Taxpayers are being misled into funding the private firms that are raiding our NHS


It seems more than half of the UK’s voting public would be willing to pay more income tax in order to fund the National Health Service.

Pollsters ComRes told The Guardian that 49 per cent of people would accept a tax hike if the money went directly to the NHS, compared with 33 per cent who would not and 18 per cent who didn’t know what they would do.

This must be very gratifying for David Cameron, whose creeping privatisation of the NHS is at least partly to blame for the increasing deficit faced by the UK’s flagship public service. The Private Finance Initiative, introduced by the Conservatives in the early 1990s, must also take much of the flak, along with a reduced funding commitment from the Coalition government.

(We can’t be sure about the government’s funding commitment. Back in 2010, then-NHS chief exec Sir David Nicholson said it would have to make £20 billion of efficiency savings within four years – but the Coalition Agreement of 2010 promised “We will guarantee that health spending increases in real terms in each year of the Parliament”. However – again – by late 2012 the figures showed a real-terms cut in expenditure which meant the government was not taking its commitment seriously.)

Professor Chris Ham, chief executive of health thinktank The King’s Fund, reckons people want to help the NHS because they have been led to believe that it is starting to struggle financially and clinically, and because they value it very highly.

This indicates that the public has been misled.

Look at the Private Finance Initiative. According to Private Eye (issue 1,369, p34), buying its way out of a PFI contract for Hexham General Hospital will cost Northumbria NHS Foundation Trust no less than £114.2 million. That’s exorbitant enough, but consider this: the buy-out will save around £3.5 million a year on PFI costs over the 19 years the contract would otherwise have had to run.

How badly are PFI contracts crippling the NHS? Well, according to The Guardian, PFI repayments were costing the service £1.76 billion – that’s almost two per cent of the £100+billion budget.

That pales into insignificance next to the amount spent on contracts for private companies to carry out NHS work – £6 billion. Some of that, admittedly, will go into healthcare – but a large proportion will be hived off as profit.

And then there are the real-terms expenditure cuts that appear to be part of government policy. Spending has not risen in real terms since the Coalition government came into office in 2010.

No wonder the NHS is in trouble.

So thank goodness for all the kind-hearted earners who are happy to pay an extra penny from every pound they earn, for the NHS. But that won’t cover the projected £30 billion gap in its finances by 2020.

Taking average earnings to be £26,000 per year (as the government does), then every earner would have to pay an extra 4p in the pound. Tax paid on £26k per annum is 20p in the pound, so that’s a tax increase of nearly 17 per cent or one-sixth.

Earners would be £1,040 per year worse-off. That could put many of them in financial difficulty.

And they would be paying debts accrued by big businesses who wanted to profit from healthcare.


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  1. jeffrey davies August 16, 2014 at 6:37 pm - Reply

    way hold on to give more monies to the nhs it gets billions of its workers but directing that monies back to the nhs isnt a tory way they taking monies away not given it its dues but then they friends with the yanks who want this nhs has a cash cow ready for the milking jeff3

  2. amnesiaclinic August 16, 2014 at 6:52 pm - Reply

    Good post – thanks for this!


  3. casalealex August 16, 2014 at 11:37 pm - Reply

    WHEN WILL PEOPLE OPEN THEIR EYES? THE NHS (as we know it) IS GONE! I don’t think the public voted to lose the NHS. This government did not have a mandate from the people! Read NHS SOS if you want to know the truth about how we lost the NHS.

    Unfortunately, we have been conned, good and proper. They HAVE actually privatised the NHS before our eyes, and it should no longer be called the National Health Service, because it is trading under a false premise. There are many different companies involved in the running of it, and each is in it to make a profit, thereby ensuring that shareholders will gain whilst ‘customers’ lose.

    “At 2.10pm on the afternoon of Tuesday, 27th March 2012, immediately after prayers from the Lord Bishop of Ripon and Leeds, The Health and Social Care Bill repealing the legal foundations of the NHS in England was given royal assent and became law.” – read NHS SOS

    We did not vote for the abolition of the NHS. Neither was it part of the Coalition agreement. And, unlike those citizens who reside in England, citizens of Scotland, Wales and Northern Ireland will continue to have an NHS – under the law. – read NHS SOS

    I would very much like to know, now that most of the NHS is private hands, (only the non-profit making bits may still be in the hands of the taxpayers), how much are the taxpayers ‘subsidising’ the private companies contracts?

    • Mike Sivier August 17, 2014 at 8:43 am - Reply

      I have read NHS SOS and can thoroughly recommend it.

  4. Smiling Carcass August 17, 2014 at 12:13 am - Reply

    But why take 4p in the £ off lower earners? Why not an extra 40p in the pound off the super-wealthy?

    • Mike Sivier August 17, 2014 at 8:43 am - Reply

      Wrong government.

  5. John August 18, 2014 at 12:39 am - Reply

    You do not mention Labour governments doing the same thing.
    In the interests of balance and impartiality, you should.
    I utterly oppose privatisation of the NHS and the scandal of PFI applies – regrettably – not just to the NHS but also to parts of our national education service too.
    Changes going back decades have seen schools and colleges paying “leaders” and “managers” increasing pay and perks packages while the lower paid workers have seen their incomes and quality of life deteriorate.
    Hard to believe, is it not, that there was a time when a salary of £50,000 a year was thought more than adequate for people heading up UK nationalised industries such as British Gas, British Coal and other large state bodies.
    Halcyon days !!!!

    • Mike Sivier August 18, 2014 at 7:39 am - Reply

      I’m not sure what you’re getting at, here.
      NHS privatisation and PFI schemes were introduced by the Conservatives, as stated in the article. Labour carried on with PFI, and tinkered around the edges of the NHS with private firms working on some aspects, as has been documented in other articles on this blog, but it would be wrong to attribute as much blame to that party as belongs to the Conservatives. That would be disproportionate.
      Also, you are mistaken when you say PFI applies also to parts of the education service – public services across the board are riddled with these schemes. The Guardian link in the article provides a full picture (as it was when the Guardian published it).

  6. Smiling Carcass August 19, 2014 at 7:01 am - Reply

    Wrong system!

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