Financing Medicine: The British experience since 1750 (Studies in the Social History of Medicine)

Financing Medicine

The questions of how much and in what way we should pay for our health services are never far from the political agenda. Today Britain relies predominantly on central taxation, but before the National Health Service arrangements were much more diverse, and included private medicine, mutual health insurance, philanthropy and local taxation. The chapters in Financing Medicine tell the story of this changing mix, from the charityfunded voluntary hospitals of the eighteenth century to the recent debates about the desirability of an insurance-based NHS. The book begins by examining the long-run development of the voluntary-sector acute-care hospitals, which over the course of two centuries moved from a reliance on the philanthropy of the rich to a system based on mass contribution by patients themselves. The focus then turns to the provision of tax-funded medicine, initially through resourceconstrained Poor Law institutions, and subsequently through municipal hospitals open to all citizens. Next the book traces the emergence of health insurance as a means of accessing the general practitioner, exploring the innovation of friendly society sickness benefit and its successor, the statutory national health insurance arrangements established in 1911. The final section deals with the period since 1948, when, despite the NHS settlement, the old problems of meeting ever-expanding needs in an equitable manner from limited resources remained as pertinent as ever. The collection provides an introduction to recent work on this important aspect of social and medical history. Its chapters trace the coming of a conception of health care as a right, founded on payment and participation, which underpinned the transition from voluntary to public financing. The long-term view of medical finance which it offers illuminates the problems of providing an efficient and comprehensive service in a system which initially developed through unplanned local initiative. The contributors to this volume provide a sustained and detailed examination of the British model of health care financing, both prior to and under the NHS – an organisation whose distinctive features hold such fascination for scholars of health systems, as well as the history of medicine. Martin Gorsky is Senior Lecturer in the Contemporary History of Public Health at the London School of Hygiene and Tropical Medicine. He most recently co-authored Mutualism and Health Care: hospital contributory schemes in twentieth century Britain. Sally Sheard is Senior Lecturer in History of Medicine at the University of Liverpool. She co-edited Body and City: histories of urban public health. Her most recent coauthored book is The Nation’s Doctor: the role of the Chief Medical Officer, 1855–1998.

Routledge studies in the social history of medicine Edited by Joseph Melling University of Exeter and

Anne Borsay University of Wales, Swansea, UK

The Society for the Social History of Medicine was founded in 1969, and exists to promote research into all aspects of the field, without regard to limitations of either time or place. In addition to this book series, the Society also organises a regular programme of conferences, and publishes an internationally-recognised journal, Social History of Medicine. The Society offers a range of benefits, including reduced-price admission to conferences and discounts on SSHM books, to its members. Individuals wishing to learn more about the Society are invited to contact the series editors through the publisher. The Society took the decision to launch ‘Studies in the Social History of Medicine’, in association with Routledge, in 1989, in order to provide an outlet for some of the latest research in the field. Since that time, the series has expanded significantly under a number of series editors, and now includes both edited collections and monographs. Individuals wishing to submit proposals are invited to contact the series editors in the first instance. 1 Nutrition in Britain Science, scientists and politics in the twentieth century Edited by David F Smith 2 Migrants, Minorities and Health Historical and contemporary studies Edited by Lara Marks and Michael Worboys 3 From Idiocy to Mental Deficiency Historical perspectives on people with learning disabilities Edited by David Wright and Anne Digby 4 Midwives, Society and Childbirth Debates and controversies in the modern period Edited by Hilary Marland and Anne Marie Rafferty 5 Illness and Healing Alternatives in Western Europe Edited by Marijke Gijswit-Hofstra, Hilary Maarland and Has de Waardt

6 Health Care and Poor Relief in Protestant Europe 1500–1700 Edited by Ole Peter Grell and Andrew Cunningham 7 The Locus of Care Families, communities, institutions, and the provision of welfare since antiquity Edited by Peregrine Horden and Richard Smith 8 Race, Science and Medicine, 1700–1960 Edited by Waltraud Ernst and Bernard Harris 9 Insanity, Institutions and Society, 1800–1914 Edited by Bill Forsythe and Joseph Melling 10 Food, Science, Policy and Regulation in the Twentieth Century International and comparative perspectives Edited by David F. Smith and Jim Phillips 11 Sex, Sin and Suffering Venereal disease and European society since 1870 Edited by Roger Davidson and Lesley A. Hall 12 The Spanish Influenza Pandemic of 1918–19 New perspectives Edited by Howard Phillips and David Killingray 13 Plural Medicine, Tradition and Modernity, 1800–2000 Edited by Waltraud Ernst 14 Innovations in Health and Medicine Diffusion and resistance in the twentieth century Edited by Jenny Stanton 15 Contagion Historical and cultural studies Edited by Alison Bashford and Claire Hooker 16 Medicine, Health and the Public Sphere in Britain, 1600–2000 Edited by Steve Sturdy 17 Medicine and Colonial Identity Edited by Mary P. Sutphen and Bridie Andrews 18 New Directions in Nursing History Edited by Barbara E. Mortimer and Susan McGann

19 Medicine, the Market and Mass Media Producing health in the twentieth century Edited by Virginia Berridge and Kelly Loughlin 20 The Politics of Madness The state, insanity and society in England, 1845–1914 Joseph Melling and Bill Forsythe 21 The Risks of Medical Innovation Risk perception and assessment in historical context Edited by Thomas Schlich and Ulrich Tröhler 22 Mental Illness and Learning Disability Since 1850 Finding a place for mental disorder in the United Kingdom Edited by Pamela Dale and Joseph Melling 23 Britain and the 1918–19 Influenza Pandemic A dark epilogue Niall Johnson 24 Financing Medicine The British experience since 1750 Edited by Martin Gorsky and Sally Sheard 25 Social Histories of Disability and Deformity Edited by David M. Turner and Kevin Stagg Also available in Routledge Studies in the Social History of Medicine series: Reassessing Foucault Power, medicine and the body Edited by Colin Jones and Roy Porter

Financing Medicine The British experience since 1750

Edited by Martin Gorsky and Sally Sheard

First published 2006 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN Simultaneously published in the USA and Canada by Routledge 270 Madison Ave, New York, NY 10016 This edition published in the Taylor & Francis e-Library, 2006. “To purchase your own copy of this or any of Taylor & Francis or Routledge’s collection of thousands of eBooks please go to www.eBookstore.tandf.co.uk.” Routledge is an imprint of the Taylor & Francis Group, an informa business © 2006 selection and editorial matter, Martin Gorsky and Sally Sheard; individual contributions the contributors All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging in Publication Data A catalog record for this book has been requested ISBN10: 0-415-35025-5 (hbk) ISBN10: 0-203-68240-8 (ebk) ISBN13: 978-0-415-35025-9 (hbk) ISBN13: 978-0-203-68240-1 (ebk)

Contents

List of figures List of tables Notes on contributors Acknowledgements 1 Introduction

ix x xi xiv 1

MARTIN GORSKY AND SALLY SHEARD

PART I

Voluntary funding and the growth of hospital care 2 The price of charity to the Middlesex Hospital, 1750–1830

21 23

BRONWYN CROXSON

3 Charitable bodies: the funding of Birmingham’s voluntary hospitals in the nineteenth century

40

JONATHAN REINARZ

4 Regional comparators in the funding and organisation of the voluntary hospital system, c.1860–1939

59

STEVEN CHERRY

5 ‘The caprice of charity’: geographical variations in the finances of British voluntary hospital services before the NHS JOHN MOHAN

77

viii

Contents

PART II

Local government and medical institutions 6 Paying for the sick poor: financing medicine under the Victorian Poor Law – the case of the Whitechapel Union, 1850–1900

93 95

KEIR WADDINGTON

7 Reluctant providers? The politics and ideology of municipal hospital finance 1870–1914

112

SALLY SHEARD

8 The Bradford Municipal Hospital experiment of 1920: the emergence of the mixed economy in hospital provision in inter-war Britain

130

TIM WILLIS

PART III

General practice and health insurance 9 Friendly society health insurance in nineteenth-century England

145 147

MARTIN GORSKY

10 ‘Strong combination’: the Edwardian BMA and contract practice

165

ANDREW MORRICE

11 The economic and medical significance of the British National Health Insurance Act, 1911

182

ANNE DIGBY

PART IV

Contemporary issues

199

12 A double irony? The politics of National Health Service expenditure in the 1950s

201

TONY CUTLER

13 Inequalities, regions and hospitals: the Resource Allocation Working Party

221

JOHN WELSHMAN

14 Financing health care in Britain since 1939

242

RODNEY LOWE

Index

252

Figures

5.1 5.2 5.3 5.4 7.1 7.2 11.1 11.2 11.3

Voluntary hospital expenditure per bed, 1891 and 1937 Regional trends in expenditure on voluntary general hospitals, 1891–1937 Expenditure versus throughput for voluntary hospitals, 1937 Sources of income for voluntary hospitals, 1937–39 Annual expenditure by local authorities on hospitals in England and Wales, 1885–1913 Liverpool hospital annual recurrent expenditure, 1885–1913 Dr Owen’s Birkenhead panel practice, 1924–33 Large-panel practitioners in Birkenhead, 1914–34 Panel incomes in 1913

80 83 84 87 120 124 187 188 189

Tables

2.1

3.1 3.2 3.3 4.1 4.2 4.3 4.4 6.1 9.1

9.2 10.1 12.1 12.2

12.3

The Middlesex Hospital’s five-year average annual income, 1746–97, grouped into the major income categories used by the hospital Subscribers to the General Hospital, Birmingham, 1779, 1800, 1810 and 1820 Subscribers to Birmingham Hospitals, 1860–1900 Fines to Birmingham General Hospital, 1784–1826 Composition of British voluntary hospital income (quinquennial/decennial means), 1890–1938 Composition of ordinary income in five Norfolk and Suffolk hospitals, 1900–39 Composition of ordinary income in four South Yorkshire hospitals, 1900–39 Composition of ordinary income in the four Sheffield voluntary hospitals, 1900–39 Occupational background of elected guardians (Whitechapel Union), 1853–73 Correlation coefficients between friendly society membership density and socio-economic variables in forty-one English counties, 1803 The extent of friendly society membership in selected localities, 1874 Distribution, attendances and earnings in contract practice contracts, 1905 National health expenditure in constant (1985) prices 1950–51 to 1959–60, and 1978–79 to 1987–88 Social service expenditure trends, United Kingdom 1951–52 to 1959–60, expenditure in £ million, actual prices (indices in brackets, 1951–52 = 100) Proposed NHS charges and estimated revenue yields, Great Britain, December 1951

26 42 43 47 61 63 64 67 106

149 153 173 202

204 213

Notes on contributors

Steven Cherry is Senior Lecturer in the School of History at the University of East Anglia, Norwich. His publications include Medical Services and the Hospitals in Britain 1860–1939 and Mental Health Care in Modern England, and is editor, with Josef Barona, of Health and Medicine in Rural Europe 1850–1945. Bronwyn Croxson is an economist currently working in the Social Policy Branch of the New Zealand Treasury, with an honorary post at the Health Services Research Centre, Victoria University of Wellington. She has previously held posts at the Centre for Market and Public Organisation, University of Bristol, the University of East Anglia and the University of Cambridge. She completed a PhD on the economic history of the eighteenth-century London voluntary hospitals. Tony Cutler is Professor of Public Sector Management, Royal Holloway, University of London. His books include Keynes, Beveridge and Beyond, with J. and K. Williams, and Managing the Welfare State, with Barbara Waine. His research interests include the financial history of the National Health Service and its relation to the use of management techniques in the Service. Anne Digby is Research Professor in History at Oxford Brookes University. She has published widely on the medical history of Britain and of South Africa, including Madness Morality and Medicine; Making a Medical Living; The Evolution of British General Practice, 1850–1948; Diversity and Division in Medicine: Health care in South Africa from the 1800s. Currently she is researching the history of Groote Schuur Hospital, Cape Town, in collaboration with colleagues from the University of Cape Town. Martin Gorsky is Senior Lecturer in the Contemporary History of Public Health at the London School of Hygiene and Tropical Medicine. His publications include Patterns of Philanthropy, and he is co-author of Mutualism and Health Care: British hospital contradictory schemes in the twentieth century (forthcoming). His current research focus is the integration of the British health system in the mid-twentieth century, and is sponsored by the Wellcome Trust.

xii

Notes on contributors

Rodney Lowe is Professor of Contemporary History at the University of Bristol. He is currently on long-term secondment to the Cabinet Office to write the official history of the Civil Service since 1968. He has written widely on welfare policy and policy-making in Britain and abroad during the twentieth century. Amongst his recent works are The Welfare State in Britain since 1945 and, with Margaret Jones, From Beveridge to Blair: the first fifty years of Britain’s welfare state. John Mohan is Professor of Social Policy at the University of Southampton, though the research on which his chapter drew was conducted in the Geography Department, University of Portsmouth. He has written extensively on historical and contemporary aspects of health care and health policy, and is the author of Planning, Markets and Hospitals; Social Capital, Place and Health, with Kelvyn Jones, Liz Twigg and Steve Barnard; and Mutualism and Health Care: British hospital contributory schemes in the twentieth century, with Martin Gorsky and Tim Willis (forthcoming). Andrew Morrice qualified as a doctor in 1991 from St Mary’s Hospital Medical School in London, where his studies included the Wellcome Institute’s intercalated BSc in the History of Medicine. He later spent two years as a Research Fellow at the WIHM at UCL, culminating in his 1999 MD thesis on the work of the BMA’s Ethical Committees in the early twentieth century. He currently works as a GP in Somerset and teaches medical students at Bristol University. Jonathan Reinarz is a Wellcome Research Fellow in the Centre for the History of Medicine at the School of Medicine, University of Birmingham. He is writing a history of Birmingham teaching hospitals, and has recently commenced a Wellcome-funded project examining the history of medical education in provincial England between 1800 and 1939. He has published on various aspects of economic, social and medical history, including technological change, apprenticeship, and the brewing industry. Sally Sheard is Senior Lecturer in history of medicine at the University of Liverpool. Her research interests include the political economy of British public health and local government in the nineteenth and twentieth centuries, and the development of medical authority. She is co-author, with Professor Sir Liam Donaldson, of The Nation’s Doctor: the role of the Chief Medical Officer, 1855–1998. She co-edited, with Helen Power, Body and City: histories of urban public health. Keir Waddington is Senior Lecturer in history in the School of History and Archaeology at Cardiff University. He is co-author of The History of Bethlem and author of Charity and the London Hospitals; Medical Education at St Bartholomew’s Hospital; and The Bovine Scourge: meat, tuberculosis and public health, 1850–1914. He is currently working on a textbook for Palgrave on health and medicine, 1500 to the present.

Notes on contributors

xiii

John Welshman is currently Senior Lecturer in Public Health in the Institute for Health Research at Lancaster University. His research interests are in the history of social policy and public health in twentieth-century Britain, on which he has published widely. His most recent book is Underclass: A History of the Excluded, 1880–2000 and editor (with Jan Walmsley) of Community Care in Perspective: care, control and citizenship. He is currently working on the history of debates around the concept of transmitted deprivation. Tim Willis is a Social Researcher with the Work, Welfare & Equality Group of the Department for Work and Pensions. Before joining the Civil Service he worked as a Research Fellow at the University of Wolverhampton and the London School of Hygiene and Tropical Medicine. A historian of politics and policy by background, he has previously published on municipal health care between the wars, vaccination policy, and mutual health insurance in the twentieth century.

Acknowledgements

The majority of the chapters in this collection originated as papers delivered at a Wellcome Trust Research Symposium on Financing Medicine in 1996. Our thanks go to Anne Hardy and Keir Waddington for organising this, and for their initial editorial work. Rodney Lowe’s chapter is a revised and updated version of an earlier paper which first appeared on the ‘History and Policy’ website: http://www.historyandpolicy.org/archive/policy-paper-08.html. We are grateful to the site’s moderators, Simon Szreter and Alastair Reid, for permitting its publication here. We would also like to thank the anonymous referees at Routledge for their suggestions, which helped to shape the final balance of papers in the book.

