Sustained and deliberate underfunding of the Welsh NHS by both Cardiff Bay and Westminster has left Wales' health service on it knees.
A special report from WalesOnline has found that political decisions made by the Welsh and UK Governments have starved Wales' health service of funds for over a decade. The investigation found that since 2010 the UK Government has cut the cash coming to Wales while simultaneously the Welsh Government failed to pass on equivalent amounts of funding to the NHS that was being spent in England.
Whether you are a patient waiting up to six (that’s right six) years for a procedure, a member of staff watching your real terms year-on-year pay plummet as you’re asked to do more work with less resource or simply someone who has even a cursory look through the data - Wales’ health service is in a serious trouble. Among many key metrics, it is also performing worse than the health service in England.
Read more: Living and dying in pain: The victims of Wales' NHS waiting list scandal
When it comes to funding of the Welsh NHS both sides need to shoulder their share of the blame. There is no doubt that from the Tories coming to power in Westminster in 2010, they have massively cut the amount of cash in real terms coming to Wales. This gave the Welsh Government tough choices - something had to be cut. Unlike in England where NHS spending was ringfenced in Wales the Welsh Government under Carwyn Jones decided not to pass this ringfenced cash on to Welsh NHS, instead insulating other areas such as social care against the brutal cuts that came from London.
Whether that was the right course of action or not, is a matter for debate, but whatever the merits of this decision it ultimately led to a massive shortfall in funding for the health service in Wales that would take years to recover. Even today, the Welsh Government does not pass on all the money it receives as a consequential from England's health service to the Welsh NHS. - spending proportionally more on education and housing compared to England. This is to say nothing for the incidents of mismanagement of the health service which fall squarely at the feet of the Welsh Government.
What this special report shows is that despite sharing the responsibility for the NHS's current plight both sides agree on just one thing - it is the other who is to blame. This is a real issue. This constant passing of the buck leads to less accountability and ultimately more suffering for Welsh people at a time they need care not excuses.
So how do we know that both the Welsh and UK Government are to blame for starving the Welsh NHS of funds?
So how can we know this? Let's look are how much money has been spent of health in Wales since the Conservatives took over in 2010. These figures were put together by Cardiff University's Wales Governance Centre.
This first graph shows how health spending in Wales has changed compared to 2010/11. Basically if the figure is above 100 it means it has gone up, if it is below 100 in any year it means it has gone down. As you can see, there is a lot more money that has been spent on the Welsh NHS in 2020 than 2010. It also shows that since 2013/14, spending in Wales on health has exceeded 2010 levels.
But this fails to take into account inflation. Once we adjust the line for inflation (the pink dashed line) we see that it isn't until 2016/17 that spending exceeds 2010.
However, this still doesn't fully reflect the full reality of the situation, because even if the spending has gone up, if the population has increased then the amount of spending per person will be lower. Therefore the purple dashed line reflects the amount of spending adjusted for the increase in population.
If we then take into account that Wales has become older in terms of demographics over that period of time the line shifts again. This incorporates the fact that older people require higher expenditure. Put simply this includes the "cost" of ageing into the expenditure. Once we take into account the increased demand (the dotted blue line) we can see that throughout the 2010s, health spending in Wales was consistently below 2010 levels. This final measure is more of an estimate and is based on need which is a concept we will come to more later.
It is no surprise the Welsh NHS is in a state
Given the fact that Wales' health service has been been receiving lower funding for a whole decade it is utterly unsurprising that it is in a mess. Now this begs the wider question, is it the Welsh or UK Government that has caused this underfunding? This takes a little breaking down.
The UK Government did cut the overall budget
The first thing to say is that the austerity imposed on public sector budgets by the Conservatives from 2010 cut the amount the Welsh Government had to spend. Though the Welsh Gov has some very limited tax raising powers, any meaningful increase in its budget could only be achieved by taxing people in lower incomes which is politically unpalatable. This means that most of the money to be spent on devolved areas like health and education comes from London, and therefore the decision to impose austerity by the Tories meant that the Wales had less money.
The Welsh Government chose to protect health budgets less than in England
But there was Welsh Government decision making at play here as well because although Wales' total amount of cash was reduced, the Welsh Government made the decision to impose more cuts on the health budget than the Tories did in England. When the Conservatives announced austerity in England they ring fenced the NHS meaning the cuts fell more brutally on other departments.
However in Wales the Welsh Government did not do this. For the first three years of austerity, the then Carwyn Jones-led administration decided to spread the pain around meaning that the health budget got reduced in order to protect some other departments - particularly social care.
Throughout the early years of devolution, Wales spent significantly more than England did on healthcare. The reason that Wales has had higher funding was based on a Treasury assessment of need back in the 1970’s. Unfortunately for Wales, due to the Barnett-squeeze (we will come this in bit) this has come down steadily. However even with this Wales was spending about 8% more than England on health on the eve of austerity.
