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Behind the heated referendum rhetoric on NHS 'privatisation'

Photo: PA

It is an iron rule of elections that the closer you get to polling day, the more heated becomes the campaign rhetoric.

The same can be said of referendums, and the referendum on independence for Scotland which takes place on September 18 is a case in point.

In the run up to referendum day rhetoric has become particularly heated over the issue of the future of the National Health Service.

First Minister Alex Salmond has claimed that the ‘privatisation’ of the NHS in England puts the continuation of the service at risk in Scotland.

Only a ‘Yes’ vote in the referendum can save the NHS and its founding principle that care is delivered by the state free at the point of use, the SNP leader argues.

In return Labour’s health spokesman, Neil Findlay MSP, has described the SNP stance as “the biggest lie so far in the referendum campaign.”

Labour say that the Nationalists’ are peddling fears and scare stories to frighten voters into backing independence.

Ironically this Labour jibe mirrors the SNP’s claims of the Unionst’s before project fear’ which nationalists say are based on unjustified warnings on the consequences of a ‘Yes’ vote.

So what is going on and what - as far as we can establish them - are the facts in all of this NHS row?

Let’s try to keep this simple for clarity. But there may be a few figures in this and some technical jargon to explain, so please bear with me.

Alex Neil MSP, Cabinet Secretary for Health and Well-being Credit: PA

“The UK Government has estimated that the impact of privatisation will be to reduce the health budget in England by £1 billion a year within the next two or three years.”

– Alex Neil, SNP cabinet secretary for health

If that happens, Mr Neil claims, “the knock-on impact on the Barnett consequentials will be the loss of £100 million a year to the national health service in Scotland”.

Pause for a bit of jargon explanation. Barnett consequentials are the money which Scotland gets whenever there is an increase (or decrease) in the budget of an England only or England and Wales Whitehall department.

Mr Neil, and the SNP government, base their claims on a impact assessment by department of health south of the Border into the effect of the Health and Social Care Bill 2011.

This document looks at what will happen when what are called Clinical Commissioning Groups (CCGs) are handed power to commission health services south of the Border, which could involve private sector provision.

The document does indeed contain a figure £1 billion, £1.068 billion to be precise, in “savings” per annum from 2014/15 to 2019/20.

When I contacted the department of health about this, a spokeswoman told me that the word “savings” was crucial. Any savings would be re-invested in the NHS.

The Department of Health say that any savings would be re-invested in the NHS Credit: PA

So in the UK government’s view, these are not cuts but merely a way of running the health service in England more efficiently.

It’s also worth looking at whether the health budget south of the Border - a proportion of which comes to Scotland through the famous (ish) Barnett consequentials - has been cut under the UK coaltion.

The answer, according the the respected Institute for Fiscal Studies, is no.

Gemma Tetlow, programme director at the IFS, says spending UK-wide on health has gone up 3% a year from 2010 to 2013, a real terms growth of 0.9%.

That’s much lower that the 5.9% a year up to 2007 when Labour was in power - before the 2008 crash put a halt to large increases in public spending.

The IFS concludes that with growing demand for health care the current much smaller increase means there is pressure on the service. But there has been an increase.

So, is the SNP correct that there is a growing use of the private sector in the NHS south of the Border?

Yes. Some hospitals are run by private companies and the new commissioning system will potentially allow for greater private sector involvement.

However, the services provided to patients remain free at the point of use and they are funded out of the public purse, not by the patients or by health insurance plans on their behalf.

AS an aside, but an interesting one, probably because of the impact of the recession spending on private health care in the UK fell by by almost 6% in real terms between 2008 and 2011, according to IFS research.

Some hospitals are run by private companies and the new commissioning system will potentially allow for greater private sector involvement. Credit: PA

But back to the Scottish government and how much it receives from Westminster. According to Liberal Democrat Chief Secretary to the Treasury, Danny Alexander, the Holyrood government admits health expenditure in Scotland has increased by nearly £300 million in the last year.

This, he says, the SNP administration admits on its website is because “of the budget consequentials arising from the increase to health in England”. Over the whole parliament the increase is £1.3 billion, Mr Alexander says.

I put this to the Scottish government who said that Mr Alexander was demonstrating his “sensitivity” on this issue. The SNP government say the Chief Secretary is one of the architects of privatisation south of the Border.

Chief Secretary to the Treasury Danny Alexander Credit: PA

Not surprisingly SNP ministers stick to their claims, though the SNP government’s response to Mr Alexander did range wider than simply citing privatisation

“Every £10 cut from NHS England through austerity, privatisation, or patient charges will consequently reduce Scotland’s budget by £1.

Is Danny Alexander seriously suggesting they are privatising the NHS in England to increase public spending?”

– Scottish government spokesman

The Nationalist’s opponents will say that this reply, while attacking Mr Alexander, does not deny that there have been consequentials - sorry that jargon again - for Scotland.

The SNP deploys a further argument. It points to warnings from Andy Burnham, the shadow health secretary at Westminster, on the threat of Tory privatisation.

Mr Burnham, according to the Independent newspaper, has warned of the threat to free universal health care.

I put this to Labour MSP Jackie Baillie, her response was that there is no privatisation of health services in Scotland which - her opponents may say - is not answering the question.

With apologies for the length of this blog, that is I hope, a fair summary of the pre-referendum dispute over the future of the NHS - and some of the facts that underlie it.

Voters might hope that with some facts, the campaign rhetoric might be reduced somewhat. Wishful thinking, I am afraid.

The heated exchanges on this continued today in the chamber of the Scottish parliament.

We can expect more of this, not less, in the run up to 18 September.

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