1

Introduction Martin Gorsky and Sally Sheard

As the World Health Report 2000 observed, the development of health systems in the twentieth century has been driven in part by the desire to address health needs with efficiency, fairness and responsiveness to expectations.1 Some states pin their faith on market solutions, trusting to the incentives of competition to ensure quality and access. Others depend on a combination of private medicine and social insurance, operating within a statutory framework.2 Since the midtwentieth century Britain has chosen to rely principally on direct, general taxation and hierarchical government control, an approach which, while not unique, is untypical. It differs, for example, from neighbours France and Germany, which rely to a greater extent on social and private health insurance, and from the United States, in which the private sector plays a larger part.3 Nonetheless the National Health Service (NHS) initially proved both popular and successful, in that it was deemed to be meeting the desired health outcomes without imposing an excessive burden on the public purse.4 However, since the oil shock of the 1970s and the subsequent curbs to welfare state expansionism, policy-makers in Britain have increasingly looked abroad for inspiration.5 Does the American system show that market disciplines will increase efficiency and responsiveness?6 Does non-profit self-government for hospitals, for example following the Spanish Alcorcon model, enhance service delivery?7 Does the Scandanavian reliance on local government as health-service provider offer greater accountability to the public?8 Do levels of expenditure and satisfaction in Western Europe suggest that insurance enhances social willingness to pay for health care and ensures greater responsiveness to consumers?9 Conversely, the virtues of the British system hold their own allure. A service that, at least nominally, aims to deliver universal, comprehensive provision free at the point of use is attractive to societies in which coverage is costly and partial.10 And, in circumstances of market failure due to poorly informed consumers, might a strong central bureaucracy not be the most effective way of containing costs of pharmaceuticals and doctors’ services? Thus the cross-national assessment of the costs and benefits of private, non-profit and public delivery of health services provides an essential tool for those who seek to understand and develop health systems The starting point of this volume is that analysis of the historical record is an

2

M. Gorsky and S. Sheard

equally valuable tool. This is particularly so in the British case, and not simply because its recent past provides a prime example of central funding and direction. Prior to the National Health Service Acts (England, 1946; Scotland, 1947) Britain offered perhaps the pre-eminent illustration of a mixed economy in health care.11 A substantial private sector operated, with those on middle incomes and above for the most part paying commercial rates to their doctors.12 Statutory health insurance covered workers on lower incomes for general practitioner care, while non-profit contributory schemes provided hospital care on a quasi-insurance basis. Teaching hospitals and major general and special hospitals lay within the voluntary sector, and drew their income principally from philanthropic and private sources.13 A panoply of services was provided by local government through local taxation, including the sanitary infrastructure; general, maternity and infectious disease hospitals; and schemes for addressing venereal diseases, tuberculosis and infant welfare.14 Finally, on the boundary of health and social care, the workhouses and infirmaries of the Poor Law (Public Assistance after 1929) accommodated the impoverished elderly, the sick poor and the mentally ill.15 The British past therefore offers its own rich resource for examining different forms of health-service provision, the attitudes of our predecessors towards these, and the changing ways in which they were paid for. The theme of this book, then, is the development of the British medical services viewed from the perspective of their mode of finance. Its coverage extends from the later eighteenth century to the late twentieth century, and its focus lies on four main areas. First, it considers the history of the voluntary hospital, depicting its shift over the long run from an institution reliant on the charity of the rich on behalf of the needy, to a service funded principally by its users. Second, it examines the growing role of the state and the local taxation system in hospital care. This was manifested initially in the tendency of the Poor Law to differentiate its health care from its relief duties, and later in the willingness of local government to enter the field of institutional provision. Third, it traces the advance of health insurance, from its beginnings with friendly society sickness benefit to the emergence of a ‘club’ system which provided medical care for the working class, which in turn supplied the model for the more extensive national health insurance (NHI) arrangements instituted by the Liberal government in 1911. Fourth, it explores the financial ramifications of the NHS structure, as health competed for resources with other spending departments, as new questions were raised about how to distribute expenditure equitably, and as persistent doubts arose over the advisability of tax-based rather than insurance-funded health provision. How does this range of subjects fit into the broader history of British health service financing? We begin by outlining some key aspects of the economic history of medical services since about 1750. In the course of this we will highlight the contributions which the authors in this collection make to current knowledge. What do they show about why the funding of the health system developed in the way that it did? And what were the implications of these arrangements for the nature and extent of health care?

Introduction

3

Philanthropy and the voluntary hospitals The eighteenth century witnessed ‘an unusually spectacular blossoming of commercial medicine’ in which the market for attendants and therapies was highly diverse and unregulated.16 Practitioners of conventional medicine vied with a host of quack doctors and amateurs for the business of the public, who might equally prefer self-medication.17 Institutional care in 1700 was minimal: Britain’s earliest public hospitals had been religious foundations with mixed pastoral functions, many of which were suppressed in the Henrician Reformation.18 Subsequent charitable effort had been directed towards schooling and almshouses rather than hospitals dedicated to medical care. Parish poor relief gave financial aid to those made destitute through sickness, but the Poor Law contained no statutory remit to provide medical services.19 The coming of mass, urban industrial society, then, both created a need for new forms of health provision and furnished the wealth which would pay for them. The most visible and highly capitalised of these new forms were the voluntary hospitals, which were founded in British towns and cities from the mideighteenth century. These institutions drew their income principally from the philanthropic gifts of wealthy local supporters, and relied on the unpaid labour of honorary consultants and management committees recruited from local elites.20 The timing of their appearance makes it tempting to see the voluntary hospitals as an integral element of the transition to industrial capitalism, a means by which the property-owning class safeguarded and restored its human capital. There is certainly good evidence that employers loomed large amongst the hospital’s supporters and that its prime function was to address acute disease experienced by younger workers, rather than the health needs of the economically inactive.21 The admissions system, under which the sick needed to solicit a letter of recommendation from a hospital subscriber, seems to have operated in the early industrial era as personal patronage which instilled deference and strengthened social bonds.22 However, the emergence of voluntary hospitals was also driven by non-economic factors. These included their function in the political world of the town and county, where they provided a new venue for the exercise and display of power; their appeal both to old and new money as a means of displaying wealth and status; their utility to doctors in a competitive marketplace who used hospital work to gain prestige, experience and lucrative connections; and the allure of hospital charity as a means of expressing the humanitarian impulses of the late eighteenth century or the ‘feeling heart’ of nineteenthcentury evangelicalism.23 The early history of voluntary hospital financing is examined through detailed case studies in Chapters 2 and 3. Both show how economic imperatives shaped the interaction of lay trustees, medical men and patients, with important consequences for the character of care. Croxson’s study (Chapter 2) focuses on London’s Middlesex Hospital and the world of the eighteenth-century benefactor, whose annual subscriptions provided the bedrock of financial support. The control which benefactors exercised over admissions defined the hierarchical

4

M. Gorsky and S. Sheard

relationship between philanthropic elites and working people – a dialectic of dependence and obligation, related to labour market, service, property ownership and so on. Reviewing the tensions between the doctors and hospital benefactors over control of admissions, Croxson suggests that initially both groups were forced by a fund-raising imperative to give primacy to maximising the number of successful cures. However, from the mid-nineteenth century medical professionals gained greater autonomy, as admissions by letter of recommendation fell and new hospitals abandoned the system. This decline in the rights of the subscriber, alongside the ‘medicalisation’ of the hospital, is clarified further in Reinarz’s study of the voluntary hospitals of Birmingham during the nineteenth century (Chapter 3). The great manufacturing centre of the Midlands contained a range of teaching, specialist and general hospitals, and Reinarz explores their relationship with a specific urban economy and philanthropic milieu in which they competed for funds. He shows how in the course of the century they expanded their funding base so that individual subscription, with its accompanying rights, assumed a lesser importance. This was a period of transition in which the dominance of lay individuals and the church as the major donors gave way to that of business, the leisure industry and organised mass funding, a process characterised by Reinarz as one of democratisation. However, the removal of individual scrutiny by the subscriber also meant that charity needed to become more ‘scientific’, to prevent abuse of the free services by patients who could afford to pay for themselves. Reinarz notes that such developments sit uneasily with historical claims for a ‘de-personification’ of the patient ushered in by the rise of laboratory diagnostics. In contrast, the financial concerns of voluntary hospitals ensured that almoners and clerical staff continued to address the ‘whole’ patient.

Public hospitals before 1914 While the voluntary hospitals were associated with medical advance and prestigious institutional development, it was the public sector that contributed more to the betterment of population health. The Europe-wide fall in mortality which began in the mid-eighteenth century had slowed in England in the early nineteenth century, as the mushrooming cities exacted an ‘urban penalty’ on their more vulnerable citizens.24 Town living meant exposure to heightened risks of occupational and infectious diseases in an unregulated environment of poor housing and inadequate drainage and water supply. Although the resumption of a decline in mortality from about 1870 was partly attributable to improvements in nutritional status following rising living standards, it was also due to the gradual adoption of sanitary reform measures, implemented by local government and funded by local taxpayers.25 Alongside its role in prevention, the public sector also assumed increasing responsibilities for care and cure. Medical activities financed by the Poor Law increased in number. Poor claimants were able to access doctors’ services both through the workhouse and in the home, with some areas providing relatively generous subsidies for medical care and vaccination.26

Introduction

5

After the Poor Law Amendment Act of 1834 this situation changed, as government sought to apply the tenets of economic liberalism to the problem of poverty.27 Out-relief (domiciliary support) was now to be targeted at the infirm and incapacitated, while the workhouses were subject to disciplinary regimes that would act as a deterrent to claimants. Alongside this agenda of ‘less eligibility’ to motivate the work-shy went a reform of the administrative structure, with power removed from parishes to larger Unions overseen by Boards of Guardians, who embarked on a major workhouse building programme.28 To some extent the Dickensian image of the workhouse as Poor Law Bastille has been modified by studies which demonstrate that the harshness of central policy was modified by humane local practice.29 None the less, medical care was not a central consideration and the quality of provision for the sick initially fell far below that of the voluntary hospitals.30 Chapter 6, on the Victorian Poor Law, explores the financing of public medicine in the wake of the 1834 Amendment Act. The process is exemplified by Waddington’s study of the Whitechapel Union, located in London’s East End, which, although comparatively small, had an income far in excess of that which a voluntary hospital could muster. Initially reliance on limited resources drawn from the local rates prevented the development of medical services, but from the 1860s expenditure rose, following diversification of the financial base through greater borrowing, the charging of patients’ relatives and central government grants. Revenue growth allowed the Union to separate the infirmary from the workhouse and provide for the development of specialist medical care, both under the Poor Law and by contracting from voluntary hospitals. However, Waddington’s analysis of the Guardians themselves leads him to conclude that economic rather than humanitarian considerations were uppermost: more efficient treatment of the sick poor would return workers to productivity and thus relieve the rate burden. Gradually the stigma of resorting to the Poor Law began to decline amongst local users, who came to accept the infirmary as an element in the broader network of provision. Chapter 7 deals with another part of that network, municipal government, and the department of state which oversaw it, the Local Government Board. Sheard’s particular focus is the programme of hospital building undertaken by local authorities between about 1870 and 1914. The spread of isolation hospitals followed the Infectious Disease (notification) Act of 1889, which placed on local councils statutory obligations to tackle designated diseases. Instead of contracting services from the voluntary sector or relying on the Poor Law, municipal authorities chose to develop their own capacity. This choice, Sheard argues, reflected the impact of new disease transmission theories and the increased financial capacity of local government. She uses taxation records to trace empirically the timing and extent of this massive investment in public capital projects, and demonstrates through a comparative analysis that the largest and wealthiest towns were not always the biggest spenders on hospitals. She concludes with a case study of municipal hospital provision in Liverpool – a large, progressive urban authority. Here the story is illustrative of recurrent tension between the

6 M. Gorsky and S. Sheard city council and the Local Government Board, as different local priorities impeded the expansion of municipal hospital provision desired by central government.

Sickness insurance: from mutualism to state welfare Despite these developments, for most of the population publicly-funded services remained a small component of the medical economy: municipal infectious diseases hospitals were used only by a few, while accessing medicine through the Poor Law carried a stigma which persisted into the twentieth century.31 The alternative was out-of-pocket purchase of medical care, and in this marketplace the process of professionalisation increasingly differentiated the licensed, trained ‘regular’ practitioner from the quack.32 By the mid-nineteenth century the ‘general practitioner’, whose work spanned the traditional areas of the surgeon, the midwife and the apothecary, had emerged and developed a broad appeal.33 The medical schools of London and Edinburgh were joined by those in provincial cities, encouraged in part by the voluntary hospitals whose wards and expert staff provided new opportunities for clinical teaching.34 Indeed, so keen were middle-class families to secure the professional status which a medical career promised that the marketplace gradually became overcrowded with new entrants as the century advanced.35 The general practitioner’s clientele therefore extended far beyond the well-off. The spectre of sickness was particularly feared because of the threat to the family economy of loss of earnings. This risk was met through mutualist health insurance for working people, financed by low-cost subscriptions to friendly societies.36 These were voluntary associations with roots in ale-house clubs, where small sums were pooled monthly and used to fund members’ benefits at times of sickness or death. During the nineteenth century the friendly society movement developed substantially, and it was common for members to receive medical attendance alongside a cash benefit during periods of sickness.37 There has been much historiographical interest in the later period, with respect both to the politics of national insurance and to the potential of friendly society statistics to explicate morbidity trends.38 However, less is known of the movement’s role in the early development of medical care, and it is to this issue that Chapter 9 contributes. Gorsky begins by assessing the extent to which concern with medical risks, particularly related to occupational health, may have determined the growth of the movement. However, evidence of the geography of membership and of occupational exclusions in early rulebooks suggest that these were only peripheral considerations when set against income replacement. For those who were covered, a cash sickness benefit was the norm from the outset, with the employment of doctors to assess and treat sick members becoming a regular feature only from the mid-century. It therefore seems more likely that the early growth of prepaid domiciliary medical attendance came about not because it was desired in itself, but because doctors were instrumental in policing claims and

Introduction

7

guarding the funds. This occurred as branch sizes grew and the context of membership evolved beyond tight community bonds, which had hitherto constrained the threat of moral hazard. Yet both sides benefited. Members enjoyed greater security against duplicitous claims, and access to qualified doctors whose advice was increasingly trusted. Doctors gained a career niche in a competitive profession, and fostered increasing public demand for the services of regular practitioners. Gorsky concludes with an empirical discussion of the extent of friendly society membership at different times in the nineteenth century, cautioning against over-optimistic assumptions of the numbers who accessed doctors through this channel. The experience of friendly society work was not always congenial for doctors. By the late-Victorian period ‘club practice’ had become a significant element in the nation’s medical economy, and doctors found themselves competing on price for society business. Not only did this violate the gentlemanly demeanour of the profession, it also threatened to depress incomes for all doctors, particularly as there were fears that the ever-growing membership of the societies included many who could afford commercial rates. The subject of Chapter 10 is the response of the doctors’ trade body, the British Medical Association (BMA), to insurance work in the Edwardian period. Morrice shows that from 1902 the BMA set out to abolish contract practice arrangements that were not to its liking. In doing so it drew on the successful model of workingclass trade unionism, on ideals of sociability and solidarity and on an emerging set of ‘ethical’ rules. At the same time, the BMA’s campaign also entailed extensive research into contract practice which provided information that was later drawn on in the preparations for statutory national insurance. Indeed, many of the recommendations it laid down became the ‘cardinal points’, largely won from Lloyd George in 1911, when doctors gained a doubling of capitation rates under the state scheme. Even then some in the profession still construed this as a defeat, since control of NHI was not in the hands of the profession but remained with the mutual and commercial funds, which now became ‘approved societies’. Morrice therefore demonstrates that an aversion to lay control and a concern for gentlemanly independence was at the heart of the profession’s response to the state health system from the outset. Indeed, the collective success of doctors in managing the price paid for their services has influenced the cost of providing medical care ever since. The transmutation of friendly society health insurance into a more comprehensive state scheme is of course only one element in the larger process of the coming of welfare states. Why, in the early twentieth century, was the financing of medicine increasingly managed, either directly or through third parties, by the state? Such was the vigour of economies in the developed world that wages could sustain the development of health services, funded either through taxation or through mandatory insurance arrangements.39 At the same time, population health became a key policy concern in an era of imperial rivalries and economic competition.40 Some readings also stress the importance of the extension of mass democracy, in that broadening political citizenship raised expectations of social

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rights.41 That said, it was a more authoritarian state, Bismarck’s Germany, that pioneered compulsory health insurance in 1883.42 The Krankenkassen (sickness funds) were a key influence on Lloyd George, and the implementation of national insurance in Britain was in part a policy transfer based on German experience.43 The question of how the coming of national health insurance (NHI) impacted on both doctors and patients is the theme of Chapter 11, which draws out the health implications of the new financial regime. Despite the initial concerns of the BMA (which Morrice’s work highlighted), the majority of doctors saw the advantage offered by the new system of public payments for taking on ‘panel’ patients. Enrolment in the scheme guaranteed them a core income which could be supplemented by private practice. Patients gained too, as low-income areas previously unable to sustain a practice could now support one. Further benefits for working-class patients included freedom from out-of-pocket charges, which encouraged the insured to attend their doctor more frequently and at an earlier stage. However, Digby also shows how the statutory framework placed constraints on the system. A limited range of conditions could be treated and, crucially, payment was by capitation (a fixed sum according to the number of patients on the panel roll) rather than by fee for service. Doctors therefore had little incentive to improve the quality of care offered to working-class patients, and consultations tended to be brief, thus freeing up more time to attend paying patients.

