Council tax bills set to rise at fastest rate for two decades, economist warns
Paul Johnson said that local government in England did 'perhaps a little bit better than it might have expected' out of the Chancellor's statement on Wednesday, but the 'sting in the tail' is the assumption that 'council tax bills will rise by 5% a year' as part of the funding.
The core spending power of councils is set to increase by 2.6% a year from next year, and 'if English councils do choose 5% increases – and most almost certainly will – council tax bills look set to rise at their fastest rate over any parliament since 2001-05', Mr Johnson said on Thursday.
On Wednesday, Ms Reeves said that ministers will not be 'going above' the 5% annual increases in council tax.
She told ITV: 'The previous government increased council tax by 5% a year, and we have stuck to that. We won't be going above that.
'That is the council tax policy that we inherited from the previous government, and that we will be continuing.'
The biggest winner from Wednesday's statement was the NHS, which will see its budget rise by £29 billion per year in real terms.
Ruth Curtice, the chief executive of the Resolution Foundation, has said that Britain is turning into a 'National Health State'.
Overnight, the think tank said Ms Reeves' announcements had followed a recent trend that saw increases for the NHS come at the expense of other public services.
Ms Curtice said: 'Health accounted for 90% of the extra public service spending, continuing a trend that is seeing the British state morph into a National Health State, with half of public service spending set to be on health by the end of the decade.'
Defence was another of Wednesday's winners, Ms Curtice said, receiving a significant increase in capital spending while other departments saw an overall £3.6 billion real-terms cut in investment.
The Institute for Fiscal Studies (IFS) made similar arguments about 'substantial' investment in the NHS and defence coming at the expense of other departments, although Mr Johnson warned on Wednesday the money may not be enough.
In his snap reaction to the review, Mr Johnson said: 'Aiming to get back to meeting the NHS 18-week target for hospital waiting times within this Parliament is enormously ambitious – an NHS funding settlement below the long-run average might not measure up.
'And on defence, it's entirely possible that an increase in the Nato spending target will mean that maintaining defence spending at 2.6% of GDP no longer cuts the mustard.'
Ms Curtice added that low and middle-income families had also done well out of the spending review 'after two rounds of painful tax rises and welfare cuts', with the poorest fifth of families benefiting from an average of £1,700 in extra spending on schools, hospitals and the police.
She warned that, without economic growth, another round of tax rises was likely to come in the autumn as the Chancellor seeks to balance the books.
She said: 'The extra money in this spending review has already been accounted for in the last forecast.
'But a weaker economic outlook and the unfunded changes to winter fuel payments mean the Chancellor will likely need to look again at tax rises in the autumn.'
Speaking after delivering her spending review, Ms Reeves insisted she would not have to raise taxes to cover her spending review.
She told GB News: 'Every penny of this is funded through the tax increases and the changes to the fiscal rules that we set out last autumn.'
Conservative leader Kemi Badenoch described rising health spending as a 'conundrum', with a similar approach having been taken 'again and again' as she spoke at a business conference in central London on Thursday morning.
In reference to a pro-Brexit campaign stunt, Mrs Badenoch said: 'I mean, who remembers the side of a red bus that said 'we're going to give the NHS £350 million more a week'?
'Many people don't know that we did that. We did do that, and yet, still we're not seeing the returns.
'We've put more and more money in, and we're getting less and less out.'
The Government have not explained how and why the NHS will be better as a result of its spending plans, the Tory leader added, and claimed the public know 'we need to start talking about productivity reforms, public sector reforms'.
