NHS cash promise threatens vital local services

JOHN Swinney is on a collision course with councils over his plans to protect the NHS from the swingeing cuts that will hit the public sector over the next few years.

•In these straitened times, the health service – now in its seventh decade – has become an ideological battleground Picture: Getty

The finance secretary's insistence on excluding the health budget from cutbacks that will see up to 50,000 Scottish public sector job losses was attacked last night by the head of Scotland's local authorities, who warned it would "devastate" communities.

Cosla president Pat Watters said that protecting Scotland's 11 billion health budget would result in local government bearing the brunt of the cuts and threaten the services that councils provide for vulnerable members of society.

Mr Watters will meet Mr Swinney next week to challenge him on protecting the NHS from the cuts and the finance secretary's view that some of the SNP government's popular but most expensive policies should also be exempt.

With less than a year before the next Scottish election, Mr Swinney has indicated that free care for the elderly and free bus travel for the over-60s will be spared the axe, even though this week's Independent Budget Review (IBR) suggested the policies should be reconsidered.

The review, led by the former Scottish Enterprise chief Crawford Beveridge, also advised against protecting health on the basis that doing so would result in other areas of the public sector being hammered at a time of unprecedented economic hardship.

Mr Beveridge's report said: "We could find no overwhelming rationale for protecting major blocks of expenditure . . . and would be concerned about the burden this would place on non-protected areas."

Mr Swinney's approach to the health budget threatens to further damage the already strained relationship between government and councils. It is also likely to undermine the historic concordat Mr Swinney signed with councils that delivered the council tax freeze and has been hailed one of the major achievements of Alex Salmond's administration.

Mr Watters last night said ruling out health from the cuts represented a raw deal for councils.

He told The Scotsman: "To rule things out at such an early stage is not the way to do it. We must keep everything on the table. The biggest impact will be felt by the rest of the services.

"Our projections suggest if the government protects the NHS, cuts to other sectors could more than double.This could be devastating to local communities."

Mr Watters warned that savage cuts to local government budgets would result in NHS hospitals being clogged up with elderly people because the social care services provided by councils would suffer.

Care services provided by local authorities play a key role in enabling elderly hospital patients to come home at the earliest available opportunity, thus preventing "bed blocking", which sees valuable hospital beds taken up by people who could otherwise be cared for in the community with the right support.

Mr Watters also argued that cutting care services would threaten work that reduces emergency admissions to hospital thanks to council carers' intervening before a patient's condition becomes too serious.

"Important areas of policy like discharge from hospital are dependent on having well-funded social care services," Mr Watters said. "If local government is asked to make bigger cuts than the NHS, we could very easily see a return of the days of bed blocking in hospitals."

Mr Waters also criticised Mr Swinney's pledge to continue free personal care and concessionary travel.

The personal care policy currently costs 4.5 billion per year, with the bill expected to soar as people live longer. The concessionary travel scheme will cost 914 million between 2011 and 2015.

"Cosla fully supports the review's recommendation that the Scottish Government and parliament should consider undertaking immediate work to review whether free or subsidised universal services should be retained in current form," Mr Watters said.

"As the (review] panel says, it is no longer simply about whether these are desirable but whether they are affordable into the future."

Another source of friction will be the council tax freeze, with Mr Watters indicating he would be prepared to see a small rise in the levy if it meant saving local services.

Mr Swinney has committed himself to keeping the freeze for the duration of this parliament.

But Mr Watters said: "If it was a choice between protecting services and not having an increase, I would want to protect the services even if that meant a slight rise in council tax."

Yesterday Mr Swinney reasserted his commitment to the health budget. South of the Border, the coalition has vowed to ringfence health spending.

Any increase in the English budget will be reflected by a rise in the Scottish budget as a result of the Barnett Formula, the mechanism that determines how much money Scotland receives from the Treasury.

Mr Swinney has promised that all the extra cash will be given to health and not diverted elsewhere.

"The Scottish Government would apply any Barnett consequentials arising out of the protection given to the health service by the UK Government to the health service in Scotland," Mr Swinney said."That's the commitment we've given for some considerable time and I think it's important that's restated."

Mr Beveridge's report described the economic outlook as "unmatched since the Second World War".

It called on the Scottish Government to discontinue the council tax freeze, release cash by changing the status of Scottish Water and institute a public sector pay and recruitment freeze. It also forecast public sector job losses of between 29,000 and 50,000, one-tenth of Scotland's public sector workforce.

A Scottish Government spokesman said: "The government - working in partnership with parliament and the people of Scotland - will give careful consideration to the Independent Budget Review.

"We have made clear our determination to protect the vulnerable.

"As we work towards setting a budget for next year, we are now encouraging the widest possible debate about the range of options set out in the review. We are involved in regular dialogue with our local government partners through Cosla."

Points of view from across public life

A KEY part of the budget review process involved written submissions from nearly 100 organisations including the representatives of senior police officers, the pharmaceutical industry and doctors:

FEWER POLICE ON THE STREETS

The Association of Chief Police Officers in Scotland (ACPOS) issued a warning in its submission and said it was "inevitable" that officer numbers would be slashed due to the "severe" cuts.

Public confidence in the ability of Scotland's police forces to tackle crime could also be put at risk due to the swingeing economies, according to ACPOS.

A written submission said: "Despite the mitigating factors the police service will put in place, it is foreseen that it will have to reduce staff numbers, both support and police officers. The public has been very supportive of additional police numbers in recent years, and research shows that the public are reassured by obvious police presence.

"The inevitable reduction in police officer and police staff numbers to meet severe budget cuts over a sustained period will impact on this."

The comments from ACPOS come after Scotland's biggest force, Strathclyde, imposed a recruitment freeze, with other forces now facing a similar crisis.

POOR PROGNOSIS FOR MEDICINES

The Association of the British Pharmaceutical Industry (ABPI) warned that the package of cuts put forward in the review would "disproportionately" hit spending on NHS medicines.

There would also be less funding for new medicines and drugs if spending was slashed, the group claimed.

The submission said: "Given that medicine companies do not receive external funding for the multi-million pound costs of bringing a new medicine to market, cuts in spending on medicine mean there is less money to finance new innovation. Past experience leads ABPI Scotland to expect that cuts in overall spending within NHS Scotland will be borne disproportionately by the medicines budget."

The comments from ABPI come as the Scottish Government's flagship policy of free prescriptions is challenged in the review.

MIDDLE CLASS CAN AFFORD OWN CARE

The Association of Directors of Social Work (ADSW) claimed funding for free personal care in Scotland was "controversial".

A submission from the body, as part of the review, argued that large numbers of older people who could afford to pay for their own care were benefiting from the policy in Scotland.

The submission said: "As well as reducing income from charging, free personal care has brought large numbers of older people into the local authority care system who have sufficient means to fund their care and who previously would have done so.

"The affordability of free care in the medium to long-term remains controversial."

NOW NOT THE TIME TO TARGET HEALTH

The British Medical Association (BMA) Scotland said slashing health spending would be a mistake.