Page last updated at 14:28 GMT, Wednesday, 22 April 2009 15:28 UK

Health service facing 'hard slog'

The NHS budget is set to be squeezed from 2011

Investment in the NHS in the long-term is set to slow-down significantly, many are predicting.

Chancellor Alistair Darling said from 2011 public spending will rise by just 0.7% a year to help repay debts.

It is less than the 1.1% predicted last year and means the NHS is under pressure to make savings.

NHS experts said the service was ready for the "hard slog", but doctors warned the progress made in recent years could be undermined.

The health service enjoyed record rises of over 7% a year between 2002 and 2007. Even now it is getting 5.5% extra each year, but those spending levels will end in 2011.

It is vital that the government sticks to its promise and continues to invest, in real terms, in the health service
Dr Hamish Meldrum, of the British Medical Association

The chancellor said in his Budget that that level of spending was safe, but from 2011 the public sector as a whole will have to cope with 0.7% annual rises.

It is not known exactly what the health service will get, but NHS managers have been working for some time on the basis that it will be little more than 1%.

In real terms - once inflation is taken into account - that could be the equivalent of a freeze or even a cut in spending.

But with the UK in the middle of a recession, NHS chiefs have acknowledged there is little option but to try to get more out of the service.

Regional health bosses have already met government officials this year to discuss how the health service can become more efficient.

The Department of Health has already announced it wants the NHS to make £2.3bn efficiency savings from the £100bn-plus budget over the next two years.

But another part of the strategy is to build up reserves by carrying over surpluses each year. Last year £2bn was left unspent and managers believe by 2011 this could help soften the impact of a squeeze on finances.


Steve Barnett, chief executive of the NHS Confederation, which represents health service managers, said: "The message is clear - the levels of growth seen over recent years are at an end and there are tough times ahead.

"Leaders in the NHS will have to use this time to prepare for 2011 onwards when the financial outlook is more challenging.

"If the NHS is to continue to deliver high quality care in an environment with little or no growth and rapidly rising demand even more significant efficiencies will be needed."

Professor John Appleby, chief economist at the King's Fund health think-tank, said: "As spending has risen in the NHS, productivity has gone the other way.

"The challenge now the service is facing much smaller rises is to tackle this.

"In a sense, the health service has got to the top of the hill. Waiting lists have fallen and reforms have been introduced so the NHS does not need those big rises it has seen in the past, but it will still be a hard slog."

But Dr Hamish Meldrum, chairman of the British Medical Association, said while he was relieved spending in the coming years was not going to be affected, he was worried about what would happen in the long-term.

"In recent years, staff in NHS trusts have worked exceptionally hard to make savings and it is very difficult to see how any more can be asked of them without damaging patient care.

"As more people lose their jobs and homes and suffer the health consequences linked to the current economic climate, increasing demands will be made on the NHS.

"It is vital that the government sticks to its promise and continues to invest, in real terms, in the health service."

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