Chapter 8: Department of Health

In Budget 2000 the Government announced an unprecedented increase in NHS UK funding of 6.1 per cent average annual real terms growth over the four years to 2003-04. This is the longest period of sustained high growth in the history of the NHS. It compares to an average of 3.3 per cent annual real growth since the foundation of the NHS and 2.9 per cent annual real growth between 1978-79 and 1996-97. In the 2000 Spending Review:

social services funding has been increased significantly in real terms to provide for the elderly, children and other vulnerable groups; and
funding for the Food Standards Agency will increase by an average annual 6 per cent in real terms to help protect the consumer from food-related illness.

The National Plan for the NHS will be announced shortly, setting out a strategy for investment and reform in the NHS, including the Public Service Agreement targets for the NHS and social services.

The national plan to reform the NHS

8.1 The Government began its programme to rebuild the NHS in the White Paper The New NHS1 in 1997 and demonstrated its commitment to modernised health and social services through substantial investment in the 1998 Comprehensive Spending Review.

8.2 The new investment is delivering significant improvements. The Manifesto commitment for reducing numbers waiting for planned inpatient hospital treatment by 100,000 below the March 1997 level has been achieved. Many patients are now able to make hospital appointments at a time that suits them, cutting out the uncertainty of waiting on a list. Three quarters of accident and emergency departments are being modernised, expanded or updated; of these nearly half are already completed. The national nurse recruitment campaign was launched in February 1999. By February 2000 over 9,000 nurses had contacted the NHS about returning to work. The latest figures show that in the last year the number of nurses working in the NHS increased by 5,600.

8.3 The Government has also set tough targets to reduce avoidable deaths from the major killers of heart disease and stroke, cancer, suicide and accidents, backed with policy frameworks for national and local action and investment. The national service framework for coronary heart disease was published in March 2000; it sets a long-term structure for developing and improving services for patients at risk of heart disease. Cancer referral guidelines for General Practitioners (GPs) have been developed to support the implementation of the two week standards for urgent referrals. An impressive start has been made, with 96 per cent of all women with suspected breast cancer now being seen by a specialist within two weeks of an urgent referral by their GP.

8.4 Although the NHS retains worldwide respect for its fairness and efficiency, there are still unacceptable variations in performance between the best and the rest. Budget 2000 announced the biggest, sustained increase in funding of any four year period in the history of the NHS, set to grow in the UK at an average of 6.1 per cent annually after inflation.

8.5 On 22 March, the Prime Minister set out five challenges for the NHS to address:

Partnership: working together across all parts of the health system to ensure the best possible care, for example reducing unnecessary hospital admissions and providing the right level of beds and services for each level of care, particularly for the elderly;
Performance: ensuring that, using information, incentives and inspection, all parts of the health system come up to the standard of the best; that there is the right support and intervention for those struggling to perform well, and that the systems are in place to root out poor clinical performance;
Professions and the wider NHS workforce: stripping out unnecessary demarcations and breaking down traditional barriers between health care professionals so the right people deliver the right care;
Patient care: improving patient access by delivering fast and convenient care for patients, and empowering patients by listening to their needs and letting them know their rights; hospitals and primary care groups should ensure they all adopt best practice and introduce convenient booking systems so that patients with the most serious conditions are treated quickly; and
Prevention: balancing spending on tackling the causes of ill health with treating illness, tackling variations in care, and promoting healthy living.

8.6 The Secretary of State for Health established a series of modernisation action teams, involving experts from across the NHS and other stakeholders, to respond to these challenges. A National Plan to reform and modernise the NHS, tackle poor performance and drive up standards will be published shortly, alongside the Public Service Agreement for the Department of Health.

8.7 The National Plan will map out the ways in which variations in quality and types of service will be overcome and will set out the priorities for investment and reform. Health services nationally and locally will be required to change in a way that makes them more responsive to the needs of patients.

