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Spring Statement 2022

 

On 23rd March 2022, the Chancellor of the Exchequer, Rishi Sunak, will present his Spring Statement 2022. Whilst the “Autumn Statement” is a time for announcing tax and spending commitments, the ‘Spring Statement 2022” presents an update on the economy, forecasts of government financial commitments and can signal any changes which need to be made.

This year, the focus is expected to be on pandemic related economic recovery, the escalating costs of energy, exacerbated by the Russian invasion of Ukraine, and support for those most affected by the cost-of-living crisis. These are indeed big issues.

I am wondering though, whether the Chancellor has given some thought to the role of health in the economic recovery. By investing in population health, the government is investing in the wider economy. By investing in population health, the government is increasing the productivity of health spending.

The case for restoring real spending levels on public health and illness prevention in England must surely be very compelling.

By investing in population health, the government is investing in the wider economy.

The evidence suggests that a 1-year increase in average life expectancy increases GDP per capita by 4%.

Individuals who are healthy are:

1. More likely to be productive in the workplace

2. More likely to enjoy working for longer

3. More able to contribute to society outside work and in later years of life

4. More likely to live longer and contribute as consumers

 

In short, there is a strong causal relationship between longer healthier life expectancy and economic health.

By investing in population health, the government is increasing the productivity of health spending.
health spending spring statement 2022

Every £1 spent on prevention generates a £14 – £15 return to the health and social care economy.

Public health expenditure is between three and four times more productive than health treatment expenditure.

We have nearly two decades of experience in National Institute for Health and Care Excellence (NICE) and latterly Public Health England of reviewing the evidence and there are lots of examples and lots of tools! Public Health England ‘Health Economic Evidence Resource’ (HEER) tool includes over 370 interventions the overwhelming majority of which are cost effective.

The case for restoring real spending levels on public health and illness prevention in England is very compelling.

Did you know:

– Variations in health outcomes are over twice as likely to be caused by health behaviour patterns, compared to treatments, and indeed the largest driver of variation in health outcomes are factors outside the parameters of the health system such as environment, education, housing, employment and so on; and

– Prevention spending is between 3 and 4 times more productive than treatment spending.

Despite this, in 2019 5% of UK health spending was on preventative care. This compares well across OECD countries. Very well. However, out of a total spend of £225.2bn, we spent only £10.8bn on prevention. We know health spending overall has dramatically increased in 2020/22 as a result of the COVID-19 pandemic.

We don’t yet know what impact this has had on prevention as a share of health spending. But we do know that the public health grant has remained fixed in England throughout this period and there are no published plans to increase it.

Final reflections.

I get it, I really do. If the government can encourage a shift from treatment to prevention at the local level through Integrated Health and Care Boards at “Place” then it will show an increase in the share of spending on prevention without increasing budgets overall.  But I really struggle to see how investment funding, at the scale needed, can ever be released from the immediate pressures facing our hospital and community health services.

We have 6 million people on the waiting list, a tsunami of undiagnosed health issues which have built up during the Covid-19 pandemic, and un-precedented in-year efficiency targets. Care for patients in immediate need must be a priority too.

While the Chancellor is trying to balance the books we hope that prevention can be funded by a strategic investment in population health as a national priority, whilst also protecting spending on health treatment.

References

Alsan, M. Bloom, D. Canning, D and Jamison, D: The Consequences of Population Health for Economic Performance: Harvard, October 2006

David E. Bloom Michael Kuhn Klaus Prettner Health and Economic Growth, IZA DP No. 11939, Harvard University and IZA November 2018

Masters R, Anwar E, Collins B, et al. Return on investment of public health interventions: a systematic review. (2017)

Stephen Martin, James Lomas, Karl Claxton: Is an Ounce of Prevention Worth a Pound of Cure? Estimates of the Impact of English Public Health Grant on Mortality and Morbidity CHE Research Paper 166

https://www.healthaffairs.org/doi/pdf/10.1377/hlthaff.21.2.78

https://www.ons.gov.uk/peoplepopulationandcommunity/healthandsocialcare/healthcaresystem/datasets/healthaccountsreferencetables

https://www.gov.uk/government/publications/health-economics-evidence-resource

https://www.gov.uk/guidance/health-economics-a-guide-for-public-health-teams

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