My View on the Welsh Budget

First, the budget needs to be looked at in the context of the Westminster Government cuts that are being imposed on the Welsh block grant. The budget in 2015-16 is nearly 10% lower overall, in real terms, compared to 2010-11, which equates to over £1.5 billion removed from the Welsh public purse, or, more importantly, removed from Welsh public services. The long period of sustained reduction has had an impact on all services, even those that have been relatively protected. The fear is that, in future years, if the coalition continues in Westminster, things will only get worse.

 

The amount available for capital investment will be 30% lower than it was at its peak in 2009-10. I listened to speeches earlier from both Peter Black and Nick Ramsay, when they talked about being unhappy with some of the cuts. What they have failed to do is come up with a balanced budget that replaced those cuts with others. I think that the people who wish to amend the budget need to come along with suggestions—if you add £200 million here, you have to take £200 million off somewhere else.

On the budget strategy, the budget increases health expenditure by £226 million, which equates to a real terms increase of £121 million or 1.9%. This has been mainly paid for by a reduction in local government of £193 million, which equates to a reduction of £262 million in real terms, or 5.7%. Effectively, this is a movement of resources to hospitals from local government services, such as leisure, environmental health and social services, whose activities are important in ensuring that people stay out of hospitals.

Another £44 million has been added to the pupil deprivation grant, which I know has been welcomed by most of the schools in my constituency, because my constituency has one of the highest numbers in Wales of pupils receiving free school meals. However, after two years of the pupil deprivation grant, a resulting improvement in the key stage 1 results of children receiving free school meals should have occurred. I look forward to seeing these results show that the expenditure has had beneficial results in terms of educational attainment. After four years, we should be seeing improvement in key stage 2 results and, after five years, in GCSE results for free school meal pupils. This is one of the easiest expenditure headings to identify success or failure in.

I now turn to the increase in health expenditure, which has been welcomed across Wales, including by many in my constituency. In the 10 steps towards a future NHS Wales discussion paper by Tony Beddow, Julian Tudor Hart, Wayne Richard and John Richards, recommendation 5 is to stop doing all work categorised by the National Institute for Health and Care Excellence as ineffective or harmful.

Nick Ramsay

Mike, you have just welcomed the injection of cash into the health service. Do you therefore regret supporting a Government that, over the last four years, has taken more money than that cash injection out of the health service? That is your Government; you supported it.

 

Mike Hedges

If you listen to what I have to say in the next few minutes, I am going to explain why health needs to be run efficiently. I have serious concerns about some of the work being done in health. If you had listened to what I just said, it should stop doing all work categorised by NICE as ineffective or harmful. I can think of no other public service outside health where such a recommendation could exist. I cannot imagine having in education a recommendation that we should stop teaching people in a way that means they do not learn or we take knowledge out of them. Surely the Welsh Government should tell health boards to stop funding such work. How much of the health budget is being spent on such work? To quote remarks made by Mark Drakeford in January 2014, roughly 20% of customary medical activity is either ineffective or harmful to health, based on US research.

 

The report I mentioned earlier also crushes some health myths. Facts cited in the research report show that the average time in hospital before death does not increase with age and admission rates fall after the age 85. That is from the BMJ, which is an organisation that has been quoted in the Chamber several times in the past. After reviewing major trials, the Cochrane Centre for meta analysis concluded in 2012 that treatment for the borderline range of blood pressure is more likely to harm people than help them, except for those with diabetes. However, GPs are still being encouraged to treat this group as part of their quality and outcomes framework.

I also share the concerns about polypharmacy and the detrimental effect on health it can have. Rather than charging for prescriptions, perhaps you should be looking for a reduction in the number of prescriptions, especially those whose interaction with others can make health worse. So, yes, more money for health is good, but it needs to be money that works. Every time somebody goes to see a doctor, they do not have to walk out with a prescription and they do not have to walk out with a doctor’s paper: they can actually be given advice on how to improve their health, and that might well be a better way of making progress than doing what we are doing at the moment.

On a major point, we cannot continue to increase the proportion of the Assembly’s expenditure on health, or sometime in the next Assembly, health will hit 50% of total Welsh expenditure. If we keep on going like this, in the middle of this century, it will hit 100%, and, towards the end of it, it will be over 100%, but I am not quite sure how you spend more than 100% of your budget.