The NHS will exist only as a brand name
Tony Blair’s New Labour pushed the NHS ever deeper into the market at ever greater speed, says Julian Tudor Hart. Photograph: Kirsty Wigglesworth/AFP/Getty Images
From its birth to the late 1990s, the NHS grew in both body and mind, but was always starved of resources. What else could we expect from governments that believed (as all still do) that healthcare as a universal public service cannot produce wealth?
The NHS became seriously sick only in the 1980s, when the managing director of Sainsbury’s was invited to start the process of redesigning it as a business. Successive reorganisations all pursued the same goal: to break it up into competing commercial units, differing from the rest of the market place only in that the government, not the consumer, finally met the bills.
In its 1997 election manifesto, Labour gave an explicit promise to reverse this process. But after the few months it took to elbow [Tony Blair''s first health secretary] Frank Dobson out of the way, the New Labourites for the next 12 years pushed the NHS ever deeper into the market at ever greater speed. Blair provided the funds the NHS had previously lacked, but spent most of them on the huge transaction costs incurred by introducing competitive trade into what had formerly been a simple gift economy with minuscule administration.
NHS England is now so sick that the coalition government is handing over responsibility for 80% of the budget to GPs. Its default fate will be to shrink to a brand name within which any corporate provider can operate, once they have secured the franchise by buying it from GP providers unfit to run a large retail business and mindful of the £8bn they might collectively gain from the sale of goodwill.
The foundations of the NHS lay in political economy: a market in wants and needs at zero prices, with costs shared by everyone. According to classical economics, it was nonsense. But from 1948 until the 1980s, the NHS provided the most cost-effective, and therefore most influential, economic model for state-funded healthcare services.
The political economy of healthcare has therefore become something everyone who may ever need the NHS needs to understand. My book about this, The Political Economy of Health Care, a revised edition of which is published today, is written for patients, not doctors. It starts not from a theoretical model but from my experience of care for a small south Wales mining community over more than 30 years, pursuing public health ends by innovative clinical means, ending with evidence that planned, proactive, personalised care can reduce death rates for those under 65 by well over 20% compared with good, demand-led care in a neighbouring control community.
Wales has fewer than 3 million inhabitants, but this is where the ideas underlying the NHS were first applied (by miners’ mutual aid schemes, long before Lloyd George). This was the birthplace and graveyard of coal and steel-based industry. It was the site of two generation-shattering waves of mass unemployment, and may now face a third. For the NHS and education, our Wales assembly has independence. Like Scotland, Wales has defied Westminster and is returning to first principles, the lessons of its own history rather than the fashions of north London thinktanks.
• Julian Tudor Hart is a former GP and epidemiological researcher. The Political Economy of Health Care (second edition), with a foreword by Tony Benn, is published by Policy Press.