An independent body to dictate government funding for the NHS and a new wave of reorganisation are required to make sure the health service can meet the demands of the next 30 years, a new report has concluded.
The final instalment of former Labour health minister Lord Ara Darzi’s Better Health and Care for All review also calls on the government to hike National Insurance contributions by 1% to contribute towards easing the health and social care system’s current funding problems.
Darzi, who is a surgeon by profession, said in an interim report earlier this year that the Department of Health and Social Care was facing a £60bn funding shortfall in the years to 2030 because of a combination of demographic pressures and historic under-funding.
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His just-published final report – delivered ahead of next month's 70th anniversary of the NHS’ creation – says the service also needs to include social care that is “free at the point of use” .
However, ensuring that services are properly funded to meet the pressures they face is a key area of focus and the report urges the government to create an Office for Budget Responsibility-like body with a statutory duty to set out the funding requirements for the health and care system .
The report, co-authored with former Department for Business, Energy and Industrial Strategy minister Lord David Prior, says that the new body should also be able to indicate the additional tax requirements needed to meet the nation’s health and social care requirements, and potential changes to taxes – such as partial ringfencing of National Insurance – that may be necessary.
“This body would be similar in remit and design to the Low Pay Commission or the Office for Budget Responsibility,” Darzi said.
“This should be established as a non-departmental public body, reporting to parliament rather than to government.”
Darzi’s report said that in the short- to medium-term employers, the self-employed and employees should all face a 1% increase in their national insurance contributions, which would be committed to supporting the health and social care system.
The review said that the proposed provision of free personal social care would be funded by means testing Winter Fuel Payments, Attendance Allowance and the Carer’s Allowance.
Darzi also calls for a restructuring of key NHS institutions, dubbed a “national simplification”, that would create a “single NHS Headquarters” to report directly to the recently-renamed Department of Health and Social Care. It would incorporate NHS England, NHS Improvement, Health Education England, and the health protection and delivery functions of Public Health England.
“This is the logical conclusion of recent announcements of the near-merger of NHS England and NHS Improvement and the creation of a single finance and performance management system, albeit with the retention of two chief executives due to the statutory framework,” Darzi said.
“The NICE and the CQC would complete the national institutional architecture.”
Darzi said health-promotion functions should be “delegated in full” to local authorities, with the budget flowing directly from the health department.
Darzi served as parliamentary undersecretary of state for health from 2007 to 2009, while Gordon Brown was prime minister.
His review is published by think tank the Institute for Public Policy Research.