Bigger drugs list ‘will mean rise in taxes’
LONG-TERM funding equivalent to a 1% rise in income tax or 50% hike in property tax will need to be found if the States backs proposals to make more drugs and treatments available.
Policy & Resources has spelt out the implications of moving in line with the UK and Jersey, something to be debated next week.
‘Throughout the process of developing this policy, the Committee for Health & Social Care has been clear that it is not willing to pursue it in preference to investing in other areas of policy development which it considers to be a higher priority, offering wider and longer term benefits to the community as a whole,’ P&R president Gavin St Pier says in the letter of comment to HSC’s plans.
‘Health & Social Care also makes it clear that it would not be possible to fund additional drugs and treatments from within its existing general revenue budget without significant cuts to other services it provides which it considers would be a highly unsatisfactory solution and untenable.
‘Therefore, if this policy letter is approved a long-term funding source will need to be found. While interim funding can be made available from the Guernsey Health Reserve (formerly the Guernsey Health Service Fund), this is only a short-term solution.
‘To give an indication of the scale of this requirement to fund this item of policy alone at an ongoing cost of between £8m. and £12m. per year, it would require an increase in revenues equivalent to a 0.5% to 1.0% increase in the headline tax rate, or a 50% increase in all TRP rates.’
Deputy St Pier said that while achieving parity of provision with the UK and Jersey is undoubtedly attractive, it must be considered whether this decision is appropriate for Guernsey.
‘The States are facing unprecedented fiscal pressures and debate on how to address these has already started.
‘It must be clearly understood that the approval of the recommendations in this policy letter will have material fiscal consequences and impact on future taxation.’
P&R has stressed that many of the new drugs are not life-saving treatments and that most patients who might benefit from the extension are captured within the first two years of the phased approach being proposed.
‘The Policy & Resources Committee therefore considers a phased approach with the provision of a second decision point after the first two years of the practical operation of this policy to review the success of its implementation and assess the ongoing costs as essential.’
Health & Social Care wants fresh funding from P&R for drugs and treatments in receipt of a National Institute for Health and Care Excellence (NICE) technological appraisals.
It would spend £5.6m. extra in year one, and £8.3m. in year two.
If approved, HSC would report back after two years with a review of the policy.