Monday, 23 January 2017

Obesity is not going to bankrupt the NHS

A new IEA report today looks at the cost of obesity to the taxpayer. This is variously claimed to be £6 billion or £16 billion. When I was on the radio last year, Tam Fry from the National Obesity Forum claimed it was £25 billion per year. These figures are all wrong, but while the £16 billion and £25 billion are totally fraudulent, the £6 billion figure is merely grossly misleading. It is wrong within normal parameters.

When looking at costs to the taxpayer, what matters is the net cost, not the gross cost. The £6 billion figure is based on the gross cost, which is to say that it assumes that if people didn't die from obesity-related diseases they wouldn't die at all (or, at least, would die of a disease that costs no money to treat). This leads to a greatly exaggerated estimate of the financial consequences for the government.

Surprisingly (or not), no one has bothered to estimate the net cost of obesity to public services. Until now. Economist Mark Tovey has now provided that service and Obesity and the Public Purse is the result. He does not challenge the gross cost estimates cited by 'public health', nor does he challenge the assumptions made about the health effects of being obese (and overweight) - although there are reasons to do both. Instead, he takes these figures as fact and works out the savings associated with obesity in terms of uncollected pensions, healthcare, social care etc. and calculates that the total net cost is no more than £2.5 billion per annum - and may be considerably less.

This is not a trivial sum of money but it is only 0.3 per cent of government spending. It is not going to bankrupt the NHS.

Commenting on the report, Mark Tovey, author of Obesity and the Public Purse, said:

“The public deserve better than shoddy guesstimates and exaggerations. Our rigorous, step-by-step estimate of the net cost of obesity on government finances shows the real figure to be less than £2.5 billion. This is not a trivial amount of money, but it is only 0.3 per cent of government spending. Despite the claims of some of the more excitable campaigners, obesity is not going to bankrupt the NHS.”

Christopher Snowdon, Head of Lifestyle Economics at the IEA, said:

“Given the NHS is currently in the icy grip of a winter-related spike in demand, the topic of healthcare costs could not be more pertinent. Every year, the public price of increased longevity is brought into focus as the cold weather drives a growing number of frail pensioners en masse into ailing A&E departments around the country.

“It is good news that we are living longer, but we must get to grips with the financial consequences of this, rather than making scapegoats of people who happen to be fat.”

You can download the report here.

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