The Rt. Hon. Sir John Major KG CH

Prime Minister of Great Britain and Northern Ireland 1990-1997

Chief Secretary (1987-1989)

Mr Major’s Parliamentary Answer on NHS Expenditure – 11 February 1988

Below is the text of Mr Major’s Parliamentary Answer on NHS Expenditure, made on 11th February 1988 in the House of Commons.

Mr. Boyes To ask the Chancellor of the Exchequer if, in view of recent representations, he will increase planned public expenditure for 1988-89 on (a) National Health Service provision and (b) education and training.

Mr. Bernie Grant To ask the Chancellor of the Exchequer what representations he has received in relation to his published expenditure plans for (a) the National Health Service and (b) Government expenditure generally.

The Chief Secretary to the Treasury (Mr. John Major) The White Paper plans for next year already include increased provision for the Health Service, education and training, as part of the £4.6 billion increase in the total for programmes.

Mr. Boyes The Government’s attacks on the National Health Service and on the education service are nothing short of political vandalism. Is the Minister aware that in a recent poll 86 per cent. of the people questioned suggested that it would be better to give money to the National Health Service, even if that meant increasing taxation? If cash is available on Budget day, it should be given to improve the National Health Service and the education system, rather than to line the pockets of the Minister’s friends in the City.

Mr. Major The Government are as concerned as the hon. Gentleman about the National Health Service. The public expenditure plans for next year and for the two subsequent years show an increase of over £1 billion for the Health Service. It is the most substantial cash increase over a period that the Health Service has ever received.

Mr. Grant Does the Minister agree that, instead of fiddling around with this large sum of money, it would be better to spend some of it, not only on the Health Service, but on increasing rate support grant for local authorities such as ILEA, which will probably have to make 3,000 teachers redundant? My authority will have to make cuts amounting to £45 million this year. Would it not be better for him to use some of the available money to alleviate the suffering and poverty that the Government have caused?

Mr. Major As to the Health Service, I reiterate the point that I made a moment ago: there will be substantial increases in programme expenditure next year amounting to £4.5 billion. ILEA, for all the expenditure that it has lavished, has failed to provide a decent education service in London, and I shall be glad to see the end of it.

Sir William Clark Does my right hon. Friend agree that the one subject on which Opposition Members are expert is spending other people’s money? Does he also agree that throwing public money – taxpayers’ money – at, for example, ILEA, with its poor academic record, would be a complete and utter waste of money, just as lavishing taxpayers’ money on the National Health Service without cuts – [HON MEMBERS: “Cuts?”] – without improvements in efficiency would be a derogation of the Government’s duty?

Mr. Major The Government are certainly keen to see increased efficiency in the National Health Service, and the cost-improvement programmes have provided that to a certain extent. We hope to see more efficiency in the future.
ILEA is a uniquely high-spending authority. Moreover, I doubt whether it gives value for money. It employs two and a half times as many administrators per pupil as the average; twice as many non-teaching staff per pupil as the average; and its spending on the youth service is two and a half times that of even the most generous inner-city partnership. Clearly, it spends far more than it ought, and in the wrong way.

Mr. Andrew MacKay Is my right hon. Friend aware that many of us have noted that in real terms the Government have spent a lot more on the National Health Service, but, all the same, many of us believe that the problems of the NHS are much more complex and cannot be solved just by throwing more taxpayers’ money at it? A radical review of the whole service 40 years on would be better than spending extra money willy-nilly.

Mr. Major I entirely agree with my hon. Friend and hope that we shall have such a radical review. I take my hon. Friend’s point about the increase over retail prices. The increase in expenditure is well over 30 per cent. since 1979, which far outstrips that provided by any previous Government.

Mr. Beith Does the Chief Secretary not recognise that, in real terms, taking the level of price increases in the economy as a whole, the increase for the Health Service this year is only 1.2 per cent., that it is likely to be less than that when the generally higher costs of the Health Service are taken into account, and that it will be nothing at all if the health authorities are expected to fund any part of the nurses’ pay review? Why does he not respond to the massive public concern on that matter?

Mr. Major I take the hon. Gentleman’s underlying point that “real terms” can be defined in more than one way. We are both aware of that. However, in terms of the normal definition of “real terms”, with the income-generation schemes and the cost-improvement schemes, the National Health Service will receive a real terms increase of about 3 per cent. next year.

On the second part of the hon. Gentleman’s question, we will, as usual, consider that matter when we have the report of the Nurses Pay Review Body, and we shall then decide whether we can accept it. Other matters will follow from there.

Mr. Sayeed Will my right hon. Friend confirm that the Government’s expenditure plans show that spending on social security, health and education alone account for 60 per cent. of total Government expenditure – the highest proportion ever? Does he agree that those areas of massive public expenditure show rises even after the application of the overall GDP deflator?

Mr. Major The figures may be even larger than my hon. Friend suggests, but his underlying premise is entirely correct.

Mr. Gordon Brown Does the Chief Secretary not find it surprising that no one – the British Medical Association, the National Association of Health Authorities in England and Wales or the Royal College of Nursing – agrees with him that the Health Service is properly funded? Given that he has had to concede that he has a Contingency Fund of £3.5 billion, will he now allay the fears of health authorities throughout the country which are faced with having to budget for cuts and closures? Will he state today that he can and will fully fund the nurses’ and health workers’ pay settlements?

Mr. Major We have not – [Interruption] – if hon. Gentleman – [Interruption].

Mr. Speaker Order. The Minister has been asked a question.

Mr. Major The provision for the National Health Service for next year has been substantially increased. Those who question the size of the increase simply have not taken into account the enormously increased provisions that have been made. It would be more helpful if the hon. Gentleman would concern himself with reality rather than with fiction.