Opinion

Why the credit crunch is ready to bite GPs

04-Jun-08

Despite the media frenzy over the UK's financial crisis, there have been few comments about its effects on the NHS. This says a lot: the NHS being a state icon, we imagine it is bubble-wrapped against economic problems.

However, with the economy in a downward spiral the government will receive less in tax revenue. Over the past 11 years the cost of the NHS has tripled - yet with precious little extra output to show for it. A large slice is taken up servicing PFI agreements, which will remain a huge drain on the NHS for the next 20 or 30 years.

In the immediate future, government money will inevitably become less available. Undoubtedly the parts of the NHS to suffer most will be the services at the sharp end, rather than where the cuts really should come - on its bloated financial and management structures.

There will be pressure to sell off expensive NHS real estate in cities. While alleviating financial pressure in the short term this is inevitably a one-off measure, leading to a permanent second-class service as far as patient access is concerned. A more equitable and longer-term solution would be to nationalise all existing PFI projects, thus stopping private firms siphoning off vast amounts of NHS money.

Financial stringencies and cuts are likely to be imposed across the NHS, but with the government's pet projects of Darzi clinics, Connecting for Health and NHS Direct being spared. As usual, money will always be available for the wrong things.

Levels of clinical staff in hospitals will inevitably fall. But, those most immediately affected by the current financial crisis will be GPs. The credit crunch means banks will be less willing to lend to prospective GP partners needing to buy into the practice. Credit given to GPs used to be considered a guaranteed investment, but with the downturn in property values and the risk of practices failing because of competition from the Darzi clinics, banks will be looking carefully at borrowing levels for new partners and existing practices alike.

Stagnation of the GP partnership market will ensue, with more GPs becoming salaried and fewer existing partners being able to sell out. It is not a happy picture for anyone.

Dr Lancelot is a GP from Lancashire. Email him at GPcolumnists@haymarket.com.