Only Competition and Private Enterprise Can Save the NHS

Only Competition and Private Enterprise Can Save the NHS

Leading figures from the world of healthcare have written a letter to The Times, calling for a cross-party independent review on how the National Health Service (NHS) is funded. The signatories, including the heads of the Royal College of Physicians and the Royal College of Nursing, believe the system is “creaking at the seams” and that, without action, an extra £30 billion will be needed by 2020 to fund service NHS at current levels.

The group has identified higher taxes as a possible solution – no surprises there – but has not ruled out private payments for some elements of healthcare, or a review of what is available on the NHS. It can only be hoped that the last two options are taken more seriously than the first, but given the totemistic image of the NHS in Britain, it would take a brave politician indeed to question the service’s existing funding model.

I’m not sure how the NHS is perceived abroad, but the way it was celebrated in the opening ceremony of the 2012 Olympic Games provides an insight to the pseudo-religious status it has in the UK. This has nothing to do with the outstanding quality of care the NHS provides. Even if surgeons were sawing off people’s legs without anaesthetic, it would still enjoy enormous public sympathy – because it’s not the real-world version of the service that people are enamoured by, but its guiding principles and the supposed selflessness of its employees.

For many people, the NHS is a shining example of how society at large should operate: our needs pandered to, irrespective of our personal conduct or ability to pay, with no potential for the better-off to buy themselves a better alternative, but an obligation on them to subsidise the less well-off.

This ethos is essentially a romanticised version of childhood. Just as the perfect parents are omnipotent caregivers, who look after their children without asking for anything in return, so progressive types want a society that operates on the same terms.

They resent organisations making money – be they healthcare providers or high street retailers – because they don’t expect the people who provide us with stuff to receive anything in return, beyond the satisfaction of seeing us get what we want. As far as they’re concerned, a business that looks to turn a profit is no better than a parent who asks his kids to pay for their upkeep.

Because the NHS works to the liberal-left model, and is involved in the emotive issue of medical treatment, its employees are treated like saints. Any mistakes they make are attributed to a lack of support from cruel, skinflint politicians. All the botched operations, unclean hospitals, needless red tape, and obstructive staff are brushed aside to reveal the pristine ideology beneath.

One of the oft-heard arguments in favour of government provision is that we could never afford things like decent schooling and healthcare without the helping hand of the state. Such is the expense of providing these services that collectivising the cost is the only means of guaranteeing universal coverage. If we were to rely on the private sector, the corporate fat cats would hike prices and put essential services beyond the reach of the little guy.

This is baloney. Using government spending as a guide to how much things like healthcare cost is like using Barack Obama’s travel expenses to calculate the price of a family holiday. The only reason public services cost so much is that they’re public services. They are designed to solve a problem created by their own existence. The state can’t control costs to make things affordable to the masses. All it can do is make something so expensive that it can only be afforded by the state.

If, thirty years ago, a progressive government had capped the price of home computers, to make them more affordable to the public, does anyone think they would be so cheap and clever today? Would over 80 per cent of UK households own one? Would an Apple Macintosh cost five times less in real terms than it did three decades ago?

Of course not. Why would manufacturers have bothered to be innovative and productive if there was no motivation for doing so? Why would they have gone into business at all if some bureaucrat was going to tell them how much money they could make? Make no mistake, if the government had taken control of the computer industry, we’d still be loading software off audio cassettes.

We know with hindsight that leaving the computer industry alone made the technology cheaper and better. And we know this happened in spite of the market being dominated by profit-hungry organisations like Apple, Dell and Hewlett-Packard. Products that were once affordable only to the wealthy now cost less than the average Brit’s annual tattoo budget, and we have the free market to thank for that.

As with computers, so with anything else. As long as the state has a monopoly on healthcare, it will always be expensive and second-rate. No one will know what good value or good service looks like, because they will have no point of reference, and no incentive to find one. Employees who do not fear failure or competition will work to the lowest possible standards, with only a nebulous commitment to public service to guide them.

Even if you believe that the government can run a healthcare system as efficiently as the private sector, that still doesn’t take into account the bloated cost of government administration. As Thomas Sowell put it: “It is amazing that people who think we cannot afford to pay for doctors, hospitals, and medication somehow think that we can afford to pay for doctors, hospitals, medication and a government bureaucracy to administer it.”

It’s all very well shrugging off the inflated expense of the NHS on the basis that someone else will pay the lion’s share, but there comes a point when even a subsidised service costs most people more than the private sector alternative. That point has long since been reached.

Healthcare is an important and sensitive issue, which is precisely why irrationality should be stripped from the debate. No one wants people dying for a lack of funds, but neither do they want the NHS to be a dispenser of standardised, overpriced disappointment. The choice is not between state provision or people dying in the street; it’s between hard truths and adolescent dreams.


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