Cabinet Secretaries' notebooks (CAB 195/19): National Health Service
H.A. Cttee. support these proposals - despite pol. doubts in para. 6 - largely because they are necessary counterweight to rise in Estimates.
Estimates shown 10% increase : for 5 yrs. increase has bn. between 8 and 10%. This rate of increase makes it more difft. to change emphasis of N.H.S. to accord with developmts. in medicine.
My plan can be represented as shift of emphasis and priorities, rather than merely cuts. Substantiated this in reln. to welfare milk, charges for specs and dentures (wh. will enable more resources to be applied to children) : drugs - cost has gone up 50% in 4 years and this wd. warrant charge of 1/6; the other 6d. is designed to secure more careful prescribing. Experiment & undertaking to review charge downwards - this is ok. for experiment has another year to run and has yielded nothing so far.
Only item needing legn. is appliances. Is that worth special Bill?
Cd. it be combined with Bill on stamp?
Satisfied on welfare foods - no real damage to health.
Worried about charge because will bear most hardly on chronic sick.
Necessary and courageous attempt to bring cost of N.H.S. under control.
Prospective redn. in consumptn. of milk by larger families. This ought to be put to med advisers before we act.
Shd. have to give them assumptn. v. effect on consumption.
You cd. give them present figures & ask for advice on effect of say 5% fall in consumption.
Cd. you have a differential price for larger families.
x./ Wd. commit you to permanent subsidy for milk to largest families.
On charges - retirement pensioners above assistance level & needing drugs will protest. This will off set effect of increasing pensions.
Whole plan, by drawing attentn. to 10% rise in cost, may help to shock public into co-opn. in keeping Service under control.
Support x. - remember adminve. cost & complication of this.
Support the need for action & also the priorities approach.
E.P. is seeking adminve. economies in hosp. services. Hope something can be said on this when this plan is announced.
Recognise need for this. Have 2 points I cd. mention.
i) Is it worth having a Bill - for £2¾ m.
ii) Hope N.H.S. won't be only apparent economy : when Estimates as a whole are so much increased.
On ii) we can point to some new discipline in housing.
The most alarming service is education - schools & universities.
Wish we cd. apply principle of pay as you go.
Worried about regressive affect of 1/= on stamp. Effect on our capacity to adjust fiscal arrangemts. to increase incentives to production and exports.
Support this view. Quite wrong. These are not real economies.
They will incur, in long run, much unpopularity : after initial welcome from Hinchingbrook and D.T. Tho' I will go along with it if Cabinet so desire.
Rate of increase in total Estimates is about £300 m. All the evidence is tht. direct taxation operates as a disincentive to production & enterprise. We must switch emphasis to some extent to other means of raising revenue - of which this is one. We may have to consider increasing employers' contn. to discourage inefficient use of man power.
No great relief available via defence cuts. Support this proposal.
On Bill - this is important qua. presentn. on priorities : also enables me to offer two useful concessions.
What about abolishing all subsidy to welfare foods & w'drawing all other proposals. This wd. avoid legn. & increased charges. But wd. yield about same saving.
That wd. affect milk consumptn. v. seriously - and¬ throw largest families to wolves!
Cd. subsidy be concentrated on largest families and older people.
These are not economies - they are means of making people (users) carry more of the cost.
Sympathetic with I.M.'s approach. But world is changing. In former days help was concentrated on needy & cost carried by taxation.
Now these services are so comprehensive & costly, that old theories of taxation can't be pressed too far. Look at prob. cost of education. New concept. The diffy. is tht. beneficiaries of these services still include some needy. These are ques. of adjustment rather than principle.
Feel unhappy over this. But see the need for a warning note.
Genl. feeling in favour of doing this. But -
i) There will be trouble & esp. over prescriptions. Let us consider
whthr. we can do more over welfare milk.
ii) Favour retaining the proposals involving legn.
On i) what I mean is : try to do it all this way : if you can't, produce a reasonable exemptn. to protect largest families.
We must get something of order of £20-25 m.
Further study on this basis and report back to Cabinet.