The ongoing NHS crisis has brutally exposed the inadequacies of our political system. The numbers are horrifying: hundreds of unnecessary excess deaths a week; average ambulance wait times of an hour and a half for patients having a stroke or even a possible heart attack; over 700,000 waits of more than four hours in A&E departments in December alone. The reasons are complex and multifaceted. But there is no doubt that a big part of the cause is long-term underinvestment in key parts of the system, particularly in buildings, IT systems and social care. A health service that was already deteriorating pre-pandemic has been knocked so badly that recovery will take years, even if we start doing the right things.
There is no solution that doesn’t involve very large sums of money—well beyond the 1 per cent annual increase allocated to the health department in the autumn statement. To take just a few examples, there’s a £10bn maintenance backlog before you even get to adding in any new capacity, and social care can only be salvaged by increasing pay well above the current minimum wage levels. The last time public satisfaction with the NHS was this low, in the mid-1990s, the fix was a huge injection of cash: an annual average spending increase of 9 per cent in real terms from 2000 to 2005. But even if things weren’t so bad, more money would still be needed. Health systems around the world are getting more expensive because populations are ageing, meaning there is higher demand for care, while wages paid to health workers are having to rise to compete with those in more productive sectors.
Yet both main political parties are pretending this isn’t true. The government is desperately downplaying the crisis. Tory backbenchers, under the deluded belief that our health system is unusually bureaucratic and expensive, wish to explore social insurance systems, although they are typically more expensive and spend far more on administration, due to having more organisational layers. Labour, meanwhile, is happy to condemn the government’s failures but not to acknowledge the cost of rectifying them.
This deliberate myopia goes well beyond the NHS. Child poverty is rising in absolute terms; recorded crime is at a 20-year high as the number of offences prosecuted in court continues to fall; the Department for Education considers it “very likely” that school buildings will collapse due to the extent of delays to repairs; childcare in the UK is more expensive than in almost any other country in the world, pushing people out of work to look after dependants; local councils are going bankrupt. This list goes on and on. Each problem exacerbates the other. Greater poverty puts more pressure on services; worse services increase poverty.
As such, the government’s spending plans are obviously unrealistic, but no one wants to accept the inevitable corollary given the parlous state of the public finances: taxes need to go up, and by a lot. Labour has adopted a number of small revenue-raisers carefully targeted at the most privileged minorities, such as removing non-domicile tax status and charging VAT on private school fees. But the sums raised by these policies wouldn’t touch the sides.
The sums we need are only available by going after one of the big three: income tax, National Insurance or VAT
When confronted with this problem, politicians default to talking about the importance of economic growth as the way out of the dilemma. After all, New Labour did raise taxes, but most of its additional public spending came as a result of the economy doing very well. If we can get back to that kind of annual growth the pressure on taxation will decrease. But when it comes to the things that might drive that growth, such as planning reform, higher immigration, rejoining the single market—well, they don’t want to talk about any of that either. Labour has its green growth agenda, which is one good policy more than the Conservatives, but not much else.
In any case, even if a future government were to do these politically tricky things, they would take years to produce dividends. In the short term, taxes are the only option. And not just taxes on the wealthiest, either; the kinds of sums we need are only available by going after at least one of the big three: income tax, National Insurance contributions or VAT. Which makes it more irresponsible that the government cancelled the planned NICs increase that was nominally dedicated to funding health and social care, and which enjoyed public support.
Whoever is in power post-election will have to face this reality and substantially raise taxes (or oversee a more dramatic decline in public services). The question is whether we are going to have to spend the next year and half in stasis, with politicians refusing to acknowledge this while fighting over Potemkin election pledges. No party has any short-term political incentive to jump first and admit the truth, but it’s Labour, given they’re the most likely winners, who will suffer the most if no one does. Trust in politics is almost non-existent—and a government that only levels with voters once it’s arrived in office will not get the benefit of the doubt.