Supporting communities and families by investing in social services

8.8 Since the reforms of the 1998 Comprehensive Spending Review, services for the elderly and for children have improved. The rate of growth of emergency admissions for the elderly is slowing, as initiatives for better joint working between health and social services take hold. The Quality Protects programme has begun to transform children's services, improving the educational attainment of children in care and significantly reducing the proportion of children re-registered on the child protection register.

8.9 The 2000 Spending Review builds on the investment of the Comprehensive Spending Review. High quality social care and good joint working between the NHS and social services are essential to deliver effective care, particularly for the elderly. Too few older people are given the opportunity to regain their independence following a stay in hospital or a minor accident. As a result they can face unnecessarily long stays in hospital, or unnecessary placement in a care home. Policies and investment to provide better care and rehabilitation services for the elderly will be integrated into the National Plan. The Government's response to the report of the Royal Commission on Long Term Care, chaired by Professor Sir Stewart Sutherland, will also be set out by the Secretary of State for Health as part of the National Plan.

Box 8.1: Personal Social Services

The investment in social services will, by 2004:

promote higher quality care, rehabilitation and care close to home as part of a strategy for better service for the elderly, to be announced in the National Plan for the NHS;
continue the drive to give children in care the same life chances as their peers; and
improve social care support for people with mental health problems, in line with the social care standards in the National Service Framework on mental health.

Improving food safety and standards

8.10 The Government established the Food Standards Agency on 1 April 2000. The Agency combines food safety functions previously carried out by the Department of Health, Ministry of Agriculture, Fisheries and Food (MAFF) and the devolved administrations; and incorporates the Meat Hygiene Service.

8.11 Reflecting the importance the Government attaches to improving food safety, the 2000 Spending Review provides substantial sustained increases in spending for the Food Standards Agency. Its funding will grow in real terms by an average of 6 per cent a year over the next three years. This will help the Food Standards Agency in reducing food related illness and improving enforcement.

Box 8.2: The Food Standards Agency

The Food Standards Agency aims to:

measurably improve public confidence in national food safety and standards;
reduce food borne illness by 20 per cent, including reducing levels of Salmonella in UK produced chickens on retail sale by at least 50 per cent, by 2006; and
protect consumers through improved local authority enforcement on food safety and standards.

Spending plans

8.12 The new spending plans for the NHS in England announced in Budget 2000 provided for 6.3 per cent average annual real terms growth over the four years to 2003-04. Funding for social services has also grown significantly in real terms, allowing growth in spending on services for the elderly, children and other vulnerable groups.

Table 8.1: Key figures ¹

£ million
	2000-01	2001-02	2002-03	2003-04
Total Department of Health²	45285	49461	54437	59011
Total NHS (net)³	44485	48193	52264	56653
of which: Resource Budget	42852	45696	49103	53471
Capital Budget	1633	2497	3161	3182
Personal Social Services	9407	10032	11405	12208
of which: Funded by Department ⁴	713	1164	2062	2247
Standard Spending Assessments ⁵	8693	8869	9344	9962
including: net transfers into PSS ⁶	0	-10	705	784
Food Standards Agency	87	104	111	111

1. Numbers may not sum due to rounding
2. Sum of total NHS (net), Personal Social Services funded by Department of Health and Food Standards Agency
3. Net of receipts
4. Shows spending funded by the Department of Health on social care and related services, which comprises mainly special, specific and capital grants to local authorities and credit approvals; includes effect of transfers detailed in note 6 and an additional transfer from PSS SSA to PSS funded by the Department.
5. Includes effect of transfers detailed in note 6 and an additional transfer from PSS SSA to PSS funded by the department for each year from 2001-02; this means the SSA figures for 2000-01 contain £231 million which has been transferred out for 2001-02 onwards reflecting these changes in responsibilities.
6. Includes transfers into PSS from Department of Social Security and out of PSS to Home Office and Department for Education and Employment.

¹The New NHS: Modern, Dependable - December 1997, Cm 3807.