Daniel Hannan: Streeting is learning the hard way what happens when you pay the BMA danegeld

Lord Hannan of Kingsclere was a Conservative MEP from 1999 to 2020 and is now President of the Institute for Free Trade.

Question: if you give a group of public-sector workers an immense pay rise in return for calling off a series of strikes, which do you think is more likely? Will they return to work gratefully, putting in a little extra effort to show their appreciation for your kindness? Or will they threaten to strike again, hoping for another increase?

Wes Streeting, the embattled Health Secretary, is learning the answer the hard way. Like so many Labour ministers, he took office thinking government would be easy. I mean, if those Tory tossers had managed it for 14 years, how hard could it be?

His first decision was to give junior doctors a massive pay bump: 28.9 per cent in phases, the last tranche of which comes into their bank accounts next month. The doctors’ union, the BMA, trousered the money and, for a brief while, junior doctors (now called “resident doctors”) called off their industrial action.

Now, a year later, they are back demanding more. On reflection, they have decided that the old deal was not enough. They want a new and similarly vast pay off – another 29 per cent is being suggested.

Until now, public opinion has tended to favour the strikers. This is not because they have a better case than other workers (we almost all ended up getting a real-terms pay cut because of the lockdown) but because we grew up with a high opinion of medical professionals. Closest thing to a religion and all that.

But a poll in the Guardian last weekend showed that public support for the strikes had fallen from 52 per cent last year to 26 per cent now.

Perhaps it reflects a growing sense that, however much the NHS budget increases, things don’t seem to improve. We have more doctors and nurses on higher salaries, but it is harder than ever to see a GP.

There is often a perception-lag in politics and, until recently, Britain’s unimpressive health outcomes were attributed to an imagined lack of funding.

In fact, our health spending has been above-average for a wealthy country since the massive budget increases of the Blair/Brown years. Our lower survival rates and poorer outcomes are purely a result of our insistence, unique in the world, on maintaining a wholly state-run healthcare system.

Which brings us to the irony of these strikes. BMA members fanatically defend the Marxist principle on which the NHS is run: production according to ability, distribution according to need. Yet they don’t like the application of the same principle to their own salaries.

How true is it that their pay has lagged behind? That depends – lagged behind whom?

Compared to other government employees, doctors are doing well. No other group has had anything like a 28.9 per cent pay increase, and even Labour must be aware that caving in yet again would trigger strikes across the public sector. On the other hand, it is true that newly-qualified doctors could do better in other countries… countries without an NHS that can exploit is position as a monopoly employer.

We train doctors very expensively only to see them take their skills to Dubai or Sydney. And we must then replace them with less expensively qualified doctors from East Africa, South Asia, and the Caribbean.

Let’s talk hard numbers. The latest pay settlement means that a resident doctor now starts on £38,831. But bonuses for on-call working take average earnings to about £53,000. By the time they reach the last stage of training, called ST8, basic salaries are £73,992. Working a 40-hour week with a full on-call rota would push earnings to £101,369.

True, resident doctors are earning less than those of their university contemporaries who became lawyers or bankers. But they are hardly indigent.

In any case, arguments about what people deserve are meaningless when there is no money. I might feel I deserve a chalet in a ski resort. My sense of injustice doesn’t change the fact that I don’t have money for it.

We have no money because, for the better part of two years, we paid people to stay at home – a policy warmly supported by the BMA.

We have no money because, since lockdown, a lot of us have stopped working, either refusing to come back to the office or joining the 3,000 people a day going onto sickness benefits.

We have no money because, on inheriting this situation, Labour went on a further spending spree, expanding the state payroll and giving pay rises to its public-sector supporters, doctors foremost among them.

What, then, should Streeting be offering the doctors? One idea which, to his credit, he has taken up, is to let them exchange part of their pension entitlements for immediate cash. It is a sensible suggestion, though I am not sure the BMA will welcome a public discussion about its pensions, which are vastly more generous than those in the private sector.

Another would be to seek to halt the emigration, perhaps by writing off part of doctors’ student loans on condition that they stay in this country. (One of the perverse incentives in the current system is that doctors who go abroad find that their student loan obligations in practice become impossible for the government to recover.)

Again, though, it is far from clear how well such a policy will play with a BMA membership that is already highly internationalised.

Be that as it may, there is, to repeat, no money. However much danegeld ministers would hand over if they could, they have a problem that Ethelred never faced. Britain is borrowing £150 billion a year simply to cover its existing spending commitments. There. Is. No. Money.

Indeed, ministers will soon find that, in order to avoid national bankruptcy, they have to make actual cuts to the public sector – both in terms of the number of employees and in terms of pay and pensions.

It turns out that being in government involves making tough decisions rather than just talking about them. Who knew?

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