The Economic and Political Background to Eye Health Care

Andrew Haldenby, Director, Reform

4 November 2010

About us

UK deficit as share of GDP

• Worst structural deficit in OECD in 2011

• I.e. excludes effects of the recession

• Second biggest increase in public spending in OECD 2000-10

• 15 percentage points of GDP, from 35 to 50

• Only Ireland greater

UK government debt as share of GDP

• “Danger zone” throughout this Parliament

• Source: Office for Budget Responsibility, June 2010

• Bound to be underestimate

Impact on economic growth

• Debt depresses growth• Why? Need higher taxes to fund

public spending• Reduces incentives to earn more

and make profits

Interest payments on government debt

• Cash terms, £bn• For comparison:

• Schools spending is around £35 billion

• Police is about £12 billion

The Spending Review – opening up public services

“Increasing the diversity of provision helps share that responsibility across society, and drives innovation and efficiency by increasing competition and consumer choice.”

“The Government will pay and tender for more services by results rather than be the default provider; look to set proportions of specific services that should be delivered by non-state providers … in community health services.”

The optical sector is a perfect example of public service reform

Guaranteed service for all, financed by government and private sector

Two-thirds of the 20 million sight tests administered annually are financed by the taxpayer

Innovation and local leadership provided by private sector management

2009: 10,734 ophthalmic providers in the UK

Crucial for NHS reform

NHS reform turns on the rebalancing of healthcare from treatment to prevention

The revised 2010-11 Operating Framework supports a shift towards primary and community care

Only 4 per cent of sight tests result in a referral to a GP or consultant

Other NHS services should be better integrated with optical care.

Deregulation

Vince Cable, 10 June 2010: “The regulatory burden is a check on business growth and everything we can do to lighten it will help”

Opportunities for deregulation:

Duplication of regulation between NHS and GOC

General Ophthalmic Mandatory Services Model Contract

Self-regulation by Local Optical Committees

Optical sector action plan

Take the story of the optical sector to the heart of government

Present the optical sector as an example of the Big Society – that is, the idea that public services should be delivered by a partnership between government and other organisations

Present the optical sector as an integral part of NHS reform

Use the Government’s commitment to deregulation to support the development of the sector