Pressures on the healthcare system and social care in the UK are building. Moody’s expects more English councils will fail, due to the falling value of commercial property investments, high inflation, rising interest rates and ballooning demand for social care services.
The disruption from this week’s ‘unprecedented’ industrial action – consultants and junior doctors are walking out in their first co-ordinated strike in the health services’ 75-year history – will have further knock-on effects on waiting lists.
Inactivity due to long-term sickness increased to another record high in the May-July period. According to the ONS, nearly two-fifths (38%) of those economically inactive because of long-term sickness, reported having five or more health conditions (up from 34% in 2019), pointing to increasingly complex health issues.
Inflation is stickier, and growth prospects weaker, than in the US. The budget deficit is still widening vis-à-vis last fiscal year. The public sector is receiving its biggest annual (regular) pay rise since records began in 2001. The cost to the Treasury of indemnifying the BoE’s APF losses continues to be revised higher.
The Fed is in a better position to pause and wait to assess the cumulative impact of its rate increases. The BoE, by contrast, has work to do, to restore its credibility: public confidence in the central bank has fallen to a record low.
