Cameron ‘sailing close to wind’ over NHS costs

Prime Minister David Cameron has been accused of breaking the coalition’s pledge to increase funding for the National Health Service as soaring inflation threatened to undermine the Government’s spending plans.

The Institute for Fiscal Studies (IFS) said the Government was now “sailing extremely close to the wind” over its promise to raise NHS spending in real terms every year of the current parliament.

In its analysis of the Budget, it said the worsening economic outlook meant there was now a 30 per cent chance Chancellor George Osborne would have to put up taxes or find further spending cuts if he was to meet his target.

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Labour went further arguing that Mr Osborne would have to find another £1.8bn over the course of the next four years if the Government was to honour its commitments on the NHS.

Health Secretary Andrew Lansley, however, insisted that the Government would meet its pledge and accused the opposition of spreading “scare stories”.

The latest forecasts by the Office for Budget Responsibility (OBR) – published alongside the Budget – showed that the outlook for growth and inflation had worsened since the Government’s spending review in October.

IFS analyst Gemma Tetlow said that at that time the Government had been on course to deliver 0.3 per cent real-terms increase in NHS spending over the life of the parliament, but latest OBR inflation figures now pointed to a 0.9 per cent cut.

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“It is not clear from the political pledge exactly what baseline they are using,” she said.

“Arguably, the Government is continuing to meet its pledge although they are using a different baseline.

“Either way you look at it, although they perhaps look on course to meet their pledge they are sailing very close to the wind.”

Meanwhile, Chancellor George Osborne was accused of betraying pensioners after it emerged he was cutting the winter fuel allowance despite rising energy prices.

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The National Pensioners Convention expressed outrage that the Government was scrapping the temporary increase to the winter fuel payment of £50 for households with a pensioner aged up to 79 and £100 for ones with someone aged over 80.

Dot Gibson, NPC general secretary, said: “It’s absolutely outrageous that George Osborne didn’t have the guts or common decency to make this announcement public in his speech yesterday, but instead chose to bury it in all the paperwork.

“If we really are all in this together, why is he going to take £100 off the winter fuel allowance for the oldest members of society at a time when fuel bills are rising and winter deaths amongst older people are a national scandal?”