The Government is bound to a manifesto pledge to increase health spending by £8bn a year by 2020 / Getty Images

Experts liken current situation to 'the moment before the train crashes'

The NHS is suffering its hardest decade since its creation, three leading think-tanks have said, warning that current government spending pledges amount to the lowest 10-year growth rate the health service has ever seen. Nine in 10 hospitals in England are expected to overspend their budgets this year, potentially tipping the sector £2bn into the red.

Experts from the King’s Fund, the Nuffield Trust and the Health Foundation have all submitted bleak assessments ahead of the Government’s autumn spending review, with leading health economists likening the current situation to “the moment before the train crashes”, and saying Whitehall was in a state of “panic and denial”.

The Government is bound to a manifesto pledge to increase health spending by £8bn a year by 2020. Anita Charlesworth, chief economist at the Health Foundation, said this amounted to a 1.3 per cent real terms annual increase. With minimal growth in health spending over the past five years, this decade will see the lowest real-term growth since the NHS was established in 1948.

Meanwhile, cost pressures on the health service, driven by a growing and ageing population, are rising by an estimated 4 per cent a year. Council care services for elderly, long-term ill and disabled people are also under intense pressure, the think-tanks said, with 25 per cent fewer people getting care packages.

Speaking to the Health Select Committee yesterday, the Health Secretary, Jeremy Hunt, conceded that financial pressures on the NHS were “the worst they’ve ever been in its history”. But he was confident  the NHS would end the year with a balanced budget.

Chris Ham, chief executive of the King’s Fund, said this week that despite serious concerns about looming deficits, the Treasury was reluctant to consider any further increase in health spending. “The deteriorating state of NHS finances is leading to panic and denial in Whitehall,” he said. “Panic best describes the mood in the Department of Health, where the prospect of a £2bn deficit among providers is of growing concern.” 


The King’s Fund is calling for a £1bn injection of funding this year, with up to an additional £2.1bn a year from 2016 to enable the transition into new ways of working. Mr Ham said a turning point could come this winter. “The Treasury will be forced to intervene or accept a rapid and serious decline in performance,”  he added.

Ms Charlesworth said there was a “gulf” between the day-to-day reality for NHS staff and government planning. “It is that moment before the train crashes where everything is oddly calm. The thing we are all worried about is that there is this massive gulf between the reality for hospitals, and a ‘top of the system’ that is still talking about priorities that are about additional spending pressures and isn’t actually articulating a plan for how on earth we get through the next 18 months.”

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