Inflation (NHS) (Hansard, 16 December 1993)

§ 9. Ms Lynne
To ask the Chancellor of the Exchequer what account he took of the level of national health service inflation in determining his allocation of resources to the Department of Health.

§ Mr. Portillo
The Government reached a view on the appropriate level of national health service spending, taking into account the GDP deflator and the scope for efficiency improvements.

§ Ms Lynne
Is the Minister aware that the British Medical Association says that the real inflation figure in the national health service is 3.9 per cent? Does he agree that the announcement in the Budget will therefore lead to a decrease in NHS spending power?

§ Mr. Portillo
I calculate that in the year ahead the NHS will be able to treat 4 per cent. more patients than this year. Once again, I urge the hon. Lady and other hon. Members to concentrate on outputs, not inputs. Surely what matters is how many people get treated, not how much money gets put in.
The hon. Lady underplays the tremendous scope in the NHS for improving efficiency. Last year, the northern region was able to increase its efficiency by nearly 4 per cent., as was the Oxford region, with the west midlands region only a little behind—the Mersey region was very close, too. For all those reasons, we can increase both efficiency and the number of patients who are treated.

§ Mr. Marland
Does my right hon. Friend agree that the way to solve a problem is not necessarily to throw money at it but to get better value for money? Is he aware that the NHS trusts in Gloucestershire are doing just that? Gloucester Royal hospital will treat nearly 250,000 people this year—it is a trust. The Gloucestershire ambulance service, also a trust, is continually improving its service to patients, too.

§ Mr. Portillo
The reforms that my right hon. Friend the Secretary of State for Health and her predecessors have introduced have transformed the ability of the health service to provide efficient health care and to ensure that ever more patients are treated well and efficiently. The hon. Member for Rochdale (Ms Lynne) was wrong to talk about a rate of inflation in the health service. Inflation in the health service is largely a matter of pay in the health service. That pay is under the control of management in the health service, and so it should be.