us who are MPs and who are experienced and understand the funding and service planning struggle through the local architecture and the decision-making to know what money we need, where it should be targeted and how on earth our constituents will pay for it.
I tried to look at the issues in my own health economy. Members will be pleased to know that I will not have time to go through all its accounts, which I looked at over the weekend. Bristol has been in balance over the past few years, but, unfortunately, our neighbours have not, and the solution has been to join us together, so now we are all suffering under a huge deficit. It was another £30 million last year. We have an £83 million historic deficit—not in Bristol, but in our neighbouring authorities for which we are now responsible. If we run forward with that deficit over the next five years, that is another £150 million, plus, possibly, the £83 million that we already have. We are then getting very close to the £300 million that the £20 billion equates to in our local health economy.
All hon. Members can take the £20 billion and equate it with their own health economies and start to see what that money will really buy. The £300 million that this may equate to is also roughly equivalent to what the sustainability and transformation partnership said two years ago that it would be short of. This is a long way round and I excuse hon. Members for not keeping up with the numbers, but what I am essentially saying is that the money will allow us to stand still and not much else.
The coalition Government wanted to liberate the NHS, but instead they put a torpedo in the middle of it, fragmented it and then threw it all up in the air. People have done a remarkable job in keeping it going over the past few years. Why not try a different approach? Why do we not liberate the frontline to talk to us about what this money means? Why do we not look at the real demand in our health economies, what that money is and try to make sense of it for local people? Then we should talk to them about how much it would cost to have the level of service and treatment that they think they want. That would be a really liberating thing to do for all those managers and clinicians on the frontline. Local transparency, local accountability, is the only way to go in starting to square the circle of demand, quality and cost. MPs should not be let off the hook and kept outside the production of this new NHS plan and the way that it will be funded by our constituents over the next five months.
In this 70th year, the best present that politicians could give to the NHS would be to stop piling on the priorities, knowing that the money is not enough to meet them all, and to front up the political choices that we have asked people to make and our constituents to pay for.
It is a pleasure to follow the hon. Member for Bristol South (Karin Smyth). In fact, all the speakers so far this evening command the respect of both sides of the Chamber for obvious reasons given what they have said. I, too, agree with a large amount of what has been said. It is also a pleasure to speak in this very week of the 70th anniversary of the NHS.
We are talking this evening—it is in the Order Paper—about NHS expenditure summing to greater than £120 billion. That is a staggering sum and it just shows how important the NHS is not only to the Treasury and the Government, but, perhaps most importantly, to the public. Certainly, this is the top topic of interaction for my constituents. It is very, very important to them. The NHS is right up there with the royal family and the armed forces in making the Brits proud to be British, and for understandable reasons. I therefore very much welcome the £20.5 billion increase in real terms spending on the NHS. It is not only obviously needed because the population is ageing and the cost of healthcare is growing, but also desired by the British public. Some 86% of the British public say that they feel the NHS needs more spending. They are also willing to pay for it. It is very important that we listen to the public very carefully when they say that they need more spending on the NHS and that they are willing to pay for it. We will come in a moment to how they should pay for it. The British public are not stupid. They are fully and well aware that Government expenditure all comes from taxation, either now, immediately, or in the future in terms of debt. That is important, as they recognise that we cannot magic money out of thin air. We must also be very responsible and careful as politicians that we respect the fact that, whenever we decide that we wish to increase Government expenditure, what we are effectively doing is reaching into the pockets of hard-working people in this country and saying, “We’ll take some of that out, thank you very much.” We have to be really respectful of that and explain why we are doing it and what we are doing it for. The laziest thing to do in politics is pretend that other people are going to pay for all this and to promise the world to everybody. It is a dangerous route to go down and the British public will eventually see through that approach.
If we are going to be straight with the British public, how will we achieve this increased expenditure? I am sceptical, but not as sceptical as my hon. Friend the Member for Totnes (Dr Wollaston), about the Brexit dividend. I do, however, like to talk about a deficit dividend; as we reduce the massive amounts of interest that we are paying over time, there will be a benefit to the UK population. We have to be honest about where the money could come from, and hon. Members have mentioned other ideas about how it could be generated, including by looking at council tax, tax-free allowances and the pension age.
We do need to look at the pension age very carefully again. We have already increased the pension age to 67 and 68, but as the population ages and we all live longer, it is not unreasonable to expect us all to work longer. As we work longer, we generate more taxes during our lifetime, and that is pretty important. We have to consider whether it is reasonable that we should all be living 15 or more years after we have retired without paying more tax.
Is the hon. Gentleman aware that the increase in life expectancy is actually stalling and not continuing to soar? Unfortunately, it is another inequality between richer areas and poorer areas, and the danger is that people in deprived areas will get no retirement at all.
The hon. Lady makes a perfectly valid point. The differentials in life expectancy concern me greatly, but we have come such a long way. Pensions were first introduced in 1908 for people aged 70, when the average life expectancy was 48 for men and 52 for women. Life expectancy increased slowly as the century went on, but I believe that it is now—quite staggeringly—78 for men and 82 for women. This is well beyond the average age at which we retire, so we have to look at the situation carefully.
Rather than directly tax people more, I would like to see economic growth, which was mentioned earlier. Every 1% increase in economic growth adds £7 billion to the economy, whereas every 1p increase in income tax raises just £5 billion. We have to look at having a good mix. The more that we can grow the economy the better. Owing to the growth in the economy, HMRC receipts actually increased from £414 billion in 2010-11 to £594 billion last year, so the more that we can do for economic growth, the better for us all.
Alternatively, we could shift Government expenditure from one Department to another, but that is very difficult to do in the age of austerity and perceived austerity. As a Conservative, I believe in Government spending that is as small as it can be, but as large as it needs to be. The message that I heard from my constituents at the last election is that they believe that it probably needs to be just that little bit bigger, particularly for health, social care and education.
The British public are now respecting and accepting the fact that Conservatives are very careful with their money and are respectful of taking tax and money out of their pockets. They know that we are not going to spend money willy-nilly. More than 60% of the British population—across all demographics, including party political persuasions, age groups and income groups—support a taxation increase to spend more money on the NHS, and we need to listen to that.
But we need to move the conversation away from being all about inputs. Everyone in this House needs to commit to avoiding this kind of arms war, whereby there is always a debate and a fight about who can spend most. Instead, we need to put much more focus on the outputs, such as improving diagnoses, treatments, survival rates and other matters in the NHS. That is part of the debate. I was glad that the Health Secretary focused on that while introducing the additional spending. It is an important factor to consider; productivity very much needs to be part of the deal.
