Scotland measures up its NHS for cuts

The NHS in Scotland is not used to talk of "cuts". Since power was devolved in 1999, government spending on health has risen year on year, while even in the supposedly dark days of the Thatcherite 1980s and 90s the health section of the old Scottish Office budget continued to increase, albeit modestly. All that, however, is about to change – or is it? It is according to the report of the Independent Budget Review (IBR) panel , which was published last month. This panel of "three wise men" was given the unenviable task of reviewing the SNP Scottish government's spending options in light of UK government plans for 25% cuts in spending. "We think", said the panel's chairman Crawford Beveridge with considerable understatement, "it's going to be very difficult." The figures concur. Total government spending in Scotland is expected to fall by 12.5% in real terms by 2015 (£4.3bn). With health constituting more than a third of the Scottish government's budget, the IBR suggested a two-year pay freeze for all nurses – as an "essential first step" – reconsidering the bonus scheme for senior doctors, freezing the phased withdrawal of prescription charges and, perhaps most importantly, thinking "very carefully" about the policy of "ring-fencing" health spending. John Swinney, the finance secretary, refused to comment on the detail of the panel's report – which was generally acknowledged as a thorough piece of work – while a Scottish government spokesperson points to the recent UK Budget, which committed the coalition government to "providing the National Health Service with real increases throughout the Parliament". "We will pass on any Barnett consequentials from an increase to the health budget in England to the health service in Scotland," says the spokesperson. "We don't yet know what those consequentials will be. We do know that any increase to next year's health budget will be significantly smaller than the health service has been used to in recent years. The health service, like the rest of the public sector, faces serious financial challenges." Ring-fenced thinking Despite that caveat, continuing talk of "increasing" health spending concerns the former Scottish health minister Susan Deacon, now an honorary professor at Edinburgh University's School of Social and Political Science. "My view is that we need to be asking every political party, not just the SNP, for a different kind of debate," she says. "This ring-fencing mentality doesn't just ring-fence budgets, it ring-fences thinking and ring-fences discussion. "We need some real political leadership in Scotland around this," she adds. "It takes us right back to inputs versus outputs. At the moment it's all about how much you spend, but when you're thinking about improving the health of the nation there's not a simple correlation between how much you spend and how much you improve that. What's important is that we think about what kind of society we want to live in, and that's not just about public purse, it's about the role of the private and voluntary sectors too." Tom Miers, author of a recent Policy Exchange report, Devolution Distraction , agrees, citing a series of independent studies that have concluded that the Scottish NHS is performing more poorly than in other parts of the UK. "Yet these outcomes are barely recognised in Scottish political debate," he says. "Instead, discussion in political circles and the media focuses on lifestyle problems. "It is almost as if the problems of the NHS were the fault of the Scottish people," Miers adds. "For there is very little discussion about how to run an effective health service – a service which has barely changed in the last 10 years." The IBR panel also hinted that cuts provided an opportunity for creativity, recommending that if the Scottish government decides to ring-fence the health budget, then it should "consider alternatives… that allow for a broader interpretation of health spending", including "non-NHS services that support the health and well-being of the community, for example, early intervention programmes across the public sector". Spending cuts are, of course, political decisions, and with elections to the Scottish Parliament taking place next May, those bidding for power are naturally anxious to avoid being seen to wield the axe. But, as Susan Deacon warns, "if they all go into the election having a bidding war over who can protect the most things, then we're never going to have an informed discussion and the likelihood is we'll end up in a worst place as a result".