On 17th October 2022, the House of Lords debated a bill to repeal the Health and Social Care Levy. The Bishop of London spoke about the importance of sustainable funding for the health and social care systems:
The Lord Bishop of London: My Lords, I have some technical questions about the implications of repealing this levy, but they prompt more significant questions about the sustainability of health and social care funding, as other noble Lords have already suggested. The sustainability of health and social care is hugely important to me, not just as a former Government’s Chief Nursing Officer, but as a bishop. This is about funding a service well with a long-term view, so that those who work hard to care for us have the resources to do the job. This is about the fact that every person is of great value in God’s sight and should be treated with dignity and equity. This is about a thriving economy because, without a healthy population, we will not have an economy that grows.
When the levy was introduced, the then Financial Secretary wrote to the Treasury Select Committee to justify it, saying that
“it would not be possible to fund this from existing tax revenues, nor would it be responsible to fund it through borrowing.”
This uncertainty about the direction does not inspire confidence that the Government have a sustainable plan to fund health and social care. If repealing this levy will not affect health and social care funding, can the Minister guarantee that a detailed breakdown of how this tax cut will be funded will be set out clearly?
As we have already heard, departments have been asked to double their efforts to make savings on spending. Presumably, this will include the Department of Health and Social Care. In that context, how will spending on health and social care be maintained? The Secretary of State announced £500 million for the health plan for patients. Is this additional funding, or will it be absorbed into the cost of maintaining the level of spending in the department after cutting this levy?
If we are concerned about the sustainability of health and social care funding, we must be even more concerned about the sustainability of the workforce. They are the bedrock of this sector. The noble Baroness has already mentioned the social care workforce. There is a very serious issue, particularly around retention. The Nuffield Foundation’s recent research stated that 40,000 nurses have left the workforce this year. The Government responded to the BBC by saying that they were already half way to meeting the target of 50,000 additional nurses in the NHS. I am not sure that this is being felt in the NHS, nor that the loss is being kept up with. Almost as many nurses are leaving the sector as are joining, resulting in the loss of valuable expertise. This is an inefficient and expensive approach to staffing, and one that sees people as expendable.
We are in the midst of a cost of living crisis, of which the health and social care workforce are at the centre. They are not exempt because they look after us. In fact, they are feeling some of the worst effects. One in four hospitals has food banks set up for nurses. The NHS Providers report on the rising cost of living said:
“Increasing numbers of nurses and other staff, particularly in the lower pay bands, are finding they are unable to afford to work in the NHS.”
It cannot be overstated how difficult things have become. Can the Minister say what is being done to make sure that we have a sustainable workforce? Only with this will we find that health and social care funding is sustainable.
One of the most effective ways, perhaps, to ensure the sustainability of health and social care funding is to reduce the need for it. The Government have not confirmed whether they will publish the long-awaited and desperately required health disparities White Paper. There are rumours that they are stepping back from the tobacco control plan and obesity strategy. What are the Government doing to reduce health inequalities? Health and social care funding is only sustainable if the need for these services is reduced.
I started by speaking about values. I am grateful that the Minister mentioned some of the values behind the Government’s objective for this Bill, including the flourishing of the economy not for its own sake but for the most vulnerable. Forgive me: I am concerned that, without a long-term plan for sustainable funding for health and social care and plans that ensure effective public health to reduce health inequalities, it will in fact be the most vulnerable who will suffer.
We need a sustainably funded health and social care system that has the resources to invest in good and equitable health and social care, but also in public health. Surely this is the bedrock of a flourishing community and economic growth.
Extracts from the speeches that followed:
Baroness Bennett of Manor Castle: I come to my main area of concern with this Bill. I note that the Treasury factsheet says that
“funding for health and social services will be maintained at the same level as if the Levy was in place.”
That is, I think, a promise from the previous Chancellor—it is hard to keep up—not the current Chancellor. Can the Minister confirm that the briefing also fits with this?
I shall skip over some points so as not to cross over with what others have said, but I want to highlight what the noble Lord, Lord Sikka, said in a direct question to the Minister: “That was £12 billion a year ago. Is the spending for the NHS going be maintained in real terms?” I also highlight and strongly agree with points made by the noble Baroness, Lady Brinton, and the right reverend Prelate the Bishop of London about the extreme strain under which our NHS and social care systems are suffering with the current levels of spending.
Baroness Kramer (LD): I also agree with those who say that it is very important to establish that the cancellation of this levy must not mean a £12 billion cut in funding for health and social care services. The Minister sought to give us that assurance, but you could tell from the general response that there was concern about quite what the phrasing meant. As so many have said in this debate, the IFS has identified that public services are in a fragile state, particularly in the health and care system.
Both my noble friend Lady Brinton and the right reverend Prelate the Bishop of London raised the issue of uncertainty: how on earth unfunded costs in the sector were going to be dealt with, the spectre of constantly increasing waiting lists and what the consequences would be.
Viscount Younger of Leckie (Con): First, I noted the strong remarks of the noble Lords, Lord Macpherson and Lord Lipsey, on keeping the levy. I make no bones about it; the decision has been made to reverse the levy and make it up through general Treasury funds. A number of noble Lords, including the noble Lord, Lord Lipsey, the noble Baronesses, Lady Bennett, Lady Brinton and Lady Kramer, and the right reverend Prelate the Bishop of London asked about the amount that the Treasury has set aside in place of the levy and—the real question—whether it is based on real terms. It will be in cash or nominal terms. This is because the budgets were announced last year at the spending review and are now fixed on that basis until 2024-25. I hope that helps to answer that question. The bottom line is that reversing the levy delivers a tax cut for 28 million people worth, on average, as I said at the beginning, £330 every year.
(…)
The noble Baroness and the right reverend Prelate the Bishop of London also raised workforce issues. We absolutely recognise the challenges faced by the sector and are responding to them. As part of Our Plan for Patients, the Government announced a £500 million adult social care discharge fund to help people out of hospitals and into social care support. The fund will bolster the social care workforce and target the areas facing the greatest challenges, freeing up beds for patients who need them.
There is more. We are all aware of the shortage of nurses and other NHS staff, and there needs to be a sustainable workforce, as the right reverend Prelate picked up on. Although I do not have all the answers today, I reassure the House and those Peers who have raised it that this is a very important matter. As we are on the subject, I think the right reverend Prelate has raised the health disparities White Paper twice today, as I think it was also in a Question earlier. I do not have an answer to that, but her question was very clear: where are we on this? I need to write to her to give her chapter and verse on that.
The Church of England in Parliament 
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