The traditional NHS winter crisis kicks in

Bang on time, "as much a seasonal tradition as the perfume adverts", comes news of a winter NHS crisis, said The Daily Telegraph, involving financial deficits, staff layoffs, and an official policy of delaying operations to save money. But this time, it's worse than ever.

First, an extraordinary leaked memo from a senior Department of Health official shows the extent of the financial crisis, said Antony Barnett in The Observer. In it, officials are told to ignore ministers' commitments and stop spending on pain of disciplinary action. Second, said Nigel Hawkes in The Times, a leading health economist has warned in a Reform report that the NHS faces a stunning £7bn deficit by 2010 unless it reverses all present spending trends and pulls off a "productivity miracle".

It's not as if no one saw this coming, said The Independent. When the Government announced its £40bn NHS plan in 2000, plenty of critics warned that "huge cash injections" could quickly be swallowed up "without delivering any discernible improvement in the service". Labour ministers countered, complacently, that the money would be spent efficiently and accompanied by reforms. "Five years on, these pledges ring hollow." A few independent treatment centres have opened, obliging a handful of hospitals to raise their game. "But the NHS is still fundamentally running as it always has as a profligate, monolithic and inefficient healthcare provider" that now finds itself stumbling into crisis.

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"Never tell people there is lots of money coming their way, or it will be wasted," said Graham Serjeant in The Times. Which helps explain why the NHS has a current overspend of £600m, even though its budget has doubled in eight years. And because it has been wasted, it "explains why Primary Care Trusts [PCTs] grew into a vast new bureaucracy that no one wanted. It is why, in an effort to halve the deficit by the end of this financial year, the guilty quarter of hospital trusts and PCTs are under pressure to put off medical treatments until the last permissible moment."

The most fundamental problem is that the NHS's sickness has been "consistently misdiagnosed", said Melanie Phillips in the Daily Mail. It's not lack of money we now spend an astronomical £75bn on it each year (compared to £42bn in 2001). It's that the NHS is simply too big and unwieldly for any government to manage, and that the bureaucracy needed to try and do so is self-defeatingly cumbersome. A classic example is the wave of money that has hit the NHS in the past four years. Analysis by the King's Fund think-tank shows that only 2.4% of the increase has gone on new beds and operations. Ten times as much has been spent on alterations to NHS pensions and the next biggest slice has gone on pay rises, bonuses and extra staff. "A top-down, centrally run health service is a dinosaur on a dog-lead."

For health secretary Patricia Hewitt, the cure for all this is yet another structural reorganisation of the NHS, due in April, said Simon Jenkins in The Guardian. Her blueprint is a form of privatisation, under which hospitals, ambulance and primary care teams "compete" for patients. But just like the similar systems introduced by Ken Clarke in 1990, and more recently by Alan Milburn, it won't work, because it doesn't tackle the core problem of size and bureaucracy. "No other Western nation tries to run doctors and hospitals as a civil service centrally from the capital." The only effective solution is a new NHS, centrally financed but locally run, as abroad.