We need to continue focusing on an NHS that is free at the point of need, but we need to be clear with people that it is not free. The NHS never has been free and never will be free. It comes at a cost and we all have to pay for it. We need to ensure that we keep focusing on cost, look at other areas of savings and educate the public that there is a cost when they miss an appointment, when an ambulance goes out unnecessarily and when people go to A&E but do not really need to do so. We should all play our part in ensuring that NHS money is spent as wisely and carefully as possible.
There is still a lot of work to do on social care and public health, as my hon. Friend the Member for Totnes said. We should try to put together a cross-party royal commission, as other have said, and investigate moving the NHS out of party politics as much as possible, but that is a debate for another day.
It is a pleasure to follow the hon. Member for Mid Worcestershire (Nigel Huddleston) and to speak in the estimates day debate to mark the 70th anniversary of our NHS—the most remarkable achievement of a Labour Government to provide free healthcare for all, free at the point of delivery.
I want to speak about King’s College Hospital—a major teaching hospital, tertiary referral hospital, and local district and general hospital in my constituency. There is a strong bond between local residents and King’s. I am proud that my mum worked at King’s as an occupational therapist for 10 years. Like so many local residents, I owe a personal debt of gratitude to the tremendously hard-working staff at the hospital. I was a surgical in-patient at King’s in my 20s, gave birth to both of my daughters there in my 30s, and have subsequently been an out-patient. My family rely on the A&E to be there when we need it. As we celebrate the 70th anniversary of the NHS, I pay tribute to the staff at King’s for their skill and professionalism, commitment and dedication, care and compassion.
King’s went through very challenging times during the 1980s and ’90s, but was completely transformed by Labour’s investment and NHS reforms. By 2010, the hospital had achieved a balanced budget every year and was meeting all its major targets. Since 2010, however, King’s has faced very significant and substantial challenges, driven principally by chronic underfunding and an enforced decision in 2013 to take on the management of Princess Royal University Hospital and Orpington Hospital when South London Healthcare NHS Trust failed. King’s now finds itself in special financial measures, with an annual deficit of £140 million.
While there are some areas where the trust can make improvements—and I know that staff are working as hard as they can to do so—many of the problems that it faces are outside its control. The Government’s funding model rewards elective surgery and penalises emergency work. King’s has a regional trauma centre and a stroke centre. It is one of a small number of London hospitals with a helipad. It has a busy accident and emergency unit and will soon open a new critical care unit. These specialisms save lives daily, but the funding model does not recognise this work. As a result, the hospital is grossly underfunded, even though London needs centres of emergency excellence such as King’s—no more so than during the Westminster and London Bridge terror attacks and the Grenfell Tower fire last year, when the team at King’s were at the forefront of the emergency life-saving response.
Last year the Government refused to allocate sustainability and transformation funding to King’s, in contrast to many other hospitals, resulting in the hospital’s already challenged financial situation becoming significantly worse. In the context of a spiralling financial decline, the Government then decided to fine King’s for not achieving its already impossible financial control targets—even though it was the Government’s failure to provide adequate funding that led to the inability to meet these targets in the first place. Since King’s has been in special financial measures, the trust has been charged penal rates of interest on the money it has had to borrow to tackle the deficit it faces.
King’s does not have access to the capital funding it needs to undertake routine buildings maintenance and to invest in the infrastructure it needs to be able to be as efficient as possible. The Government love to recommend efficiency improvements. At King’s, efficiencies can be delivered if the buildings and outdated equipment are fit for purpose for the needs of patients in the 21st century. Both King’s and Maudsley Hospital across the road urgently need more funding to meet mental health needs in our communities. Too many local residents are ending up in mental health crisis because early intervention is not there, and too many of those patients spend far too long—often days at a time—waiting in accident and emergency at King’s for the mental health support that they need.
I raise these issues today because while any additional funding for the NHS is welcome, the problems at King’s cannot and will not be solved by 3.5% a year for five years. King’s needs new funding now to overcome its current challenges. It needs an end to the perverse policies of financial penalties for failing to meet impossible targets. It needs urgent capital funding to enable the Denmark Hill site in my constituency to be fit for purpose to meet patient needs. It needs revenue funding to enable it to recruit and retain the staff that it needs to run the hospital.
It is an appalling and unacceptable fact that as we mark the 70th anniversary of the NHS this week, one of the biggest teaching and research hospitals in the country, with such world-class life-saving and enhancing expertise, is in such a perilous financial state. This must be stopped. We owe it to the staff; we owe it to the patients. There is no way around the need for additional funding now. I call on the Government to acknowledge this challenge—to acknowledge the impossibility of the current situation at King’s with the current financial settlement and to step in to provide the funding it so desperately needs.
I draw Members’ attention to my entry in the Register of Members’ Financial Interests; I am a vice-president of the Local Government Association. I am pleased to take this opportunity created by the estimates to discuss adult care funding, given that a large percentage of the funding that local government administers relates to it.
I have been part of the joint Select Committee inquiry on the future of adult care. Before that, I led a county council with responsibility for adult care that had an adult care budget alone of around a quarter of a billion pounds. I then arrived as an MP just in time for Northamptonshire County Council to fall over financially, due in no small measure to adult care costs; addressing local versus national responsibilities for that are perhaps for a different time.
Adult care funding is a very important issue, and the solution to it requires bold thinking. Although the better care fund and the general funding in the estimates are welcome, they do not represent a solution; rather, they represent a temporary patch. When I was deputy chairman of the LGA, we had a presentation from the King’s Fund in which it showed us reports that it had produced every year since 1999—this is very much a cross-party issue—saying, “This year must be the year that there is a solution to adult care funding.” That was in the last century. Integration is not the same as the NHS taking over. There will always be lines. With adult care, the next line would be housing, and I do not think anyone is suggesting that the NHS take over housing.
Colleagues have mentioned parity of esteem. Parity of esteem for employees is important institutionally. We speak a lot about the NHS. We are proud of it, and we are talking about its birthday, but often the NHS workers shade out the esteem that we need to give to social care workers and people who work in local authorities providing essential local services, particularly to the elderly.
I thank the hon. Gentleman for the part he played in the joint Select Committee report. He is absolutely right about that. Figures in the inquiry showed that for the same work, social care workers were paid about 29% less on average than workers in the NHS.
I thank the hon. Gentleman for that comment. It is about pay, but it is also about conditions and remembering that the health economy is much more than the NHS.
I believe, however, that more tax is not the solution, even if hypothecated and ring-fenced as road fund licence and national insurance were in their time. It is not wholly in tune with Conservative philosophy to suggest that higher tax rates equal higher tax revenue, and there is economic theory to back that up. The Laffer curve, for which the British economy in the 1970s was in many respects the laboratory, indicates that when a certain tax rate is reached, revenue goes down, not up. We are high on the Laffer curve already: 41% of GDP is Government spending in the last recorded figures, compared with 38% in 1988-89 and 34.5% in 2000-01. This is not about whether we need more—we do—but how to get it.