Hospital finances before the NHS: a period of transition Another limitation of the British NHI scheme was the exclusion of a hospital benefit. Lloyd George had seen its principal remit as the relief of poverty, not the delivery of comprehensive health care, and hospitalisation therefore fell outside the new arrangements (although a sanatorium benefit for tuberculosis patients was initially included).44 The power and prestige of the voluntary-hospital lobby also kept the state at arm’s length, for fear that it would undermine their independence.45 However, the problems of raising income for the hospitals from private sources grew more acute as the century progressed. Traditional philanthropy lost much of its vigour as income tax bit into middle-class earnings, and the First World War further undermined patrician charity, already reeling under the impact of falling incomes.46 Meanwhile, the screw of expenditure demands turned relentlessly: labour costs were driven up by skilled nurses, salaried residents and ancillary staff, while advances in medical technology and infrastructural change (such as electrification, steam laundries, telephone systems and lifts) added to the pressure.47 Chapters 4 and 5 document and evaluate the voluntary hospitals’ response to the challenge of providing mass medicine in this financial context. Cherry’s approach is a detailed study of hospital provision in two regions, South Yorkshire and East Anglia. His survey runs from 1890 to 1939, allowing him to observe how some of the new fund-raising initiatives, noted earlier by Reinarz,

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played out over a longer period. With respect to income, the workplace contributory funds soon developed into organised forms of payroll deduction premised on quasi-insurance principles, and direct patient charges were also imposed. There were also financial incentives to seek public sector co-operation with municipal and Poor Law hospitals as payments were made for referred patients. Cherry’s case studies suggest that it is possible to discern the emergence of a hospital system before the NHS. Community responsibility and patient choice emerge as strong factors in this process, prompting the striking of relatively sophisticated agreements between the public and private hospital sectors. Patient mobility between types of hospitals increased in the 1930s – particularly in regions such as Norfolk, which operated a centralised contributory scheme. Cherry’s analysis provides an important counterpoint to the case of London, where philanthropy continued to have greater importance in voluntary hospital finance.48 On the one hand he stresses the resilience and continuing viability of the sector on the eve of the NHS, but on the other he points to regional differences and the lack of comprehensive cover. Cherry’s case-study methodology is complemented by Mohan’s quantitative survey of regional variations in national hospital expenditure and income patterns. Using a large dataset of voluntary hospital finance and utilisation between 1891 and 1939, he is able to map the geography of hospital spending, showing a marked urban/rural divide, with the towns more favoured, as well as other regional differences. He then sets these differences in expenditure against a measure of utilisation and is able to show that they impacted on the quality of care. Not only did variable levels of expenditure affect the level of service, they were also not improving: despite the shift away from reliance on philanthropy towards user payments, there was no significant regional convergence in the first half of the twentieth century. Finally, Mohan turns to income, analysing spatial differences in revenue sources and demonstrating the variations in the funding mix which underpinned this uneven geography of expenditure and utilisation. He concludes with some reflections on the recent trends towards promoting greater financial autonomy for NHS foundation trusts. Is there a risk that history might repeat itself, with a similar distortion of resource distribution and a comparably detrimental impact on care? Although government in the early twentieth century favoured retaining an independent voluntary hospital sector, it also committed substantial sums to public medical provision.49 In Britain the threat of infectious disease had receded significantly between 1870 and 1920, but expenditure on public health services still had to be maintained. This was the duty of local authorities, particularly the councils of urban districts and county boroughs (the largest towns). Also, council housing stock multiplied in the inter-war period, reliant on a mix of government grants, rental income and local taxes.50 Public bodies also moved increasingly to provide institutional health care, with the incentives of Treasury grants encouraging local initiatives. Venereal disease clinics (typically in voluntary hospitals) were funded from 1916 by this central/local mix, as were tuberculosis sanatoria (from 1911), homes for ‘mental deficiency’, and maternity and

10 M. Gorsky and S. Sheard child welfare services (from 1914).51 Finally, asylums and hospitals were an ever-growing component of municipal budgets. A watershed was reached in 1929, when the Local Government Acts empowered councils to establish ratefunded general hospitals.52 This signalled that they should go beyond their original function of containing infectious diseases and encroach upon the terrain of acute hospital medicine, hitherto the province of the voluntary hospitals. It is arguable that the advent of the municipal general hospital hastened the demise of the voluntaries, and the aim of Chapter 8 is to interrogate the underlying causes of this process.53 Willis’s method is a case-study of the hospital service in the northern English city of Bradford, chosen because it was a pioneer municipality, which established a general hospital several years before the legislation of 1929. The proximate cause was a crisis of provision in 1919, when waiting lists built up at the voluntary hospital while 600 beds lay vacant at the Poor Law infirmary. By proposing to take over the Poor Law institution, the council sought to remove the stigma of pauperism from public hospital care and thus ease the crisis. However, the implication was that rights of access to a taxfunded hospital would now be open to all citizens, not just the dependent poor or isolation patients. The proposal was therefore bitterly contested by the voluntary hospital managers and the local branch of the BMA, who decried it as municipal socialism. Willis explores the reasons why Bradford Corporation overcame this challenge and won approval for its initiative. Politics and ideology played a part, in that the Labour Party (which was then committed to an extension of public ownership throughout the economy) supported the measure, both locally and nationally.54 However the driving force appears to have been an official, the local Medical Officer of Health, who sought a pragmatic solution to the problem of scarce resources. The Bradford experiment created a vital precedent: part technocratic, part ideological, it was a notable step in the development of Britain’s tax-funded hospital system.55

The NHS era: problems of funding and resource allocation In popular memory the coming of the National Health Service was the creation of a post-war Labour government committed to a wider programme of industrial nationalisation and universalism in welfare.56 However, a broad shift of opinion behind organisational and financial reform had been building through the interwar period.57 The political left had long countenanced greater state agency, with the trades union movement advocating an extension of NHI, and the Socialist Medical Association championing local government health services.58 Even so, it was the Conservative government which framed the Local Government Acts, whose health clauses both encouraged municipal medicine and institutionalised the public/voluntary mix. By the 1930s, policy-makers were talking increasingly of financial consolidation and of greater co-ordination and integration of services. In part the turn to system-building was driven by progress in medical science, in that the demand for expertise and specialist technology necessitated the forging of referral networks between hospital centres and primary care.59

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Another determinant was the vogue for planning which pervaded policy discourse in the 1930s. The conviction that principles of ‘scientific management’ borrowed from business could be applied to social and economic policy had gained ground with think-tanks of both right and left, especially when unemployment surged after 1929.60 Even the notoriously individualistic voluntary hospital leadership proposed forming regional associations with pooled revenues, though both they and many doctors remained wary of the dirigisme which they associated with state health services.61 This uneasy consensus for change was impelled forward by war. The expectation of mass civilian casualties from aerial bombing prompted the formation of an Emergency Medical Service which introduced area planning: voluntary hospital exchequers were relieved by state subventions, and medical staff saw for themselves the poor quality of many public facilities.62 All this undermined professional resistance to state direction. Meanwhile the popular mood was swayed by the publication of the Beveridge Report, which envisaged a comprehensive health service as a co-requisite of a universal social security system.63 More controversially, it is possible that the shared hardships of the Home Front fostered an unprecedented degree of social solidarity, which sustained a leftward political swing. By the time of Labour’s election victory in 1945, a White Paper with plans for achieving a comprehensive service had already been issued by the cross-party national government.64 Building on this groundwork, Labour’s legislation went further than previous proposals, creating both a unitary funding system and a hierarchical management structure. The new system was to have a tripartite arrangement, over which the Minister of Health had statutory responsibility.65 Voluntary hospitals, along with most of their charitable resources, were nationalised and placed under Regional Hospital Boards alongside the municipal infirmaries, which were removed from the local authorities. General practice was overseen by regional Executive Committees and doctors remained independent, with the majority contracting into the NHS. Commercialism diminished, as the buying and selling of practices was terminated and universal access, free at the point of use, drastically reduced the scope for private medicine.66 Local authorities were deprived of many of their public health duties, though they retained a limited role in providing personal medical services such as health-visiting, home nursing, midwifery, psychiatric social work and preventive programmes.67 Funding too was centralised. The insurance principle, whether statutory or voluntary, was set aside in favour of direct taxation, the better to achieve the goal of a comprehensive universal service.68 In the half-century that has elapsed since the ‘appointed day’ (5 July 1948) on which the service was launched, the euphoria which accompanied it has been tempered. Looking back, the official historian of the NHS concludes that it ‘has been mismanaged, neglected and starved of resources’, and late twentiethcentury concerns have focused on the comparatively low level of national wealth devoted to health.69 The book’s final three contributions illuminate some of the problems with the new system. One key difference was that the NHS

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relied predominantly on a single funding source, where hitherto medicine had drawn on four – private and voluntary payments, and local and national taxes – all of which were subject to different pressures. Now the fledgling service was in competition with other spending departments that also pressed their claims on the Exchequer, and the repercussions of this for the NHS are the subject of Chapter 12. Taking a long-run view of NHS expenditure, Cutler shows that the 1950s was a period of austerity comparable to the Thatcherite retrenchment of the 1980s. Part of the problem was the political weakness of the Ministry of Health, whose lack of Cabinet status hampered its dealings with the Treasury. Its position was damaged further by the clumsy underestimates made by civil servants who had forecast the cost of the service. The outcome was constrained expenditure, which grew at a much slower rate than education spending. Although the rising schools budget owed something to demographic pressures, Cutler argues it was also driven by the political storm surrounding limited access to grammar schools, and the perceived need to raise standards in secondary modern schools. Paradoxically, then, the NHS lost out because government viewed it as popular and uncontroversial, so that resources could be safely directed at the more tendentious problem of schooling – a process he describes as an ‘irony of political success’. Securing resources was only one part of the challenge for the NHS, which had also to consider how spending should be apportioned. Part of the rationale of the new service had been to achieve a more coherent distribution than that determined historically by the vagaries of philanthropy and the variable capacity of local taxation. Until the early 1970s, however, no systematic attempt was made to address historic disparities in service provision. The concern of Chapter 13 is the initiative which finally sought to tackle the problem: the Resource Allocation Working Party of 1975. Welshman begins by discussing the inherited pattern of resources, noting the gulf between the well-provided South and the North. Although there was recurrent discussion of inequalities in expenditure distribution from the 1950s, Welshman detects a step-change in policy discourse only from the late 1960s, and it is this which he then seeks to explain. An early impetus lay with the Hospital Plan, the building programme inaugurated by Enoch Powell, which placed the problem of fairer revenue distribution on the policy agenda. However, it was the pressure from academics, particularly geographers and health economists concerned with ‘territorial justice’, which established the research and policy context within which these ideas evolved. Welshman’s final verdict on RAWP is mixed. It began the task of reducing the gulf between resource-rich and resource-poor regions, yet charges of ‘postcode rationing’ continued into the later twentieth century. Millennial anxieties over the British health system also focused on the question of whether the predominantly tax-based mode of funding was the most appropriate.70 However, as Chapter 14 shows, this concern has been regularly revisited since 1948, without prompting the abandonment of the system. Lowe begins by explaining how a combination of pragmatism and principle led

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Labour to abandon Beveridge’s preferred social insurance formula. Such was the scale of the proposed welfare state that flat-rate insurance payments could not meet the cost. Conservative politicians in both the 1950s and the 1980s considered the reintroduction of an insurance-based system for both economic and ideological reasons. In both cases, change was obstructed by the political impracticality of providing a universal service while abandoning universalism in revenue gathering. In both periods, paradoxically, the tax-funded system became more deeply ingrained: modernisation in the 1960s was furthered by the capital spending programme of the Hospital Plan, while the 1980s panacea of the internal market left the revenue side untouched. On the basis of these precedents Lowe concludes that 1948 marked a critical juncture after which policy became ‘path dependent’, in the sense that the advantages to be gained from a fundamental reform were outweighed by its costs.

Conclusion There are four key themes running through the book, illuminated by the collation of these new pieces of research. The first is the transition in the manner in which resources for health care have been allocated. At the start of our period formal institutional care was a dispensation made by the rich on behalf of the poor – charity for the deserving and the Poor Law for the rest – while medical attendance was delivered in an open marketplace of regular and irregular practitioners. Our contributors show first how this was gradually eroded in the hospital. In the voluntary sector, the growth of collecting funds and then contributory schemes undermined the dependent relationship implicit in the subscription system, and began to remove lay control from traditional elites. In the public sector, the association of the workhouse with the stigma of less eligibility and with an inferior standard of care gave way before growing acceptance of a rate-aided municipal service open to all. Meanwhile domiciliary care was increasingly delivered through club practice, habituating working people to reliance upon the expertise of GPs. Thus by the twentieth century the conception of health care as a right, founded on payment and participation, was strongly entrenched.71 This, along with a growing confidence in the quality and reliability of state medical services, provided the context in which a universal, tax-funded NHS could be contemplated. Second, several contributions prompt the question of why the option of delivering services through local government units was not pursued. The outcome of a centralised NHS appears at odds with the steady advance of the public hospitals which is documented here. Notwithstanding the tensions between the central state and local authorities, municipalisation had long been the preferred policy of the Local Government Board and its successor, the Ministry of Health. The Bradford case points to one of the key problems: the friction that existed between the medical establishment (particularly the voluntary hospital consultants) and the local authority. As in the case of contract practice, issues of status and distrust of lay control explain this, although it was often articulated by

14 M. Gorsky and S. Sheard doctors as a defence of their clinical freedom.72 The abandonment of a national health service founded upon local government in favour of a regional service with an independent administration was the compromise which Bevan made to win the BMA round to his Bill in 1946. The result was the tripartite structure of the NHS, in which divisions between hospital, domiciliary and social services militated against coherent policy-making. Despite efforts to address this in the reorganisation of 1974, and in the current vogue for partnerships, these divisions have persisted. In particular, the boundary between health and social care for the elderly continues to attract concern.73 A third theme running through the book is the problem of providing a uniform and comprehensive service in a system which initially developed through unplanned local initiative. Levels of friendly society membership were determined by local labour-market conditions, while the more extensive contract practice of the Edwardian period was subject to variation in levels of pay and quality of care. NHI addressed some of these spatial discrepancies, though differences persisted in terms of panel size, the mix of public and private patients and the attitude of local insurance committees, all of which influenced the clinical encounter. The individualist and spontaneous nature of hospital charity also fashioned a highly diverse network of institutions. Again, the economic structure and underlying wealth of a given locale was crucial in determining both the patterns of provision and utilisation, and the timing and extent of the transition to mass funding. The local wealth base was also a critical influence on the extent of Poor Law and municipal services, alongside the political complexion of elected representatives. This uneven geography of service provision was one aspect of inter-war discussions about a planned health system, and addressing these disparities was a concern of policy-makers in the 1940s.74 Under-investment in capital projects in the early phase of the NHS meant that spatial inequalities persisted, until the RAWP began to address them. The problem of reconciling the virtues of local autonomy with the need to deliver a uniform service resurfaced again with the inception of the internal market in the 1990s, and in more recent debates about localism and the empowerment of foundation trust ‘membership communities’.75 Our authors show how issues of equitable distribution of health goods, whether social or spatial, are the products of long-run processes. A final recurrent theme is that of efficiency. It is a trend which one would imagine to have appeared relatively recently, if judged by media and political interest. Yet it is apparent even in the earliest chapters – for example in Croxson’s hospital governors, who monitored the length of stay of patients at the Middlesex Hospital in the 1780s, and also in Reinarz’s Birmingham hospitals, which continually evaluated the value for money of their suppliers. It is also seen in the activities of the friendly societies, who were determined to stamp out inefficient use of medical services, and in the chapters which focus on the creation of ‘systems’ of medical services, especially intra-regional, and intersystem patient transfers. Certainly it was a conscious impetus in the formation of RAWP in the 1970s, as Welshman has shown, and has returned more recently in the guise of the ‘purchaser–provider’ split in the ‘internal market’ of the NHS.

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The goal is always to drive costs down, relative to past expenditure and future demand. This was an early feature of the new NHS, as demonstrated by the Guillebaud Report of 1958. However, contrary to expectations, that report established that the NHS had offered value for money in its first decade, and was considerably underfinanced.76 The theme of financial efficiency also underpins the ‘Cogwheel’ reports on medical management of the late 1960s and the seminal Cochrane studies of the early 1970s, which set the agenda for evidence-based medicine for the foreseeable future.77 Yet the process of financial monitoring, which is inherently historical, rarely takes account of historical perspectives. This is a significant loss, but perhaps one which generally works to the advantage of politicians intent on damping down the costs of state-delivered medical services. The discipline of health economics has become increasingly sophisticated in recent years, with the development of specialist academic units at York and LSE, and also the Office of Health Economics, which was formed in 1962 and is now an integral part of the Whitehall policy-making machine. However, there are continuing problems with obtaining long-run financial data. One would expect this to be the case for the eighteenth century, but with the expansion of state responsibility for a wide range of services, surely data should be readily available? The Webbs had great difficulties in accessing financial information on municipal hospitals in the early twentieth century. By the late twentieth century the problem had changed from that of basic lack of data to that of the reluctance and even deliberate obfuscation of politicians to release what data exist. It has been suggested that Margaret Thatcher gave her senior civil servant Derek Rayner a specific brief in the 1980s to ‘reduce the collection and dissemination of statistics that might prove inimical to Tory plans to reduce the scope of government activities in health care’.78 Perhaps the unifying theme of this collection is ‘the political economy of health’. Although the chapters are diverse in their chronology, they all exhibit the fundamental concern with the cost of maintaining, or improving, the nation’s health. We have chosen to focus purely on medical services for this volume, but are aware of course that medicine alone cannot meet this challenge. Yet Britain’s hospitals, whatever their affiliation, have always swallowed a disproportionately large amount of the ‘health budget’, and the introduction of a ‘limited list’ of medications which GPs were allowed to prescribe from 1985 was a fairly insignificant economy when compared to the huge expenditure on secondary health care. What has not yet been adequately considered, perhaps because of its intangible, political obtuseness, is the cost and effectiveness of ‘preventive’ health services, yet there have been periods in the past when this has been demonstrably more effective in improving health than has investment in medical services. While the current political attention remains focused on the tension between public and private medical services, a return to this agenda will be difficult.