The red line on the graph below show what Wales was spending on health compared to England (the black line). The blue line shows what Wales would have spent on health if it had passed on exactly the money it was getting through the Barnett formula based on health spending in England. As you can see, the period at the start of austerity, where the black arrow is, shows how the Welsh Government attempts to insulate other departments meant that for a period of three years, Welsh health spending was the same per head in England.
This cut led to a marked decline in Welsh NHS performance and led to David Cameron describing Offa's Dyke as "the line between life and death". Senior lecturer in politics at the Wales Governance Centre Ed Poole told WalesOnline: "Cameron's comments were at the same time there was basically a whole week where the Daily Mail ran front pages and big spreads against the Welsh Labour and the Welsh NHS. This obviously spooked the horses and in one budget year there was a huge turnaround, a U-turn, with about half a billion pounds put back into the NHS."
Despite the Welsh Government passing on more of the consequential for the second half of the last decade they are still not passing on everything. The figures suggest that since 2010-11 the UK Government has increased health spending in England by 38.9% but the Welsh Labour Government have increased health spending by just 30.6%.
So what is the Welsh Government spending this extra money on? If you look at the Treasury data it is spent on several other devolved areas but most notably education and housing. According to Mark Dayan who is a policy analyst and head of public affairs at the Nuffield Trust who has looked extensively at devolved funding, the Welsh Government does have the ability to significantly increase spending on health but that doesn't necessary mean it is the right thing to do.
He told WalesOnline: "There's certainly plenty that can be done. It is true that if the Welsh Government were to spend as high proportion of it's money it has on health as England does, it would lead to a fairly significant increase in health spending. That's not saying that's the right thing to do because obviously there has been a 13 year period of fairly tight public spending. So it does confront them with somewhat difficult choices and to an extent England has chosen to spend quite a bit less on other services, and for the Welsh Government to spend more on health care, they'd have to do that as well. But that is the case they could make looking at the countries and regional assets and sort of other areas that Wales is spending much more per person on than England including education and housing.”
What Wales gets and what Wales needs - a broken system
So what we know is that the UK Government has imposed big real terms cuts on the Welsh Government budgets meaning Wales had to make tough choices. In the face of this over the last decade the Welsh Government has opted to take out some of the devolved health budget to support areas such as social care, education and housing. Whether you agree with this decision or not it means that the Welsh NHS has less money than if the Welsh Gov had allocated their budget along the same lines as in England.
But Wales and England are different countries, with different geographies and different demographics. What works for England may not work for Wales. Wales is older and sicker than England. The fact that our population is so spread out also makes it more expensive to deliver the same amount of care for the same money. So how much more money does the Welsh NHS need to deliver the same level of care as the English NHS?
Several studies have looked at this but it is a hard thing to quantify and they are all about a decade old. The most recent is a study by the University of Sterling from 2013 which suggested that if you were to apply the formula applied in England for deciding what each part of England gets, Wales would get 10% more. This rises to 16% when you take into account the health inequalities.
And this brings us to the third thing to blame for the Welsh NHS's state - the current devolved system. A massive proportion of the Welsh Government's budget comes from the Barnett formula which isn't based on need.
There is no system where the UK Government looks at Wales, looks at the challenges faced and says "this is what is required to tackle them". Instead Wales just gets rises and falls in its budget based solely on what England decides England needs.
This situation is likely to get worse because of what is called the "Barnett squeeze". This means that over time the Welsh, Scottish and Northern Irish budgets converge with that of England.
No one is blameless here
So who is responsible for Wales' underperforming NHS? Ultimately the UK Government, Welsh Government and creaking system they are all operating in all have to bear their share of the burden.
There is not getting away from the fact the UK Government has imposed substantial cuts on Wales' budgets over a decade. This has made tough decisions inevitable. It has also failed to give Wales funding that is proportionate to its need when it comes to the age and sickness of its population. Wales does get more per head than England, but this does not match the extra cost of delivering healthcare in Wales.
The Welsh Government is also culpable. It has made the decision to spend some of the money that came as a consequential of English health spending on other policy areas. Whether this was a necessary decision or not to safeguard other areas, it had the inevitable consequence of reducing Wales' health budget when it does technically have the resources to offset much of the shortfall in health spending based on need.
Plus there are huge questions for the Welsh Government to answer about the management of the health service itself. The enormous waiting lists compared to English are issues that have to land firmly at their door as do the myriad of mistakes made during Covid. This is on top of the long running saga of Betsi Cadwaldr Heath Board being perpetually in special measures.
Dig a little deeper and other questions arise about the running of the health service by the Welsh Gov. For instance Wales has fewer consultants per head than England though has more nurses. Some of this could be down to specific policy decisions but it could also be down to recruitment challenges in rural Wales. The point is that though scrutinising how an organisation the size of the Welsh NHS is run is hard, but the Welsh Government is making decisions everyday about how it is run, they can not wash their hands of responsibility over its significant failures.
The system that both governments are having to operate in is also failing. The way cash is divided up has, at the end of the day, no real bearing on what is actually required within the devolved nations to create parity in public services across the who UK.
Only by understanding who is failing the people of Wales when it comes to their health service can they be truly held to account. And it is clear there are plenty of failings to go around.
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