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2009: when economics and politics collide – Health Policy Today, 11 January 2009

Tom Smith offers a review of policy trends in the latest instalment of Health Policy Today

On today's Daily Politics the Daily Mirror's political editor Kevin McGuire offered his predictions for the year ahead.  “2008 was dominated by the economy and Barack Obama”.  His prediction for 2009? “Politics will be dominated by the economy and Barack Obama.”

It is not more of the  same, however.  The nature of  debate will change.  Economics will become very much more political.  A clue as to how is offered by a new spate of stories on pay and spending in the Department of Health.


In a lecture at the LSE just before Christmas, University of Kent sociologist Professor Frank Furedi argued very persuasively that in recent years economics became depoliticised.  Economic discussions became technical and instrumental; financial rather than social and political.  

Furedi is surely right to say that economics is going to become much more politicised.

After the collapse of Lehman Brothers in September 2008, economic discussion did begin to turn more political.  But the debate was often grandstanding – Keynes against Hayek – as, in the absence of any certainty, politicians looked to the bookshelves for inspiration; looking back instead of forward.

Economic discussion has become mainstream political discourse - but it will change in nature, as it moves away from macro-positioning towards micro-management.  

With the immediate economic crisis of last Autumn now apparently over – in the sense that the global banking system no longer seems to be facing immediate collapse -  discussion now moves onto how to manage our way through, requiring more subtle analysis and an understanding of the micro-economy.  

In the early days of the credit crisis, PM Gordon Brown benefited from being first off the mark with a view on what to do.  In contrast, and with some success, the prime minister  labeled the Conservatives inconsistent, lacking an overarching economic view and a “do-nothing” party.

Yet the Conservatives have reflected on their position over the Christmas break and have begun the new year fighting back, to some effect, brandishing Conservative principles and thrift as valuable qualities.  And David Cameron is angry.  Early in the new year, David Cameron told the Today programme that Gordon Brown's profligacy made him say, “sometimes I want to shake the prime minister”.

The lead piece today on ConservativeHome (the activist website) advises the party leadership to continue its attack on Labour spending.  This is how Conservatives should frame the next election: 'a Labour Party that spends your money wastefully' against 'a Conservative Party that will treat every taxpayer pound with the greatest care'.

A consequences of shifted politics is a much greater focus on micro-economics and the things that public money is spent on.


Since the turn of the year, more people have started to articulate the following narrative.  The private sector is taking the brunt of the economic pain, through job losses and pay cuts. The numbers are sharp and frightening.  The public sector number, on the other hand, is cushy - and by the way, have you noticed how much these people are paid?

The “traditional” explanation is no longer true, say some, that security and pensions in the public sector compensated for the relative lower pay.   Howard Flight  argues that pay is now 23% higher in the public sector.

There is increasing grumbling about pay in the public sector, compared with private sector counterparts.  Ever ahead of the game, when Vince Cable started to question the large numbers of public sector workers on £100,000, at the Lib Dem conference, he appeared a little extreme in suggesting all should resign and then be interviewed for their jobs again.  

Yet like economics, politics is shifting. More and more people are making similar points.


The Surrey Comet is a local paper.  While the local press is often dismissed, the Comet has played  a key role in local reconfiguration “debates” and local NHS managers seem to remain slow to appreciate its influence.

Today the Comet reports that Wandsworth PCT is  paying a temporary manager , recruited through an agency, the equivalent of £147 an hour or £287,000 per year, if they worked every day of the year (which of course they don't).

It is an amount that will upset both right and left.  Geoff Martin, the head of campaigns at Health Emergency, says the figure is “indicative of the distorted priorities in the NHS”.  He believes the figure is an insult to all full-time and frontline staff.

It was a Freedom Of Information request revealed the cost of the strategic commissioning manager.  It seems that FOI requests are driving a lot of the cost stories, and that strategy is not cheap.


Lib Dem health spokesman Norman Lamb is a regular user of FOI requests to find the answers to questions.  He wants to know how many people in the Department of Health are earning more than £100,000 per year. The answer? Fifty. This compares to eight in 1997 (but 70 in 2006).

The DH response to the news story is classic.  The reason for the increase is that the DH is now strategic, with less staff working in the Department: “because we're now more strategic, we've a higher proportion of senior posts.”


A very boring-looking Sunday Times headline contained dynamite about some of the perks received by senior Department of Health staff.   The article named and shamed.   David Nicholson (NHS chief executive) and Bill Kirkup (associate medical director) as recipients of high secondary benefits.  

'David Nicholson, head of the NHS, claims an annual £37,600 allowance for working away from home – yet he was already working and living in London when he took the job three years ago.  Nicholson was head of NHS London and had a flat in the centre of the capital'.

According to the paper, the allowance 'could comfortably meet the annual repayments on a £500,000 interest-only mortgage'.  Damning stuff, followed by a killer line.  'It is more generous than the benefits typically on offer in the private sector'.

For no particularly clear reason, the article mentions that Nicholson was a member of 'the Communist party in his early years'.  It then points out Nicholson's promise to parliament, 'that he intends to “squeeze the pay bill in the NHS”.'


The Mail on Sunday this week reported   Anger after NHS pays £90,000 to celebrities to front public health ad campaigns

The article says the NHS has spent nearly £90,000 paying celebrities to front public-health campaigns over the last 12 months.  

'The vast bill, which was met by the taxpayer, paid for seven famous faces - including former Page Three girl Melinda Messenger, The Bill actor Gary Lucy and model Donna Air - to publicise messages about healthy eating, stopping smoking and breastfeeding.'  It also included 'actresses Gemma Bissix and Sian Reeves, former Atomic Kitten singer Jenny Frost and psychologist and TV presenter Professor Tanya Byron' who  'were also paid thousands from the public purse'.

Serial information requester, Norman Lamb says he has written to Health Secretary Alan Johnson 'demanding that the full details of the fees paid to individual celebrities be released.'

Ben Bradshaw is relaxed about the charge.  'The cost of paying for public figures to help get a message across could be justified by the impact it achieved'.  “The small amount spent on well-known figures to help strengthen the impact and reach of our public health campaigns will save the country considerably more in the long run”.

It is going to be harder and harder to defend the money spent on a range of things.  'Prove it', people will say. Such proof will not be easy to compile.