Raise National Insurance to secure the future of the NHS, says Labour MP

Labour MP Frank Field has renewed calls to raise National Insurance (NI) contributions in order to fund the NHS. In a pamphlet for Policy Network co-written with Patrick Diamond and Jonathan Todd, the authors warn that the NHS “will cease to exist as we have known it since it came into being in 1948” unless new ways are found to finance it. The pamphlet suggests raising NI by 1p could raise around £1bn a year.

In September, Shadow Secretary to the Treasury Chris Leslie appeared to rule out the possibility of going into the election offering a “Health tax”. This followed a debate on LabourList last summer between Frank Field and the Fabian Society’s Andrew Harrop over whether the NI raise was a good policy.

But Field has not been deterred by Leslie’s announcement. He pours cold water on Leslie’s suggestion that no tax rises can be pledged until more savings are found in the health budget:

“It seems implausible that a funding gap of £30bn, equivalent to one-third of current NHS expenditure, can be eliminated by savings without NHS patients noting a marked deterioration in the quality and comprehensiveness of their care.”

The pamphlet argues that it “is hard to feel confident that any political party has yet proposed solutions truly big enough to meet the massive challenges facing the NHS” and that people will accept the tax rise if they truly believe that the money will be ringfenced for the health service. They point out that “little more than half of Gordon Brown’s one-penny increase in national insurance contributions for the NHS in 2002 ended up in NHS coffers.”

They also warn that the problems in the NHS are not rooted in the current Government – meaning that a Labour election victory will not simply secure the future of the health service alone:

“To a large extent, the drivers of this funding crisis are independent of reforms introduced under the coalition government, no matter that these reforms have unnecessarily introduced inefficiencies. The replacement of the coalition with a Labour government does not, therefore, automatically mean the long-term challenges facing the NHS will be addressed.”

Despite the focus on the NHS, the authors warn that as an issue, it will not deliver electoral success alone:

“In March 1992, 22% of voters thought the Conservatives had the best policies on the NHS, while 52% believed Labour did. This did not stop the Tories winning the general election two months later.

“This experience should caution us against seeing the lead that Labour currently enjoys on the NHS as sufficient to secure a Labour victory at the general election. Labour’s trust and popularity on this issue is not a passport to election victory. But it is a political asset that might be deployed to create such a passport.”