THERESA MAY has agreed to pour an additional £384million per week into the NHS after Brexit – exceeding the amount mooted by the official Leave campaign and effectively locking the UK into leaving the EU.
The boost for the health service, which the Prime Minister will set out in a speech tomorrow, is intended to mark the 70th anniversary of its creation, partly by drawing on the “Brexit dividend” that will arise from the country ceasing payments to the EU.
Writing in The Sunday Telegraph, Jeremy Hunt, the Health Secretary, who campaigned for Remain during the 2016 referendum, says the Brexiteer pledge of extra funding for the NHS “can now unite us all”.
In a heavily criticised slogan, the Leave campaign had said the UK sent £350million per week to the EU in cash terms, which could be spent on the NHS instead.
Mrs May’s decision to fund the increase partly from the Brexit dividend signals an insistence that the UK will leave the EU next year, and is likely to frustrate pro-Remain MPs and peers pushing for the country to stay within the bloc or keep the closest possible ties.
The announcement marks a significant victory for Mr Hunt, who has been lobbying Philip Hammond, the Chancellor, for a significant funding boost for the NHS, as well as Brexiteers such as Boris Johnson, who urged Mrs May to deliver on their campaign promise.
However, Mrs May will risk a backlash from Conservative MPs by opening the door to increased borrowing and tax rises to fund the pledge. The Prime Minister is expected to say details of how the extra funding will be financed will not be announced until a future Budget – pledging to listen to views about how it should be achieved.
Mr Hunt states that the funding will help “deliver the improvements people desperately want from their NHS” including better cancer survival rates and reduced waiting times for mental health treatment.
“The extra funding will come in part from the ‘Brexit dividend’ – vast sums of money we will no longer send to the European Union after we have left – and the country will be asked to contribute a bit more for the NHS in a fair and balanced way,” a No10 spokesman said last night.
Downing St said that the NHS “will receive an extra £600million per week in cash terms” in a five-year funding settlement. The settlement would PUGH GEOFF equate to an average increase of around 3.4per cent per year over the next five years and £384million in real terms.
“Under our plan, by 2023-24, the NHS budget will increase compared to today by over £20billion a year in real terms, which is approximately £600million a week in cash terms,” the Downing St spokesman added. In return, the NHS will be expected to produce a plan, led by doctors, setting out how the money will deliver the Government’s “vision” for the health service and ensure value for money.
During the 2016 referendum campaign, Brexiteers, including Mr Johnson, travelled around the country in a Vote Leave bus emblazoned with the slogan: “We send the EU £350million a week, let’s fund our NHS instead.”
The campaign was accused of “misleading” voters because the figure referred only to the UK’s gross annual contribution and did not take into account Britain’s rebate and other payments that come back from the EU.
But in January Mr Johnson doubled down on the slogan, stating that the estimate was “grossly underestimated”. The Foreign Secretary said the UK’s weekly gross contribution to the EU would in fact rise to £438million by the end of a post-Brexit transition period in 2021, as he continued to pledge the NHS would be “top of the list” when the spare cash became available. Writing in this newspaper, Mr Hunt states: “The debate over Brexit can be divisive, but that famous campaign promise can now unite us all: the British public voted for £350million a week for the NHS, and that – and more – is exactly what this Government will deliver.”
The announcement follows 11thhour discussions between Downing Street, Mr Hammond, Mr Hunt and Simon Stevens, the chief executive of NHS England, over the figures.
Last week Mr Stevens said a rise of between 3.5 and 4 per cent was required to ensure the NHS, which currently has a £128billion budget, could cope. Since 2008 average growth has been 1.4per cent a year. Mr Hunt has been pushing for an annual increase of 4 per cent every year from next year.
Proposals for funding the pledge alongside the Brexit dividend are said to include freezing the thresholds for the personal allowance, the rate at which people start paying income tax, and for the 40p rate from April 2020.
In the past, such an approach has been criticised as a “stealth tax” because freezing the threshold means that more people get dragged into the higher rate as earnings rise. It has been estimated that the measure could raise almost £4billion by the end of this Parliament.
Meanwhile, in a sign of arguments likely to be made by Tory MPs, John Penrose, a senior backbencher, says today that Mr Hammond should commit himself and future chancellors to only borrowing money for “long-term investments” in infrastructure, rather than day-to-day spending on areas such as the health service.
Writing for www.telegraph.co.uk, Mr Penrose, a former Cabinet Office minister, urges Mr Hammond to introduce a new “fiscal rule” to ensure “we only live within our means”.