In general economic terms, productivity gains, as my hon. Friend the Member for Mid Worcestershire (Nigel Huddleston) said, and GDP growth per head are key to more funding going into adult care. In specific terms, an insurance approach with some elements of the German model has a great deal to commend it. I was very pleased to see that option retained in the recommendations of the joint Select Committee report.
It is a pleasure to follow the hon. Member for Northampton South (Andrew Lewer).
One thing I think we can all agree on is that we take our health for granted. We all get bogged down with everyday worries and problems, and all too frequently we hear the phrase, often from those who are more experienced, “Your health is the most important thing. Don’t take it for granted.” Of course, everyday life—education, work, family, bills and so on—are very real challenges that we all face, and it is sometimes easier just to hope for the best and go for the line, “Fingers crossed, it won’t happen to me.” The reality, however, is that at some point every one of us will experience either poor health or the likelihood of having to care for a loved one who is suffering.
My real concern is that our health and social care system is built on shifting sands, and there seems to be no long-term strategy from the Government for dealing with the challenges we face as a nation. We have an ageing population, a growing population and a population with more complicated health needs, yet we lack forward thinking and planning.
At the time of my election last June, the Care Quality Commission had found that one in four social care services was failing on safety grounds, with at least one care home closing every week, while only 2% of providers were regarded as outstanding. Our Prime Minister acknowledged that our social care system was not working, and promised to fix it—it was even in the Conservatives’ manifesto—but that promise has been broken. Since then, the Chancellor failed even to mention social care in the autumn Budget, and he missed another opportunity in the spring statement. The single departmental plan of the Health Secretary’s Department of Health and Social Care has failed to acknowledge the social care workforce. The result is that care providers up and down the country, including in my constituency, have been placed in special measures and face closure.
It is devastating to see people at breaking point because of this undignified and broken system. It is not just those in need of care who suffer, but their families. I recently visited a very good care home in my constituency, and I spoke to a gentleman who told me how wonderful his care was at that home. He also stated that he had now spent his life savings on his care, and would more than likely have to sell his home, which his children live in, to be able to continue to fund his necessary care. He expressed his regret at an unfair system, in which dignity in old age is determined by the amount of money people can pay.
I wish to draw on one particular issue that has not had the publicity it deserves, even though it threatens the viability of the care sector and could jeopardise the care of the most vulnerable people in our society. It is the Government’s mismanagement of the sleep-in crisis. I first learned about this issue when a senior council worker at Cheshire East Council was sacked after raising concerns about dozens of careworkers who had been paid less than the national minimum wage by the Conservative-run council, which had pledged to pay all its workers a living wage. Since then, one of the Conservatives’ own councillors has said that the council knew it was underpaying careworkers as early as 2014, adding that he would resign if he was proven wrong.
Unison brought a successful claim to an employment tribunal, where it was ruled that careworkers who sleep overnight in care homes are entitled to the national minimum wage for each hour that they are at work in what are referred to as sleep-in shifts. In February 2015, the Department for Business, Energy and Industrial Strategy updated its guidance to reflect the court ruling, and this should have been the end of it. The Government, now knowing that their previous guidance was wrong, should have taken swift action to ensure that all careworkers received the back pay they were owed and were paid the national minimum wage.
Yet freedom of information requests have revealed that HMRC was instructed in February 2016 that staff were not entitled to the national minimum wage during sleep-in hours. In my opinion, this mistake is unforgivable. Over a year later, HMRC has finally started enforcing complaints made by workers, who are in addition seeking six years of back pay to make up for missing wages. However, the Conservatives stopped this by delaying in July 2017, and again in September 2017. Incredibly, local authorities were not instructed to pay the national minimum wage for these sleep-in shifts until October 2017. From 2015 to 2017, careworkers were ignored.
A careworker in the constituency got in touch with me because he did not know where else to turn. He described how staff morale was at rock bottom, with many careworkers suffering from poor mental health, worrying about their job security, relying on food banks and payday loans, and being too scared to take time off sick and unable to afford going on annual leave.
Does my hon. Friend agree that we must not allow the sleep-in crisis to be kicked into the long grass? We must draw attention to it, and the Government must do something about it.
I absolutely agree.
The careworker who contacted me described how careworkers feel that they have no voice and no respect. Is it any wonder that more than 900 careworkers leave their job every day? The way that this crisis is being handled is utterly disgraceful, and the Government have missed opportunity after opportunity to put things right. How can we expect the care sector to function, given all this uncertainty?
After years of continued mismanagement, the careworkers’ back pay bill is due in November. The reality is that the Government have never paid local authorities enough money to allow them to provide sleep-in shifts at the national minimum wage. We know from sector surveys that care providers cannot afford to pick up the Government’s tab. If they are made to do so, some will close and some will hand back contracts, leaving the vulnerable people they support to find new carers and local authorities to struggle further. Some will be forced to cut the additional services they provide, such as those that help disabled people live more independent lives. Blackpool has already seen one care provider close. We do not have long until we start seeing the effects across the UK. It is vulnerable people and low-paid carers who will suffer.
The Government have had three years to get to this point, so where are their proposals for safeguarding the viability of the care sector? I ask the Government please not to wait any longer. The careworkers deserve better, the providers deserve better, and the citizens of this country deserve better.
It is a pleasure to follow the hon. Member for Crewe and Nantwich (Laura Smith), who made some interesting points about adult social care. I have similar issues in my constituency, where one of the main care providers increasingly sees private clients effectively subsidising local authority provision. The gap between the costs has been getting wider and wider. The concern of many of my constituents is whether they will be able to afford private care if public provision is not forthcoming.
It is also a pleasure to follow the hon. Member for Dulwich and West Norwood (Helen Hayes), who spoke about King’s College Hospital. My father was a registrar in neonatology—he is a paediatrician—at King’s in the 1980s, so it is a hospital that I know well, and I am sympathetic to the challenges of an inner-city area. In my area we have a rural district hospital, which is very high quality and gets very good results, and the people there do an outstanding job. The hospital is in deficit and has been part of the vanguard transformation initiative, which has meant extra costs. Sometimes the benefits of working in new ways do not show in the money saved initially, because we have to wait for wider population health outcomes to be able to judge that.
The hon. Gentleman raises the important issue of how we transform care to ensure that we do the very best for patients. Does he share my concern—this was raised by the National Audit Office only last Friday—that the vanguard programme has not delivered the depth or scale of transformation in service that was intended? Part of the reason is that there are not enough funds in the rest of the NHS to ensure that the transformation that we want to see can actually occur.
