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Disaster Capitalism in the NHS

Years of austerity and marketization have wreaked havoc on Britain’s National Health Service. The crisis is now reaching a breaking point.

Junior doctors protesting NHS privatization on October 17, 2000. Rohin Frances / Flickr

When news of the current crisis in the English National Health Service (NHS) reached the United States, the New York Times asked its readers about their experiences with the British health system. The answers from the UK poured in via social media: “The NHS saved my sight and gave me everything I have today.” . . . “My mum had the best critical care, we never once needed to worry if we could afford it” . . . “It’s an incredible service” . . . “The best thing the UK government has ever done.”

Despite the current crisis, the British love the NHS. It’s our most popular institution, more popular even than the royal family. But it wasn’t always like this. In prewar Britain, health care was provided by a patchwork of private insurance schemes, voluntary hospitals, or by charities. I’ve heard heart-breaking stories firsthand of women dying in childbirth and children dying of preventable diseases, simply for lack of money. Illness caused major financial problems for many families, some of whom simply couldn’t afford any care at all.

In the aftermath of World War II, there was a strong feeling in the UK that, having won the war, the population was not going to lose the peace — a mood conveyed beautifully in Ken Loach’s 2013 documentary The Spirit of ‘45. When it came to health care, Britons weren’t prepared to return to the bad old ways, and the stage was set for the postwar Labour government to introduce a national health service in 1948.

In 2018, it will be seventy years since the NHS was introduced, and while it has gone through many changes it still by and large lives up to its original aims — a health service available to all regardless of wealth, comprehensive, universal and free at the point of delivery, financed from taxation. People pay in according to their means and use it according to their clinical need.

So why is the NHS now faced with such severe problems that the Red Cross recently declared that the service was facing “a humanitarian crisis”? As Colin Leys and Stewart Player wrote in their 2011 book The Plot against the NHS, the roots of the crisis lie in the past two decades: “Since 2000, governments have pursued a policy for the NHS that the electorate hasn’t voted for and doesn’t want.” Politicians and private interests worked patiently behind closed doors to transform the NHS from an integrated public service into a mere branding device attached to a series of competing providers.

Politicians increasingly made cause with the private sector, opening the door to commercial interests through step-by-step reforms, each of which concealed its true purpose in language with which we have become only too familiar — patient choice, modernization, contestability and plurality of providers. Politicians hardly ever use the word “market” and have always denied their intention to privatize. When the jigsaw pieces are fit together, the picture that emerges is of a popular and effective public service betrayed by corporate greed and political dishonesty.

Both Conservative and Labour governments have pursued market-based reforms, including the widespread use of public-private building partnerships — known as Private Finance Initiative (PFI) programs (now exposed as a very costly mistake) — and an expansion of private-sector involvement in delivering NHS care. The numerous “reforms” needed to bring about these changes have resulted in the NHS undergoing a “redisorganization” almost every two years. There has been no time to allow reforms to bed down or for staff to adapt before the next reform is imposed. The irony is that the reorganizations often seek to deal with problems arising from the last ill-thought-through changes.

Until recently, the biggest challenge the NHS faced was the ideological position, embraced by both political parties, that the private sector would deliver care more cheaply and more efficiently than the public sector, and that competition with the private sector would improve the NHS. As a result, governments introduced a “market” into the NHS, with compulsory tendering of contracts to competing providers (including the NHS itself). The private sector’s deep pockets and experienced lawyers meant that last year they were awarded 70 percent of tendered contracts. But while they’re expert at winning government contracts, they are not so good at delivering them. Since it’s the first legal duty of private companies to make a profit, we shouldn’t be surprised when they are discovered putting profits before patients.

The recent spectacular collapse of Carillion, a huge private company responsible for delivering many public service contracts, has illustrated the dangers of outsourcing vital public services to the private sector. Public services such as health care and prisons cannot be allowed to fail — if the private company contracted to deliver them goes under then the state has to step in. The Conservatives have still not admitted how much the Carillion debacle will cost the taxpayer, but the figure of “hundreds of millions” is being quoted.

The truth about these companies is that they privatize the profit and socialize the risk, leaving the taxpayer with the bill when they go under but ensuring that senior staff will look after themselves even while their workers’ pensions are threatened: when Carillion’s collapse was first reported, the former chief executive, the finance chief, and the directors had arranged to be paid huge salaries and benefits for months to come, although public outcry has now put a halt to that.

