Gold for the NHS

Good news that raises questions on consistency and sustainability

The chancellor's budget statement sets out plans for unprecedented rates of growth in NHS spending over the medium term. Responding to the Wanless review team's challenge on the long term funding needs of the NHS,1 the chancellor's special, five year settlement for the NHS will mean an extra 7.4% real terms expenditure each year over the period 2003-4 to 2007-8. This will increase the NHS budget from £65bn ($94bn; 106bn) this year to £105bn after five years (allowing for inflation) and represent a rise in the share of gross domestic product spent on health care from 7.7% to 9.4%. Some idea of the scale of these increases in expenditure can be gauged from the fact that over the period 1954-2000 annual increases in real expenditure on the NHS averaged 3.7%. If plans are realised, the next five years will double this rate.

For those who have lamented NHS underfunding over the past 20 years, this is unadulterated good news. …