The hon. Lady makes a good point. It is about trying to understand when the effects will show up. Often what we have to do in the meantime is to run two parallel systems, in order to get one up and running, and that can be challenging. I welcome the extra money for healthcare but, as I said on Wednesday, we really should not allow it to crowd out other types of spending, particularly local government spending, which we have heard about in relation to social care.
In Somerset, the Conservative county council has undertaken nine years of efficiency savings. It has cut a lot of money out of its budget, but we are getting to the point where further cuts will make a significant difference to people’s lives and the provision of services. The Liberal Democrats left the county with nearly £400 million of debt. The repayments are £100,000 a day, which is really disappointing because we would much rather spend that money on services for the public. The county really needs about another £20 million. Ministers should look at whether the virements in the estimates are enough. I would like the amount in paragraph (2)(c) to be increased by £20 million to fund the very serious gap the county will otherwise have to make up through serious cuts to real people’s services.
It is worth highlighting the plight of children’s social care. The county has made great strides to deal with issues and modernise the service—it has spent a lot of money doing so—and that is an ambition we should all espouse. The difference between children’s social care and adult social care is essentially that adult social care gets cross-subsidised by private clients, as I said, and to some extent by its integration with the healthcare system. What does not really happen in children’s social care is the same level of integration or thought about how the education service integrates with it. In Somerset, we have very high transport costs for children who wish to be educated in Somerset but are placed outside it, for example in Bournemouth. That is something that we need to address.
The reality is that overall Somerset needs more funding. It needs fairer funding, because it is still massively underfunded relative to urban and other areas. On how to pay for that, we have heard good points about why we should not automatically look to tax rises. Public spending has come in under estimate, so there is scope at the moment for a bit of extra deficit funding. Given the fiscal and monetary tightening around the rest of the world that is taking some of the heat out of western economies, I think that would not be frowned upon. Local government funding in Somerset would be a very worthy recipient of such flexibility.
It is a pleasure to follow the hon. Member for Yeovil (Mr Fysh). I concur at least with his points about local government funding and the pressures on councils in general with regard to their social care responsibilities. I want to address the points made in the joint Select Committee report. I thank the hon. Member for Totnes (Dr Wollaston) —she is my hon. Friend on this occasion—for her contribution to the report. Everyone worked together on it.
I do not think there is any doubt at all that funding is needed for social care. We cannot carry on trying to get this sorted out on an as-and-when basis every year. We need a long-term solution that people, and particularly the local councils that have to deliver the services, can rely on. Politicians are often good at identifying what needs to be done, but not very good at saying how it should be done. A great strength of the report is that I think it actually does say how this should be done. We say that we cannot carry on providing care in the same way and to the same level as has been the case over the past few years. We are say that, yes, there is a gap here and now, as identified by the Local Government Association, the King’s Fund and the Nuffield Trust. There are clearly demographic issues that are pushing costs upwards with regard to not merely the elderly, but people of working age with disabilities—there are demographics in both. We also have to accept that if we broaden the scope of people who get care, including people who have moderate needs, that will mean prevention and taking people out of the national health service. That is one way in which we can join up the two services very effectively.
We then have to look at quality. We all know of examples of quality failing at present. We know that the workforce are often on zero-hours contracts and the minimum wage—the same wage someone working on a supermarket checkout can get. We need to look at the long-term stability of the workforce, as well as their pay and conditions. We need to consider the viability of care providers, which are often giving contracts back or going out of business. All those issues require money. That is why, in the end, I have to say that although I very much support the long-term principle of care that is free at the point of delivery, according to need—that is one way in which we can join up health and social care in the long term—all the issues that I listed immediately need extra funding. It will therefore perhaps be some time before we can move to that free care system, but we can deal with clinical needs much earlier.
We can ensure that any money that is raised, whether through the national insurance funding model or the German model, is earmarked so that people can see that if they have paid extra, it goes towards social care. That came out very strongly from the citizens’ assembly. It is also about fairness and pooling risk, so that if everyone who can afford it pays a bit of inheritance tax, no one needs to find that the vast majority of their assets, including their home, has to go towards paying for their care. That really upsets people—it is the lottery of life, is it not? If someone has dementia and ends up in care for a long period of time, their home simply goes to pay for that. Most people feel that is really unfair, so if everybody pays a bit when they can afford it, no one would risk losing everything in the way that they do under the current system.
One of the strengths of our report that we have perhaps not made enough of is the fact that this is doable. It is practical and can be delivered in a reasonable period of time. As we have said, if business rates—75% of which are going to be retained by local councils in 2020—were kept in the local government system, that could address the local government problems to which the hon. Member for Yeovil referred. That can be done. We know that there can be a simple switch from the current intention of replacing public health grants and other things. If we consider the basis of a social care premium, either through national insurance or the German model, the structure is there to collect the money and would be relatively simple to adapt. As for the change to inheritance tax, again the system and framework are in place. They would be relatively easy to adapt and it could be done in a fairly short time.
Integration is a really important issue. We have not started from scratch and called for a whole new national health and care system, which could take years to bring about. We have said that, yes, health and social care need integrating and bringing together, as do housing services—most people who get social care do so in their home—and the link with public health, but that can be done within existing frameworks locally. The integrated care plans have been mentioned as one basis and there are the health and wellbeing boards. We have also heard about the Manchester model. All those models already operate and we can use them to bring about this practical integration at the point at which people need the service. This is not about a new bureaucratic framework, but about delivering services better for the individual.
Yesterday I was pleased to go on a 10-mile walk, raising funds for the Sheffield Hospitals Charity—that perhaps says something in itself. I went with my excellent consultants, Professor John Snowden and Dr Andy Chantry, together with their team from the haematology department at the Royal Hallamshire Hospital in Sheffield, who have given me such excellent care and treatment over the last year. I thank them all very much for that. There is a little secret that I have to let out though: John Snowden and Andy Chantry did a 50-mile walk over two days, and I just came on the last 10 miles of it. The commitment that they showed with members of their team demonstrates and is symptomatic of the approach that so many of our NHS staff have to the job they have to do—a job that we rely on them so much for.
It is a great pleasure to follow the thoughtful speech of the hon. Member for Sheffield South East (Mr Betts). I really enjoyed listening to it.
Everybody has an NHS story, whether a child born, a disease cured or a life saved. I have seen the NHS at its best—when my five-year-old son got appendicitis on Christmas day and three days later was home and happy, without his appendix. I have also seen it at its worst, however—when my fiercely independent grandmother tripped over and bruised herself. What followed included misdiagnosis, mis-medication, a morphine overdose, a six-month stay in hospital and enormous frustration trying to access social care. She returned home only to die. I suspect that my experiences reflect a national picture, of many, many lives saved against the odds and huge public support, rightly, for the NHS, but also of the tragedy of lives lost through omissions and errors.
