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After the Prime Minister’s promise of more cash for the NHS, a new report from the Institute for Government calls for a parliamentary inquiry into how to raise this money now – and in the future.

Published today, How to Fix the Funding of Health and Social Care says the Government needs to provide an answer to one of the most politically vexed questions of our time: how to raise the money needed for health and social care? 

The proposed extra money for the NHS – a 3.4% annual increase over the next five years – is significant and will help stem a further decline in standards. But this new spending will be unsustainable unless the Government has a realistic plan for how the money will be raised. The report dismisses the idea of a ‘Brexit dividend’ and argues that unless there is a clear way to raise the additional money it will have to come from cuts to other parts of public expenditure, where there is little low-hanging fruit left to pick.

The report concludes that a parliamentary inquiry could help get to the root of this question while building political support for an answer. Even if the proposals were not fully implemented before the next election, the conclusions of a cross-party inquiry could be easily picked up by a future government of any political leaning.  

The report says that in order to succeed, a parliamentary inquiry must:

• be set up quickly and report in time to feed into the 2019 spending review.
• include a high-profile, cross-party group of MPs and peers, to win support for its conclusion
• be led by a select committee chair who could continue to champion its recommendations beyond the life of the inquiry.

Nick Davies, Programme Director at the Institute for Government, said:

“Fixing health and social care funding is critical but implementing the tax rises which are likely to be necessary to pay for it will be controversial. A parliamentary inquiry offers the best hope of building sufficient political support for a solution. There is already cross-party support for the idea. Now it is time for the Government to act.”

The report also calls for an independent body to monitor and scrutinise government spending on health and social care. It argues that these functions could be placed in an existing institution – such as the Office for Budget Responsibility – or given to a new one. This would ensure that funding increases are provided consistently over time, allowing for better planning and more efficient delivery of health and social care services.

Notes to editors

• The full report is available online here.
• The Institute for Government is an independent think tank that works to make government more effective.
• For more information, please contact nicole@instituteforgovernment.org.uk / 0785 031 3791.

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