Money and (Better) Public Services?

I was on the Nolan Show this morning, performing my usual role as defender of the idea of small state/low tax economy. The discussion was to have focused on whether it might be a good idea for us to collectively pay more tax to fund ‘better public services’.

You can listen to the debate by playing the Audioboom recording above.

However, I wanted to pick up on one strand of the discussion. It was an emerging ‘theme’ of the programme – following an extensive discussion regarding Northern Ireland’s relatively high rates of suicide – that additional funding for the NHS might be a solution to this problem. I like to refer to this as the public-pocket-fix that tends to be the default argument of most lefty commentators and politicians and callers to the Nolan Show.

Now, this morning, I committed the cardinal sin of suggesting that perhaps the NHS wasn’t all it’s cracked-up to be. Yes it’s great etc. And it employs veritable selfless saints. But it’s still not that good, relatively speaking. Other nations spend less (or more) on healthcare but have much better healthcare systems and outcomes.

The spending isn’t the point. Everyone wants better healthcare but the current system isn’t providing it. The NHS is stuck. Funding is vast and is politically contrived. In other nations, with much better outcomes (like the Netherlands or Switzerland) there’s more localised control, more competition and less politicised funding arrangements.

In certain areas the NHS is over-funded. There has been a vast increase in managers given the complexity of the organisation. Social care has vast staffing, comparatively speaking, to front-line acute staffing.  The entire organisation is bloated, procurement practices are bizarre and the rock-stars of the NHS – the consultants – derive considerable incomes from private work while being in the employ of the tax-payer.

To say these things doesn’t make one bad or NHS-hating. Stephen Nolan’s reaction, when I suggested these inefficiencies might exist, suggested that the (hard-working) porters at the local hospitals might be perplexed by my assertions (I paraphrase).

But as Dr Kristian Niemietz of the Institute of Economic Affairs has put it, “If one views the NHS primarily as a team-building exercise, it would be seen as a phenomenal success, but as a health system its outcomes are sobering. It lags behind most comparable countries in terms of health outcomes, quality and efficiency measures, and is financially unsustainable in the face of an ageing population. Patient choice is underdeveloped, incentives to innovate are low, and political short-termism continues to trump best practice. It’s time for these significant shortcomings to come under the microscope, otherwise the health of the nation will suffer.”

Jeffrey Peel is @jeffreypeel on Twitter and, among other things, is a Fellow of the Institute of Economic Affairs.



Free market libertarian. Businessman. Small government advocate. Former Vice-Chair, Conservative Party in NI. Fellow, Institute of Economic Affairs. Former Regional Chair, Business for Britain (the business voice of VoteLeave).