I would like to take a step back in this the NHS’s 70th birthday year to say there is much to celebrate in our national health service: 44 million babies born, millions more treated, cancers cured, thousands of people alive who would not have been without its help, and long-term conditions such as diabetes much better managed, with much improved quality of life as well as life expectancy. Our health service is renowned around the world for providing the most equitable access to healthcare, and for this it is the envy of the world.
But we must not be misty-eyed about the NHS. Even on access, in my area of Kent there are some terrible A&E waits, while 1,500 children are waiting for mental health treatment, over 100 of them for more than a year. In some areas, NHS outcomes are not what they should or could be. There is still far to go to join up parts of the health and social care systems, as others have said this evening, and too little emphasis on public health and ever rising demand. I welcome the recently announced £20.5 billion of funding for the NHS, and also the forthcoming social care settlement, which is really important, because funding the NHS will not work if we do not also give social care the funding it needs.
The NHS has a huge opportunity to make the funding go further, and I do not mean through salami-slicing, penny-pinching and cost-cutting, through saving on biscuits and paper clips—I actually think a little more should be spent on enabling staff to eat together. I just want to touch on three areas of better spending. One is technology. There is a huge opportunity here. It has been said many times, but should be said again, that there is much further to go to improve the use of technology in the NHS, whether that is just updating systems so they work—so that doctors do not spend time cutting and pasting patients’ information or waiting for a system to turn on after it has turned itself off; having a fully functional single patient record that brings together mental and physical health, dental records and end-of-life instructions; or giving patients far more opportunity to use technology. In that regard, I welcome the recently announced app for booking appointments online. There are many other tools for better self-management. We must drive forward the potential for big data, artificial intelligence and personalised medicine, which could make such a difference to what we get from our NHS.
Secondly, on the workforce, it is fantastic that we are training and recruiting more doctors, including 100 more in a medical school in Kent, but with vacancy rates too high, particularly in mental health, and high staff turnover, we know that for parts of the workforce things are just not working. Junior doctors have told me they feel like cogs in a machine, and so too often do nurses, therapists, healthcare assistants, porters—you name it. So often I have heard them say things like, “Nobody ever listens”. In some parts of the health service, command and control has unfortunately dehumanised the experience of working in the NHS—a job that should be so full of satisfaction. The NHS has much to learn from itself, and from other systems and other sectors, about how to be a better place to work and to make the most of its fantastic workforce in order to provide the care we aspire to.
Thirdly, it is time to end the divide between physical and mental health. We need to give a greater share of the funding pie to mental health, as the Government have recognised, and knit together mental and physical health. When the two are joined together, it improves outcomes for patients and provides better value for the NHS—better outcomes at lower cost, which is exactly what we need and want.
We need to talk about the funding of the NHS and social care, as many Members have done so eloquently this evening. We need to talk about how much money is needed, and about the big question of where we are to find that money. Those are not difficult conversations, and they do not involve difficult decisions. However, we also need to talk about how to make the best use of the money, so that we can have the health and care system that we want for years to come.
We have heard some fantastic speeches from Members on both sides of the House about adult social care. I am not sure that we have been given the solution, but I think we have realised that there is a problem that needs to be solved.
Housing represents, potentially, a great asset for people in later life, which can help to pay for adult social care and other services that people need as they age. My worries are about house-price-to-earnings ratios and house price inflation. In 1996 the Nationwide house-price-to-earnings ratio was just 2.8, which means that 2.8 times someone’s earnings could buy that person the average house in the United Kingdom. Over the past 40 years, house price inflation has averaged 5% a year. That affordability gap is now extremely wide throughout the country. It is bizarre. One would have thought that the areas with the highest house prices would have the lowest ownership, but the reverse is the case. In the north-east, 60% of people are owner-occupiers, and the house-price-to-earnings ratio is just over 5. In the south-east, where house prices are obviously higher, 70% of people own their homes, but the ratio is now close to 10. That does not quite follow the pattern that we might expect.
Back in 1995, it would have cost first-time house buyers 17.5% of their incomes to service their mortgages. According to the figures that are available, in late 2016 the proportion was 33%. At the peak in 1989, base rates were approaching 14%, and it was costing 56% of income to maintain a mortgage, so we are not living in unusual times.
Thankfully, we are narrowing some of the gap between housing requirement and provision. It has been running at an estimated rate of 230,000 a year for some years, and will continue into the future. We built 217,000 houses last year, which is all to the good, but we have a fundamental problem: we do not seem to want to live together as generations any more. We seem to want independent living, and that can often lead to lonely living. There is a potential solution there, which might also solve some of the adult social care problems.
Is it time that we had a debate about a further loosening of planning law? Let me put some questions—not solutions—on the table. Are we allowing a degree of timidity in relation to development? Are we just trying to add little bits to existing conurbations, thus increasing pressure? Are we not thinking clearly enough about the building of completely new towns, with proper infrastructure—road, rail, health provision and schools—as part of the plan, rather than simply adding to the edges of existing communities?
Should we be trying to unlock brownfield sites? I can think of a perfect 5-acre derelict site that used to be the gasworks in the middle of Ramsgate. No one wants to develop it because of the remediation costs. Should legislation be introduced to force what are often utility companies to regenerate on pain of, perhaps, an additional business rate charge, or should the Government provide loans with a clawback provision to inject the seed capital to get developments moving?
We do have an existing stock, and I think that two measures would be helpful. Capital gains tax and inheritance tax are a problem, particularly for older people with holiday homes. Let us suppose that an elderly couple have had a holiday home for many years. One of them might become a widow or widower. They have fond memories, and do not want to rent out the property because of the aggravation that it would involve. Most people will not face an inheritance tax charge. Why on earth would they want to sell an asset that is hugely pregnant with gain, paying capital gains tax at 18% or 28%? They would rather leave it in their estate until they die, and perhaps pay nothing at all. As for those with a chargeable estate, why should they pay a 28% capital gains tax charge, and then a 40% inheritance tax charge on the £72 that is left in cash after that tax has been paid, which would represent a total tax charge of 57%?
The second measure I present is downsizing relief for stamp duty. Often, again, this would affect the elderly person, perhaps on becoming widowed. There is a north-south divide in this of course: in parts of the country it will be perfectly possible to buy that downsized smaller property for within the £125,000 stamp duty threshold for paying zero, but for many in the south, particularly in London, there will be a huge stamp duty to pay. My proposal is that we should have a downsizing relief for people moving to a smaller floor-area property—the threshold could perhaps be 75%. The Treasury might say it would lose money, but it forgets that for every seller there would be a new purchaser, so we would be creating stamp duty on purchases that might not otherwise have happened at all.