16 M. Gorsky and S. Sheard

Notes 1 World Health Organisation (WHO), The World Health Report 2000, Geneva, WHO, 2000, p. 13. 2 M. Powell, Evaluating the National Health Service, Buckingham, Open University Press, 1997, Ch. 7. 3 B. Abel-Smith, ‘The history of medical care’, in E. W. Martin (ed.), Comparative Development in Social Welfare, London, Allen and Unwin, 1972, pp. 219–40. 4 A. Hardy, Health and Medicine in Britain since 1860, Basingstoke, Palgrave, 2001, Ch. 5; C. Webster, The National Health Service: a political history (2nd edn), Oxford, Oxford University Press, 2002, pp. 59–60. 5 Ibid., pp. 254–5. 6 R. Klein, ‘The crises of welfare states’, in R. Cooter and J. Pickstone (eds), Companion to Medicine in the Twentieth Century, London, Routledge, 2003, p. 169. 7 A. Maqueda, ‘From Spain, a not so healthy role model’, New Statesman, 11 October 2004, 28–9. 8 Powell, Evaluating the National Health Service, pp. 168–71. 9 D. Green and B. Irvine, Health Care in France and Germany, London, Civitas, 2001. 10 WHO, World Health Report, p. 62. 11 S. Cherry, Medical Services and the Hospitals in Britain, 1860–1939, Cambridge, Cambridge University Press, 1996; B. Harris, The Origins of the British Welfare State: social welfare in England and Wales, 1800–1945, Basingstoke, Palgrave, 2004, Ch. 15. 12 A. Digby and N. Bosanquet, ‘Doctors and patients in an era of national health insurance and private practice, 1913–38’, Economic History Review, xli, 1988, pp. 74–94. 13 B. Abel-Smith, The Hospitals 1800–1948: a study in social administration in England and Wales, London, Heinemann, 1964. 14 J. Welshman, Municipal Medicine: public health in twentieth century Britain, Bern, Peter Lang, 2000. 15 M. A. Crowther, The Workhouse System 1834–1929: the history of an English social institution, London, Methuen, 1981, pp. 156–67. 16 R. Porter, Health for Sale: quackery in England 1660–1850, Manchester, Manchester University Press, 1989, p. 43. 17 R. Porter, Disease Medicine and Society in England, 1550–1860, London, 1987, 2nd edn, 1993, pp. 32–47. 18 N. Orme and M. Webster, The English Hospital 1070–1570, London, Yale University Press, 1995, pp. 11, 161–6. 19 J. Lane, A Social History of Medicine, London, Routledge, 2001, pp. 44–5. 20 R. Porter, ‘The gift relation: philanthropy and provincial hospitals in eighteenthcentury England’, in L. Granshaw and R. Porter (eds), The Hospital in History, London, Routledge, 1989, pp. 149–78; J. Woodward, To do the Sick no Harm: a study of the British voluntary hospital system to 1875, London, Routledge and Kegan Paul, 1974; Abel-Smith, The Hospitals. 21 H. Marland, ‘Lay and medical conceptions of medical charity during the nineteenth century’, in J. Barry and C. Jones (eds), Medicine and Charity before the Welfare State, London, Routledge, 1991, pp. 149–71; M. Fissell, Patients, Power, and the Poor in Eighteenth Century Bristol, Cambridge, Cambridge University Press, 1991. 22 Ibid., Ch. 6. 23 P. Shapely, ‘Charity, status and leadership: charitable image and the Manchester man’, Journal of Social History, 32(1), 1998, 157–77; A. Wilson, ‘Conflict, consensus and charity: politics and the provincial voluntary hospitals in the eighteenth century’, English Historical Review, cxi, 442, 1996, 599–619; A. Borsay, ‘ “Persons of honour and reputation”: the voluntary hospital in an age of corruption’, Medical History, 35, 1991, 281–94; D. W. Bebbington, Evangelicalism in Modern Britain: a

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25

26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43

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17

history from the 1730s to the 1980s, London, Unwin Hyman, 1989; K. Waddington, Charity and the London Hospitals, 1850–1898, Boydell, Woodbridge, 2000; D. Owen, English Philanthropy, 1660–1960, London, Oxford University Press, 1965, Ch. II. Harris, The Origins of the British Welfare State, pp. 114–18; S. Szreter and G. Mooney, ‘Urbanisation, mortality and the standard of living debate: new estimates of the expectation of life at birth in nineteenth century British cities’, Economic History Review, xli, 1998, 84–112. B. Harris, ‘Public health, nutrition and the decline of mortality: the McKeown thesis revisited’, Social History of Medicine, 17(3), 2004, 379–407; S. Szreter, ‘The importance of social intervention in Britain’s mortality decline’, Social History of Medicine, 1, 1988, 1–37. I. Loudon, Medical Care and the General Practitioner 1750–1850, Oxford, Oxford University Press, 1986, pp. 231–5; Lane, A Social History of Medicine, pp. 44–54. M. Rose, The Relief of Poverty 1834–41, Basingstoke, Macmillan, 1986, pp. 10–11. F. Driver, Power and Pauperism: the workhouse system, 1834–1884, Cambridge, Cambridge University Press, 1993. A. Digby, Pauper Palaces, London, Routledge Kegan Paul, 1978. R. Pinker, English Hospital Statistics 1861–1938, London, Heinemann,1966, pp. 110–12; Crowther, The Workhouse System, pp. 162–6, 182–90. S. Hussey, ‘ “An inheritance of fear”: older women in the twentieth-century countryside’, in P. Thane and L. Botelho (eds), Women and Ageing in British Society since 1500, Harlow, Longman, 2001, pp. 186–206. Porter, Health for Sale, Ch. 8; N. Parry and J. Parry, The Rise of the Medical Profession, London, Croom Helm, 1976, Ch. 6. Loudon, Medical care, pp. 273–5. K. Waddington, Medical Education at St. Bartholomew’s c. 1780s–1995, Woodford, Boydell, 2003; G. Risse, Hospital Life in Enlightenment Scotland: care and teaching at the Royal Infirmary of Edinburgh, Cambridge, Cambridge University Press, 1986. Loudon, Medical Care, Ch. 10. S. Cordery, British Friendly Societies 1750–1914, Basingstoke, Palgrave, 2003; P. Clark, British Clubs and Societies 1580–1800: the origins of an associational world, Oxford, Oxford University Press, 2000. P. H. J. H. Gosden, The Friendly Societies in England 1815–1875, Manchester, Manchester University Press, 1961, pp. 138–49. J. C. Riley, Sick Not Dead: the health of British workingmen during the mortality decline, London, Johns Hopkins University Press, 1997; D. G. Green, Working Class Patients and the Medical Establishment, Aldershot, Gower, 1985. M. J. Daunton, ‘Payment and participation: welfare and state formation in Britain 1900–1951’, Past and Present, 150, 1996, 169–216. J. Lewis, ‘Health and health care in the Progressive era’, in Cooter and Pickstone (eds), Companion to Medicine, pp. 81–95. T. H. Marshall, Citizenship and Social Class, Cambridge, Cambridge University Press, 1950. P. Rosenberg ‘The origin and development of compulsory health insurance in Germany’, in D. Light and A. Schuller (eds), Political Values and Health Care: the German Experience, London, MIT Press, 1986, pp. 105–25. E. P. Hennock, British Social Reform and German Precedents: the case of social insurance 1880–1914, Oxford, Oxford University Press, 1987; B. B. Gilbert, The Evolution of National Insurance in Great Britain, London, Michael Joseph, 1966, pp. 291–3. Gilbert, The Evolution of National Insurance, pp. 387–94. F. K. Prochaska, Philanthropy and the Hospitals of London; The King’s Fund, 1897–1990, Oxford, Oxford University Press, 1992, pp. 92–3.

18 M. Gorsky and S. Sheard 46 Abel-Smith, The Hospitals, pp. 307–9, 323–4; D. Cannadine, The Decline and Fall of the British Aristocracy, Yale University Press, New Haven, 1990, Chs 2, 3. 47 M. Gorsky, J. Mohan and M. Powell, ‘The financial health of voluntary hospitals in interwar Britain’, Economic History Review, lv, 3, 2002, 533–57. 48 M. Gorsky and J. Mohan, ‘London’s voluntary hospitals in the inter-war period: growth, transformation or crisis?’, Nonprofit and Voluntary Sector Quarterly, 30(2), 2001. 49 Harris, Origins of the British Welfare State, pp. 234–42. 50 J. Parker and C. Mirrlees, ‘Housing’, in A. Halsey, British Social Trends since 1900, Basingstoke, Macmillan, 2nd edn, 1988, pp. 357–97. 51 A. Levene, M. Powell and J. Stewart, ‘Patterns of municipal health expenditure in interwar England and Wales’, Bulletin of the History of Medicine, 78(3), 2004, 635–69. 52 M. Powell, ‘An expanding service: municipal acute medicine in the 1930s’, Twentieth Century British History, 8(3), 1997, 334–57. 53 Prochaska, Philanthropy and the Hospitals of London, p. 111. 54 See also M. Powell, ‘Did politics matter? Municipal public health expenditure in the 1930s’, Urban History, 22, 1995, 361–379. 55 Cf. M. Gorsky, ‘ “Threshold of a New Era”: the development of an integrated hospital system in north-east Scotland, 1900–39’, Social History of Medicine, 17(2), 2004, 247–67. 56 P. Hennessy, Never Again: Britain 1945–51, London, Cape, 1992, pp. 122–3, 132–4. 57 C. Webster, The Health Services since the War: Volume I, Problems of Health Care, the National Health Service before 1957, London: HMSO, 1988, Ch. II. 58 J. Stewart, ‘The Battle for Health’: a political history of the Socialist Medical Association, 1930–51, Aldershot, Ashgate, 1999. 59 D. Fox, Health Policies, Health Politics: the British and American experience, 1911–1965, Princeton, NJ, Princeton University Press, 1986. 60 D. Ritschel, The Politics of Planning, Oxford, Oxford University Press, 1997; S. Sturdy and R. Cooter, ‘Science, scientific management, and the transformation of medicine in Britain c.1870–1950’, History of Science, xxxvi, 1998, 421–66. 61 British Hospitals Association, Report of the Voluntary Hospitals Commission, London, 1937; C. Webster, ‘Conflict and consensus: explaining the British Health Service’, Twentieth Century British History, 1(2), 1990, 115–51. 62 Harris, Origins of the British Welfare State, pp. 286–7. 63 William Beveridge, Social Insurance and Allied Services, Cmd. 6404, London, HMSO, 1942, p. 158. 64 Ministry of Health, Department of Health for Scotland, A National Health Service Cmd. 6502, London, HMSO, 1944. 65 C. Webster, The National Health Service: a political history, Oxford, Oxford University Press, 2nd edn, 2002, pp. 15–25. 66 J. Higgins, The Business of Medicine: private health care in Britain, Macmillan, Basingstoke, 1988. 67 J. Lewis, What Price Community Medicine? The philosophy, practice and politics of public health, Brighton, Wheatsheaf, 1986. 68 M. Gorsky, J. Mohan and T. Willis, ‘Hospital contributory schemes and the NHS debates 1937–46: the rejection of social insurance in the British welfare state?’, Twentieth Century British History, 16(2), 2005, 170–92. 69 Webster, The National Health Service, pp. 2, 230–5. 70 B. Irvine, D. G. Green, M. McKee, A. Dixon and E. Mossialos, ‘Social insurance – the right way forward for health care in the United Kingdom?’, British Medical Journal, 325, 2002, 488–90. 71 Abel-Smith, ‘The history of medical care’, in Martin (ed.), Comparative Development in Social Welfare, pp. 222, 231, 237–8.

Introduction

19

72 F. Honigsbaum, The Division in British Medicine, London, Kogan Page, 1979, pp. 190–4, 212; ‘Correspondence’, British Medical Journal, 27 September 1941, pp. 456–7. 73 P. Bridgen and J. Lewis, Elderly People and the Boundary between Health and Social Care 1946–91: whose responsibility?, London, Nuffield Trust, 1999. 74 M. Gorsky, J. Mohan and M. Powell, ‘British voluntary hospitals, 1871–1938: the geography of provision and utilization’, Journal of Historical Geography, 25(4), 1999, 463–82. 75 A. Pollock, NHS plc: The Privatisation of Our Health Care, London, Verso, 2004; J. Mohan, ‘Uneven development, territorial politics and the British health care reforms’, Political Studies, XLVI, 1998, 309–327. 76 Webster, The National Health Service, pp. 32–3. 77 A. Cochrane, Effectiveness and Efficiency: random reflections on health services, London, Nuffield Provincial Hospitals Trust, 1972. 78 B. Fetter, Five Hundred Priests in the Temple of Health: economists and politicians in the making of national health accounts, unpublished working paper, University of Wisconsin-Milwaukee, 2004.

Part I

Voluntary funding and the growth of hospital care

2

The price of charity to the Middlesex Hospital, 1750–1830 Bronwyn Croxson

Introduction Competition drove the dynamics of the eighteenth-century London medical milieu. Individual healers competed for paying patients, and charitably-funded institutions competed for benefactors’ support.1 Benefactors could choose between a variety of different types of charity, delivered in a variety of ways by a number of competing organisations. Benefactors who wished to support a charity designed primarily to cure the sick poor, for example, could support charities treating the sick poor in their own homes, or choose between a number of competing hospitals. A subset of the London hospitals, the ‘voluntary hospitals’, had only small endowments and could survive only by attracting and retaining benefactors.2 They were vulnerable to competition from each other and from alternative uses of benefactors’ disposable income. Surviving in this environment required that voluntary hospitals meet benefactors’ objectives. As one voluntary hospital, the Middlesex Hospital, noted in its 1751 Annual Account: ‘the continuance and increase of the voluntary subscriptions, by which they are supported, are the strongest argument that [hospitals] have answered their end’.3 The institutional arrangements of the eighteenth-century voluntary hospitals reflected this fundraising imperative. This chapter describes the general features of the London voluntary hospitals and their funding, gives details about the nature of their income, and shows how the need to raise funds permeated every aspect of voluntary hospital activities, including hospitals’ admission arrangements. The chapter draws on information from all London hospitals, but focuses on the Middlesex Hospital as a primary case study. The Middlesex Hospital is a useful case study since a relatively large amount of primary material survives, giving insight into its administration, finances and admission arrangements.4 The Middlesex was a typical London voluntary hospital, in terms of its general rules and organisation. It was, however, smaller than the other hospitals: in 1748 the Middlesex Hospital had thirty beds, increasing to fifty-five by 1759. By contrast, in 1746 the Westminster Infirmary had 101 beds, and in 1734 (a year after it opened) St George’s Hospital had eighty-seven beds. The Middlesex was also atypical in being the only general hospital to admit lying-in women as inpatients during the eighteenth century.5

24 Bronwyn Croxson

The voluntary hospital system in eighteenth-century London There were seven general hospitals treating the ‘sick and lame poor’ in eighteenth-century London. St Bartholomew’s and St Thomas’s hospitals (founded in 1123 and c.1200), and Guy’s Hospital (founded in 1725) funded their activities primarily from their endowments.6 The remaining general hospitals were ‘voluntary’ and relied on current benefactions to survive: the Westminster Infirmary (founded in 1715), St George’s Hospital (1733), the London Hospital (1740) and the Middlesex Hospital (1745).7 In addition to the general hospitals, a number of special and lying-in hospitals were founded in London in the eighteenth century, also reliant on current benefactions, including the Lock Hospital, for people with venereal disease (founded in 1746), the Smallpox Hospital (1746), St Luke’s Hospital for Lunatics (1751) and a number of lying-in (i.e. maternity) hospitals.8 The London foundations were part of a more general United Kingdom ‘voluntary hospital movement’.9 The hospitals all followed similar formal rules and had similar institutional arrangements.10 Management decisions and the admission of patients took place at weekly meetings of a subgroup of hospital governors (called the Weekly Board). Subordinate committees were sometimes formed to supervise specific activities, and hospitals also held ‘General Courts’, attended by benefactors, to deal with policy matters and to elect officers. Hospital officers included a secretary, a matron and an apothecary, who were all paid a salary by the hospital. Other staff, including housekeeping staff and nurses, were appointed by the Weekly Board. The hospitals’ medical staff (men-midwives, physicians and surgeons) were elected at General Courts, but they were not paid directly by the voluntary hospitals.11 This lack of pecuniary benefit was, however, offset by personal and professional benefits derived from association with a hospital, including the opportunity for direct contact with hospital benefactors (who were potential private patients) and the opportunity to establish a personal reputation as a skilled practitioner. Hospitals also contributed to ‘consolidating elite privileges’ for hospital doctors as a discrete group of medical professionals12 and, by allying hospital practice with the ‘scientific’ practice of medicine, differentiated the profession as a whole from other types of healer.13 This is evident in the text of a sermon preached to raise funds for the Middlesex Hospital, which argued that one of the benefits of the hospital would be to rescue the poor from the ‘dismal consequences’ that followed from treatment under ‘forward empirics’ and ‘boasting and unskilful pretenders’.14 There is controversy over the role of physicians in founding hospitals, but surgeons and men-midwives were certainly involved in the foundation of some London hospitals, including the Middlesex, the London and the lying-in hospitals.15 Prior to the eighteenth century substantial charitable donations were generally conferred through bequests or capital endowments, in the form of perpetual trusts.16 For example, capital endowments comprised 88 per cent of benefactions to St Bartholomew’s Hospital between 1480 and 1660.17 As discussed below, the voluntary hospitals, by contrast, were funded primarily by current benefactions.

The Middlesex Hospital, 1750–1830

25

The Middlesex Hospital received no capital endowments in the decade following its foundation, and few in subsequent years. This imposed a discipline on voluntary hospitals, giving them a ‘high-powered’ incentive to be sensitive to benefactors’ objectives in order to attract and retain funding. It also placed hospital benefactors in a powerful position. Medical practitioners were ultimately subordinate to benefactors, the hospital ‘governors’, who provided the hospital’s income and who were, potentially, private patients. Voluntary hospitals were manifestations of a second, and complementary, eighteenth-century institutional innovation: associated charity.18 They combined the funds and efforts of many individuals without any formal, centralised direction. By 1748, for example, the Middlesex Hospital was supported by the combined efforts of about 256 benefactors. The sums required to establish and maintain hospitals meant that, without the institutional innovation of associated charity or centralised direction, new hospital foundations could have occurred only with substantive single benefactions such as that from Thomas Guy, who founded Guy’s Hospital in London in 1725.

