MPs will wriggle and jiggle on the hook of making pragmatic decisions on resource provision for Health Care. Cold admissions don’t worry MPs and their families, as they have the means to go privately. But emergencies is a different matter. There is no practical emergency service as a competitor to the state provision, except in London. Thus MPs, especially in the shires, have a perverse incentive to be more concerned about emergencies than waiting lists and cold cases: It’s in their own interest... Hypothecated taxation could be regressive, and the financial effect of Brexit with overall 20% increase in costs “could finish it off” (New Statesman 4th Jan)
Richard Murphy in Tax Research argues against hypothecated taxation based on NI contributions, but what about based on income?
Chris Smyth reports on another wriggle (denial) with: Tory call for new taxes as patients face A&E delays (The Times 5th January 2018)
Thousands of patients languished in ambulances last week because A&Es were too full to take them, as hospital chaos led Conservative MPs to demand new taxes to fund the NHS.
One in eight patients arriving by ambulance had to wait at least half an hour before hospitals could see them, amid concerns that frail patients dialling 999 would face long delays because paramedics were stuck in A&E.
Flu sent three times as many patients to hospital over Christmas as the week before, raising questions over how the NHS would cope with the rest of the winter. Flu admissions for Christmas week were also three times that of the same period last year.
At least 16 hospitals declared an emergency situation this week, and a national crisis team has advised hospitals to cancel all non-urgent operations until the end of the month.
Theresa May said on a visit to Frimley Park hospital in Surrey yesterday: “I know it is difficult, I know it is frustrating, I know it is disappointing for people and I apologise.”
Sarah Wollaston, Tory chairwoman of the Commons health select committee, called for taxes on the over-forties to pay for reforms that would unite the NHS and a crumbling social care system.
“If you link taxes, people are happier to pay them,” she told The Times. “You have to factor in how you can fairly bring in money from those who are in retirement so you can spread this across the generations rather than have it fall all on younger people.”
Johnny Mercer, another Tory member of the health select committee, called on the government to examine a “hypothecated tax”, ringfenced for the NHS, as other influential figures in Westminster spoke out in favour.
Lord Macpherson of Earl’s Court, who was permanent secretary to the Treasury for more than a decade, voiced support on Twitter and Nick Timothy, the prime minister’s former chief of staff, endorsed increased national insurance for older taxpayers.
However, a former head of the NHS argues that tinkering with funding is a “distraction”, insisting that reforms to ease pressure on hospitals by boosting local clinics are too slow. Lord Crisp, who was chief executive of the NHS between 2000 and 2006, writes in a letter to The Times published today that “the underlying problem is much deeper” than simply money, urging a “massive expansion” in local services and a move to virtual GP consultations.
Hospitals were well above the 85 per cent bed occupancy level considered safe, with a national average of 91.7 per cent last week.
On New Year’s Eve in some hospitals half the patients arriving by ambulance had to wait more than an hour to be seen. Queen Alexandra Hospital in Portsmouth was hardest hit, with a third of patients who arrived by ambulance having to wait for more than an hour with paramedics last week.
Richard Murphy for Tax Research UK opines 3rd March 2017: Labour has to avoid hypothecated taxes for the NHS
…..But there is something more important to realise about National Insurance, which is that it is a deeply regressive tax for two reasons. The first is that National Insurance charge on employees falls from a rate of 13.8% to just 2% when earnings exceed £41,865 a year. This means that as earnings rise above this point the overall percentage rate of contribution paid by a higher earning employee falls as a part of income.
Secondly, National Insurance is regressive because it only applies to earned income. That means that if a person can live off investment earnings, or they can recategorise their earnings as investment income, as many self-employed people do by recording their income through a company and then pay themselves dividends, then national insurance is not paid and this has the result of making this particular tax in some part in voluntary, and in another part a tax only on labour, and not on capital. Both factors suggest that that the tax is already deeply unfair when every member of society benefits from the tax paid. If, therefore, any tax was to be hypothecated, National Insurance is definitely not the one to use…..