................................................................................ ON THE RECORD DAVID BLUNKETT INTERVIEW RECORDED FROM TRANSMISSION BBC-1 DATE: 13.2.94 ................................................................................ JOHN HUMPHRYS: Well David Blunkett, you do have a problem don't you, between those who say we must spend basically as much as is needed and those who say we must make no commitment. DAVID BLUNKETT: Well there's always been the clash between hope and aspiration on the one hand and prudence and hard headed reality on the other and it's not some sort of gigantian clash between two people; that is really a very silly way of looking at it. What we need to examine in the next eighteen months, two years, is what we can do to re-use resources, not merely within the Health Service but re-use the massive tax take which the Conservatives are inflicting from this April. Fifty pounds a month on the average family this year, rising to eighty pounds a month next year. How we can re-use that, instead of applying it for Conservative priorities and for matching their own incompetence, bridging the gap between income and expenditure to putting people to work, to getting more taxes and National Insurance into the coffers and to spending it on health and education and other vital Social Services. But it goes further than that John, it's not somehow how do you find more revenue from the public, it's how do you link what you're doing in terms of creating economic growth and prosperity with essential public services and I believe very strongly that investing in good health and in the Health Service can make a substantial contribution to that growth and prosperity. HUMPHRYS: And investing means putting more money into it, in very simple terms. BLUNKETT: Yes it can be and I'll give you an example, a partnership with the private sector. This last week, the health and safety executive, revealed that sixteen billion pounds a year was lost to the economy through the hundred and eighty million days lost each year, it's a staggering total in sickness and ill health and injury, with people being absent from work. If we could just work together with business and the trade unions to get a fraction of that down, we'd automatically increase our productivity, our competitiveness and our ability to raise money. That would in turn, feed back into the Health Service as well as preventing ill health, so we'd get the best of all worlds. HUMPHRYS: And in the long term that may well prove effective, MIGHT prove effective, but in the long term. In the short term you've got to do something... BLUNKETT: I accept that totally, I think finding some of those resources that are currently being squandered in the Health Service - what an eighteen hundred per cent increase in the cost of senior management, the doubling of the amount spent on company cars for the Health Service, the whole business and commerical ethos that's being created, we can do something with that. But there are lots of tricks up our sleeves, this is a consultation paper, it's designed to stimulate debate and to get people thinking about these issues and I think we can do that, I think we can say to people: Look, if we need more ambulances, high quality, well-equipped ambulance services with paramedics, linking in with new forms of accident and emergency facilities in GP practices and health centres. When you spend on ambulances and equipment you don't throw money away, you actually stimulate growth and productivity and the productive economy in the private sector. You buy those ambulances and that equipment, you therefore stimulate your productive economy. HUMPHRYS: But you've got to find the money to buy those ambulances or the new hospitals, or whatever it may be, you have to find that money and that involves, does it not, a commitment to spend more money? BLUNKETT: Well it involves investment on the one hand and re-using resources on the other. Just to underline the point, we're not interested and I think those who are arguing prudence are right in this respect, that somehow we need to charge people out there more tax, the Tories as has just be revealed over the last fortnight are actually levying more tax on the British people than any Labour Government has ever done. We don't need more tax we need fairer taxes, we need to re-distribute the way in which the tax yield is distributed onto people and we need to challenge something else as well. Of course, you have to pay for improvements in the Health Service, wherever the money comes from, but if we're going to grasp the exciting possibilities of key-hole surgery, of new technology, molecular and genetic research and we're going to apply them for the benefit of everybody, we are going to have a debate about whether that should be done through private health insurance and charges or whether it should be done through tax revenues. Now, those who say, well the private sector's the one that's going to deliver the goods, are accepting that it's the wealthy who would be able to pay for the advances for the technological developments, for their families to receive health care that the rest of us can't and if they can afford the private health insurance then they can afford progressive fair taxation. HUMPHRYS: And therefore, the logic of that is that you improve the health service by making greater use of tax money, by levying more tax... BLUNKETT: The better use of tax resources because at the moment we're paying for, even on the government's figures, almost three million people to be paid to stay at home. Fancy paying trained nurses and health