Middlesex Hospital income, 1745–1800 Table 2.1 presents available information about the Middlesex Hospital’s income during the eighteenth century, grouped into five-year averages and in the major categories used by the hospital.19 Subscriptions generally comprised the largest single category of income for the Middlesex Hospital. This was typical of voluntary hospitals: St George’s Hospital, for example, reported subscriptions of £2,083 in 1781, 74 per cent of the hospital’s reported income in that year.20 Not only did subscriptions comprise a substantial proportion of income, they were also important since, compared with other forms of benefaction, they were relatively stable. Making a subscription implied an ongoing commitment to give a specified sum to the hospital every year. Subscriptions were collected annually by a collector under contract to the hospital. Unlike individuals making ad hoc donations, subscribers therefore had to make a deliberate decision not to support the hospital financially. Subscriptions implied not only an ongoing financial commitment, but also a commitment and perhaps obligation to be involved in hospital governance: subscriptions above three guineas a year entitled individuals to take part in hospital governance and to recommend individuals for admission as inpatients. A variety of special fundraising events were held, at which subscribers were recruited and donations collected, including annual ‘feasts’, special concerts and annual church services dedicated to the hospital. Hospitals also ran special campaigns to raise funds for new buildings. Benefactions (shown in the second, third and fourth rows of Table 2.1) were sometimes (but not always) clearly distinguished from subscriptions in the hospital’s accounts. Benefactions above a certain level gave individuals the same entitlements as those available to subscribers. Unlike subscriptions, benefactions were, however, treated by the hospital as ad hoc income, implying no ongoing commitment to the hospital.

452

869

1,288

0 220 312 6 0 21 0 0 0 94

c

572

1751–1755 /56

1751

1,839

2,098

744 496 252 269 125 11 11 29 763 0 0 117

1756/57– 1760/61

1756/57

1767

2,332

2,610

1,222 338 231 156 346 18 18 47 294 0 0 175

2,868

2,946

1,518 438 103 132 516 11 43 44 606 0 0 49

1761/62– 1767– 1766 1771

1761/62

1782

c

3,841

2,634

2,778

0 0

c

c

c

c

216 628 10 50 87 428 0 0 123

c

859 471

298 6 52 182 496 182 410 33

c

c

820 203

1,905 1,903 1,847

1,714 2,476 1,784

c

c c

c

27 181 4 37 52 292 0 0

c

c

109 2,182 17 50 89 1,727 0 0 164

951 258

1,316 192

4,358

1787 1792

1777– 1782a 1787– 1792a 1778a 1789a

1777

1,362 158

1772– 1774a

1772

Notes a In these periods information was not available for each year. b ‘Ordinary’ and ‘building’ subscriptions are combined, since these were not always separated by the hospital. c An empty cell indicates no information is available. d Total income reported here is the total income reported by the hospital; it does not necessarily equal the sum of each income category. In some years information is available for only some categories of income – in these years all available information is presented. e Includes both ordinary hospital spending and ‘extraordinary’ spending on building works.

Total (average) spending (net of purchase of stock)e

508

363 45 0 69 11 3 0 0 0 0 0 48

Subscriptionsb Benefactions Benefactions donated for building projects Funds raised at specific fundraising events Legacies Poor box Pupils Dividends, interest, rent Sale stock Cancer patients French patients Balance carried forward

Total (average) annual income

1746–1750 /51

Years included in the calculation of the average

d

1746

Average annual income for the five-year period beginning:

Table 2.1 The Middlesex Hospital’s five-year average annual income, 1746–97, grouped into the major income categories used by the hospital

The Middlesex Hospital, 1750–1830

27

The hospital received small amounts of income from a variety of other sources. Clinical staff had pupils, who were required to pay an annual fee to the hospital. Small sums were collected in a hospital ‘poor box’, including any contributions received from patients. The Middlesex Hospital did not normally accept paying patients in the eighteenth century – the references in Table 2.1 to ‘French’ and ‘Cancer’ patients refer to direct payments made by or on behalf of French refugees who boarded at the hospital, and to special donations for a dedicated cancer ward (discussed below). The Middlesex received only a small proportion of income from its assets in the form of interest, dividends and rent. In some years the hospital recorded relatively high income from ‘sale of stock’. This was sometimes planned, to fund building works, and was sometimes used to fund current activities when there was a shortfall in other sources of income, during periods of financial difficulty. The reliance on subscriptions was typical of the London voluntary hospitals. St George’s Hospital, for example, had a total income of £2,803 in 1781, of which £2,083 was in the form of subscriptions.21 By contrast, in the same year St Bartholomew’s Hospital, the only endowed hospital for which there is relevant information, had a total income of £23,602, of which 4 per cent (£1,002) was received from current benefactions and 72 per cent from rents, dividends and interest.22 Notwithstanding the decreased importance of bequests as a charitable form by the eighteenth century, the Middlesex Hospital occasionally received legacies, sometimes recorded in current income and offset against current expenses, and sometimes entered directly into the hospital’s balance sheet. Legacies did not, however, comprise a significant or reliable source of income for the hospital. In many years the hospital received no legacies, and in some it received considerable sums: in 1776, for example, it received £3,170 in bequests. The income-generating assets held by the Middlesex Hospital increased over the century, from £1,665 in 1764 to £9,060 in 1800, reflected in an increase in income from rents, dividends and interest. Although they increased over time, the hospital’s assets were small compared with those held by endowed hospitals. Guy’s Hospital’s estate was valued at £256,810 in 1796.23 Their small asset base and reliance on current benefactions left voluntary hospitals vulnerable to changes in benefactors’ spending patterns, and to short- and long-term fluctuations in benefactors’ fortunes. Hospitals could accommodate short-term deficits by delaying payments to creditors or by selling stock; however their long-term survival depended on attracting and retaining benefactors. To do this they had to fend off competition for benefactors’ income from other charities and from non-charitable ends. They were also vulnerable to competition from each other. This was recognised by Samuel Johnson, who referred to ‘the open competition between different hospitals, and the animosity with which their Patrons oppose one another’.24 Their vulnerability to competition imposed a discipline on hospital governors and, as discussed in the next section, meant that they constantly had to strive to meet benefactors’ objectives.

28

Bronwyn Croxson

The relationship between benefactors’ objectives and hospitals’ organisation Hospital benefactors supported hospitals because they had objectives that could be met if they supported a charity which had as its primary function treating (and restoring to health) the sick poor. Curing the sick was desirable to altruists, to patriots and to benefactors motivated by a prudent desire to safeguard the health of their employees or, in the event that their own circumstances changed, their own health. Hospitals were also attractive to benefactors motivated by more personal objectives. This was observed by Mandeville who, in an essay written in 1725, noted that ‘pride and vanity have built more hospitals than all the virtues together’.25 Hospitals provided a means of gaining direct, but controlled, contact with the ‘objects’ of charity.26 This was described by the Middlesex as ‘heartwarming’ and by the City of London Lying-in Hospital as a source of ‘secret, sensible pleasure’.27 Supporting hospitals also gave benefactors an opportunity to advance commercial interests, either by making contacts among fellow benefactors or by supplying the hospital with goods. Association with a hospital also provided opportunities to make political and social contacts, and to participate in a fashionable activity. The Middlesex Hospital held regular social events to raise funds, providing opportunities for benefactors to network and to be associated with ‘the great and the good’. The fundraising literature published by individual hospitals appealed to all of these objectives. The hospitals also strove to demonstrate that they met these objectives, and that they had in place institutional arrangements supportive of these ends. As discussed below, they designed their admission arrangements and rules so that benefactors could have direct (and ‘heartwarming’) contact with patients, and in such a way that benefactors could have faith that only ‘proper objects’ would be admitted. The ‘proper’ use of funds comprised admitting only certain patients (‘proper objects’), as well as preventing fraud, using funds cost-effectively, and ensuring that patients, staff and hospital officers behaved appropriately. Demonstrating that funds were used properly was vitally important to successful fundraising. However, persuading benefactors of this was difficult in associated charities such as voluntary hospitals, since benefactors did not directly control how funds were used. Associated charity inserted an arm’s-length relationship between benefactors and charitable objects, and between the act of giving and the delivery of charity. In order to attract and retain benefactors, hospitals therefore had to have in place structures which benefactors believed would promote the proper use of funds. The need to satisfy benefactors’ objectives and raise funds permeated all of the Middlesex Hospital’s activities and organisational arrangements. This is illustrated in the next section, which examines how the Middlesex Hospital’s admission arrangements were designed to meet (and to be seen to meet) benefactors’ objectives – in particular, how the hospital’s admission arrangements promoted the proper use of funds.

The Middlesex Hospital, 1750–1830

29

The Middlesex Hospital’s admission arrangements Strict rules governed who could be considered a ‘proper object’ for admission to the Middlesex Hospital. ‘Proper objects’ had to be drawn from the ‘deserving poor’,28 which excluded unmarried lying-in women, individuals with venereal disease, and individuals whose ill health resulted from their own ‘careless actions’ or from ‘ill conduct’.29 Voluntary hospitals were intended not only to treat the sick poor, but also to cure them. In his classic early study of the voluntary hospital, Abel-Smith suggested that medical professionals wanted to admit patients who could be cured quickly, whereas benefactors were ‘content to have their money used to give relief and comfort to those in pain: help to a patient whose suffering was of long duration might even be preferred to constructive treatment for a patient whose stay was short’.30 However, voluntary hospitals’ rules and minuted decisions provide convincing evidence that the proper use of funds required that hospitals admitted only those patients likely to benefit from a stay in hospital, and that they discharged patients likely to receive no further benefit. Hospitals and contemporary writers made a clear distinction between curing the sick poor, the legitimate purpose of a hospital, and caring for those who could not be restored to health. As Aikin, a late eighteenth-century medical writer, wrote: ‘I would wish to enforce as much as possible the idea of a hospital being a place designed for the cure of the sick, and not an almshouse for the support of the indigent and decrepid’.31 Caring for incurable patients was a function fulfilled by workhouses and almshouses. Patients were often discharged from the Middlesex Hospital to workhouses, as ‘more proper objects’ for the latter.32 This was reflected in the hospital’s formal admissions policy, which explicitly excluded people considered to be incurable or chronically ill, or who had a condition that was unlikely to benefit from hospitalisation. This category included patients who were blind, those with palsy, those who were paralysed, and those with lateral curvature of the spine. Incurable patients were normally admitted to voluntary hospitals only when the hospitals had received benefactions specifically for this end.33 Guy’s Hospital initially provided care only for incurable patients,34 the Westminster Infirmary received an anonymous donation of £400 for the provision of care for incurable patients in about 1736,35 and in 1792 the Middlesex Hospital was given a benefaction by Samuel Whitbread to establish a cancer ward where patients would stay ‘until either relieved by art or released by death’.36 It is notable that the hospital governors feared that dedicating a ward to incurable cancer patients might turn the ward into an ‘almshouse’, a fate they averted by stipulating that ‘operable’ as well as incurable patients be admitted and that incurable patients should be involved in research. The emphasis on successfully restoring a large number of individuals to health is apparent in the Middlesex Hospital’s fundraising activities. The number of patients treated and cured in the hospital was regularly advertised in newspapers and in the hospital’s annual Accounts and Reports. In its fundraising

30

Bronwyn Croxson

literature the hospital repeatedly referred to the large number of cases ‘happily restored to their health again’, the hospital’s low mortality, the large number of patients who were ‘cured’, and the hospital’s ‘visible and extraordinary success’.37 The Middlesex Hospital’s admission policy also excluded people with (or required the discharge of people found to have) infectious diseases, ‘lunatics’, children and paupers. The exclusion of infectious patients reflected the risk of contagion, as shown in the following decision: ‘Ordered that Hugh Bourne be made an out-patient, his case appearing to be too infectious to be admitted into the wards without danger’.38 Lunatics may have been excluded to minimise disruption to other patients.39 It is possible that children were also excluded to minimise disruption or because it was difficult to provide adequate supervision; however, all of the explicit references in the hospital minutes suggest they were excluded because it was sometimes hard to discharge them.40 Neither the hospital nor the local parish wished to bear the ‘expense’ of caring for children or paupers from other parishes, and both were admitted only with a surety for their discharge. This was codified in the hospital’s minutes by the following decision: ‘Ann Northover, a child recommended by Captain Miles was admitted by the board were of opinion that a housekeeper should engage to take away every child admitted into this hospital whether cured or not. To prevent there being an expense to the charity or the parish. In case of being deserted or the death of the parents’ (sic).41 The policy restricting admission to proper objects was implemented and enforced by a particular set of rules and procedures. Various arrangements were used to screen patients applying for admission, to monitor the screening process and to monitor patients after they were admitted. As well as providing a means of controlling who was admitted to hospital, these rules offered benefactors an opportunity to participate in the admissions process as an end in itself. The rules specified two routes patients could use to gain admission to a voluntary hospital. Patients could be admitted as ‘accident’ cases, by making direct application to a hospital medical officer. Alternatively, they could solicit a letter of recommendation from a hospital benefactor and, with the letter, apply for admission to a Weekly Board meeting. Letters of recommendation were in the gift of hospital benefactors who, in return for their support, were permitted to recommend a certain number of patients, usually within a specified time period, and with the number of patients determined by the size of their benefaction. In the Middlesex Hospital in 1759, for example, donors of £50 and subscribers of £5 could each recommend five lying-in women, five sick and lame patients and an unlimited number of outpatients each year, whereas donors of £30 and £3 subscribers could recommend two lying-in women, three sick and lame patients and an unlimited number of outpatients.42 Recommending rights were also given to clergymen who held a collection for the hospital, and to executors when (and if) the hospital received a legacy from an estate. Recommending rights were used by the hospital to attract benefactors who

The Middlesex Hospital, 1750–1830

31

wanted access to medical care for specific individuals; they were used by some subscribers, and marketed by some hospitals, as a form of insurance against ill health in domestic servants or employees.43 Although more common in the nineteenth century, this did occur during the eighteenth century. The London Hospital, situated in the East End docks, used an insurance-type argument to raise funds from local industrial and mercantile firms.44 The Middlesex Hospital was in a residential area, and there are frequent references in its minutes to the admission of domestic servants.45 In what might be an example of proactive marketing by the hospital, when a servant to a local man, Admiral Galbraith, was admitted with fever but without a letter of recommendation in 1780, the hospital sent the Admiral a copy of the Annual Account of the hospital, as if to induce him to make a benefaction.46 As an institutional arrangement, letters of recommendation gave individual benefactors a direct role in the admission of patients. This arrangement created a situation which brought the two parties together, and which ‘confirmed’ the munificence of the benefactor and turned potential patients into supplicants. It also, potentially, created a patronage relationship between benefactor and potential patient. Throughout a patient’s stay, he or she was identified with the recommending benefactor. In hospital records, patients were always associated with the name of their recommending governor. Recommenders were informed if their patient died, or was discharged because of some irregularity. In 1753, for example, two patients caused ‘great disturbance and even proceeded to blows’; they were immediately discharged and their recommenders ‘acquainted with the reason for their discharge’.47 This type of communication may have occurred defensively, if the hospital was protecting itself against patient complaints. Alternatively, recommending rights may have been a rule the hospital used deliberately to create a patronage relationship, so that individual governors could be made responsible for patients’ behaviour. The relationship was reinforced by a requirement that, when discharged, patients should give thanks in person to the Weekly Board and to their recommender. Any patient who did not do so was barred from future admission to the hospital.48 This rule offered benefactors an additional opportunity to bask in the gratitude of the recipients of their charity, it provided a means of communicating to benefactors that they could recommend another patient and it was a vehicle for advertising the hospital’s success. Letters of recommendation also gave benefactors, as individuals, some control over the characteristics of patients admitted to hospital. Benefactors were asked by the hospital to screen potential patients to ensure they were ‘proper objects’. This was recognised in a sermon preached on behalf of the Middlesex Hospital in 1758, which stated that the purpose of letters was ‘so that the merit and condition of the object to be relieved may be more fully and thoroughly known’. It also seems reasonable that benefactors would have played a role in evaluating the medical characteristics of the patients they referred.49 Individual benefactors could not, however, be relied upon to send only proper objects to the hospital with a letter of recommendation. As was recognised in a

32 Bronwyn Croxson letter published in the Gentleman’s Magazine in 1764, benefactors did not always have sufficient knowledge to screen patients to ensure they were proper objects for admission.50 Moreover, benefactors had objectives other than the admission of proper objects, which might lead them to recommend patients they knew to contravene the hospital’s admission policy. These objectives could conceivably lead them to try to free-ride by recommending patients who were ‘improper’, hoping that other benefactors would continue to recommend only ‘proper’ objects so that the hospitals’ reputation would be maintained. There are instances recorded in the minutes when individual benefactors insisted on the admission of a patient they knew would not contribute to the objective of maximising success. In 1783, for example, the hospital admitted a patient with a chronic ulcer because a governor insisted that if a cure was possible the patient should be treated.51 In instances such as this it appears that not alienating the individual benefactors was paramount; however, in general the hospital’s institutional arrangements were designed to exclude patients recommended on this basis. There are also frequent examples of individual benefactors breaking the rules by exceeding the number of patients they were entitled to recommend in one year, and by continuing to recommend patients when their subscriptions were in arrears.52 Although the fundraising imperative was binding on the hospital as a whole and on hospital benefactors as a group, it did not constrain the activities of individuals, who could conceivably try to free-ride and exercise their own conflicting objectives in the belief that, if they were the sole ‘deviant’, the hospital as a whole would not suffer. Recommending rights were not, therefore, on their own sufficient to guarantee that only proper objects would gain admission to the hospital. Benefactors’ rights to recommend patients had to be attenuated by additional tiers of admission arrangements. A second tier of admission arrangements was provided by the requirement that patients in possession of a recommendation had to be passed by a meeting of the Weekly Board, and screened by the medical officers. After obtaining a letter of recommendation, potential patients were required to attend a meeting of the hospital’s Weekly Board. The Laws of the hospital published in 1770 give a detailed account of the conduct of Weekly Board meetings.53 At 11 am the board called for ‘recommendatory letters’, which the secretary examined to ensure that the recommending benefactor was entitled to recommend patients: that their subscription was paid, they did not already have a patient in the house and they had not exceeded their allotted rights. Patients holding valid letters were sent to the ‘gentlemen of the faculty’ (i.e. the medical officers), who determined whether the patient was medically ‘proper’, and whether he or she should be admitted as an inpatient or an outpatient. The patient then returned to the board meeting for formal admission to the hospital. Patients who had suffered an accident or who had ‘fever’ did not have to attend Weekly Board meetings, but could be admitted at any time by medical officers. Fever patients did, however, have to have a valid letter of recommendation, and both groups had to report to (and be vetted by) a Weekly Board meeting after their admission. The Weekly Board, as a collective body, was in a better position than individual governors to

