Using cross-national fixed effects models covering 25 EU countries from 1995 to 2010, we quantified fiscal multipliers both before and during the recession that began in 2008.
We found that the multiplier for total government spending was 1.61 (95% CI: 1.37 to 1.86), but there was marked heterogeneity across types of spending. The fiscal multipliers ranged from −9.8 for defence (95% CI: -16.7 to −3.0) to 4.3 for health (95% CI: 2.5 to 6.1). These differences appear to be explained by varying degrees of absorption of government spending into the domestic economy. Defence was linked to significantly greater trade deficits (β = −7.58, p=0.017), whereas health and education had no effect on trade deficits (peducation=0.62; phealth= 0.33).
The King’s Fund suggest that a 3.5% annual real-terms rise in NHS expenditure, combined with the provision of ‘moderate’ and ‘higher’ social care needs free at the point of use, would bring total health and social care expenditure up to between 11 and 12 per cent of UK GDP by 2025. This compares with the 16.9% of GDP spent by the US and the 11% spent by France on healthcare alone in 2015.
If UK economic growth continues at an annual average of 2%, by 2025 GDP at 2013 prices will be around £2.2 trillion compared to £1.8 trillion in 2015, an increase of £400 billion. In 2013 terms an increase in spending on health and social care to 12% of GDP would represent around an additional £60-70 billion annual spend in 2025. Yet even with this increase in health and care expenditure, the nation as a whole would still have over an extra £300 billion to spend on all other goods and services, public and private. The King’s Fund’s recommendation is thus eminently affordable.
The government had to lend cash-strapped hospitals a record £2.825bn in the last financial year so they could pay staff wages, energy bills and for drugs needed to treat patients.
The Department of Health was forced to provide emergency bailouts on an unprecedented scale to two-thirds of hospital trusts in the 2015-16 financial year because they were set to run out of money, the Guardian can reveal.
The NHS has more than 100 PFI hospitals. The original cost of these 100 institutions was around £11.5bn. In the end, they will cost the public purse nearly £80bn. The total UK PFI debt is over £300bn for projects worth only £55bn. This means that nearly £250bn will be spent swelling the coffers of PFI groups.
The outcome of the EU referendum has been unfairly blamed on the working class in the north of England, and even on obesity.7 However, because of differential turnout and the size of the denominator population, most people who voted Leave lived in the south of England.8 Furthermore, of all those who voted for Leave, 59% were in the middle classes (A, B, or C1). The proportion of Leave voters in the lowest two social classes (D and E) was just 24%.8 The Leave voters among the middle class were crucial to the final result because the middle class constituted two thirds of all those who voted. Continue reading
In 2011, the independent researchers Jim and Margaret Cuthbert showed the
scale of the returns to investors when they analysed three hospital contracts
for Hereford Hospital, the Edinburgh Royal Infirmary, and Hairmyres in East
Kilbride.2 Shareholders are predicted to make truly astronomical gains. Equity
of just £100 invested in rebuilding Hairmyres Hospital is projected to
earn £89 million in dividends over 30 years, while half a million pounds of
equity in the new Edinburgh Royal Infirmary is expected to win dividends
of £168m and a £1,000 equity in Hereford will yield £555.7m. These high
rewards are contractually protected and underwritten by government. The
Cuthberts’ analysis of internal financial projections for six PFI schemes show
investors are expecting to recoup 12 times more than they invested. The UK
Government has ignored these findings and there has been no major enquiry.
Using investors’ own projections, the Cuthberts calculated how much profit
was predicted from the six schemes and found that £42m of “subordinate debt”
invested by the companies building the six schemes was predicted to yield £517m. The profits on the £717,297 put in as equity by shareholders were projected to reach £350m.