visitors and home helps to stay at home rather than to be doing a job of work. Fancy losing their tax and National Insurance contributions that they pay back in when they've got a job. It's a crazy way to run an economy. HUMPHRYS: So, if you're going to re-employ those people, if you're going to have more nurses and more doctors, I keep coming back to this fundamental issue, it costs more money and you are saying, are you? - because I'm not quite sure whether you're saying this - we are prepared to charge...to increase the tax take if we have to. BLUNKETT: Well I'm saying that the tax take as a whole, is already high enough, the distribution of that tax take is something which we will be debating, including the Treasury colleagues in a non-adversarial way, not as some sort of knock-out contest, over the next eighteen months. Their job is to ensure that the British people trust us, that we are not feared by people in terms of the amount of taxation we'll take from them and we've got to prove that public expenditure, that a reaffirmation of the importance of public spending is about quality services that all of us want. And I think there's a very important area here that we have to argue over the next two years and that is this; that public spending can often be very much more efficient in terms of the use of resources than the split between private and public and the Health Service is a classic example of that. Where the private sector are duplicating facilities, they're using resources that could go into the Health Service and they're switching away from a planned investment in the technology and the primary care of the future. HUMPHRYS: You see when I talked to John Smith about exactly this issue the other day, he said...I said where's the extra money going to come from? You'd have to raise taxes wouldn't you? And he said no, for a start we'd have one point eight billion pounds extra because that is what we would save as a result of eliminating waste and so on. Now that isn't realistic is it? BLUNKETT: Well I heard John being interviewed by you from Glasgow and he said the speed of what we could do would be determined by the level of growth we achieved and I agree with that entirely. The speed of what we can do is a crucial factor in ensuring that people believe our promises, that we don't live in a kind of fairyland where we promise people things that (a) they don't believe and know and (b) they know we couldn't deliver anyway. So I'm a realist, I ran a council as a realist for seven years. HUMPHRYS: Well then if you're a realist you'll realise that that one point eight billion that he said, I think you've said in this document 'waste in the NHS', you're going to save, actually isn't very real is it? You're not going to save that one point eight billion. BLUNKETT: Well we pointed out and John pointed out, that the Tories spent one point two billion on simply setting up the new commerical, competitive internal market.. HUMPHRYS: Precisely, and that's been spent... BLUNKETT: The business system. We then earmarked and highlighted six hundred million extra which is currently being wasted and mis-used and the six hundred million we can apply and John never...John never said that we could immediately apply one thousand eight hundred million pounds in the first year we get in. Over a period of time of course we'd be able to squeeze that out but I'm not pretending that there won't be more money needed for the Health Service and it will come from a number of sources, including economic growth. HUMPHRYS: But you say, we'll be able to squeeze that out, you won't be able to squeeze that out at all because most, the vast majority..proportion of that one point two million that you mentioned first has already been spend, you're not going to be able to get it back again and the six hundred million that you say has been wasted - I mean let me give you some examples of the sorts of things it's been wasted on, according to your document. It says, for instance, fifteen million pounds was wasted because of dripping taps, now you're not going to stop taps dripping under a Labour Government. BLUNKETT: What you are going to stop is the drip-drip of money being mis-used out of the Health Service including, and I welcome people, write in everybody, get this document from us "Health 2000", look for yourselves about what we're saying, eighty-five million pounds is currently going on tax relief for individuals over sixty taking out private health insurance. What a farce to actually... HUMPHRYS: But that's a separate issue, you're not dealing with the point that I just raised. BLUNKETT: Not it is not another issue. Eighty five million that can be reapplied and we illustrate that in the document by saying that's twenty-two thousand hip replacements for older people who could be living independently and with dignity if those operations were carried out. That's not an airy-fairy suggestion it's an absolute concrete proposal. HUMPHRYS: But what is airy-fairy is to suggest that there is anything like one point eight billion pounds that you could restore to the National Health Service because the way you would change things. BLUNKETT: I repeat, I heard the interview John Smith did not say that we could apply that money over night by simply turning the clock back. He did not say that, he said that there was waste and bureaucracy and everybody knows there is, they've seen it, we've revealed it over recent months very effectively. HUMPHRYS: We're talking about an organisation that employs a million people, the biggest employer in Europe, there's always going to be waste, there's always going to be bureaucracy, there's always going to be dripping taps and what I'm suggesting to you is that it's positively misleading to produce as part of the statement that you've just held up, this other little document that's part of it "Waste in the NHS" a catalogue of one point eight billion pounds of waste, that's what it says and the implication is that you're going to save that, you're not going to save it. BLUNKETT: Ah an implication is a very different matter. And nobody would forgive us if we hadn't revealed the mis-use of resources, while people are lying on trolleys there is money being used simply to operate the system. Nothing to do with dripping taps but to operate the competitive contract system which has replaced the previous way of funding and
