Blog 2023 Malcolm Blair-Robinson

The Deputy governor of the Bank of England is the latest distinguished authority to raise concern about the house price boom, of which the government is more or less in denial. This blog and others have been warning since 2009 that another housing boom would be a disaster, yet the government has organised a recovery programme setting this economically poisonous process in train. It was a mistake to fund Help to Buy without having in place a clear correction system like bank rate, which would be triggered if prices rose faster than inflation. It was also a mistake to launch it without a major and strident housebuilding programme, not the piffling affair we have at the moment. Macmillan built 400,00 houses a year. So can we.

It should come as no surprise in the end that this Tory blind spot has yet again intervened to put economic prosperity at risk. Every Tory led government since Sir Alec Douglas Home took office in 1963 has engineered a housing boom which then has been followed by a bust. Last time flashy New Labour embraced the thrill of illusory wealth fuelled by the biggest debt mountain in the world except for the US, leading us to the biggest bust ever.

What is sad is Labour now has the greatest opportunity since 1945 to really show it stands for a different economic structure, not based on some muddled ideology but on practical arithmetic and public interest in a fair society which prospers for the common good. It does not measure up. All we hear of is ‘initiatives’ and tinkering at the margins, much of which is worthy, but all of which is forgotten five minutes after it is announced. None of it creates a narrative of hope, nor paints a picture of a future worth aiming for. Perhaps a plan to tackle what will soon be the housing crisis would be a good place to start afresh.

Meanwhile in the Tory headquarters champagne flows in celebration that Britain has the fastest growing economy in the G7. Yes well. Remember Ireland. In Ulster average house prices fell by fifty per cent and they are still down there. If prices go on rising in England at five times the rate of inflation and significantly ahead of wages it will happen here for sure. This is a dangerous moment.

Buy my books

Visit my website

The last reorganisation of the NHS, which has given us Commissioning Boards instead of Primary Care Trusts, has achieved nothing which could not have been achieved within the previous system. This can be repeated backwards through one upheaval after another right back to 1948.

There are two problems which override everything. The first is the way the service is funded.This assumes that you can provide an infinite service on a finite budget. This is mathematically impossible. It is equivalent to giving a major supermarket, or a group of them, a fixed annual sum, in return for which they feed the nation for nothing. The people would be fed after a fashion, but there would be shortages and waste and waiting lists for butter. The most dramatic transformation to the NHS would occur if instead of giving it a fixed budget it was paid for every treatment and process it carried out, patient by patient, item by item, according to a price menu set by the government.

The true cost of a decent health service, about £200 billion at today’s prices, would then be understood and paid, but there would be no waiting lists or delays. To fund it, income tax should have the rate substantially cut and a new income related health tax introduced, operating one year in  arrear on the actual cost of the service. The NHS would continue to be free at the point of delivery but the illusion that it is actually free and someone else’s problem to pay for it would be broken. It is not free, it never has been, everybody is contributing, but under this new system the link between cost and delivery would be properly established. Vast swathes of bureaucracy currently mixed up in commissioning boards, waiting lists and so on would disappear, to be replaced by an accounts department appropriate to an organisation supplying on demand. That is the nub. What the NHS provided would be according to public demand, not government control.

The second problem is the barmy and utterly ridiculous relationship between the NHS and its doctors. This is that Consultants, though employed by the NHS are free to carry on lucrative private practice, which extends waiting times for those who do not have private medical insurance and speeds treatment for those who do. GPs are classed as self-employed (!!!) under a financially rewarding  contact which is out of all proportion to the service they provide. All doctors of whatever rank, class, discipline or experience would become employees of the NHS working exclusively for it and paid to a fair professional standard.

Make those two simple changes and the NHS would be transformed. The medical profession would for the most part oppose these moves hook line and sinker. Treat them like Thatcher did the miners. The majority would see the sense and move forward. The greedy ones would leave. They should never have been there in the first place; treating the sick is not about getting rich. If you think it is, you are in the wrong job.

Buy or download my Books

Visit my Website