The Middlesex Hospital, 1750–1830

33

reject ‘improper’ cases: not only could the members of the board monitor each other, but individual members could also avoid taking ultimate responsibility for difficult decisions. These institutional arrangements were not fully effective in ensuring that only cases likely to contribute to the objective of maximising the number of successful cures were admitted to or retained in the hospital. Medical officers had objectives likely to conflict with benefactors’ objectives, and which might lead them to admit patients who contravened the hospital’s admission policy. They probably shared benefactors’ desire to maximise the number of successful cures, since this reflected well on their ability and promoted their private practice. However, this objective sometimes conflicted with a desire to admit patients useful for the purposes of research and teaching.54 Moreover, since medical professionals had closer contact with patients, they may have given way to a ‘sympathetic impulse’ and admitted or failed to discharge ‘improper objects’. It is also possible that benefactors did not trust medical professionals to vet the socio-economic suitability of potential patients. Writing about this tension during the nineteenth century, Peterson55 notes: Governors and medical staff lived with the tension between the intention of the laymen to bring health care to ‘deserving’ persons, i.e. the truly poor, and the physicians’ and surgeons’ desire to accept ‘interesting cases’ of value in their teaching, regardless of their economic status. There was therefore a third tier of arrangements, designed to monitor medical officers, ensuring that the hospital’s resources were directed to the deserving poor and that the number of successful cures was maximised. This third tier relied on ongoing monitoring after patients were admitted, and on a formally specified maximum length of stay.56 Ongoing monitoring was provided by visiting benefactors and by hospital staff. All benefactors were encouraged to visit the hospital and observe the patients. As was stated in an early account of one London hospital: As all subscribers are trustees of this charity, so the more they will please to engage themselves in conducting the affairs of it, they will still be the greater benefactors to it, and will also be able to satisfy themselves that the money is justly and frugally applied.57 ‘House visitors’ were appointed from the hospital’s governors to make regular visits and to monitor all aspects of the hospital’s activities.58 House visitors made weekly visits to the Middlesex Hospital (in some hospitals they made daily visits) and monitored, among other things, the characteristics and behaviour of patients. For example, in 1756 one report noted: ‘Mr Seraston and Mr Turpin visited the House and reported all things well, except that John Aberdeen admitted as an Accident the 19th inst appears to be an imposition’.59 The third tier of rules included one that patients should be discharged when

34

Bronwyn Croxson

they could no longer benefit from being in hospital, and that sick and lame patients should be discharged after two months. Lying-in women were permitted to stay at most three weeks after giving birth. This provided an impersonal, formal mechanism that facilitated discharging incurable patients. Stipulating a maximum length of stay was consistent with minimising the risks of hospitalisation. As Aikin argued, ‘the inbred disease of hospital will almost inevitably creep up in some degree upon one who continues a long time in them, but will rarely attach in one whose stay is short’.60 A maximum stay was also consistent with a desire to provide care for those most likely to benefit (since long-stay patients were more likely to be chronically ill) and to minimise the danger that patients would become dependent on charity.61 Neither the Weekly Board nor the medical officers could be relied upon to enforce this rule rigorously: there are numerous orders in the Weekly Board permitting specific patients to stay longer than two months. In 1758, for example, it was ordered that ‘Naomi Meads and Ann Billeter be permitted to continue in the sick ward a fortnight longer, at the desire of the physician and surgeon’.62 Moreover, an examination of the admission registers shows that many patients had an unauthorised stay of longer than two months: in 1797, for example, 15 per cent of those admitted with letters and 16 per cent of accidents stayed longer than nine weeks.63 It appears that Quarterly General Courts, which were attended by members of the wider body of benefactors, monitored the activities of the Weekly Board, perhaps to offset or minimise the apparent ‘laxity’ of the Board. At most meetings of a Quarterly General Court, the Weekly Board and medical officers were required to justify the retention of patients who had been in the hospital for longer than two months. The list of long-stay patients considered by the Quarterly General Court was compiled by the hospital’s salaried apothecary, not the physician or the surgeon who undertook admissions. As well as ensuring that only ‘proper objects’ were admitted to hospital, the admission arrangements of the voluntary hospitals had to provide a way of rationing hospital places during periods when demand exceeded capacity. The existence of excess demand is implied by references in the Weekly Board’s minutes to difficulties accommodating the ‘great number of patients’ applying for admission to the hospital.64 There were, in particular, frequent entries suggesting high demand for inpatient lying-in places, from both patients and subscribers. In several years the matron complained that she could not find space within the hospital for all the lying-in women and had to take additional rooms in the neighbourhood, and in 1763 house visitors found that there were two women in many of the beds, a situation ‘very hazardous both for women and children’.65 We do not have information about the number of people applying for places in the Middlesex Hospital, but the records of the British Lying-in Hospital, located in the same neighbourhood as the Middlesex, show that demand for such places usually exceeded the number available.66 Coping with excess demand posed a delicate problem, given the association between admitting patients and raising funds from their recommenders. In 1771, for example, the minutes of the Weekly Board recorded the board’s discomfort

The Middlesex Hospital, 1750–1830

35

at the ‘disagreeable necessity of rejecting the recommendations of many governors’ and the board’s fear that those governors ‘may take umbrage at their recommendations not being received’.67 Rationing was often essential; however, it had to be achieved in a way which did not alienate benefactors. This problem was resolved in respect of lying-in patients by introducing a lottery for admissions: In order, therefore, to ease those Governors who add to their generous Benefactions their time and attention to the Business of the hospital, and that every governor’s recommendation may have equal chance of being accepted, it is proposed for the consideration of the next Quarterly General Court for the future that all lying-in patients though proper objects, be admitted by Ballot and that such ballot be made in the board room before the Governors on the Weekly Board days. If there are more than six lying-in patients present letters of recommendation examined and marked, that there be put into a box six white balls and as many black balls as equal the number of lying-in patients to ballot and those who draw the white balls to have orders of admission and that letters be sent to acquaint the recommenders of those who have drawn black balls.68 Lotteries for admission places were also used by other lying-in hospitals and by the foundling hospital, but not by the sick and lame hospitals. This may have reflected the fact that it was harder to prioritise lying-in women, a relatively homogeneous group, according to their capacity to benefit from hospitalisation. This hypothesis is consistent with the rule passed in 1774, which gave the Weekly Board the right to override the ballot and give priority to those women who they judged to be most in need.69 With respect to sick and lame patients, the Weekly Board as also empowered by the hospital’s rules to give preference to ‘such objects as appear to stand most in need of immediate relief’.70 In periods of excess demand, the Weekly Board also curbed benefactors’ ability to send patients by vigilantly enforcing the rule that benefactors with subscriptions in arrears could not make recommendations, and by reducing recommending rights.

Conclusion Eighteenth-century voluntary hospitals could survive only with benefactors’ support, and competed with other charities to attract and retain benefactors. In this environment it was important that hospitals were demonstrably successful in treating and curing patients. Moreover, success had to be real, and to this end hospitals had in place institutional arrangements allowing benefactors to monitor and influence hospital activity. Benefactors (or their representatives) inspected hospitals to monitor conditions, hospital management, and admissions and discharges. Curing the sick poor was not the only function of hospitals: if they were to attract benefactors’ support, the hospital’s activities also had to be consistent

36 Bronwyn Croxson with a number of other social and private objectives. It is important to note that a desire to support an institution which cured the sick does not imply that hospital benefactors were necessarily motivated by the needs of the sick poor. The objectives of benefactors that were able to be met by association with a charity designed to cure the sick poor included personal pleasure, social and commercial objectives, and a desire for a particular kind of contact with the recipients of charity. The voluntary hospitals had institutional arrangements designed to ensure that hospital activities were consistent with benefactors’ objectives. As voluntary organisations, reliant on current benefactions, they were constrained by financial incentives; as associated charities their institutional arrangements also had to provide safeguards against ‘free-riding’ by individual benefactors. Hospitals also had to be able to assure benefactors that funds would be used ‘properly’. Properness was equivalent to modern ‘cost-effectiveness’ or ‘efficiency’, and in some instances the word ‘efficiency’ was actually employed by voluntary hospitals. One of the dimensions of ‘properness’, which also finds echoes in modern concerns, was that hospitals not only had to cure the sick poor, they also had to cure as many of the sick poor as possible. The rules surrounding the admission of patients to hospital in general, and recommending rights in particular, were integral to successful hospital fundraising. Letters of recommendation, for example, were an institutional arrangement which facilitated direct contact between benefactors and the recipients of charity. This was desired as an end in itself, as a manifestation of and a route to patronage relationships. It also provided a means whereby benefactors were able to influence the nature of patients admitted to hospitals – although not a completely reliable means of ensuring this, and so needing to be able to be balanced by additional checks. The rights of benefactors were attenuated by the roles given to medical professionals and to the Weekly Board: benefactors knew that they had to cede ultimate control over admissions. It was as though hospital benefactors were willing to attenuate their rights since they recognised the possibility that they might free-ride or have insufficient information and thereby recommend ‘improper objects’ – behaviour which could damage the hospital’s reputation if it was widespread. Contrary to popular mythology, voluntary hospitals could not be ‘gateways to death’.71 A fundraising imperative meant that voluntary hospitals could survive only by successfully curing the sick poor. Moreover, if they were not successful, the hospitals would not attract patients. This combination of high-powered financial incentives and patient choice exerted powerful discipline on voluntary hospitals’ activities.

Notes 1 A. Digby, Making a Medical Living: doctors and patients in the English market for medicine, 1720–1911, Cambridge, Cambridge University Press, 1994; D. Porter and R. Porter, Patient’s Progress, Oxford, Polity Press, 1989; R. Porter, ‘Before the fringe: quackery and the eighteenth-century medical market’, in R. Cooter (ed.), Studies in the History of Alternative Medicine, Basingstoke, Macmillan, 1988.

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37

2 R. Porter, ‘The gift relation: philanthropy and provincial hospitals in eighteenthcentury England’, in L. Granshaw and R. Porter (eds), The Hospital in History, London and New York, Routledge, 1989. 3 Account of the Middlesex Hospital, Dr Dalton’s Sermon Preached Before the Governors of the Middlesex Hospital, London, 1751, p. 1. 4 B. Croxson, ‘An economic analysis of a voluntary hospital: the foundation and institutional structure of the Middlesex Hospital’, unpublished PhD thesis, University of Cambridge, 1995. 5 B. Croxson, ‘The foundation and evolution of the Middlesex Hospital’s lying-in service, 1745–86’, Social History of Medicine, 14, 2001, 27–57. 6 H. C. Cameron, Mr Guy’s Hospital 1726–1948, London, Longmans Green and Company, 1954; E. M. McInnes, St Thomas’s Hospital, London, George Allen and Unwin, 1963; V. C. Medvei and J. L. Thornton, The Royal Hospital of Saint Bartholomew 1123–1973, London, St Bartholomew’s Hospital, 1974. 7 A. E. Clark-Kennedy, The London: A Study in the Voluntary Hospital System, Altman Medical Publishing Company, 1962; G. C. Peachey, History of St George’s Hospital, London, John Blae Sons and Danielsson, 1910–14; W. G. Spencer, Westminster Hospital: an outline of its history, London, Glaisher, 1924; E. Wilson, The History of the Middlesex Hospital, London, John Churchill, 1835. 8 R. B. Cannings, The City of London Maternity Hospital: A Short History, London, J. S. Forsaith and Son, 1922; J. Donnison, ‘Note on the foundation of Queen Charlotte’s Hospital’, Medical History, 15, 1971, 398–400; J. Donnison, Midwives and Medical Men: a history of the struggle for the control of childbirth, 2nd edn, London, Historical Publications, 1988; P. Rhodes, Doctor John Leake’s Hospital: a history of the General Lying-In Hospital, York Road, Lambeth 1765–1971, London, Davis Poynter, 1977. 9 Porter, ‘The gift relation’. 10 A. Borsay, ‘ “Persons of honour and reputation”: the voluntary hospital in an age of corruption’, Medical History, 35, 1991, 281–94. 11 I. Loudon, Medical Care and the General Practitioner, Oxford, Clarendon Press, 1986. 12 M. Pelling, ‘Medical practice in early modern England: trade or profession’, in W. Prest (ed.), The Professions in Early Modern England, London, Croom Helm, 1987, p. 94; Digby, Making a Medical Living. 13 O. Keel, ‘The politics of health and the institutionalisation of clinical practices in Europe in the second half of the eighteenth century’, in W. F. Bynum and R. Porter (eds), William Hunter and the Eighteenth-Century Medical World, Cambridge, Cambridge University Press, 1985; S. Lawrence, Charitable Knowledge: hospital pupils and practitioners in eighteenth-century London, Cambridge, Cambridge University Press, 1996. 14 E. Cobden, ‘The Parable of the Talents’, A Sermon Preached at the Parish Church of St Ann, Westminster, on Thursday, March the 24th 1748, Before the Governors of the Middlesex Hospital, for Sick and Lame and Lying-in Married Women, London, 1748, p. 15. 15 M. A. Versluysen, ‘Medical professionalisation and maternity hospitals in eighteenth century London: a sociological interpretation’, Social History of Medicine, 21, 1977, 34–6; A.Wilson, The Making of Man-Midwifery, London, UCL Press, 1995; A. E. Clark-Kennedy, London Pride: the story of a voluntary hospital, London, Hutchinson Benham, 1979. 16 D. Owen, English Philanthropy 1660–1960, London, Oxford University Press and Cambridge, MA, Harvard University Press, 1965. 17 W. K. Jordan, The Charities of London 1480–1660, London, Allen and Unwin, 1960, pp. 26–7. 18 Borsay, ‘ “Persons of honour and reputation” ’; Owen, English Philanthropy; Porter, ‘The gift relation’.

38 Bronwyn Croxson 19 The sources used to compile the information presented in Table 2.1 include the Accounts of the Middlesex Hospital appended to published sermons, as well as primary material held in the hospital’s archives. The surviving hospital ledgers include details about income and expenditure from 1760 to 1774, but give only the total level of income and expenditure for each year between 1760 and 1783. No ledgers relating to the period from 1783 to the end of the eighteenth century have survived. Information for this period has been derived from the minutes of Weekly Board meetings, in the Middlesex Hospital’s Governors Fair Minute Books, including only those years for which the minutes included details of each week’s income and expenditure. 20 An Account of the Proceedings of the Governors of St George’s Hospital near Hyde Park Corner from its first Institution, October the nineteenth 1733, to the twenty-sixth of December 1781, London, 1781. 21 An Account of the Proceedings of the Governors of St George’s Hospital near Hyde Park Corner from its first Institution, the 19th October 1733, to the 31st of December 1781, London, 1781. 22 St Bartholomew’s Hospital, Abstracts of General Accounts, 1781, held in the hospital’s archives. 23 Guy’s Hospital Ledgers, held in the Greater London Record Office. 24 S. Johnson, The Idler, 6 May 1758, p. 22. 25 B. Mandeville, An Essay on Charity and Charity Schools, 4th edn, London, Tonson, 1725. 26 Porter, ‘The gift relation’; J. Yolton, R. Porter, P. Rogers and B. M. Stafford, The Blackwell Companion to the Enlightenment, Oxford, Basil Blackwell, 1991, p. 395. 27 J. Thomas, A Sermon Preached Before the Governors of the Middlesex Hospital, London, J. Whiston, 1750; T. Francklin, A Sermon Preached Before the Governors of the Middlesex Hospital for Sick and Lame and Lying-in Married Women, London, 1758. 28 D. T. Andrew, Philanthropy and Police: London Charity in the Eighteenth Century, Princeton, Princeton University Press, 1989. 29 M. E. Fissell, ‘The disappearance of the patient’s narrative and the invention of hospital medicine’, in R. French and A. Wear (eds), British Medicine in an Age of Reform, London and New York, Routledge, 1991. 30 B. Abel-Smith, The Hospitals 1800–1948, London, Heinemann, 1964, p. 44. 31 J. Aikin, Thoughts on Hospitals, London, Joseph Johnson, 1771, p. 13. 32 Minutes of the Middlesex Hospital Weekly Board, Governors Fair Minute Book, 30 November 1762, 26 February 1782, 26 June 1787, Middlesex Hospital Archives. 33 C. C. S. Murphy, ‘From Friedenheim to hospice: a century of cancer hospitals’, in L. Granshaw and R. Porter (eds), The Hospital in History, London and New York, Routledge, 1989. 34 H. C. Cameron, Mr. Guy’s Hospital 1726–1948, London, Longmans, Green and Company, 1954. 35 An Account of the proceedings of the Trustees of the Public Infirmary in James Street, Westminster, near St James Park, from their first Institution in the year 1719 to 1736 inclusive, 1736. An Account of the proceedings of the Trustees of the Public Infirmary in James Street, Westminster, near St James Park, from their first Institution in the year 1719 to the 26 March 1746 inclusive, London, 1746. 36 Report of John Howard, 10 January 1792, Middlesex Hospital Governors Fair Minute Book, Weekly Board, 23 August 1796. 37 Cobden, ‘The Parable of the Talents’; T. Church, A Sermon Preached Before the Governors of the Middlesex Hospital for Sick and Lame, and for Lying-in Married Women, London, 1754; C. Dodgson, A Sermon Before the Governors of the Middlesex Hospital for Sick and Lame and Lying-in Married Women, London, 1761. 38 Middlesex Hospital Weekly Board, 15 April 1755.

