J Enoch Powell 1966

2. The National Health Service

The supply of medical services has, in effect, been a nationalised undertaking in Britain for twenty years. Most of the aspects of Medicine and Politics derive from this fact. But the type of nationalisation is unique, and falls into two major sub­types.

The supply of medical services is not strictly a state monopoly, like the supply of electricity, for instance, or of gas or of postal services. There is no prohibition of supply outside the state system, and such regulation as there is, of non-state service— through statutory standards, inspection, certification, etc.— is neither logically nor historically connected with the existence of the nationalised undertaking. However, because, in principle, the nationalised undertaking supplies the services without charge to the consumer at the point of consumption, the scope for private supply is extremely limited. It is confined to customers who are willing to pay the whole difference between nothing and the market price in order to obtain a difference in the quality of the service. Thus, the supply of medical services is de facto a near monopoly of the state.

The nationalised medical undertaking consists of two parts, organised on widely different principles. Medical services to hospital patients are provided in state-owned hospitals by public employees. Medical services outside hospital, as well as dental and optical services, are provided by private individuals who have contracted with the state to do so. This essential difference of organisation produces a different relationship of Medicine and Politics in the two parts, and many of the phenomena are peculiar to one part only.

Before examining the separate branches, however, it is necessary to grasp the general consequences that flow from the supply of medical services being both nationalised and gratis.

FINANCE AND  CONTROL

The entire cost is met out of moneys raised on the authority of government; in other words, out of the proceeds of taxation. This is just as true of the amounts credited to the service from the ‘stamp’, the National Health Service Contribution, as it is of the major share derived from general taxation. The contribution is in no sense a payment for the service; no right is created by it; those who pay the contribution enjoy no less and no more access to the nationalised medical service than those who do not. It is a payroll tax on employer and employee, which goes to finance the service, as do, to an unascertainable extent, the duties paid by the consumers of alcohol and tobacco.

The payments attached to minor items of the service, such as the supply of dentures and spectacles, are so trivial in relative importance as not to modify the central fact that the service has virtually no source of revenue but central taxation.

This fact calls into operation the constitutional principle that the proceeds of taxation must be expended by those who are responsible to the representatives of the taxpayers. There is no need to go into the debate about what is meant by ‘responsible’ in this context, or into differences between the theory and the reality of the control the electorate exerts through Parliament over the acts of government. The plain rule is that wherever the taxpayers’ money is being spent, a minister must be held responsible for how it is being spent. If the activity on which it is being spent is largely maintained from other sources, it is possible for the purposes to be stated and accounted for in general terms— these are the grants in aid to various non-state institutions and activities. But where the whole activity is tax-financed, the control also will be detailed and comprehensive.

Most of the exceptions prove the rule. The ministers for local government and for education dispose of large sums of money by way of grants, and yet decline more than a general responsibility for the well-being and conduct of the services these grants help to support. The grants, however, are historically supplements to revenue derived from local taxation, for the expenditure of which local elected representatives are answerable in detail. Even today, when Exchequer money is supplemented by rate money rather than the other way round, the latter is still so substantial that Parliament is satisfied to leave detailed control to local government.

A special and increasingly problematic case arises with the financing of university education, where fees— themselves largely paid out of local authority revenues— and endowments now represent a small and diminishing minority of the total of university expenditure. The allocation of the Exchequer money and the policing of its expenditure is vested in the University Grants Committee, which enjoys theoretical autonomy in these functions, and Parliament has hitherto practised self-denial in seeking information and exercising influence over the university expenditure its votes now so largely maintain. The self-denial, however, is visibly wearing thin. A large part of the grants goes to the payment of salaries, in which general questions of public policy are involved, and the utilitarian reasons offered for so large a public expenditure on university education imply that it will be used in ways supposed to be specifically related to the national interest. The least that can be said is that if the University Grants Committee did not exist, it would be impossible to invent it.

No analogy is to be drawn with commercial or quasi-commercial activities, such as those of the nationalised industries, where, even if the old and new capital is guaranteed and raised on the taxpayers’ credit and substantial sums may be found out of the Exchequer to meet working losses, nevertheless the consumer or customer by and large pays the cost of the undertaking. Accordingly the relevant minister accepts only the degree of responsibility implicit in the capital and deficit financing, and successfully forswears implication in management, which is statutorily vested in a board and over which, to a certain extent, competition and the market themselves maintain control. The Post Office is the exception here, with detailed direct management vested in a Minister, the Postmaster-General, who can be questioned and held to account on the minutest details. The nineteenth-century Parliament regarded the Post Office as an instrument of public policy and a channel of political patronage, and showed a greed for control which would not be imitated today. If the postal, telegraph and telephone services had waited until the middle of the twentieth century to be nationalised, it is a good bet that they would be vested in statutory corporations, like the nationalised public utilities. (This bet of mine came off, after the above words were written, with the announcement made by the Postmaster-General in July 1966.)

