May confirms NHS boost will come from tax rises

Leslie Hanson
June 19, 2018

Instead she's dug herself in a hole over how to pay for it.

Taxpayers will have to stump up more cash in order to meet the government's planned £20bn extra cash for the NHS, Theresa May admitted today.

Mrs May also defied critics of her claim that leaving the European Union could help fund the 3.4% increase NHS by insisting that some of the money will come from a "Brexit dividend".

Well the PM told her former adviser it would come from a combination of a "Brexit dividend", so that the United Kingdom can "take advantage" of the fact that "we've got money we're no longer sending to the European Union".

It means the prime minister can claim to have fulfilled the controversial bus-sized promise, made by Brexiteers during the referendum campaign, to increase NHS spending by £350m a week. Britain will also still be paying billions of pounds to the European Union well into the next decade under its divorce settlement.

"The OBR (Office for Budget Responsibility) has said it could by £15bn a year; it could be a bit more, it could be a bit less". The Institute for Fiscal Studies has been clear: there is no Brexit dividend. That bit would need to reach an additional 1,200 to 2,000 pounds per household a year by 2033 to 2034, according to the IFS.

So where will this extra cash for the NHS be coming from? Without tax increases, Hammond would nearly certainly be forced to abandon his plans to erase the budget deficit by the middle of the next decade. And the government has accepted this official forecast, which is the opposite of a dividend.

"So we have to see the detail and see where this money is going to come from we have to see that it is going to be real money".

May said spending in England would increase to an extra 20 billion pounds by 2023/24. Though on the flip side, taxes on earnings can discourage people from getting jobs, it says.

The DUP's Simon Hamilton said the announcement was a "hugely welcome boost for our National Health Service".

Hammond could reverse some of the recent increases to the personal tax-free allowance, which is the threshold at which people start having to pay tax on their earnings.

Twenty billion pounds annually is approximately 384 million pounds per week. It wants to see a change to inheritance tax to even out the country's widening gap between rich and poor and the inter-generational divide.

"They say that they're going to increase taxes, but we've yet to hear who is going to get their taxes increased and how". The chancellor has already promised a spending review in 2019 that is expected to look at loosening the public purse strings to fund the NHS. That suggestion has been widely attacked as unrealistic, even by some Conservatives.

The announcement of more cash for the country's healthcare system, a regular issue at national elections, comes after a row in parliament over Brexit highlighted the fragility of May's minority government. The boost is the equivalent growth of about 3.4 percent a year, which is about the same amount that the Margaret Thatcher and John Major governments gave.

Writing exclusively for HuffPost UK, 12 high-profile clinicians, including ex-chair of the Royal College of GPs, Dr Clare Gerada, slam the Prime Minister's big NHS announcement and say "there is in fact a growing Brexit deficit" in the health service.

Other reports by Iphone Fresh

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