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The Guardian
an hour ago
- The Guardian
Britain in 2025: sick man of Europe battling untreated illness crisis
The same 11 young women turn up around the clock at the emergency ward of Furness general hospital in Cumbria. The group are well known to staff, other services – and each other. Aged between 19 and 35, they have all led troubled lives. Some grew up in care, most need mental health support. All have fallen through society's cracks and now gamble with their lives for a safe place to sleep. They know where to look to find the precise amount of medication to take for a non-lethal overdose, guaranteeing them an overnight stay in hospital. Some resort to swallowing household objects to secure a bed for the night. These 11 women accounted for a staggering 9% of the 45,228 A&E admissions at the Barrow-in-Furness hospital last year, at a cost to the NHS of at least £250,000. But they are far from unique. One NHS leader described a 'chilling pattern' of self-harm among vulnerable people whose regular refuge is now their local hospital. It is not confined to the young. Older people, known on some wards as 'revolving-door pensioners', are deliberately self-neglecting so they can be looked after in hospital, particular in winter when energy bills are high. The Guardian has spent months interviewing GPs, nurses, social workers, NHS leaders, academics and residents in some of the most deprived corners of Britain as they grapple with the worsening effect of deepening poverty on a health service in crisis. Through a series of pioneering schemes in north-west England, clinicians have uncovered what one NHS manager described as 'medieval' levels of untreated illness. In poorer places where GPs and community nurses have all but vanished, A&E attendances have almost doubled since 2010, driving up ambulance call-outs by 61%. Wes Streeting, the health secretary, is due to unveil the biggest NHS transformation plan in a generation next month, aiming to shift healthcare from hospitals to communities and from treatment to prevention. The challenge is stark. Britain has the lowest life expectancy in western Europe and one of the highest tallies among rich countries for preventable deaths. NHS bodies in the regions have been ordered to slash their budgets in half, cutting as many as 13,500 jobs, leaving senior figures alarmed about how this squares with Streeting's focus on community care. In parts of Blackpool, Barrow, Burnley and Blackburn, areas with some of the worst deprivation in England, the Guardian learned of children suffering from both obesity and malnutrition as families increasingly rely on cheap processed food. Babies are being fed reheated formula milk, potentially causing serious bacterial infection. Other families risk food poisoning by turning off their refrigerator overnight to save money. 'There's a certain sense of despair among professionals,' said one NHS leader. 'We're trying our best but I'm not sure how much we can do. It's deep-rooted, it's extreme, but it's a symptom of something broader and deeper happening across all society.' The NHS has become focused on treatment rather than prevention. But in parts of Lancashire and south Cumbria, health leaders have been taking a new approach aimed at tackling conditions before they become crises. On the Ryelands estate, a pebble-dashed maze in Lancaster, Lizzie Holmes, a community nurse, has spent two years persuading residents to have free health checks. The community, historically one of the poorest in Lancashire, is a desert for doctors and dentists. Residents are all but invisible to the NHS until they are blue-lighted to hospital or turn up at A&E. Many have not seen a doctor for years, pushed away by the 8am scramble to see a GP and the months-long waiting lists. Holmes, who was awarded the prestigious Queen's nurse award last year, has become an unofficial social worker and even amateur plumber to win the trust of reluctant residents. Last year she unblocked a patient's kitchen sink in return for his promise to get checked out. The man, in his late 50s, was a virtual recluse and was thought to be living with multiple chronic conditions but was refusing to get help. Her DIY plumbing turned out to be a life-saving intervention: he had been living for years with undiagnosed pneumonia, suspected bowel cancer and chronic obstructive pulmonary disease (COPD). COPD is a collection of lung conditions that kill people at a higher rate in the UK than anywhere in western Europe, and are much more prevalent in poorer areas. 'There's two outcomes if Lizzie hadn't kept knocking on his door,' said Claire Niebieski, the head of population health in Lancashire and South Cumbria. 'He would have been found dead at home or he would have been a 999 call away from spending months and months in hospital.' To date, Holmes's team has reached 164 residents, almost all of whom were highly unlikely to seek help before presenting at A&E. For just five of these patients, this preventive approach saved the NHS more than £170,000, according to an internal analysis. Most of this saving is mainly because they would no longer need a hospital bed (£2,089 per patient per day). The savings to the NHS would rise to millions of pounds across the Ryelands estate. The proactive approach has reduced A&E visits from the estate by 5% over two years, compared with a 5% increase in parts of the community without this focused approach, according to NHS modelling. A similar pilot in Poulton, in Lancaster, has led to an 11% fall in A&E attendances. It is a reversal of the trend across Britain since 2010. As more of the NHS budget is spent on hospitals, community healthcare has gone into retreat. There are far fewer neighbourhood nurses and GPs per head than in other wealthy nations, driving up A&E visits. With nowhere else to turn, some people attend A&E as many as 300 times a year at a cost of £2.5bn to the NHS, according to the British Red Cross. A fifth of these repeat A&E visits come from the poorest 10% of the country. The retreat from