Does the hon. Gentleman agree that housing is also a key determinant of health and that is an additional aspect that we must think about, especially in housing for older people? We must see housing as part of that bigger picture in creating a healthy nation.
Older people often stay stuck in a house that is not right for their future needs and is further from help they would so desperately require in their later years.
To conclude, housing is a scarce resource, particularly in some parts of the country, and we must maximise its use and maximise mobility.
As many Members have mentioned, we are approaching the 70th birthday of both the NHS and the social care system. I was shocked to work out that I graduated in the first half of that period, when the NHS was a youngster of only 34. That was a bit depressing; how did I get so old?
Most patients in all four UK health systems will have a very good experience, because they interact with dedicated and caring staff. But all four systems face three big challenges that we have talked about before: tight finances, workforce shortages and increasing demand. As others do, I welcome the £20 billion extra funding that will be there by 2023. Over the next five years, that equates to a 3.4% uplift each year. That is double the 1.2% that the NHS has been experiencing over the past eight years, but it is below the 3.7% that has been the average since 1948. So it is welcome, but to call it a windfall can make people complacent that the challenges within the NHS and social care have simply gone away.
I agree with the hon. Member for Totnes (Dr Wollaston) that it is very disappointing that this is again only NHS resources, with no money for public health, for training or for capital or maintenance and, most importantly, no funding for social care. Trying to fund a health system without supporting social care is like trying to fill a bath with the plug out.
The other question is of course: where is the money coming from? I am afraid that I am also in agreement with the hon. Lady that I do not see much chance of a Brexit dividend; I know that I am Irish, but I do not really believe that there is a pot of gold at the end of the rainbow.
The Secretary of State for Health and the Secretary of State for Scotland have both mentioned that Scotland will get a £2 billion windfall through the Barnett consequential, and that would of course be hugely welcome, but in fact no detail has been sent back in response to the letter from our Finance Minister, and we will simply have to wait for the autumn statement, because the Barnett consequentials are not always as they appear. When NHS England got £337 million to prepare for winter pressures, naturally NHS Scotland was hoping for £32 million; in fact, by the time all the other cuts were applied to it, £8.4 million made it over the border.
The Scottish Government have increased health funding by 45% since coming to power in 2007, and despite an 8% cut in the Scottish budget since 2010, we still invest £163 a head more than is invested in people in England. We focus on things like quality improvement, and we have the first national patient safety programme. That has reduced costs, and it has a massively reduced mortality. It also helps to avoid litigation, which is at a much lower level in NHS Scotland than here in England.
The next issue is the workforce. There is no extra funding for Health Education England, although it is expected to educate 1,500 more medical students and train 5,000 more GPs. Despite 36,000 nursing vacancies, the nursing bursary has been removed, and this House voted to remove the postgraduate nursing bursary just last month, so it is difficult to see how we will tackle those challenges. Even before Brexit, we are losing EU staff. In the NHS in England, 19% of its EU doctors are in the process of leaving. Unfortunately, Scotland is also seeing 14% of its EU doctors going. We have registered a drop of 90% in the number of EU nurses willing to come to work in the UK system, and we have had the issue involving more than 2,000 non-EU doctors being turned away and refused tier 2 visas in the first five months of this year. I welcome the fact that that situation has now changed, but this is about the message that that sent out. It is about the need to have an immigration policy that will deliver the people we require. Social care workers will be a particular issue, because they will not qualify for tier 2 visas. They will not be classed as highly skilled enough, and they will not earn enough.
A further challenge is increased demand. Public health has received no extra money, and it has already faced cuts. That has resulted in cuts to services such as smoking cessation and tackling addiction, inactivity and obesity. I called earlier for health in all policies, and tackling issues such as poverty and adverse childhood experiences is really important. They drive a huge amount of mental and physical ill health. We often blame increased demand on the ageing population, but I would point out, having graduated in 1982, that I worked in Victorian hospitals, on Nightingale wards, and I remember the first CT and MRI scans. Since then, we have modernised not all but many of our hospitals and increased the availability of technology and expensive new treatments. We are now entering the age of gene therapies, which will be incredibly expensive. The chief medical officer in Scotland has formulated a policy called realistic medicine. It advises that, as doctors, we should not presume that every patient always wants the latest brand new treatment or to be put through an operation. We should not presume; we should just ask them what is important to them.
One of the things that is important for everyone is keeping their independence. I do not just believe in independence for Scotland; I believe in independence for older citizens. That involves not rationing hip, knee and eye operations, as is still happening here in England, but investing in them. If we delay people’s hip or, particularly, knee replacements, their muscles waste, the end result is poorer, and they will have become more dependent in the meantime. Rationing cataract operations, as is happening in two thirds of units in England, increases the risk of falls. That will simply cost more in the long term. We are trying to get people operated on at an earlier stage, so that they can stay more independent. If people can see and walk, and if we give them a bus pass and get them out and about, they will cost us less in the long term.
The most important missing item in the statement on NHS funding was, as has been said, funding for social care. The hon. Member for Hertford and Stortford (Mr Prisk)—I used to live there when I was a teenager—talked about providing free personal care. That is something that we do in Scotland. Someone in a care home there will pay accommodation costs, which are means-tested, but regardless of whether someone is in a care home or at home, we provide free personal care. That might seem more expensive, and indeed it is—we spend £113 a head more in Scotland than is spent here—but by comparison to being in hospital, it is incredibly cost-effective. Over the past five years, Scotland has seen just one third of the rise in A&E attendances and emergency admissions that has been seen in NHS England, and that is a cost that is worth getting back.
Members have talked about funding the service and the need to look at interesting ways to do so, and I agree that national insurance needs to be reconsidered. It used to be called national health insurance, but it of course covers many other things, such as benefits, pensions and so on. However, it is something to consider, because the threshold actually starts quite low when people are earning poorly and then starts to thin out when people are earning well. That does not seem fair. It is the same for retired people who have a generous pension and do not really go on paying national insurance. That cannot be right when they are entering the most important years.
In Scotland, we believe in integration, not competition. It is estimated that the healthcare market in England wastes £5 billion to £10 billion just in administration. The NHS in England faces reorganisation anyway as it moves through sustainability and transformation plans into accountable care organisations or systems or whatever they are to be called. Perhaps the Government should consider getting rid of section 75 of the Health and Social Care Act 2012 that forces services to be put out to tender, resulting in outsourcing and fragmentation. England needs integration and co-operation, not financial competition. Tariffs that reward a hospital only for admitting someone instead of trying to keep them home are counterintuitive.
