Where has the money for the NHS and schools gone?

[EmmaGrundyForPM]

I'm not an economist so please cam someone explain this in lay terms to me?

The NHS and schools need far more funding. Along with other public services. But why is this? Taxes have risen, some costs have gone down, and yet there's not as much funding as,say, 20 years ago.

I work in local government. We've had wage stagnation for at least 10 years. In real terms, my pay is about 20% less. That's the same in a lot of other public services. I appreciate that other costs, especially building ones, have gone up.

Given that, as far as I can see, taxes haven't gone down, why is there now far less money to pay for public services?

The Tories borrowed, borrowed and then borrowed more, so we're paying a record high amount to service this debt.

They spunked the money on their pet projects: Brexit, their donors, their families/friends, Rwanda etc. Since 2010 they've been on an anti-growth, economically unstable path.

On top of that, they've been monumentally lazy. They partied, profited, slept, shagged, gambled, raped and fought amongst themselves instead of doing the business of government. So our health service, education sector, immigration department, criminal justice system, our councils, the health of the nation and the state of the roads have been left to deteriorate while the Tories were doing other, more important, stuff.

You are absolutely right. I know a forensic accountant who used to work on NHS hospitals. There were staff still on the pay roll who had died years ago, some who had never existed, loads of contracts for defunct materials that had never been cancelled. So much money wasted by a mixture of mismanagement, chaos and fraud. He was horrified.

I don't have the inside information for NHS but for schools, costs have risen significantly. So even costs of things like paper is ridiculous. The cost of utilities has more than doubled, almost tripled in the past three years.

Staff wages have gone up and in wales that increase was supposed to be covered by Welsh government but it wasn't so that came from schools too.

On top of that the actual funding has gone down. Partly due to decreased numbers in recent years but also because, again in wales, money filters from central, to assembly, to local authorities who distribute. We have seen a 5% reduction in our budget last year and have been told to expect more than 15% less over the next couple of years.

Everything is more, so a school bus has gone up around 50-75%. It's sheer madness the increases. Utilities though are a big killer and of course staffing. We will see redundancies over the next couple of years in wales for sure.

@lemonstolemonade
I agree with your summary. I’m afraid too few people are working and paying tax. The top 1% already pay 30% of income tax paid. It’s all very well being jealous and going after one sector of business that has been very successful but it’s killing the golden goose. Of course a few are “wrong uns” but the sums of money involved aren’t huge. Labour will need to pinpoint very many others to get near the tax take they need. A bigger ambition would be to get the non working working again and paying tax. Or getting part timers doing full time and relinquishing benefits.

Our big problem is lack of productivity, especially in public services. I have some ideas as to why this might be and my first thought is doing too much. Or trying to do too much. We need to ration what’s available without charge. Obviously that’s a vote loser but unless we start a saving scheme for elderly care, for example, we will continue to haemorrhage money trying to provide services for millions. Of course we don’t have anyone to do the work, but that’s another story. My other thoughts are generous contracts and and lack of value for money evaluation of the work being done.

I also think some teaching leadership has been the architect of its own problems. Poor management and working conditions don’t keep staff. Far too much being done in schools that’s not education.

Our debt is more than annual GDP. We are not rich. We owe more than we make, and we want to spend more then we make. Tinkering with companies like Michelle Mone’s are irrelevant!

We had months of furlough, when vast parts of the uk economy were mothballed but a lot of people were still paid.

That cost UK plc £70bn while the economy was in free fall and corporation tax revenues halved. That was all added to govt debt on which we pay interest every month.

Then you have the cost of living payments to help with heating bills thanks to Putin's war. That cost us £15bn in 2022 alone. That drove up the price of everything else, leaving us with 11% inflation at one point, so every ones' wages needed to increase to keep pace.

There's a few things for starters. We always knew there would be a reckoning. The strain on public finances is it!

Hard to get the actual amounts since it's all so shady.

Covid /furlough - all got to be paid for. Helping Ukraine.

Nurses are leaving the profession

Wards are having to pay agency which is approx £31-48 an hour in comparison to top of band 5 which is £17 an hour.

Or on my ward we were offered specialist overtime rates (2.5 x hourly rate) for a few months as we are Itu specialised

@TizerorFizz

Yes, that is basically it. I think that there are possible wins on social care, but it involves using wealth rather than allowing some elderly people to pass on so much in inheritance.

The voters are also at fault - loads of people on here will be bemoaning tiny micro issues or symptoms of the wider cause, which is that our demographics have changed and what was affordable in the past was no longer affordable.

My grandfather's pension with his company was based on the idea that a blue collar worker like him would retire at 50(!) and be dead by 65, having worked since 16. And cause of death would be quick. Life has changed - we have also just lost the peace dividend that we had after the Cold War, when governments in the West took money they spent on defence and spent it on other stuff - this is not the future, unfortunately.

(And yes, Michelle Mone and her husband are wrong'uns, but honestly this is a drop in the ocean overall)

@Zonder

That's a big sum to many people, myself included, but it is tiny overall. There's probably some waste of resources that can be improved upon, but the reality is that people cannot expect to pay lower than European levels of tax and have good public services and, even in Europe, people are suffering declining living standards due to demographic change.