The Middlesex Hospital, 1750–1830

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39 J. Woodward, To Do the Sick No Harm, London and Boston, Routledge and Kegan Paul, 1974. 40 Ibid; Abel-Smith, The Hospitals. 41 Middlesex Hospital Weekly Board, 5 February 1760; Laws, Orders and Regulations of the Middlesex Hospital, London, 1770. 42 W. Sellon, A Sermon Preached at the Parish Church of St Martin’s in the Fields, on Tuesday, April the 24th, 1759, Before the Governors of the Middlesex Hospital for Sick and Lame and Lying-in Married Women, London, 1759. 43 F. B. Smith, The People’s Health 1830–1910, London, Croom Helm, 1979. 44 ‘The Duty and Advantages of Encouraging Public Infirmaries’, A Sermon Preached Before His Grace Charles Duke of Richmond, Lenox, and Aubigny, President and the Governors of the London Infirmary, in Goodman’s-Fields, for the Relief of Sick and Diseased Manufacturers, and Seamen in Merchant-Service, & c. At the Parish Church of St Mary-le-Bow, on Friday March 25 1743. By Revd Isaac, Lord Bishop of St Asaph, London, 1743. 45 Middlesex Hospital Weekly Board, 6 December 1763. 46 Ibid., 15 February 1780. 47 Ibid., 23 October 1753. 48 Ibid., 21 December 1752. 49 M. Pelling, ‘Medical practice in early modern England: trade or profession’, in W. Prest (ed.), The Professions in Early Modern England, London, Croom Helm, 1987. 50 Supplement to the Gentleman’s Magazine, 1764, 611–12. 51 Middlesex Hospital Weekly Board, 7 October 1783. 52 See, for example, Middlesex Hospital Weekly Board, 22 January 1771, 7 October 1783; Quarterly General Court, 3 November 1774, 4 January 1780, 26 September 1781. 53 Laws of the Middlesex Hospital. 54 G. B. Risse, Hospital Life in Enlightenment Scotland, Care and Teaching at the Royal Infirmary of Edinburgh, Cambridge, Cambridge University Press, 1986. 55 M. H. Peterson, The Medical Profession in Mid-Victorian London, Berkley & London, University of California Press, 1978, p. 175. 56 Middlesex Hospital Weekly Board, 22 February 1763, 6 June 1749, 27 March 1750, 17 December 1781. 57 Account of the Westminster Infirmary 1736, p. 2. 58 Borsay, ‘ “Persons of Honour and Reputation” ’. 59 Middlesex Hospital Weekly Board, 22 June 1756. 60 Aikin, Thoughts on Hospitals, p. 21. 61 D. T. Andrew, Philanthropy and Police; see also Revd. Isaac, ‘The Duty and Advantages of Encouraging Public Infirmaries’. 62 Middlesex Hospital Weekly Board, 23 May 1758; see also 25 October 1748, 12 May 1752, 31 May 1748, 12 May 1752, 19 May 1752, 4 December 1773. 63 Middlesex Hospital, Admission Registers, 1797, Middlesex Hospital Archives. 64 See, for example, Middlesex Hospital Weekly Board, 27 January 1761. 65 Ibid. 10 October 1752, 6 February 1753, 6 November 1753, 21 May 1754, 6 August 1754, 18 February 1755, 28 October 1755, 20 September 1763. 66 Croxson, ‘The foundation and evolution’. 67 Middlesex Hospital Weekly Board, 9 April 1771. 68 Ibid. 69 Middlesex Hospital Quarterly General Court, 3 February 1774. 70 Laws, Orders and Regulations of the Middlesex Hospital, London, 1770. 71 E. M. Sigsworth, ‘Gateways to death? Medicine, hospitals and mortality, 1700–1850’, in P. Mathias (ed.), Science and Society 1600–1900, Cambridge, Cambridge University Press, 1972.

3

Charitable bodies The funding of Birmingham’s voluntary hospitals in the nineteenth century Jonathan Reinarz

Introduction This chapter seeks to redress the relative neglect of alternative sources of hospital finance by concentrating on the full range of fundraising initiatives used in Birmingham during the nineteenth century, and thereby generate a much more complete picture of hospital funding. The General Hospital (which began to treat patients in 1779), the Orthopaedic (1817), Eye (1823), Queen’s (1841), Children’s (1862) and Women’s (1871) hospitals were some of the largest of Birmingham’s medical charities in terms of income. Yet most research on the funding of hospital medicine in Birmingham has concentrated on the Triennial Music Festival.1 This charitable event, which did much to attract considerable attention and support for the General Hospital, and the town for that matter, continues to intrigue the public much as it did a provincial audience in the past. More recently, research has focused on the institution of ‘Hospital Saturday’, which was introduced to Birmingham by Sampson Gamgee in 1868 as a means of tapping working-class incomes for hospital funding.2 Though very different from the music festivals organised by the upper classes, both funds were distributed unequally and, as such, tend to exaggerate the true amount they contributed to Birmingham’s hospitals. In the bigger picture, this study bridges the gap between those which emphasise the late eighteenth and early nineteenth centuries, and those whose focus is the late nineteenth and early twentieth centuries. It examines six hospitals within a single large city, and explores issues of competition, the relationship between hospitals and the local economy, as well as the relationship of institutions to a specific urban philanthropic milieu. This also permits a demonstration of some differences between the experience of the provincial city – Birmingham – and that of London, which Waddington, Prochaska and Rivett have examined.3 It looks back to an era of subscriber dominance, discussed in Chapter 2 by Bronwyn Croxon, and forward to the shift to mass funding dealt with by Steve Cherry and John Mohan in Chapters 4 and 5. This shift was in part a process of democratisation, and in part a transition from lay individuals and the church as the key donors, to one in which businesses and the leisure industry play a greater role. In the process charity became more scientific but, paradoxically, this humanised relations between the institution and patients.

Birmingham’s voluntary hospitals

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Subscribers behind the subscriptions As the work of Steven Cherry and others reminds us, hospitals relied on a variety of financial sources prior to the establishment of the National Health Service. Though substantial legacies were certainly welcomed by all institutions, their amounts, like other extraordinary sources, fluctuated, and not only according to the state of the economy. All hospital managing committees desired a steady income in order to guarantee their institution’s existence over time. For voluntary hospitals in general, their ‘bread and butter’, as it has been called by medical historians, or their ‘backbone’, as more appropriately referred to by the Orthopaedic Hospital, was the hospital subscription.4 Although the names of a few well-known benefactors are recorded in memorials and anniversary histories of hospitals, much less has been said about who exactly subscribed. Consequently, the first section of this chapter will present material from the Birmingham General Hospital’s subscription lists. For this purpose, annual reports for 1779, 1800, 1810 and 1820 were examined and divided into the following categories: men, women, parish and corporate (or business), subscribers, employees and friendly societies. Any remaining subscribers were collectively identified as miscellaneous, largely comprising anonymous donors, offertory funds and the like (see Table 3.1). In 1779, the year its first patients were admitted, the managing committee of Birmingham’s General Hospital printed a subscription list that recorded 812 individuals and organisations.5 The largest single category was individual male subscribers, comprising nearly 84 per cent, against a significantly smaller proportion of individual female subscribers. Corporate donors comprised 4.3 per cent of subscribers, and a very small number of employees, parishes and friendly societies made up the rest. Records for the years 1800, 1810 and 1820, however, already reveal some changes in the hospital’s subscriber base. Most notable is a slight reduction in the proportion of male subscribers and a marginal rise in the number of women. Additional increases are recorded in both the number of parishes and friendly societies supporting the hospital. Perhaps given the fact that almost no competition to the General Hospital existed locally until 1817, the year when the Orthopaedic Hospital was founded, fluctuations in the hospital’s subscriber base during its first decades were not great. Those apparent are also easily explained. The fact that most hospitals, like other voluntary associations, were founded by gentlemen who organised informal meetings at either town halls or similar public institutions also explains the disproportionate numbers of men on initial lists.6 Furthermore, most hospital boards drew on their subscriber base in order to appoint governors and visitors to the institution, few such appointments being open to women in the hospital’s earliest years. Alternatively, their quick disappearance was due to either death, which could claim up to 10 per cent of a charity’s subscribers annually, or simply a decline in enthusiasm after the initial inspirational inauguration of a new medical charity.7 The commitment of subscribers in Birmingham would only be further

682 (84%) 564 (83%) 588 (77%) 568 (76%)

1779 1800 1810 1820

85 (10%) 61 (9%) 86 (11%) 87 (12%)

Women 35 (4%) 34 (5%) 43 (6%) 33 (4%)

Corporate 1 0 1 0

Employees 1 9 18 (2%) 22 (3%)

Mutual

Sources: BCLA, General Hospital, Birmingham, Annual Reports, 1779, 1800, 1810, 1820, MS 1921/414.

Men

Year

Table 3.1 Subscribers to the General Hospital, Birmingham, 1779, 1800, 1810 and 1820

1 11 23 (3%) 28 (4%)

Parish

7 3 3 7 (1%)

Misc.

812 682 762 745

Total

Birmingham’s voluntary hospitals

43

challenged as other voluntary hospitals, such as the Orthopaedic (1817) and Eye (1823) Hospitals, were founded later in the century. More direct competition to the General came with the founding of the Queen’s Hospital (1841), and in these particular years the General experienced a related financial crisis. The two other specialist institutions considered here appeared in the second half of the nineteenth century. Just as hospitals began to differentiate themselves based on specialties, it also seems likely that each attracted very specific subscribers (see Table 3.2). Most hospitals appear to have commenced their existence with a large number of individual male subscribers, a group that on average made up 50 per cent or more of each hospital’s subscription lists in these years. This, however, declined between 1860 and 1900 at all institutions by between 10 and 25 per cent, except at the Women’s, where female subscribers outnumbered males throughout the sequence. Interestingly, this decline was not made up for by gains in the proportion of women subscribers, which largely remained Table 3.2 Subscribers to Birmingham Hospitals, 1860–1900 (in percentages) Hospital (year)

Men

Women

Corporate

Mutual

Workmen

Parish Misc. Total

CH (1870) CH (1880) CH (1890) CH (1900) EH (1870) EH (1880) EH (1890) EH (1900) GH (1860) GH (1870) GH (1890) GH (1900) OH (1880) OH (1890) OH (1900) QH (1860) QH (1880) QH (1890) QH (1900) WH (1880) WH (1890) WH (1900)

65.5 64.2 61.2 59.2 71.0 47.4 40.0 38.7 65.4 66.8 52.5 48.0 63.2 58.0 47.0 73.8 64.2 54.0 46.9 40.8 39.6 33.0

19.5 18.8 19.6 19.2 5.0 13.2 12.0 11.8 10.2 8.8 9.9 10.2 16.6 19.5 22.0 7.2 7.3 7.5 8.3 49.6 46.7 47.0

13.7 15.2 16.5 17.9 19.0 22.8 22.0 23.7 16.0 15.6 21.2 22.4 16.2 16.9 18.0 13.8 23.9 29.0 32.3 4.9 10.4 18.0

0 0.07 0.24 0 0 4.9 7.0 7.0 2.8 2.5 2.1 2.0 0 0 2.0 0.98 0.41 0 0.53 0 0.27 1.0

0.7 0.65 1.4 1.8 5.0 5.4 13.0 12.7 3.5 4.1 11.7 14.1 0.42 0.52 3.0 2.5 2.5 5.8 9.0 0.2 0.55 1.0

0 0 0.08 0 0 5.3 3.0 3.2 0.7 0.44 0.4 0.3 0 0.52 0.3 0.09 0.17 0.12 0.67 0 0.27 0

0.4 1.0 1.0 1.6 0 0.7 3.0 2.6 1.2 1.6 2.2 2.6 3.4 4.4 7.0 1.6 1.2 1.9 2.2 4.2 2.2 1.0

1,002 1,383 1,246 1,173 59 710 1,434 1,432 1,567 2,042 2,427 2,959 234 384 586 1,120 1,690 1,556 1,488 489 366 668

Sources: BCLA, Children’s Hospital, Annual Reports, 1870, 1880, 1890, 1900, HC/BCH/1/14/2–5; BCLA, General Hospital, Birmingham, Annual Reports, 1860, 1870, 1880, 1890, 1900, GHB 417–423; BCLA, Orthopaedic Hospital Annual Reports, 1880, 1890, 1900, HC/RO/Box 14; Birmingham Central Library, Local Studies, Queen’s Hospital, Annual Reports, 1860, 1880, 1890, 1900; BCLA, Women’s Hospital, Annual Reports, 1880, 1890, 1900, HC/WH/1/10/3–4. Notes CH, Children’s Hospital; EH, Eye Hospital; GH, General Hospital; OH, Orthopaedic Hospital; QH, Queen’s Hospital; WH, Women’s Hospital.

44 Jonathan Reinarz unchanged throughout these years, or even declined slightly, as at the Eye Hospital; this was matched by a similar increase in their numbers at the Orthopaedic Hospital. Less surprisingly, the charities that attracted the greatest support among women were the Children’s and Women’s Hospitals, which claimed approximately 20 and 50 per cent female subscribers respectively. These were also the first institutions to appoint female medical practitioners, both in Birmingham and elsewhere.8 Greater increases were made in corporate subscriptions, with industrial support climbing steadily at all hospitals during the last three decades of the nineteenth century. Though more can be said about subscriber motivation, much of the rise in this area can be attributed to voluntary hospitals’ greater efforts to canvas local industrialists. Workmen themselves appear to have prioritised some charities over others. Most supported the Queen’s (due to its central location), the General (where accident cases increased ten-fold in the 1860s) and the Eye Hospital.9 A lack of worker support for the Children’s and Women’s Hospitals is perhaps easier to understand in this light, though not necessarily workers’ neglect of the Orthopaedic Hospital. Occupational therapy, however, was not one of the charity’s early specialties, as the hospital had always catered for younger patients in its first years of existence. In comparison, the Queen’s and General expended far greater sums providing the surgical instruments and apparatus, such as artificial limbs and trusses, that would have enabled workers to regain mobility and function. In this sense, although one might expect otherwise, they, rather than the Orthopaedic Hospital, can be described as the precursors to Birmingham’s Accident Hospital, a novel institution, which opened in 1941 on the site of the old Queen’s Hospital. Friendly societies tended to subscribe to the same institutions as did ordinary workers, though their support generally declined during this period, except at the Eye Hospital. One explanation for this could be that their loyalties were transferred to local institutions as they formed, as most friendly societies appear to have been what hospital managing committees referred to as ‘country subscribers’. Eye hospitals, being more rare outside London, might have retained their support longer, and this might also have been the case at the Birmingham dental charity, given that it was the first provincial institution of its kind when it opened in 1858.10 This, for example, would explain the Eye Hospital’s greater parochial support. As a result, the Eye Hospital attracted the most diverse subscriber base – a characteristic that might have surprised nineteenth-century hospital supporters, who generally expected the Children’s Hospital to appeal most widely, given the emotional power of suffering infants.11 Its committee members had always relied on the public’s perception that adults themselves could always subscribe to hospitals, while children were innocent victims. One local vicar went so far as to suggest that ‘if a man could not get the money out of [his parishioners’] purses for sick children, he did not deserve to go into a pulpit again’.12 Based on an examination of subscription lists, both groups appear to have underestimated the public’s regard for utility, as represented by the enduring support the public extended to the eye charity.

