Headlines: October 9th, 2001

The failure of UK hospitals to demonstrate improved performance from increased investment will put pressure on Chancellor Gordon Brown to scale back the public spending programme as an alternative to increasing taxation. The budget surplus is shrinking as a result of foot and mouth costs, higher defence spending, increased security demands and slower growth in the economy.Figures published by the Department of Health show that despite higher investment from April 2000 and a further 6% boost to funding from April 2001, hospital activity in on a plateau. Waiting list numbers were some 2000 higher in August 2001 than in the same month in 2000. The increased number on the waiting lists broadly matches the overall increase in demand. An explanation put forward by Ministers is that the figures reflect the government’s decision to focus on waiting times rather than waiting lists.

Concern is growing that the figures support two tenets of public service investment: there is no direct link between increased funding and improved performance and public perception that services are more readily available increases demand. Future waiting list figures and the local council’s performance measurement results next spring will be closely scrutinized to assess whether the taxpayer is getting value for the extra money invested.

The argument that excellence in performance is related more to leadership and management rather than funding is well supported by the wide disparity between the top and bottom performers across the public services. Performance measures for health, education, police and council services all display this disparity. If budget pressures continue to grow, particularly with increasing defence spending, it may become attractive to focus attention on raising the game of the poorer performers, rather than maintaining the ambitious public service spending progamme.