Sunday, 23 May 2010

NHS Services

It has been widely reported that the NHS expenditure is to be ring-fenced.

Has anyone thought about the impact on front line services of a VAT increase?

We know that management in the NHS in Scotland is top heavy and the Scottish government has yet to deal with it, but from a UK perspective, do we realise what, with a 2.5% increase in the service will be the result?

The last labour government refused to raise VAT because it would affect their voters. They blame the increase of VAT on the last Tory government who raised it from 15% to 17.5%, yet it is the lowest in Europe.

Somehow, if an increase in VAT is in the forthcoming budget, there must be some way that the NHS is protected. Easy to do.

Utilities too ought to be protected from further VAT increases. I've just had a bill from my gas and electric company and they want more than my state pension in monthly payments. That's not because I'm extravagant with my heating and electric but because this winter has been extreme. Yes I received my £200 winter fuel payment but because I don't claim any benefits I am not entitled to any of the programmes utility companies offer.

With regard to NHS services I do hope people protest. In this area there are some agencies who offer little to their communities yet their payroll contributes to the excesses in the public sector - so many voluntary agencies use very genuine volunteers yet claim vast sums of money for 'core' staff who do little on the front line.

All the present government has to do is design an online 'Where Do You Think the NH Should Be Going and Why?' We will let them know the answers, not 'think tanks'.


Goodnight Vienna said...

I don't remember when these think tanks surfaced SR but I wish they'd go away. Most of them seem to have some form of govt/taxpayer funding and it's long been a gripe of mine that I'm paying taxes to some 'group' to tell me what to do - it really annoys me, tremendously.

NHS management in England is likewise very top-heavy but the headlines will all be about nurses and doctors and the real issues won't be aired at all.

As you say, people must write, email, telephone, sign petitions and generally make a noise. This last coalition govt has proved that at least.

Apogee said...

Why does the Government as such pay VAT anyway, the money goes straight back to the Government, the tax just artificially ramps up the apparent
price, and the tax goes back to consolidated revenue.
In fact, if a business did the same thing, charged for a product and then demanded 17.5% back and put it in the corporate back pocket, is this what they call skimming AKA fraud, and illegal, or is it legal to inflate the price of a commodity in this manner because its the Government that is doing it.
You pay a notional 1.000.000 million pounds but 17.5% or 175.000 thousand pounds is paid into your back pocket,so you only pay 825.000 pounds for the goods but the accounts say you paid 1 mill.....!
Could be that plenty of accountants
out there will say I'm wrong but it at best looks questionable accounting !

Dean MacKinnon-Thomson said...

Protecting our NHS can only be a sensible thing to do. After all the NHS is still struggling to ensure universal coverage, with access to modern drug treatments.

Our NHS needs this kind of protection, otherwise the postcode lottery would be made worse.

Subrosa, did I read you right? Do you actually want to see cuts in the healthcare budgets? If so I cannot possibly agree.


subrosa said...

GV you're a woman after my own heart. I've never understood where these think tanks come from, although I've been told they're 'random'.

As you say it's all up to us now. We have a coalition and we have much more of a say. If those in power answer emails I'll be surprised but it's worth a try.

subrosa said...

Apogee, a good question for the forensic accountants who read this. Do hope someone explains it as I've always thought the same.

subrosa said...

Dean, I can't see where I mentioned cuts in the NHS budget although I can see, because the NHS pays VAT for some silly reason, that they would happen, yet the books would ignore that and give gross expenditure.

Dean MacKinnon-Thomson said...

The NHS paying VAT is justified if you think about it from the perspective that it is the worlds largest single employer after the Chinese red army...they ought to pay tax given their socio-economic importance surely?

But I mentioned cuts to the budget, because the usual objective for those criticising the NHS 'ringfenced' status are people wishing to see it cut; just from experience- its the 'hidden agenda' I find all the time.

Sorry if I misinterpreted your real point however!

Idle Pen Pusher said...

SR - they have promised to increase NHS funding in real terms year on year. I think that's irresponsible (why should health be immune? But that's another story), but I think it certainly means this post is misplaced (unless they're lying.)

Government services most certainly should pay/charge VAT. Why should there be an artificial distortion misleading people about the true cost of things? And the fewer things you exempt from VAT, the lower the rate can be for everything in order to raise the same amount in total revenue. Lower rates distort the economy less than higher rates.

For the same reasons I don't see why energy (or any other utility bills) should be protected from equal treatment by the taxman.

subrosa said...

I see your point Dean and the one of IPP following you. My initial thought is that it will require an army of bookkeepers to look after VAT only.

Indyanhat said...

No sorry I am with Apogee, in that I do not for a moment understand why the govt. who we pay for entirely through our taxes should itself (or an of its departments) pay taxes like VAT! I understand NI has to be paid but not VAT, businesses can claim it back, does the govt! it is after all a business.
What is the point in us paying for what we already pay for in this way?
Pen Pusher seems to suggest we would have to pay more if they didn't pay???surely we pay it anyway so there really is no difference!?!?!?!
The question must be Do the NHS and other public bodies claim back the VAT and if they do why do we not get rebates from the savings, where does that cash go if they do claim it back!?

verification 'rebell' hahahahaaa!!!

subrosa said...

Thanks for the link IPP. I do understand your point though but of course government doesn't want VAT to show the true cost of living.

That is why why utility bills have a reduced rate don't you think? If the standard rate was charged then it would show us as having the highest rates in Europe I believe.

subrosa said...

I asked that of a VAT (C&E) officer many years ago Apogee. He agreed with you but said it was all part of keeping thousands of clerical workers employed.

If you've ever run a small business you'll know VAT accounting is a nightmare and the VAT folks take a great delight in targeting the wee folk.

subrosa said...

Indyan, I'll try and see if I can find the answer to your question. May take a few days though.

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