Peer: NHS living on borrowed time
A Labour former health minister has warned that the NHS "is living on borrowed time" and called for an end to its protected budget.
Norman Warner said the health service's business model "is bust" and it should no longer be exempt from the austerity measures that have hit most government departments.
Without urgent action there will be a "financial train crash" after the 2015 general election, the peer suggested.
Lord Warner, who was in charge of health service reform in the last government, also admitted Labour failed to secure the improvements in the NHS that it should have for the amount of extra cash it pumped in.
He said: "My starting point is that the NHS is living on borrowed time. Its business model is bust. It is like IBM and ICL several decades ago - pre-occupied with mainframes while the world was moving to PCs. It wasted the Labour years of plenty and as a government we didn't ask enough of the NHS for the extra taxpayers' money we pumped in. Now we have a political class that knows we cannot go on like this but is reluctant to engage with the public on what needs to be done."
NHS funding has continued to be protected while other departments have suffered punishing cuts. The next spending round is currently being finalised and will be published next month.
Lord Warner added: "The UK's deficit reduction timetable has been extended to 2017 and is likely to be extended further. Given the cuts already made in other public expenditure - especially local government - the NHS cannot sensibly be ring fenced in future public expenditure rounds including the current one."
The Labour peer - speaking at a Health and Care Infrastructure Research and Innovation Centre forum on NHS innovation in central London - also called for acute services to be consolidated on fewer sites and billions of pounds in funding to be transferred to social care. Lord Warner, who is a member of the Dilnot Commission on Funding of Care and Support, said the coalition's local initiatives were not enough to bring about the change needed.
He said: "They can make a contribution but it must be very doubtful whether they can drive the necessary consolidation of specialist services on fewer sites and the extraction of resources from hospitals to fund better integrated community services without central political and professional leadership. I cannot see this leadership emerging before the 2015 election.
"However, unless there is urgent action, I can see a financial train crash after the 2015 election. Afterwards I fear it will be panic stations as the money runs out, the Treasury takes charge and radical NHS funding changes are considered."