I agree that place-based planning is the best approach for reorganisation, but it must be centred on patients, not budgets. It must start with designing what is required for the long term, not at the bottom line and then working back. In this next reorganisation, the Government should be radical and get rid of the healthcare market and, as the NHS turns 70, think of moving to a unified, public national health service.
As hon. Members have said, today’s debate comes in the week of the national health service’s 70th birthday. It is fitting that we should celebrate the NHS, which is one of this country’s most cherished organisations, but this week also marks another less-celebrated 70th birthday: that of social care. It is only right that we recognise the vital role that social care plays in keeping people independent and in supporting them with daily activities. Many hon. Members focused on social care in their contributions, but it is in a worrying state of decline at a time when it has never been more needed.
The joint report by the Health and Social Care Committee and the Housing, Communities and Local Government Committee, which is chaired by my hon. Friend the Member for Sheffield South East (Mr Betts), described a system
“under very great and unsustainable strain.”
The report found that the care system is not fit to respond to current needs, let alone to meet future needs. The Association of Directors of Adult Social Services said in its most recent budget survey earlier this month that the present situation “cannot go on”. The King’s Fund says that progress is “desperately needed” and that the system needs an urgent injection of cash just to maintain things as they are.
The projected growth in demand for services from our ageing population, with its ever more complex care needs, is set to rise substantially. I ask the hon. Member for Mid Worcestershire (Nigel Huddleston) to look at the years of healthy life expectancy, which end in someone’s 50s or 60s in many deprived areas. At the current rate of spending, the system will face a funding gap of £2.2 billion to £2.5 billion by 2019-20, and as we have heard, grant funding from central Government to the budgets of councils that have a statutory responsibility for delivering care has been cut by around 40%. As we heard from my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger), the budget has been cut by 60% in Liverpool.
As the Select Committees’ report notes, local authorities have also faced other cost pressures, such as the apprenticeship levy, increased national insurance contributions and the so-called national living wage, which has had the most significant impact. Cost and demand pressures on councils are growing, but ADASS reports that £7 billion has been cut from adult social care budgets since 2010. With the Government’s Green Paper now delayed until the autumn, a funding settlement for social care sadly does not seem imminent. According to ADASS, recent Government funding simply is not keeping pace with demand, and the result is that councils are plugging the gap in any way they can. Over half of local councils are unsustainably raiding council reserves, while others are making cuts elsewhere, so other important council services suffer. Local authorities, to their credit, are doing their best to protect budgets for adult social care services, but the increasing financial pressure on councils has meant that both the quality and the sufficiency of care have fallen and are anticipated to fall further.
Care providers’ dependency on dwindling local authority fee levels is leading to the care market becoming increasingly fragile and even failing in some parts of the country. A recent report from Age UK described the emergence of “care deserts” where care is wholly unavailable. Forty-eight directors of adult social services report that they have seen care providers closing or ceasing to trade in the past six months, 44 have had contracts handed back by homecare providers and 58 have seen care or nursing home closures, involving 2,000 people, with 135 care homes ceasing to trade in the past six months—this is from my hon. Friend the Member for Crewe and Nantwich (Laura Smith)—which is more than five a week.
Care homes with predominantly council-funded placements are at most risk of failure. Indeed, some care providers are now rejecting local authority-funded placements because of that funding shortfall. Continued failures of that type would be disastrous for publicly funded care, because councils would have to find care placements with a shrinking pool of providers.
As we have heard, the most serious imminent threat to the viability of the care sector is the unresolved sleep-in care back pay crisis, which my hon. Friend the Member for Crewe and Nantwich referred to comprehensively. As she said, this issue has been going on for several years since a tribunal ruled that overnight care shifts should be paid at the national minimum wage, rather than at a flat rate. Care providers, mainly charities, are facing a six-year back pay bill, which many say they cannot afford without having to withdraw services or close altogether. In a recent survey, 70% of learning disability social care providers said they would cease to be viable if they had to pay this bill. As hon. Members have said, this issue has been handled badly.
Having admitted that previous guidance to care providers had been misleading, Ministers seem to be continuing to ignore warnings that the combined liability of providers —some £400 million—could cause the collapse of parts of the care sector. Perhaps even worse, an estimated 100,000 personal budget holders will be liable to pay thousands of pounds in backdated pay. I join other hon. Members in saying that I hope the Care Minister will tell the House what plans are in place in the event that those care providers go to the wall and what help there will be for personal budget holders.
As we have heard, the Government seem to have no grasp of the urgency of this problem, which could derail the Transforming Care programme and could see large numbers of the most vulnerable people go without care services. Where people are able to get care, it is not always of the best quality. A fifth of care facilities have the worst Care Quality Commission rating. I am concerned that worrying pockets of poor quality are now emerging across both residential and home care, particularly in the north-west and the north-east, with nursing care among the worst affected.
I recently met a group of care staff from different parts of the country, and some of their stories of their current work experience are horrifying. Overworked, underpaid and undervalued care staff are under pressure as never before. Care providers are trying to meet increased demand for care with diminishing fee levels and are even reducing care packages to win procurement bids in the horribly named “reverse auctions.” That has led to staff with many years’ care experience being stuck on zero-hours contracts, with the constant threat of extra hours of work being withheld.
Staff are turning up to work ill because they are not paid sick leave or because they fear having their pay docked. Young apprentices are being left in responsible care positions for which they have no training or experience. Most troubling was to hear of lists showing staff on care rotas when they are actually on long-term sick leave or maternity leave, or rotas including managers and staff who do not provide care.
It is only the experience, dedication and devotion of care staff such as those I met that has stopped care quality sliding even further. The CQC has warned that the resilience of care staff is not inexhaustible. Under such pressure, with no training and little support, the recruitment and retention crisis will get worse.
We know that the impact of cuts to social care budgets is most keenly felt by people who need care and their families, and we know that 1.2 million older people who need social care have unmet care needs. People are not getting the help they need with the basic tasks of daily living, which is robbing them of their dignity. The fragility of the care system is also heaping great pressure on many unpaid carers who have to pick up the slack when formal care is unavailable. Carers are coming under unprecedented pressure, with little opportunity for respite, because most councils now have to charge for care breaks, as Labour research has shown. Four in 10 carers have not had a day off in a year, while one in four unpaid carers have not had a day off in five years. That is taking a heavy toll on their health; almost three quarters of carers told Carers UK that they had suffered mental ill health as a result of caring, while well over half said their physical health had worsened.
Despite the great contribution that carers make to the economy, the Government’s recent carers “action plan”, published in place of a promised national carers strategy, sadly offered no financial commitments to increase support for carers or to increase carer’s allowance, which is still less than jobseeker’s allowance. That is an insult to people whose care is estimated to be worth over £130 billion per year to the economy.
