NHS bosses have accused the chancellor, Rishi Sunak, of breaking a pledge to give the health service “whatever it needs” after he refused to provide a £10bn cash injection needed to avoid it being crippled by a second wave of the coronavirus.
They have warned ministers that without the money the NHS will be left perilously unprepared for next winter and the second spike in infections which doctors believe is inevitable. Nor will they be able to restart non-Covid services or treat the growing backlog in patients needing surgery.
The row piles pressure on Sunak to find more money for the NHS ahead of his summer statement on Wednesday.
The NHS England chief executive, Simon Stevens, has told the Treasury that it needs at least £10bn in extra funding this year to cover the costs of fighting the virus and reopen normal services. The money would mean the NHS could create extra beds in hospitals, keep the Nightingale facilities on standby, send patients to private hospitals for surgery and provide protective equipment for frontline staff.
However, weeks of negotiations have hit an impasse, with both sides nowhere near an agreement, sources have told the Observer. They hoped to have thrashed out a deal by Sunday, the 72nd anniversary of the NHS’s creation in 1948 by Clement Attlee’s postwar Labour government, which is being marked by widespread celebrations. But disagreement made that impossible.
“There’s a row going on. It’s quite difficult. There’s a problem here. There’s arm wrestling going on between the NHS and the government,” said one official with knowledge of the talks. “But the Treasury are playing hardball and aren’t prepared to stump up the money.”
Another well-placed source said: “They are at complete loggerheads. There’s an impasse at the moment. There’s no settlement and no agreement.”
The dispute has shattered the close relationship between the NHS and the government during the coronavirus crisis. In recent months ministers have showered the service with praise for its response, which saw hospitals massively expand intensive care units to cope with Covid-19.
NHS leaders privately accuse the chancellor of going back on his word. One senior figure said: “There’s a very, very significant difference between the phrase ‘the NHS will get whatever it needs’ and the behaviour now being exhibited by the Treasury.”
The standoff has also split the government. Downing Street is backing the Treasury’s sceptical approach to the NHS’s demands but Matt Hancock’s Department of Health and Social Care has thrown its weight behind the NHS and believes it needs the sums it is seeking. Sunak is keen to limit further government emergency spending on fighting the virus after already allocating £123bn for measures to support employment, health and other public services. The NHS has already been guaranteed at least £6.6bn of the coronavirus contingency fund that Sunak created in his first budget in March.
The sticking point is the NHS’s insistence that the Treasury continues to underwrite the £400m-a-month cost of the contract it agreed with private hospitals in March to treat NHS patients. It was conceived as a temporary measure to ensure people needing cancer surgery, hip and knee replacements and other operations could have them while NHS hospitals were tackling Covid-19. Stevens, though, now wants it extended until at least next April, amid fears that the total number of people on waiting lists for planned care in hospital could soar as high as 10 million by Christmas.
The Treasury is insisting that the NHS commits to keeping the waiting list – which currently stands at 4.4 million people – down to certain levels by certain dates through private hospitals doing agreed numbers of procedures. It believes that much of the £1.2bn spent so far has been wasted because many hospitals did worryingly few operations in the early stages of the pandemic.
“The Treasury’s view is that we can’t give you a blank cheque. They want certain guarantees from the NHS that the waiting list will be reduced and by how much. The Treasury is rightly petrified by the prospect of the waiting list hitting 8 million or 10 million,” said an insider. However, Stevens is refusing to provide such guarantees.
One hospital trust chief executive said: “It’s important to extend the private sector deal because the need for strict infection control procedures means NHS hospitals will only be operating at maybe 60% of normal capacity, which means patients will have to wait longer for surgery they need.”
Dr Nick Scriven, the immediate past president of the Society for Acute Medicine, backed the NHS’s bid. “It would be a shame if the funding that seemed to be promised is now being attached to various measures and outcomes that were not in place when the initial announcement regarding extra funding was made. Of course funding needs to result in appropriate activity, but to tie money up that is really needed to get the acute and urgent services through the next few months with elective surgical output in appropriated private hospitals does not feel right. The government needs to follow its own advice and protect the NHS,” he told the Observer.
NHS Providers, which represents NHS trusts, recently made clear that extra funding was also needed to help mental health services cope with the extra demand that the psychological impact of Covid-19 is creating. Community services would also need support to help the tens of thousands of people who survived a spell in hospital with the disease to recover.
The Treasury declined to discuss its ongoing negotiations with NHS leaders.