organising the NHS. HUMPHRYS: Right, well that a separate... BLUNKETT: ...and it's a very important one because what they're called - transaction costs - of simply operating the internal market, the business ethos, the commercialisation, that we can tackle. It will take time... HUMPHRYS: But you're not going to sack every bureaucrat are you? BLUNKETT: We've not suggested that we sack bureaucrats, in fact we found out that over the last three years the government has spent ninety-six million in redundancy pay offs, paying people off, and a lot of them have been nurses. We've lost twenty-seven thousand nursing and midwifery posts over the last five years. What a scandalous way of carrying on when there's been an extra thirty-six thousand managers and administrators, some of whom have been needed but not all of them. HUMPHRYS: Well let's go back then to how you would pay for those nurses if you were to give them their jobs back again. You've already accepted that this one point eight billion isn't any kind of panacea, that's not going to be a sudden lump of money that you will have to spend on your first day in office, manifestly, so where - to repeat the question, forgive me that I am repeating it ... BLUNKETT: You're very welcome. HUMPHRYS: ... where is the money going to come from? BLUNKETT: Well, I've explained already that there are resources that can be drawn in - and the eighty five million is only one of a number of examples that I've given, substantial sums of money that can be drawn in. You said that the drip was a little bit of a sideshow. I think that cars for senior executives increasing from five to twenty four million in trusts alone - nothing to do with health authorities or the Department of Health, just in trusts - I think another nineteen million is another contribution and we are going to build those up. Secondly, we are determined to switch resources into the Health Service as part of that economic growth and I gave the example of occupational health and I've given the example of how investing is part of the employment programme, the economic growth and industrial programme of a Labour Government. We could aid the Health Service and in return we would get money back. Thirdly, we will want to look at the issue of earmarking, which was dealt with on that film that we saw at the beginning. There isn't just simply the issue of earmarked tax, you know, there's the issue of earmarking existing funding that is available through the squandering of resources and there's the issue of earmarked growth. In other words a contract with the British people, something that was mooted by John Smith when he was Shadow Chancellor before the last general election, that we would say to people this is the way we are going to spend your money, any additional growth will be committed on these priorities. That's a contract with the British people that overcomes the mistrust which has existed previously about whether we were a high spend party. We are not. We spend on services, they spend on economic incompetence. In other words, theirs is a policy of tax and cut. I am talking about taxation being redeployed to high quality public services. HUMPHRYS: So you're not talking, when you talk about an earmarked tax or a hypothecated tax, whatever you want to call it, you are not talking about what the Liberal Democrats were talking about at the last election - and that is a penny extra earmarked in their case specifically for education, in your case specifically for health because that's what a lot of people believe that you ... BLUNKETT: It's a possibility. HUMPHRYS: A strong possibility? BLUNKETT: I think ideas should be welcomed. I think we should spend the next year not merely on this document and on the Health Service, debating sensible, prudent ideas. John Smith and Gordon Brown in the last six weeks have both said that the issue of what's called hypothecation in whatever form is worth taking a look at. It's about winning support again for decent public services, John. HUMPHRYS: And you have said that you've got to get the British people used to the idea that they are going to have to pay more for the Health Service. They are going to have to put more into it. I mean, you have said that. BLUNKETT: Well, people who argue for private health insurance accept it. What they say is that the well-off will buy themselves out of a safety net service, that the NHS will be split. There will be a safety net service for most people. There will be the cutting edge of technology and the best services for those who can afford private health insurance. Not only is that a scandal in terms of the way we actually apply ourselves to a healthy nation and the productivity and growth that comes from it but it's also inefficient because, you see, what happens is the private sector provide the cheap high turnover, the non-acute