April 12, 2008
The Undercover Economist: Cost of living
My family’s experience of the local hospital has been mixed. Sometimes it is impressive; at others it falls below the standard one would expect in the capital of a developed country. Our rule of thumb is that it’s much safer to get sick in Cumbria, where my wife’s parents live.
Although we have had our fair share of dashes to Accident and Emergency, they have been not been so frequent as to constitute a statistically rigorous study of the local facilities. Still, such studies do exist, and one recently published investigation suggests that patients in London have indeed been suffering unduly.
The reason is that many skilled workers in London have decided they have better things to do than work for the National Health Service: in the private sector they can expect to earn 50 or 60 per cent more in London than further north; in the NHS, wages for London staff are relatively meagre. As a result, hospitals in booming areas such as London have more staff vacancies, seem to over-promote staff as a way of giving them more competitive pay, and use more temporary staff hired through private agencies.
The remainder of this column can be read here. Please post comments below.
The UK does seem to have put all its economic eggs in the same finance/media/marketing basket - centralising wealth in London. The effect of rising income inequality on services (due to service workers being priced out) is well documented.
The move to flexible pay structures (London bonus or cost of living allowance) is the right thing to do, but implies more funding through taxation - something that economists (at least the neo-classical kind) tend to argue against…
…there is also a poltical problem: The UK’s opinion formers are overwhelmingly based in the London area where the problems of relatively low public service pay is at its worst - this leads to a distorted view in the media, convincing people in other parts of the country that their services are much worse than they actually are.
The plain fact is that the UK lags behind the OECD average in spending on health and education - you get what you pay for.
Posted by: David | April 14th, 2008 at 9:13 am | Report this comment