NHS sustainability depends on an effective and properly funded social care system. As we have heard in this debate, there was no money for social care in the Prime Minister’s recent NHS announcement. The announcement also excluded public health budgets, at a time when childhood obesity is reaching epidemic levels, and when there have been cuts to sexual health and addiction services. Just as with social care, underfunding those important preventive services is a false economy and will end up costing the NHS. There is now broad agreement that the need for investment in social care has never been more urgent and doing nothing is not an option, yet all we have from this Government is a proposed Green Paper, now delayed until the autumn, setting the timetable for dealing with the funding crisis in social care back even further.
I want to say in conclusion that that is not good enough. Social care needs funding now to ease the crisis and to stabilise the care sector. It is time this Government showed leadership and acted in the best interests of all the people across the country who need care.
I would like to start by welcoming the recent joint report from the Health and Social Care Committee and the Housing, Communities and Local Government Committee on long-term social care funding. I am extremely grateful for their incredibly collaborative approach to working on this report, which captures a number of important voices on the subject of social care funding, not least the citizens assembly. The Government will of course respond to the report fully in due course. I agree that it is time to set political differences aside in addressing these issues, and we welcome the involvement of parliamentarians from across the House, as well as that of leaders, professionals and experts from the health and care sector, in doing so.
This has been a wide-ranging report, which has mainly been constructive and collaborative. In the time left to me, I will try to cover as many points as I can, but if I do not get to some of them, I will write to the Members concerned. The Government recognise that demands on our health and social care systems continue to grow, as people live longer than ever before, often with multiple complex conditions. For that reason, we have increased the funding available to the NHS in real terms every year since 2010 and given councils access to up to £9.4 billion more dedicated funding for social care over three years.
My hon. Friend the Member for Totnes (Dr Wollaston) spoke about integration and how Torbay is a great shining beacon of integrated care. The Government also recognise that the health and social care systems are intimately linked, and we have set out our intention to pursue a major drive towards better integration in order to achieve person- centred, co-ordinated care. We are committed to increasing the NHS budget to ensure that patients can get the care they need in a financially sustainable system. Our NHS now has in real terms about £14 billion more to spend on caring for patients than it did in 2010-11. With our NHS funding at record levels, that means more patients are being treated, and more operations are being carried out than ever before, by more doctors and nurses; this represents more than 14,500 more doctors and almost 13,300 more nurses on our wards. But we recognise, as so many Members from across the House have said, that NHS and social care provision are two sides of the same coin.
The long-term funding report mentions the current state of the social care system, and it is important to be clear about what the Government have already done to support local authorities in England. We understand the pressures on the system, which is why at the spring Budget in 2017 we gave councils access to £2 billion more funding. We are committed to creating a sustainable system of social care in England, which is why, as a starting point, the Government gave councils access to £9.4 billion more dedicated funding for social care over three years.
So many Members have set out the importance of early intervention to manage the demand for crucial health services and improve people’s wellbeing. The 2015 spending review made available £16 billion of funding for local authorities in England for public health. That was in addition to the money that the NHS spends on prevention, including our world-leading screening and immunisation programmes and the world’s first national diabetes prevention programme. Our investment is making a real difference, including to social care services throughout the country, with a 39.6% reduction in delayed transfers of care attributable to adult social care between February 2017 and April 2018.
We are taking additional steps to ensure that those areas that face the greatest challenges improve services at the interface between social care and the NHS. That includes the establishment of a series of local system reviews led by the Care Quality Commission, to evaluate the boundary between health and social care’s functionality. It is absolutely right that future social care funding is agreed alongside the rest of the local government settlement at the forthcoming spending review. The settlement will of course apply to older and working-age adults as well.
We recognise that an ageing society means that we need to reach a longer-term sustainable settlement for social care. An ageing society puts pressure on local authority budgets, on providers and on local services, which is why the Government have committed to publishing a Green Paper to outline our proposals for change. We recognise that decisions on future reforms of the NHS and social care must be aligned, which is precisely why we will publish the Green Paper at the same time as the NHS plan, to ensure that the system is sustainable going forward.
As the hon. Member for Sheffield South East (Mr Betts) so eloquently said, a priority for reform is making sure that people are better able to plan ahead and protect themselves against the highest care costs. It is not fair that some people in our society currently stand to lose the majority of the savings and wealth that they have built up over a lifetime. The Select Committees’ report highlights that issue powerfully.
Many Members spoke about the drive towards the integration of health and care services. The better care fund is our programme for joined-up health and care services, which will allow people to manage their own health and wellbeing and live independently in their communities for as long as possible. In 2015-16, some 90% of local area leaders said that the better care fund had already had a positive impact on integration locally. Nobody underestimates the pressures that local authorities and health providers are under, but working collaboratively, communicating better and avoiding duplication of effort is a good way to use resources.
In advance of the NHS’s 70th anniversary later this week, the Prime Minister announced her intention for the Government to work with the NHS to develop a 10-year plan for the future of the health service. That is underpinned by a five-year funding offer, which will see the NHS budget grow in real terms by more than £20 billion a year by 2023-24. That funding growth is significantly faster than for the economy as a whole and reinforces this Government’s commitment to the NHS as our top spending priority. Such intervention is possible only because of the difficult decisions that the Government took to get our nation’s finances back in order.
My hon. Friend the Member for Mid Worcestershire (Nigel Huddleston) spoke about how we must be really honest about where the funding is coming from. My right hon. Friend the Prime Minister said that we will listen to views about how we will do that, and my right hon. Friend the Chancellor will set out the detail in due course.
In return for the new investment, the Government will now ask NHS leaders to produce a new 10-year plan, led by clinicians and supported by local health and care systems throughout the country. The plan will set a vision for the health service, ensuring that every penny is well spent and focused on improving outcomes for patients. We welcome parliamentarians’ continued contributions to informing the debate across health and social care. I commend the estimates to the House.
I again thank all the staff who work in health and care, and the carers and volunteers who work as partners with our health and care service. I thank the Minister for her constructive response to the debate and colleagues from all parties for their contributions.
We are all looking forward to seeing the detail of the 10-year plan in November, and we look forward to that plan being worked up with those working in the service and those who represent patients, so that we get the very best from the funding we have. May I leave the Minister with some thoughts? I really hope that transformation funding will be ring-fenced. It is about not just the money that we put into social care but how we make sure that when we change the packages of care better to suit individuals, the transformation is there. We have seen how effective that is in areas such as Manchester. I hope that the Minister recognises that the workforce lies at the heart of everything that is delivered in health and social care. In thanking again the health and social care workforce, in this 70th anniversary year, I ask the Minister to put them at the heart of everything that we do.
Question deferred (Standing Order No. 54(4)).