work, they don't have vast overheads, they leave those, they transfer those overheads to us in the NHS with the acute, the intensive care, the long-stay work. The more they do that the more the overheads push up the unit costs of running the Health Service. It's a simple economic equation that the more you do outside through private health the more you cost the rest of us and we are determined to tackle that. We can't abolish private health but by goodness we can levy a charge to reflect the true cost of how much the NHS is being drained by private health insurance. HUMPHRYS: Do you accept the basic principle that the NHS is under-funded? BLUNKETT: Yes, I do. HUMPHRYS: Therefore ... BLUNKETT: I believe it's still the most cost-effective system in the world because it isn't substantially yet split between private and public because it is still organised, even with the Tory changes, on a more planned basis than other systems in the world and most people look to us with great pride at our NHS and that's what we're going to restore. But of course I make comparisons. The Dutch, the Germans, the French spend five pounds public and private on health for every three pounds that we spend. Long-term aspirations are different to the ability to be able to win people in a general election to what they are prepared to pay not when they say it to an opinion pollster but when they are in the booth casting their vote on general election day. HUMPHRYS: So you are prepared to draw attention, as you have in your document, to the fact that a much greater proportion of gross domestic product is spent in countries like France and Germany on health than is spent in Britain. You are prepared to draw people's attention to that, but you are not prepared to say on behalf of a future Labour Government 'we will correct that imbalance and if that means spending more tax on the Health Service so be it'. BLUNKETT: Well you know perfectly well why I am not prepared to make grandiose promises ... HUMPHRYS: Well, I'd like to hear you say that. But why is that a grandiose promise? BLUNKETT: ... and the reason is very clear indeed. That the Conservatives did a hatchet job on April 9th 1992 by totally distorting long-term aspirations which we must have with the reality of what could be achieved in the first year of a Labour Government and we are not going to fall into that trap ever again. We wish to be in office to carry out our proposals and our hopes and aspirations ... HUMPHRYS: But isn't that rather dishonest? BLUNKETT: ... rather than in glorious opposition. Of course it's not dishonest. I'm making it clear this lunchtime. People out there are having their lunch. We respect people who tell the truth rather than pretend. HUMPHRYS: Well, what you're saying in that case then is 'we are not prepared to make any specific commitment but I, David Blunkett, are sitting here today saying I am making a commitment to make a commitment at some future date'. BLUNKETT: I didn't say that we wouldn't make specific commitments. I said that we have a consultation paper out for consultation till next year on the future of our Health Service. Our Health Service, our prevention measures, our new public health agenda, our switch to primary community care which can only be planned by public service, it can't be planned by the internal market. The commitment to putting patients first, giving patients new rights, for women to see a woman doctor, to choice of hospital, to rights to complaints and procedures of redress, all those things aren't about costs but where there are costs we will be honest about it in going into a general election. There's nothing dishonest, that's common sense. HUMPHRYS: All right, and that honesty includes saying 'we are so scared of what the Tories might pin on us if we make these commitments that we are going to hold off making those commitments for as long as possible'. That's what you are effectively saying. BLUNKETT: Well, I think this lunchtime I've indicated very clearly indeed, as I have with interviews with you over the last three weeks on the Today Programme on Radio Four, that I'm not scared of these issues at all. HUMPHRYS: Others in your Party are though. BLUNKETT: I am highly confident that ... HUMPHRYS: Gordon Brown is. BLUNKETT: No he is not. If we say to people ... HUMPHRYS: He said 'we are making no commitments, we have no commitments'. BLUNKETT: ... He's right. We haven't. This document is a consultation paper. HUMPHRYS: Well, we're angels on the head of a pin, the difference between an aspiration and a commitment. BLUNKETT: Oh, come on. Three years, potentially, to a general election. I mean, these lot are going to hang on for grim death until eventually they're whittled away and there's going to be a general election even if they like it or not. HUMPHRYS: And then you will have to make a commitment. BLUNKETT: We are going to plan over the next two years our priorities. We are going to put policies together so you are not separating out policies for economic growth and full employment with those that spend on public services, but we are going to integrate those policies. That is a confident party prepared to take people with us to debate these issues but not to go 'snap' so that the Tories can run a two-year campaign adding up every potential little snippet of money that they can trawl out and lie about them - as they have already on this document - pretending that we have made commitments which I thought your film went out of its way to illustrate we hadn't made. HUMPHRYS: David Blunkett, thank you very much. BLUNKETT: Thank you very much indeed. ...oooOooo...