We could pay the tax we do and pay for certain services on top. .We won’t consider it though. My DM paid £5500 a month for a care home. So many do not pass on vast amounts. A ring fenced tax could work. DM paid fees out of savings but others have had a more lavish lifestyle and don’t have savings. So it’s very difficult really. DMs income was very low and barely paid Income tax. Savings were inherited. However I have lots of well off friends who use nhs a lot. They can afford not to but see it as a right. We need to change this. I hear the views on two tier system but again, if we want poorer people to benefit, then that’s a way forward. My DH has free hearing aids. Why? He can easily afford a very decent contribution!! He pays for his glasses. As do very many people. I’ve sat in a nhs dentist with my mum. Others there were talking about their multiple holidays! They don’t need to use the nhs.

We need more people in work. Although I hear the SNP want to train Scots to work in care homes. We haven’t had enough people working in care homes for decades. Good luck with changing that.

If we're going to have to pay for these things we need a social insurance system otherwise it just encourages profiteering. We should be looking seriously at the systems they have in France, Switzerland etc (I've picked those two as I know a little about them).

We need more people in work. Although I hear the SNP want to train Scots to work in care homes.

Scotland has the highest drug problem in the western world and has done for years perhaps fixing this might provide more workers.
But I'm not sure 'training' is enough - I would hate to work in a Care Home as I don't have the patience - I'd be constantly gritting my teeth in frustration.

Nowhere else has the NHS. They have hybrids that mix insurance and state. We need to do that but the howling will be huge and it’s a vote loser - Teresa May and “dementia tax” spring to mind. We cannot accept that we have insufficient moment to be as generous as we are.

I know very few people who would love to work in a care home, irrespective of how much training they had and even how much they were paid. It is physically, mentally and emotionally gruelling work. Most people would only do this kind of work if they had absolutely no other choice and because we have a welfare state almost everyone has a choice.

I agree with this. We have an increasingly needy population which is seemingly happy to accept people need to start paying more - until the bill falls at their door.

The NHS and education are now chronically under-managed. Back-office jobs have been cut, and without people with time and experience to allocate resources and arrange work - even just someone who can chase to make sure things that break are fixed - frontline staff have to do it or things break and everything takes a little bit longer. People don’t want to hear it, but a few more bureaucrats would allow doctors and teachers to concentrate on doing their jobs without worrying about admin and management tasks.

It's gone offshore as big companies feather their nests from all the "outsourcing" in what are supposed to be public services.

Examples please?

Didn’t that happen with water companies being owned by an Australian company? Hence not caring about the mess created here and focusing on profit for shareholders instead.

@Bumpitybumper
The idea of personal responsibility and supporting yourself has been completely eroded but I believe it will make a come back as we will all have to look at how we contribute more to the services we and our families use.

How is that possible with wages that are so low they need to be topped up by government?

@sleepyscientist
NHS could make a fortune with top ups I.e for routine surgery a list that is free but is X long whilst a list that is say 2k but 6 months long. If you have a surgeon doing 5 elective procedures a day 3 come from the paid list and 2 from the other etc.

But what are the knock on effects and costs to other services/the benefits system? Someone who can't pay and be treated sooner may have a higher need for treatment and may have to give up work, for example, and claim benefits. Their mental health may suffer and need treatment. There may be extra costs caused by help needed by their family - if a spouse has to give up work to care for them, carers assessments and so on.

The whole system needs to be looked at as a whole, not one element of it.

My son has been diagnosed autistic - we were lucky, it only took a year from referral to assessment. But the time and services involved - engagement team as he was school refusing, another team I can't remember the name of, council parenting team proving support, carer assessment, police involvement due to violent meltdowns, multiple GP appointments, two CAMHS assessments, a TAF worker for a year, primary mental health service appointments for me & DH, three A&E trips for me after injuries caused by the meltdowns - some of that cost could have been prevented by DS being assessed sooner, and I'll say again we were lucky he was seen so quickly and that was largely down to a huge amount of work done by the ALNCo at his school, she was amazing.

All assessments involve multiple services though. For some DC we need to assess much earlier. At nursery in my view. Then do a lot more much more quickly. We have far more Sen dc than we ever thought possible 30 years ago. Why? What’s happening? Why has there been such an uptick? We had many services dealing with sen 30 years ago and just about kept going but now there’s so many more dc. I worked in a leafy lane area so parents really did push for dc. The numbers now are through the roof but why has this happened?

Every area of public service you look at struggles with volume and with fewer people working and paying tax, we won’t get out of it. Thames Water is virtually bankrupt. The bigger issue is with the regulator. Waste of space.

It's billions. In no world is that a tiny amount. It could solve our NHS problems for now.

Bentley, who was appointed in 2020, said in May 2023 that she would give up her bonus after the company’s environmental and customer performance suffered. However, she still doubled her pay, raking in £1.5m in salary and benefits.

Regarding Thames Water.

I was looking at who owns what. Yorkshire water is over 30pc owned by Singapore govt.

It feels wrong that vitals such as water are owned by global shareholders.