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Local integration agenda should herald new approach to investing in the public's health

16-05-2019

Public Health England and CIPFA, the Chartered Institute of Public Finance and Accountancy, are calling for a system-wide rethink on how we invest in the public’s health. Plans for increased collaboration between local government and the NHS on population health offer the ideal moment to address the policy challenge of funding preventative health programmes.

In a new joint report, PHE and CIPFA argue that a culture change in the way local organisations evaluate long-term investment in prevention is key to making the most of the proposed shift to Integrated Care Systems by 2021.

The report Evaluating preventative investments in public health in England was developed following a series of round-table discussions with local government and health experts, which highlighted current commissioning challenges.

These include the difficulty in forming a coherent local system-wide view of prevention investment when costs and benefits are spread across a number of organisations and a perception that decisions to invest in prevention are subject to a much higher bar than those to justify treatment spend.

Alongside the clear moral case for preventing people from becoming ill or infirm, improving the public’s health is an important way to secure the UK’s economic prosperity.

Evidence shows that investing in prevention is frequently cost-effective and can reduce NHS or social care costs, as well as reducing productivity losses and wider economic costs such as crime. Fully demonstrating these benefits requires the development of common and transparent approaches.

PHE and CIPFA hope to inform the debate amongst the NHS and local government finance community and commissioners by highlighting the current spend on prevention in England and advocating for a more systematic approach to evaluating the costs and benefits of preventative investment:

  • Prevention spend in England: A key principle for making the case for appropriate investment in prevention is the need for an accurate estimate of overall spend and how this relates to overall spend on healthcare. New PHE analysis published in the report estimates that in 2014, 4.7% of total healthcare spending in England was invested in prevention (£5.2bn in absolute terms). This year was selected as an initial baseline, as this represents the first full calendar year that local authorities took ownership of public health commissioning.
  • Improved evaluation of investment: Any framework to improve the evaluation of long-term investments in prevention should highlight financial and economic costs and benefits as well as taking a whole-system place-based view, unrestricted by organisational focus. The PHE/CIPFA report puts forward a number of methodologies and models that could achieve this, including a focus on Cost Benefit Analysis which has previously had a relatively limited role in health.

Michael Brodie, Finance and Commercial Director for PHE said: “Local organisations share our belief that promoting good health is an investment for their communities not a cost, and they are best placed to know what their community needs. Health and wealth are inseparable and are two sides of the same coin and revenue investments in prevention can support economic growth locally.

“But it’s also a reality that local budgets must work harder every year. Decisions about how to invest or disinvest are complicated by the difficulty of demonstrating the costs and benefits of interventions when these are felt across different sectors.

“We want to champion a common approach which views investment through the lens of the ‘public pound in a place or locality’ rather than the ‘local government pound’ or the ‘NHS pound’. Our report highlights how through transparent policies and the development of metrics to demonstrate revenue investment in prevention, local bodies – through their financial statements – will be able to evidence their commitment to preventative measures.

“We hope this report will provide a valuable contribution to the debate in what will be a crucial year for public health with the implementation of the NHS Long-Term Plan alongside an expected green paper on prevention and a Spending Review.”

Rob Whiteman, CIPFA Chief Executive said: “Developing a robust evidence base for place-based spending on prevention is how we ensure that resources are used wisely to provide the best possible outcomes for the communities we serve.

“This report starts a conversation about how we achieve transparency and consistency in our approach to evaluating preventative investments. We hope it will prompt a shift in thinking and be a catalyst for change in the near future.”

A long-term aim for PHE and CIPFA is to continue to offer insights into how much is spent on prevention across England and promoting economic evidence to argue for a greater share of total spending on prevention.

The two organisations are now looking to engage with at least one local area to test the principles and approaches contained within the report in order to generate further best practice advice.

ENDS

Notes for editors:

  • Round-table events to discuss the development of ‘Evaluating preventative investments in public health in England’ included participation from the Local Government Association, the Association of Directors of Public Health as well as major health think tanks and finance leads from local government and the NHS. Discussions were also held with CIPFA’s health and social care board which includes finance professionals from health and local government.

  • Through the report, PHE/CIPFA advocate the use of Cost Benefit Analysis (evaluation of financial economic costs and benefits), The Green Book/New Economy model (judging comparative merits of investments in a local system) and the International Public Sector Accounting Board guidance and principles of the prudential code (considering long term financial sustainability of an investment).

  • PHE’s methodology for estimating current prevention investment in England uses a wide range of publicly available data sources. In the report we compare this with the UK Health Accounts, which are only available at a UK-wide level.