preventive care has harmed the NHS and the wider economy, experts say. Britain now spends more on health-related benefits – £75bn a year – than on defence. One in 10 people in England and Wales receive either disability or incapacity benefit, the number having grown from 2.8 million in 2019 to 4 million today. The cost to the economy of long-term sickness is estimated by the government at more than £300bn a year – one-and-a-half times the budget of Streeting's Department of Health and Social Care. As poverty deepens, the NHS feels the pain. A comprehensive study for the Joseph Rowntree Foundation in 2014 estimated that £29bn of spending by the health service was associated with poorer areas, where people are sicker and more likely to use A&E. One of the report's authors, Prof Donald Hirsch of Loughborough University, said the cost of poverty on the NHS today would be closer to £50bn a year if those ratios were the same. 'In fact, it could be much higher,' he said. The preventive approach in Lancaster is one of several quietly radical programmes under way in Lancashire and south Cumbria, a vast area spanning Blackpool, Barrow-in-Furness, Burnley and Blackburn, towns with some of the poorest and sickest communities in Britain. One senior regional manager said less affluent areas were bearing the brunt of the NHS's retrenchment. 'People are attending hospital with cancerous lumps bursting through their skin,' they said. 'It's almost like medieval times when healthcare wasn't available.' Dr Andy Knox, the medical director of Lancaster and South Cumbria integrated care board, said Britain's health and social care system was not sustainable without an 'unrelenting focus on tackling health inequity'. He said: 'The truth is that right now, in the UK, we value some people significantly more than we value others. And this is actually costing us in terms of economic and societal wellbeing.' The need for action was urgent, said Knox, who was awarded an MBE in 2013 for tackling health inequalities. 'We have not created a healthy society and, particularly for our most disadvantaged communities, this is now having a profoundly negative effect and placing huge pressure on our health and care system.' The mortality rate among under-75s in Blackpool is by some distance the worst in England for cancer, cardiovascular disease and for all causes, with the average man dying at 73 – six years younger than England's average, and now the youngest in the UK. Blackpool has four times the average number of drug deaths, nearly double the rate of smoking deaths, the highest proportion of alcohol deaths and the highest rate of serious mental illnesses in England. Deaths from alcohol, drugs or suicide are the highest in England and more than twice the national average. In 2021 the then health secretary, Sajid Javid, made a speech in Blackpool in which he described the huge differences in health access and outcomes related to race and socioeconomic status as the 'disease of disparity'. Last week his successor Streeting also chose the town as the location for his first speech on health inequalities. In it he pledged to ensure more NHS funding goes to poor areas to help tackle the fact that they have fewer GPs and longer waiting times for care. 'The NHS doesn't do enough to address the unjust, unequal way in which illness presents itself in our country,' he said. Preventing the continuation of deep multi-generational illness is the work of Blackpool Better Start, a national lottery-funded initiative bringing together the NHS, NSPCC, council, police and, crucially, a six-strong team of trusted local parents, known as community connectors, who are better at winning the confidence of families than official agencies. The work starts before children are born, with a community connector making regular visits to Blackpool Victoria hospital's antenatal ward to enrol new parents and offer advice on drinking and smoking in pregnancy. Birth registrations have been moved out of the town hall and into three family hubs, formerly Sure Start centres, so every newborn must come through its doors to be given support. Every expectant parent in Blackpool is offered free perinatal classes, typically costing about £296 in other parts of England. Other universal courses are aimed at nurturing the bond between mothers, fathers and their babies – a key issue in a town with the country's highest proportion of children in care, at nearly three times the national average. 'If a baby doesn't feel safe, even though they're being fed, there's a failure to thrive,' said Tracy Greenwood, a health visitor for more than 20 years, who has seen babies failing to gain weight due to attachment issues. More than one in seven new mothers contacted by Better Start reported having four or more adverse childhood experiences, such as abuse and neglect, which is associated with higher levels of health and behavioural difficulties in their own children. Since 2019, the multi-agency scheme says, it has seen a 19% increase in breastfeeding take-up and a 6% fall in babies being born pre-term. It reports an 11% drop in the number of five-year-olds suffering from tooth decay – an issue affecting one in three children of that age in Blackpool, compared with one in four nationally – in part thanks to 'supervised brushing' programmes in schools. Blackpool's use of community connectors, local parents employed by the NSPCC and often recruited on Facebook, is seen as crucial to its success. Families in the most deprived areas felt judged and feared being reported to social services, said Jenny Armer, the chair of the Ryelands estate residents' group in Lancaster. Prof Jennie Popay, a sociologist who leads Lancaster University's Centre for Health Inequalities, said this mistrust was understandable. 'The overwhelming message [from the NHS and other institutions] is that [poor health] is how people behave and that's really stigmatising for people who live really difficult lives,' she said. Thousands of families in Blackpool are in the grip of the worst living standards on record. Emma Hobbs, a Better Start community worker, has heard new parents talk of reheating old bottles of baby formula instead of 'throwing money down the sink', increasing the risk of bacterial infections. 