Autumn statement: Hunt accused of ‘stripping back’ NHS

Jeremy Hunt today outlined the UK Government’s financial plans in the form of his autumn statement.

“The autumn statement has been a missed opportunity”

Rossanna Trudgian

Addressing parliament this afternoon, Mr Hunt said his plan for the British economy was growth-minded and based on a “long-term” vision for the future.

He outlined 110 “growth measures”, which centred around removing bureaucracy for the private sector, cutting taxes for businesses and employees, and reducing the numbers of people on sick leave from work.

Chief among his sweeping changes were promised tax cuts, including the reduction of the standard national insurance contribution for employed people over the tax threshold from 12% to 10% annually.

“By cutting taxes on work, the government is rewarding employees and providing a combined rate of income tax and national insurance contributions for an employee paying the basic rate of tax of 30% – the lowest since the 1980s,” said Mr Hunt.

“This change will make sure work pays, and in 2024-25, an average full-time nurse on £38,900 will receive an annual gain of over £520.”

Mr Hunt said he hoped to bring this measure in as of 6 January. As the main funding source of public services including the NHS, this could impact future health budgets. Also key was a cut to corporation tax, which, Mr Hunt claimed, would bolster business investment in the UK.

The chancellor said his department had been “prepared to increase funding for vital public services”, and mentioned the measures the government took in recent years to increase the number of nurses, doctors, and other public servants.

However, he said, bureaucracy had been “holding back” the public sector.

Instead of increased spending, Mr Hunt ordered the public sector to increase productivity by 0.5% each year as a means of addressing issues facing the NHS such as waiting times.

He said: “We need to see reform. We need a more productive state, not a bigger state.

“That is why I want the public sector to increase productivity by at least 0.5% per year.”

This measure was met with opposition from some nursing, and other health, leaders.

Royal College of Nursing (RCN) chief nurse Professor Nicola Ranger described this as a “cut”.

Nicola Ranger

An RCN spokesperson explained that an increase in productivity with a freeze on spending would equate to an expectation of better outcomes with less input.

Professor Ranger said the government’s decision to cut taxes, instead of increase spending on the NHS, showed health was “no longer a priority” for Mr Hunt.

“The public sector cuts the chancellor wants instead will mean even longer waits, more patients treated in corridors and perilous staffing levels here to stay,” she said.

“The real inefficiency to tackle is spending money on expensive agencies because you won’t invest in your own workforce – too few in education and poor pay and conditions pushing good people out. An extra £2 per shift from January will not turn this around.”

The RCN chief nurse said Mr Hunt “squandered” an opportunity to support the NHS through what she described as an “immensely tough” upcoming winter.

“Nursing staff are stretched too thin,” Professor Ranger added.

“[They are] caring for 10, 15 or more patients at a time. Our health service needed an urgent cash injection and instead it was entirely forgotten.”

Similarly, Dr Layla McCay, director of policy at NHS Confederation, described the statement as a “missed opportunity” to address the challenges facing health, and in plugging financial gaps left by strikes over the last 12 months.

She said: “The government has been clear in its messaging that this mini budget was to be a plan to drive economic growth yet in downgrading the NHS as a priority, it has failed to recognise the important connection between the health of the nation and its prosperity.

“The NHS has been hit with this blow as waiting lists for treatment continue to rise, there is increasing long-term sickness in the community and frontline services are bracing for a very challenging winter period.

“Also, with £10.2bn worth of outstanding repairs, this figuratively provides the service with only masking tape and papier mâché to patch it up with, and a much-needed capital strategy has been kicked into the long grass.”

On the 0.5% annual productivity growth target, Dr McCay said it was “attainable”, but added: “Stripping back long-term funding pots to support that transformation is counterproductive.

“Capital investment is key to unlocking productivity, so it is frustrating that this ambition has not been matched with resource.”

Aside from announcements around public sector funding, the chancellor also raised the minimum wage by 9.8% to £11.44, as of the start of the 2024-25 financial year.

Dr McCay welcomed this, but said that, once again, this would require “additional funding” for NHS organisations.

Sir Julian Hartley, chief executive of NHS Providers, said more staff, better support for social care, more beds, and greater capital investment were needed, and aired worries at Mr Hunt’s plans.

He acknowledged the need for greater productivity and efficiency within NHS trusts, but criticised Mr Hunt for not backing up the 0.5% per year demand with more resources for the public sector.

“Increasing productivity can’t be a case of just asking already overstretched staff to do more with existing resources,” Sir Julian added.

“Trust leaders tell us that they are seeing patients with multiple, often more complex, conditions. This can mean longer stays in hospital and take longer to reach diagnosis and ensure the right treatment.

“We need to see too the government and doctors’ unions resolve disputes behind months of costly strikes which have got in the way of work to cut waiting lists further.”

“The real inefficiency to tackle is spending money on expensive agencies because you won’t invest in your own workforce”

Nicola Ranger

As well as NHS and professional organisations, others representing patients were critical of Mr Hunt’s plans.

Rossanna Trudgian, deputy director of influencing and impact at the Teenage Cancer Trust, said the statement “has not offered any reassurance” for patients.

Ms Trudgian described healthcare services as “close to breaking point”, and said the government’s plans did not go far enough to address problems such as long waiting times for teenagers with cancer, as well as other patient groups.

“The autumn statement has been a missed opportunity for this government to give the NHS the funds it needs to provide every patient with the care they need, when they need it,” she said.

Also absent from Mr Hunt’s plans was any new funding for social care, though it “reaffirmed” large-scale investments previously promised by the government.

This was criticised by Professor Martin Green, chief executive of Care England, who said: “The autumn statement placed a huge emphasis on growing our economy.

“What was overlooked was that the adult social care sector contributes more than £50bn to the economy per annum. The people receiving care and support, the staff and the taxpayers all feel the effects of the instability of our sector.

“The sovernment must now invest in social care to truly stabilise a key pillar of our society and economy.”

Mr Hunt’s autumn statement did, however, include a significant investment in the British pharmaceutical industry.

The chancellor pledged £520m for the manufacturing of pharmaceuticals, as well as a reduction in tax for loss-making companies in the sector.

In honour of the 2028 centenary of the invention of penicillin, Mr Hunt announced a £5m package to Imperial College London, and its associated NHS trust, for the establishment of a health innovation centre.

Mr Hunt’s announcements also included investments in AI infrastructure and research, an increase in state pension, a freeze on alcohol duty until August 2024, and an increase in housing benefit.