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NHS “could be facing £6bn shortage”

26 October 2010

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A leading think tank has warned that the NHS could be facing a £6bn shortage, despite reassurances from the government, because of the UK’s ageing population and inflation-busting health costs.

Chancellor George Osborne has already said the health budget will rise 0.1% a year in real terms over the next four years.

It meets a Tory pledge to ring-fence the NHS from deep cuts in other departments.

But John Appleby (pictured), Chief Economist at the King’s Fund, said the rises would be wiped out because the cost of drugs and medical technology increased faster than other prices.

He told the Independent newspaper that with the “baby boomer” generation entering old age and adding to the demands of the health service, the NHS actually faces a cut of around 1% a year, and growing waiting lists.

“Waiting times will go up, and NHS management may end up telling ministers ‘we simply cannot do the job, given our resources’,” he told the newspaper.

“The funding gap could rise to as much £6bn a year over the next five years, just in terms of what the service needs to keep up with existing demands and to maintain existing standards.”

Further pressure would be piled on at the end of a two-year pay freeze for GPs, consultants and others earning more than £21,000, he said.

“The next two years will be relatively manageable for the NHS because of pay restraint. But when that comes off then the pressures will be back on budgets.”

Copyright © Press Association 2010

King’s Fund