A UNIQUE MINISTERIAL RESPONSIBILITY

Alone among major public services, except for the defence and overseas services and trunk-road building, the National Health Service is provided wholly out of central government revenue. It is, in consequence, provided directly by a minister, who exercises the functions of management in full and is answerable in detail for all acts of omission or commission in the service under his control, unless they can be regarded as individual acts of purely professional judgement.

The statute under which the Minister of Health operates obliges him to manage the service through certain specified agencies— the regional hospital boards, hospital management committees and boards of governors inside the hospitals, and the executive councils outside the hospitals. These, in the form laid down, he must use: he cannot decide to alter the structure of management, nor even to re-shuffle the personnel, except in accordance with the statute and the regulations. Nevertheless, agents these bodies are. They are, directly or indirectly, the Minister’s appointees. They must obey his instructions. They have no independent authority derived from any other source, such as a local electorate, which could put them in direct relationship with the public. They have, for practical purposes, no independent sources of revenue, but spend what the Minister allocates to them. I shall later have something to say about the way in which personal relations develop between the Minister and these, his statutory agencies; but for the moment I am concerned to emphasise that their existence does not detract from the monolithic centralisation that flows from the 100 per cent national financing of the service.

One of the most persistently recurrent proposals made for alteration of the National Health Service is that management should be vested in one or more independent statutory bodies, so as to ‘take medicine out of polities’. I suppose one should not say that anything is impossible; but the prospect of Parliament raising an annual sum exceeding £1,000 million in taxation and handing it over to one or more corporations over which it would have as little control as it has over the BBC, strikes one as near enough to the impossible for practical purposes. Nor, one would suppose, would the public find it tolerable that their medical care, financed by their money, should be provided and administered by autonomous authorities, not accountable to their representatives either nationally or locally. A more perfect exemplification of power without responsibility could hardly be devised. It would be no use for the dissatisfied member of the public to try to raise his grievance with his Member of Parliament. ‘My dear Sir,’ would be the reply, ‘I have no standing in this matter: you must complain to the Corporation, and if you do not like their answer, I can only advise you to grin and bear it.’

Transfer of management to independent authorities would not even ‘take medicine out of polities’. It would certainly take the details out of Parliament; but since the independent authority would be operating with funds supplied exclusively by the government, its answer to every complaint of deficiency or short­coming would be: ‘It is the fault of the government, which does not provide us with sufficient money.’ Being without responsibility either for raising the money or for any of the consequences of doing so, the independent authority would be uninhibited. The fatal divorce between getting and spending would be absolute.

This outcome could not be avoided by resort to an assigned or ‘hypothecated’ revenue— a tax, the yield of which automatically goes to a specific application. This is the relationship between the BBC and the licence fee, which is essentially an assigned revenue; and those who advocate a Roads Corporation to build and maintain highways envisage that its funds would be provided by a hypothecated tax on the users of vehicles. But a tax has still to be determined and varied by Parliament; and while rough and ready logic can argue that those who have receiving sets should pay the cost of public broadcasting, or that those who use vehicles should pay the cost of building and maintaining roads, there is no ground for arguing that the amount spent on health services should be the amount paid, for instance, in purchase tax or tobacco duty.

Taking Medicine out of Politics

There is no escape from this impasse except by altering the basic assumption, namely, by providing a substantial source of revenue other than the Exchequer. If, for instance, the duty to raise £500 million or so for the service could be transferred from central to local taxation, then the authorities levying that taxation might, at least in theory, take responsibility for the manage­ment of the service, as they do for the schools. Of course, the actual trend is wholly in the opposite direction— to transfer away from local taxation commitments it already carries. In any case, politics return with the ratepayers’ representatives: it is not observable that politics have been ‘taken out’ of school education.

In fine, the whole idea of non-ministerial management of a health service wholly financed from taxation is a chimera.

What do you think?

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Subscribe to Blog via Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Join 828 other subscribers.

Follow us on Twitter