'We've had parents telling us they were turning off their fridges at night because they couldn't afford the electricity,' said Vicky Morgan, a development manager. She worries every winter when money-saving experts encourage families to 'heat the person, not the room'. 'It's dangerous [and] it doesn't apply to under-fives,' she said. Across England, 40% of 11-year-olds are overweight or obese, a trend that has grown steadily since 2010. Children in poorer areas are more than twice as likely to be obese at ages five and 11 than those in wealthier areas. Prof James Fleming, a GP in Padiham, near Burnley, has observed a troubling new phenomenon in children nationally: they are obese and malnourished. The cost of living crisis has normalised diets that rely on cheap and calorie-dense foods, he says, with disastrous lifelong consequences such as increased risk of disability, premature death, diabetes, osteoarthritis and some types of cancer. 'We're normalising poor nutrition and poor health,' Fleming said. Last year he organised a grant for a local school, expecting it to spend it on the playground. Instead, it spent it on food. 'The teacher said: I want every child to have a full tummy. That was really upsetting,' he said. Back on the Ryelands estate in Lancaster, the school summer holidays are looming. Armer, the chair of the residents' group, organised 42 food parcels for the estate at a cost of £2 each last year. In the final week of the summer holidays, only six families could afford to pay. Children are missing school, she says, because the bus is too expensive. A four-mile round trip costs £4 a day – £80 a week, or £780 for a full school year. 'That really concerns me and just shows how much families are struggling,' she said. In Fleetwood, eight miles north of Blackpool, NHS bosses spotted that a large number of children were failing to turn up to mental health appointments. They realised it was because families could not afford the two-hour round trip on public transport. Since moving the service to Fleetwood, the child and adolescent mental health services waiting list has fallen to almost zero. A&E attendances for children in mental health crisis have decreased by 59%. At Furness general hospital in Barrow, the 11 young women are no longer routinely found in A&E. They sat down with clinicians to explain why they self-harmed to secure a bed for the night. They described a complex range of mental health issues, dating back to childhood, that had never adequately been addressed, even though many, if not all, had been seen by NHS professionals. A more comprehensive support plan is now in place and the A&E attendances are starting to fall. 'Health has to work in a different way,' Niebieski said. 'It can't continue to expect that these people will access care in the usual way. For some people the barriers they face are so great that it's impossible.'
The Guardian
an hour ago
- The Guardian
Britain's ‘medieval' health inequality is devastating NHS, experts say
Britain's 'medieval' levels of health inequality are having a 'devastating' effect on the NHS, experts have warned, with the health service estimated to be spending as much as £50bn a year on the effects of deprivation. Rising rates of child poverty have led to a growing burden on hospitals, with the knock-on cost to the NHS comparable to the annual defence budget. One senior NHS figure said they were seeing 'medieval' levels of untreated illness in some of Britain's poorest communities, including people attending A&E 'with cancerous lumps bursting through their skin'. Another said hospitals were witnessing a 'chilling' trend of vulnerable people, young and old, deliberately self-harming to secure an overnight stay. Concern has also been raised about rising rates of 'Dickensian' illnesses, including scabies, rickets and scarlet fever. The disclosures are revealed as part of a months-long Guardian investigation into the effects of deepening poverty on a 'broken' NHS. Rachel Reeves, the chancellor, last week unveiled a £29bn real-terms increase in day-to-day NHS spending – up to £226bn by 2029 – rising to almost half of all non-capital public spending by the government in that time. Wes Streeting, the health secretary, last week pledged to direct billions of pounds of extra NHS funding into poor areas by banning hospitals from overspending and overhauling the formula used to decide the levels of funding GP surgeries receive. This Thursday he will unveil the government's 10 year health plan, which will include radical plans to transform the NHS from a service primarily focused on treating illness to preventing it. However, NHS trust leaders are warning that cuts to other key areas – and long-delayed plans to reform social care and tackle child poverty – will leave hospitals and GPs having to 'deal with the fallout'. There is also unease about how Wes Streeting's ambition to shift the health service from treatment to prevention, to be unveiled next month as part of the plan, square with the deep cuts to regional independent care boards, which are under pressure to axe as many as 12,500 jobs by the end of this year. Saffron Cordery, the deputy chief executive of NHS Providers, which represents NHS trusts, called for a cross-governmental approach to tackle the impact of poverty on health. 'Prevention is better than cure but after many years of underinvestment and cuts there is a lot more to do to achieve the government's ambition of a clearer focus on preventing ill health,' she said. 'Made worse by the cost of living crisis, poverty has played a part in driving record demand for stretched mental health services, particularly among children and young people.' A comprehensive report published by the Joseph Rowntree Foundation (JRF) in 2016 estimated that £29bn of NHS spending was associated with poverty. One of the report's authors, Prof Donald Hirsch of Loughborough University said that although the exact cost today cannot be known without repeating the study, it was likely to be much higher. 