The Senior Lecturer Emeritus at Islington Technical College tells us two numbers that we need to know about the National Health Service. He’s right in that these are two important numbers. Given who he is he manages to gain entirely the wrong conclusions but then that’s rather what we’d expect.
Health spending has risen by an average of 3.7% per year since the NHS was founded, but only by 1.5% since 2010.
The relationship between input and output is known as productivity. Our desire is always to get greater output for the same input, or the same output for lesser input – we like increasing productivity that is. For, obviously enough, being able to do more stuff with whatever scarce resources we apply means that we’re richer.
The NHS is an inefficient organisation. Those numbers we’ve just been shown by the Senior Lecturer Emeritus prove that it is. Real budgets have been rising over time to gain that same thing, the health care of the nation.
So, we’d like to increase productivity growth in the NHS. How do we increase productivity? That’s something that market do and planning doesn’t. We tried this out in that grand economic experiment called the 20th century. The socialist, non-market, economies managed to increase total factor productivity by between not a lot and nothing. The market economies gained some 80% of their growth over the century from that increasing productivity.
So, we want more markets in the NHS.
We’ve even tried this, NHS England has had more markets than NHS Scotland or NHS Wales. NHS England has increased productivity more than NHS Wales or NHS Scotland.
Excellent, that the NHS requires ever more real resources every year is proof perfect that we need more markets in the NHS.
The second number:
A major increase in health investment spending is needed to bring the UK up to the OECD average.
We are at the OECD average. From the BMJ:
The UK had the lowest healthcare expenditure per capita relative to our comparator countries (UK, $3825 (£2972; €3392); study average, $5700), although this was roughly in line with the average healthcare expenditure of the OECD member states ($3854) and the EU member states ($3616).
Sure, numbers are important but so is understanding what they’re actually saying. We’ll even allow that perhaps NHS spending should rise by $29 a head of population in order to hit that OECD average.
But then we’ll still be left with the major problem the NHS has. Not enough markets in it……