The economic recession’s most significant impact on health care demand is expected to be in the area of mental health, and this increased demand is likely to be based more on people’s problems with debt rather than unemployment, Hugh Taylor, permanent secretary at the Department of Health, has told Members of Parliament (MPs).

Recent research has shown evidence of an association between levels of personal debt and mental disorders which are to do with “essentially having control over one's life,” and, if anything, are stronger than links between mental problems and low income levels, Mr Taylor told the House of Commons Health Select Committee’s enquiry into the findings of the annual NHS Public Expenditure Questionnaire (PEQ) last week.

“If we were to have a long period of downturn, then we would expect that to have some impact,” said Mr Taylor, but he also told the MPs that it would be very difficult to estimate what the impact on other behaviours in relation to health - for example, abuse of alcohol and tobacco - would be in a period of long downturn.

Increased demand for new drugs

Committee chairman Kevin Barron (Labour MP for Rother Valley) asked what preparations the NHS was also making for other issues which are expected to have significant impacts on future health budgets.
“Unquestionably, the impact of new drugs will be felt,” Mr Taylor replied, adding: “we can look at that reasonably well because of the length of the pipeline in terms of new drugs coming onto the market.” Also, under the new Pharmaceutical Price Regulation Scheme (PPRS), the government has effectively agreed to reduce drug prices from 2010-11 to produce a recurrent saving of around £450 million a year, and it has negotiated a new system under which “pharmaceutical companies will be able to introduce new drugs to the market at a more flexible price and come back to the National Institute for Health and Clinical Excellence [NICE] to get a reappraised price depending on effectiveness,” he said.

“We are introducing a number of measures which should help us to manage increased demand for new drugs,” Mr Taylor told the MPs, and added that this will be given additional significance “by the essentially more pessimistic outlook in terms of growth which the Pre-Budget Review (PBR), at the moment anyway, marks out for us.”

- This report is based on the uncorrected transcript of evidence given before the Committee. Neither witnesses nor MPs have yet had the opportunity to correct the record.