Downing Street Years - Margaret Thatcher [377]
There was another strong reason for favouring a review at this time. There was good evidence that public opinion accepted that the NHS’s problems went far deeper than a need for more cash. Many of our critics in the press admitted as much. If we acted quickly we could take the initiative, put reforms in place and see benefits flowing from them before the next election.
There was a setback, however, before the review had even been decided on. John Moore fell seriously ill with pneumonia in November, almost collapsing during a meeting at No. 10. With characteristic gallantry, John insisted on returning to work as soon as he could — in my view too soon. Not fully recovered, he could never bring enough energy to bear on the complex and arduous process of reform and produced several below par performances in the Commons. The tragedy of this was that his ideas for reform were in general the right ones, and indeed he deserves much more of the credit for the final package than he has ever been given.
I made the final decision to go ahead with a Health review at the end of January 1988: we would set up a ministerial group, which I would chair. I made it clear from the start that medical care should continue to be readily available to all who needed it and free at the point of consumption. The review would seek to reform the administrative structure of the NHS so that the best of intentions could become the best of practice. With this in mind I set out four principles which should inform its work. First, there must be a high standard of medical care available to all, regardless of income. Second, the arrangements agreed must be such as to give the users of health services, whether in the private or the public sectors, the greatest possible choice. Third, any changes must be made in such a way that they led to genuine improvements in health care, not just to higher incomes for those working in the Health Service. Fourth, responsibility, whether for medical decisions or for budgets, should be exercised at the lowest appropriate level closest to the patient.
The ministerial group met first in February. John Moore and Tony Newton represented the DHSS with Nigel Lawson and John Major for the Treasury, working with officials and advisers. Twelve background papers were commissioned covering consultants’ contracts, financial information, efficiency audit, waiting times and the scope for increased charging. The Treasury representatives were especially keen on increasing and extending charges throughout the NHS. This would have discredited any other proposals for reform and ditched the review. I stamped firmly on it. Otherwise, the danger quickly appeared that we had too much information before us on secondary matters and too little about the principles of reform. Accordingly, I asked John Moore for a paper on the long-term options for the NHS for my next meeting. This duly arrived in mid-March and set out the very differing routes along which we might go.
For intellectual completeness all such reviews list virtually every conceivable bright idea for reform. This contained, if I recall aright, about eighteen. But the serious possibilities boiled down to two broad approaches in John Moore’s paper. On the one hand we could attempt to reform the way the NHS was financed, perhaps by wholly replacing the existing tax-based system with insurance or, less radically, by providing tax incentives to individuals who wished to take out cover privately. There were several possible models. On the other hand, we could concentrate on reforming the structure of the NHS, leaving the existing system of finance more or less unchanged. Or we could seek to combine changes of both kinds.
I decided early in the review that the emphasis should be on changing the structure of the NHS rather than its finance. There was, admittedly, some attraction in the idea of funding the NHS by national insurance or an hypothecated tax, which