For reasons of ideological purity (and the desire to keep big donors on side) the Conservative government continues to award large NHS contracts to the private sector. Indeed, they may be nervous about not awarding them contracts: Virgin, which recently lost a contract to deliver care in Surrey, successfully sued the NHS for an undisclosed sum (rumored to be over £2 million), payable once again by the long suffering taxpayer.

Starving the Beast

As if the challenge of competing with the private sector were not enough, the NHS has suffered the longest financial squeeze the service has ever seen — a problem that at the moment is proving even more damaging than the process of covert privatization. Figures from the government’s own website reveal that the UK has among the lowest bed numbers and staff per capita, and spends almost the least among EU countries on its health service (for instance, Germany has 8.3 beds per 1,000 people while the UK has only 2.7). This goes a long way to explaining the current crisis, with ambulances queuing outside emergency departments and patients being treated on trolleys in corridors.

Once patients have been treated it may be difficult to get them out of hospital due to concurrent funding cuts to social care, which now has £6 billion less to spend than at the start of austerity in 2010. In particular, a shortage of post-care “step down” beds and cuts to community nurses means that patients continue to occupy expensive hospital beds when they could be cared for closer to home. Because of the cuts the system currently has no resilience, constantly operating on the brink, and any rise in patient numbers, such as occurs during a flu epidemic, tips it over the edge. But for many this so called “winter crisis” is the norm all year round and staff morale is at its lowest ever.

Finally there is a separate crisis in primary care, the system of family doctors (GPs) who provide frontline care in the NHS. They are overburdened with bureaucracy and overwhelmed with patients. Promises to increase their numbers have proven empty, and rather than more GPs we have fewer every day as older ones cut back on work or retire early and younger ones seek a future abroad.

We hear many reasons for the current NHS crisis, including the cry that it isn’t affordable, that it’s being overwhelmed by rising numbers of older people, and that the intrinsic model is not sustainable. But if we can’t afford one of the cheapest health care systems in the world, what can we afford? Every other system costs more money and gives less coverage. When it comes to the elderly the problem is not old age itself but poor health in old age, and all systems face the same challenge of keeping their elderly population healthy. As for the NHS model, it is consistently identified as cost effective and equitable by the respected Commonwealth Fund studies of national health systems.

But no system can resist constant political upheaval and a chronic lack of funds, and there are many willing to exploit the resulting problems. Every time there’s a crisis, we hear the siren voices of think tanks funded by right-wing organizations and the private sector calling for top-up payments, co-payments, private insurance, and payments to see GPs — all of which undermine the fundamental principles of the NHS. Austerity is used as a strategy to attack public services, and health campaigners are well aware of the game being played by right wing politicians and private interests.

But none is this is reason to give up hope — the NHS has survived the interference and stupidity of many politicians over the years. There’s a public desire to restore it to its original model — publicly funded, publicly delivered, and publicly accountable — and all of the problems described above can be reversed. First, fund the NHS to the level of comparable countries. You can’t have a first class service on third class funding. Next, stop the costly and unnecessary NHS market, a move that would save £5-10 billion a year (though the government won’t tell us how much it is costing) and take the usurious PFI contracts back in house. Finally, stop the disruptive reorganizations, which demoralize and distract staff and have no purpose other than to try to correct the mistakes of previous reorganizations. In other words, give the NHS time to improve itself, backed up with appropriate funding and without pressure from the private sector.

The Labour opposition under Jeremy Corbyn has promised to stop the marketization of the English NHS (marketization hasn’t happened in Scotland, Wales, or Northern Ireland), take the PFI programs back in-house, and immediately invest more money in the service. We can only hope.

The NHS is a highly successful piece of social engineering that for seventy years has freed us all from the fear of the financial consequences of illness. In 2012, the filmmaker Danny Boyle included a celebration of the health service — “the institution which more than any other unites our nation” —in the opening ceremony for the London Olympics (despite rumored opposition from Conservative health secretary Jeremy Hunt). It has long been subjected to financial stringency and attacks from right-wing ideology, but — largely due to the dedication of its staff — it continues to deliver health care free at the point of need for everyone.

Aneurin Bevan, the founder of the NHS, once wrote that the health service would continue as long as there were folks to fight for it. As the replies to the New York Times showed, there are plenty of such folks, and we are up for a fight.