'We spend a lot more on the NHS now than in 2014, and if the fraction attributable to poverty were the same, the cost would have risen to nearly £50bn,' he said. 'In fact it could be much higher, since far more people are experiencing severe hardship, including hunger and destitution, which could have strengthened the links between poverty and ill health, and hence higher health spending.' Studies suggest about a quarter of all spending in acute hospital care and primary care can be attributed to greater use of these services by people in poverty. At £50bn a year, spending on health deprivation would be similar to the defence budget and account for about £1 in every £10 spent by the government on all public services. A report by the Royal College of Physicians, published last week, estimated that air pollution – which disproportionately affects deprived communities – was contributing to about 30,000 deaths a year and about £500m a week in NHS and economic costs. Katie Schmuecker, the principal policy adviser at the JRF, said: 'Without an urgent commitment to tackling deep poverty, no plan to improve public services can succeed and the NHS and economy will continue to suffer as a result. 'Hardship is causing avoidable harm to people's health as well as holding back our economy, and failing to act on this costs us all dear.' Schmuecker said widespread deprivation was having a 'devastating' effect on the NHS and the economy. Studies have shown that those living in poverty are getting sicker and access healthcare later, contributing to A&E admissions that are nearly twice as high in the poorest groups and emergency admissions that are 68% higher. Dr Andy Knox, the acting medical director of Lancashire and South Cumbria integrated care board, which spans some of the poorest areas of Britain, said only 'full systemic change' in the approach to public health would curb widening inequality. 'There is an urgency to the situation we find ourselves in,' he said. 'We have not created a healthy society, and particularly for our most disadvantaged communities, this is now having a profoundly negative effect and placing huge pressure on our health and care system.' A report by the Health Foundation last year found that health inequalities are expected to continue over the next 20 years, with people in the poorest areas likely to be diagnosed with major illness a decade earlier than people in the wealthiest. The life expectancy gap between these areas has widened across Britain since 2013, according to the Office for National Statistics. Hugh Alderwick, of the Health Foundation, said the government's mission to tackle poverty and its impact on health 'appears to be missing in action'. He said pressure on the NHS would continue to grow without 'meaningful policy action to improve people's social and economic conditions'. A government spokesperson said ministers were 'determined to change people's lives for the better, helping them out of poverty and protecting those who need it most'. The spokesperson added: 'As part of our plan for change we announced a new £1bn package to reform crisis support, as well as the expansion to free breakfast clubs, increasing the national minimum wage and supporting 700,000 of the poorest families by introducing a fair repayment rate on universal credit deductions. 'We are also reforming the NHS so it is there for everyone, regardless of who they are or where they live, and have hit the ground running, delivering an extra 3.6m appointments since July to cut waiting lists.'
Telegraph
an hour ago
- Telegraph
Tinkering with supermarket loyalty schemes cannot save the NHS
Is it possible to get to grips with obesity without excessive bossiness about what we should eat or the taxation of unhealthy food? As part of its long-term plans for the NHS, the Government wants supermarkets to make it easier for customers to buy low calorie products. This has been denounced by the Tories as 'nanny statism' even though in office they imposed a tax on fizzy drinks for precisely the same reason. It might be better for the political parties to agree on a common strategy to deal with one of the great scourges of our time. Nonetheless, will the latest measures make the slightest difference? Supermarkets already sell fruit, vegetables, healthy food and low sugar drinks. The problem is that people do not necessarily buy them, preferring calorie laden takeaways and ready meals. Ministers say the supermarkets should offer special promotions, loyalty points for healthy eating and alternative shop layouts but many do this already. This feels like a policy of desperation as the Government searches for ideas that will stop the NHS becoming overwhelmed by the ailments of obesity. More than one in five children are living with obesity by the time they leave primary school, rising to almost one in three in the most deprived areas. This is a crisis that tinkering with supermarket loyalty cards will not even come close to solving. Yet the measures that might be needed to bear down on demand, such as rationing or pricing, are not considered acceptable in a peacetime society. For instance, should people on benefits be given vouchers that can only be exchanged for healthy food? Might a fee be exacted from obese patients for their treatment? Such ideas only have to be suggested to recognise they are not going to be adopted. They never were for smoking, though very high taxes on tobacco certainly encouraged millions to quit. Yet why should the rest of us pay for the unhealthy choices of others? Since so many children are obese and living with parents who are also fat it is in the schools where most effort is needed. Compulsory teaching on the sort of food to buy and how to cook it should once again be part of the national curriculum, rather than the current 'food technology' lessons. These would be far more valuable to children facing a lifetime of poor health than today's obsession with sexuality and diversity.