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From music festivals to charity football matches A distinctive feature of hospital charity in Birmingham was its music festivals and, although their takings could fluctuate wildly, such events did contribute substantially to hospital earnings. First organised to help construct Birmingham’s General Hospital in 1768, the city’s famed Music Festival initially raised under £1,000, but regularly collected sums approaching £5,000 by 1808. However, it took another decade before similar profits were generated, as the festival generally cost as much to stage as was collected in receipts. Bringing in £10,000 on average between 1820 and 1873, profits tended to fluctuate between £2,500 and £6,000.13 Yet the sums raised annually by the Music Festival still amounted to less than a year’s worth of subscriptions at the General Hospital. Furthermore, held every three years, they raised less than might accrue to the General from legacies, or dividends and rentals. Though legacies, cash donations and festival takings varied annually, attempts were made throughout the nineteenth century to transform such finances into more predictable sources of income. Primarily, this was done by investing income in fixed-interest stock. Recent work on London hospitals has suggested these were years in which managing committees attempted to diversify their incomes, and emphasises that the investment of such lump sums should be seen in this light.14 However, evidence for Birmingham suggests this was not always due entirely to the business strategies of hospital administrators. While the governors of the General Hospital in Birmingham had encouraged the investment of extraordinary income relatively early, this decision was also codified in the hospital’s regulations. As a result, future management boards had very little control over the charity’s income; official hospital policy was that half of all legacies had to be invested according to Law XIII. Consequently, financial matters at the General lacked some flexibility. Although regarded as a prudent financial tool that encouraged saving when introduced, the law, as its numerical title suggests, actually proved to be very unlucky and caused considerable hardship when the hospital ran into difficulties in the 1860s. Faced with a shortage of funds, the institution’s board suggested the regulation be abolished – a move that was resisted by the governors.15 They did, however, eventually decide to suspend the law until the hospital’s crisis passed. At the Queen’s, influential medical officers, such as Sampson Gamgee, equally questioned the accumulation of large investment funds ‘in the presence of [a] vast amount of suffering’.16 Similar concerns at other hospitals confirm governors’ preoccupations with the future of their charities and a tendency among medical staff to highlight immediate health concerns and thereby increase expenditure. On other occasions, despite the efforts of either faction, hospital investments increased only because donations were received with strict conditions attached. For example, in October 1865 John Cornforth gave 100 guineas to the Queen’s Hospital on condition that it should be invested and not appear in the newspapers.17 The complete reverse was the case in January 1893, when Sarah Stokes and her sister announced their donation to the same institution. The sisters sug-

46 Jonathan Reinarz gested their donation be used to construct a children’s ward or chapel, or to extend a specialist department, and on no account simply be invested. Moreover, in contrast to Cornforth’s modesty, they also requested a tablet be placed in the hospital recording the circumstances of the gift.18 Finally, many of the hospital’s shares were received as legacies, as was much property from which ground rents were collected. Consequently, though often managed by industrialists and successful entrepreneurs, hospital balance sheets cannot be read in the same way as nineteenth-century business records. Whether restricted by prudent financial laws or the whims of benefactors, hospital finances were not entirely in the hands of finance committees or those individuals who were appointed from year to year to manage available resources. While benevolence often came with strings attached, and periodically oscillated, by concentrating on such munificent donations historians have also tended to overlook some financial sources which, though comparatively smaller, say much more about nineteenth-century society. One such source was fines, which were regularly recorded in nineteenth-century hospital balance sheets. In 1810, for example, the General Hospital received a five-guinea fine collected from an individual who disrupted a meeting of the Society of Methodists at Alcester.19 Another in 1822 came after a disturbance at a local theatre, perhaps one that had previously staged hospital benefits.20 Understandably, some fines were directed to the hospital to cover expenses and services rendered – as might have been the case in 1807, when three guineas was received from the victims of assault.21 Others, however, seem less directly related to the work of the hospital, such as 13s 6d that was received from Thomas Clerke Jervoise, who fined his servants for leaving doors open at his home.22 Many subsequent windfalls came from local workshops and factories, £50 in fines alone coming from Boulton & Watt in 1813. During the first two decades of the century, fines introduced approximately £10 annually to hospital coffers. It is tempting to argue that the very existence of medical charities, while frequently saving labourers’ lives, might equally have prolonged the life of workplace fines. The added touch of benevolence would certainly have made it easier for employers to justify any wage deductions. Arguably, the same can be said of workers’ sick clubs, the funds of which also grew as a result of fines (see Table 3.3). Perhaps the greatest change in funding during the nineteenth century, however, was linked to a stagnation or even decline in church-giving and a rise in that associated with leisure activities and mass entertainment, especially sporting events. First organised following a decline in Music Festival takings and an appeal by Thomas Barber Wright in the Midland Counties Herald, church collections quickly raised considerable sums for Birmingham’s medical charities.23 Between 1859 and 1882, Hospital Sunday (when the congregations’ collections on one Sunday of the year were donated to local hospitals) in Birmingham raised more than £100,000 for the town’s hospitals, but collections soon appeared to peak and hospital committee members agreed that church appeals did not reach as wide an audience as they had in the past. In 1900, at the annual

Birmingham’s voluntary hospitals

47

Table 3.3 Fines to Birmingham General Hospital, 1784–1826 Year

Amount

Year

Amount

1784 1801 1803 1806 1807 1809 1810 1811 1812 1813

£2 2s £8 3s £5 £1 1s £3 16s 6d £19 4s 5d £10 5s £15 5s £7 13s 3d £63 15s

1814 1817 1818 1819 1821 1822 1823 1824 1825 1826

£7 £10 £21 1s £8 7s £5 10s £14 19s 6d £2 1s £12 2s £17 10s £36 10s 3d

Sources: BCLA, General Hospital, Birmingham, Annual Reports, 1779, 1800, 1810, 1820, MS 1921/414.

meeting of the Women’s Hospital, the mayor claimed that local churches and chapels were no longer sufficiently interested in the charity’s work. While he claimed that ‘[h]ealing and preaching originally used to go together’, in the last years of the century, ‘they had been somewhat divorced’.24 Nevertheless, institutions such as Hospital Sunday provided a useful model for new fundraising schemes to emulate. In 1883, the Birmingham and District Football Association began regularly to donate £20 or £30 to the Children’s Hospital.25 In 1887 more than £36 came from football clubs or associations, another £50 coming from Birmingham Charity Sports, which organised theatrical matches between noted sportsmen and local entertainers. The Children’s Hospital was said to receive more from sporting events than any other local medical institution, with £210 from such events in 1897 alone.26 The importance of mass entertainment also continued to grow. By 1901, the Edison Animated Picture Company donated almost £18 following a special matinee exhibition at Curzon Hall.27 Although the support of churchgoers may have declined, that of clergymen in some cases increased. Though managing committees could not rely on congregational collections, church and chapel continued to be courted, if only as mouthpieces with which to advertise charities. Most governors appear to have agreed with Thomas Wright’s claim that ‘no power in the land equals that of the pulpit when energetically put forth’.28 As a means of communication, they were of greatest importance in smaller communities that lacked any communal buildings besides a church. Perhaps the ecumenical appeal also explains the increased levels of clerical support enjoyed by the Eye and Orthopaedic Hospitals, a third of whose patients came from the districts surrounding Birmingham. At both hospitals clerical subscribers comprised approximately 10 per cent of all male subscribers, while they formed the equivalent of between 1 and 2 per cent at other institutions. Another explanation for the out-of-town support for the Eye and Orthopaedic hospitals might be that they were the only available sources of this medical expertise within the Midlands region.

48 Jonathan Reinarz

The power of the penny Another source of hospital funding that has attracted attention from historians is that associated with the working classes.29 Together with registration fees and workplace subscriptions, these sources of income grew most rapidly in the last decades of the nineteenth century and even began to overshadow middle-class contributions to hospitals. Labourers’ contributions were first individually accounted for following the establishment of Hospital Saturday. Though an impressive example of organised charity, it commenced quite informally in December 1868 when Samuel Gamgee, a surgeon at the Queen’s Hospital, invited twenty workmen to his home in order to discuss potential sources of hospital finance.30 Though only sixteen men actually accepted Gamgee’s invitation, the conversation that took place that winter evening in his dining room led to events that would prove the potential of workplace funding. In little more than a year the men raised enough income to fund the extension of the Queen’s Hospital, and demonstrated what many would afterwards describe as ‘the power of the penny’.31 The power of pennies, however, had long been overlooked, as most were deposited in charity boxes anonymously – a form of charitable giving that did not confer privileges in the way that annual subscriptions did. This had led to some collections at individual workshops, whose employees were subsequently recognised on subscription lists collectively, but the relatively small size of workshops in Birmingham limited the proliferation of such schemes. These circumstances were also recognised by the Artisans’ General Medical Charity Fund, whose origins preceded the movement to extend the Queen’s Hospital. Unlike Gamgee’s scheme, however, the Artisans’ Fund (from approximately 1846) canvassed workers and subscribed to local hospitals in order to provide members with admissions tickets. Believing the two committees shared a similar goal, though offering very different benefits, Gamgee suggested a merger and planned a general collection of Birmingham’s workplaces for March 1873.32 Despite the difficulties of canvassing thousands of workshops, Birmingham’s first Hospital Saturday produced £4,700 – more than the combined totals of the Manchester and Liverpool collections.33 All funds raised were distributed according to the number of patients each hospital treated. Interestingly, a grateful Hospital Saturday Committee also presented Gamgee with £450 (a much greater sum than all but two of the charities received), as well as a gold watch and a diamond bracelet for his wife.34 Although few questioned the need for such a testimonial, almost everyone overlooked the fact that workers had forfeited subscription privileges by participating in Gamgee’s scheme rather than joining the Artisan’s Fund. In general, the funds raised by Hospital Saturday were to repay medical institutions for the emergency services provided daily to the labouring classes and, in this way, it was argued that workers already received considerable benefits from the town’s hospitals. Nevertheless, the sheer scale of the contributions would have precipitated the changed relationship between workers and these institutions.

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49

Though not immediately granted subscribers’ privileges, many individuals began to advocate worker representation on hospital boards after the Queen’s extension was completed, but it was left for the Working Men’s Committee to request a say in hospital administration in future. Though this had never been their intention, the Queen’s managing committee eventually agreed that a share of management would encourage the principle of self-help and hopefully prove that ‘the working classes possess the judgment, discretion, and kindly feeling necessary for taking an active and useful part in the work of hospital administration’, and honorary life governors were appointed.35 Hesitations continued to be expressed, members of hospital committees suggesting that good movements among working men were often ‘spoiled, not so much through lack of zeal as through want of judgment, especially in the management of the accounts’.36 Nevertheless, some members had made it beyond ‘the old custom of believing that all the virtues were in the higher classes, and all the vices in the lower’.37 Yet the unchanged stance of the hospital’s managing committee was apparent some months later when a member exclaimed that ‘[n]o person with three grains of sense would for a moment contend that the working men alone could administer the affairs of a hospital better than middle-class men’.38 Though this seemed to mark the end of any potential handover or even sharing of power, working men were appointed to various committees at local hospitals and even offered the right to refer ‘really deserving’ patients at those hospitals that had not yet abolished subscribers’ admissions privileges.39 As a result, Hospital Saturday eventually assumed some of the characteristics of the Artisan’s Fund with which it had merged, though the influence of workers was greatest at those hospitals (such as the General, Queen’s and Children’s Hospitals) that received the largest proportion of money collected. Working-class support had been assured as the rewards of participation were made more tangible. Donations were also printed in local newspapers according to size, as the organisers regarded emulation to be a good stimulant to charity.40 Equally, the list was meant to shame all those firms that owed their wealth to Birmingham but offered nothing in return.41 By 1883, the working classes contributed nearly 22 per cent of the total funds expended by Birmingham’s voluntary medical institutions.42 In 1884 governors of the Children’s Hospital announced that the Hospital Saturday Fund had exceeded that collected on Hospital Sunday, and contributed approximately one-tenth of the hospital’s funds.43 By 1892 its annual report revealed that the working classes gave £1,572, against £1,502 from middle-class subscribers.44 A year later, when subscriptions reached a twentyyear low, an article in the Birmingham Daily Mail applauded the working classes, who were ‘doing their bit’, and rebuked middle-class householders, who were ‘forgetting the calls of charity’.45

Encouraging or discouraging donors? The rise of Hospital Saturday and its substantial collections could not have come at a better time, as appeals for funding seldom attracted new support and had to

50 Jonathan Reinarz be co-ordinated, given the existence of approximately a dozen local medical institutions, in order to give donors ‘time to forget’ their last contribution.46 Having finally democratised medical charities, primarily by canvassing the working classes more effectively, hospital committees now demonstrated considerable foresight by concerning themselves with philanthropy’s future. Too often subscription lists declined as a result of death, and little effort had been made to ensure replacements. Consequently, attempts were made in these years to educate a new generation in the importance of charity. Such efforts are most evident in the records of the Children’s Hospital. As early as 1875, the hospital’s governors encouraged children to contribute to hospital income in the belief that this might teach them to give throughout their lives. An article published in December 1875 in the Birmingham Daily Mail, for example, pleaded with all children in receipt of pocket money to donate to the charity.47 Hospital management also began to work more closely with schools, which, in the first years of the twentieth century established children’s needlework classes, that produced most of the clothing and linen needed to dress children in hospital, as well as beds.48 Charity cup football matches can also be seen in this light, as these events brought many more young people in Birmingham into contact with charitable initiatives. Perhaps the most effective of such campaigns in the early twentieth century was the Children’s Brick League, which allowed children to purchase and even participate in the laying of bricks which were engraved with each donor’s initials.49 This innovative fund-raising scheme was dreamed up by J. E. Player, the hospital’s first female board member, in the hope that children would form even closer links to the hospital and hopefully return to revisit their very tangible charitable contributions. Although this was one of the Children’s Hospital’s success stories, occasionally acts of charity could backfire and discourage donations. This was most common when benevolence gave the appearance that a hospital was richly endowed. From the time they had constructed their new premises in 1869, the board of the Children’s Hospital was particularly concerned with the appearance of the building, for it was intended to counter the depressing state of buildings in the city. According to George Dawson, one of the hospital’s governors, ‘Birmingham was filled with architecture which – especially on a dull foggy morning – lay like a nightmare upon the soul’.50 Comparing the unsightliness of diseases such as rickets with the ‘ugliness of architecture’, Dawson believed that ‘a little beauty cost a little money, but gave great joy’.51 By 1876, however, the hospital’s administrators felt it was necessary to remind potential donors that ‘many things in the hospitals which might be regarded as luxuries were provided for by special donation’.52 Some critics even claimed that board members had made the hospital too appealing, leading many children to become discontented with their homes. Although the hospital tried to dispel such notions as ridiculous, at their Christmas party in 1888 one young female patient declared to a journalist covering the festivities that she would not go home, ‘not for a thousand pounds’.53 Though rare, such statements also suggested extravagance and waste. In response, members of the board repeatedly claimed that the cost of maintaining

Birmingham’s voluntary hospitals

51

staff and patients was lower than at any other children’s hospital in the country.54 The public, however, proved hard to convince. By 1880, potential subscribers were again reminded that, although it was circled by a golden railing and exhibited an impressive flower garden, the hospital was still in need of donations. The chairperson at its annual meeting expressed similar concerns, claiming that many in the town regarded the hospital to be so well off that it required no further support.55 Few realised that the Kyrle Society tended the hospital’s gardens free of charge and that the hospital had one of the most generous donors in its founder and senior physician, Thomas Heslop. Besides providing the golden railing, a minute from 1870 thanks him for ‘a quantity of wire fencing’, two garden vases and two garden benches, as well as a roller and mowing machine.56 While rarely appearing in subscription lists, a number of Birmingham’s other medical practitioners supported local charities generously, though usually surreptitiously. Although at times accused of extravagance, the lengths hospital managers went to in order to ensure low costs and savings are surprising. For example, in the Children’s Hospital’s first years the housekeeping committee requested the Secretary to determine the number and weight of loaves that could be made from a sack of flour costing £2 13s 4d.57 The following September, committee members decided that to use their own flour to make bread was not economical and the matron, in future, was to purchase bread.58 In 1869, the method of curing bacon and ham in hospital was also deemed ‘inexpedient’ and the matron was requested to discontinue the same; like other supplies, both were put out to tender.59 Though it has been suggested in recent studies of hospital finance that ‘[e]xpenditure was not treated at a ward or even department level, and no effort was made to use the hospitals’ accounts as a management tool to direct spending or to control expenditure’, this does not always seem applicable to Birmingham’s medical charities.60 Attempts to cut down expenses were continually made. At the General Hospital, a subcommittee was established as early as 1864 to monitor the consumption of wine, spirits, ale and beer.61 A similar subcommittee to regulate the use of surgical dressings was organised in 1883.62 The following year the hospital’s medical committee decided the drug stock book was not only complete, but now also required the attention of an accountant due to its ‘thoroughness’.63

Scientific medicine and scientific charity With the advent of scientific medicine in the last decades of the nineteenth century, the need for control over all aspects of hospital administration increased. Facilities at all voluntary hospitals were less improvised and more carefully planned. This, of course, drove up the cost of medical care and required greater vigilance in all areas of hospital finance. Teaching hospitals, such as the General and Queen’s Hospitals, were some of the first institutions to

52 Jonathan Reinarz incorporate new techniques into medical regimes, but they also faced the added burden of maintaining ancillary departments to ensure that students acquired a complete medical education. One answer to the duplication of services lay in creating affiliated hospitals, as commenced in 1892. However, such measures barely eased the rapidly increasing expenditures as hospitals rebuilt operating theatres, added laboratories and mortuaries, and introduced specialised technologies, as well as appointing their corresponding full-time operators. Sometimes there was very little time between innovation and implementation. The General, for example, was very quick to introduce X-ray technology (patient records revealing the use of several skiagraphs in 1896), and in the same year the institution appointed two full-time anaesthetists, giving a greater confidence and tendency to operate.64 Operations also increased noticeably at the Orthopaedic Hospital, which added long sought-after therapies by appointing a masseuse and establishing a separate room for massage, electrical and medico-kinetic work.65 It was spared the cost of X-ray equipment for some years, given the generosity of the General’s radiologist, John Hall-Edwards, who volunteered the benefits of the new photography to the affiliated institution.66 In 1887, in a letter congratulating Queen Victoria on the fiftieth year of her reign, governors at the Queen’s Hospital also informed her of their plans to rebuild the hospital ‘in greater harmony with the requirements of modern science’.67 The staff at the Women’s Hospital watched all developments in medical science particularly closely as it was a small hospital and, though treating few patients, staff believed they could improve women’s health more generally by setting a good example.68 Consequently, as medicine became more scientific, so too did charity. Generally, following the lead of institutions such as the Charity Organisation Society, scientific charity involved eliminating unnecessary expenses and attempting all possible means of fundraising, while avoiding all duplicate appeals and overlap between charities. Hospital accounts improved in their organisation and were by the end of the nineteenth century standardised (at the General in 1897) so as to make comparisons between institutions possible nationally.69 Subscription lists were also modified, making it easier to determine whether subscribers represented those parishes and companies from which patients came. Such modifications first appeared in the annual reports of the Children’s Hospital in 1894, but could already be found in those of the Eye Hospital in 1882. The latter also regularly sent circulars to the employers of those workers they treated by 1886.70 A similarly methodical approach was adopted towards patients at the General in 1898, when its governors announced that the ‘[s]ystematic enquiry into [the] social circumstances of patients applying for treatment ha[d] been commenced’.71 It was the last of the local hospitals to do so. Birmingham’s voluntary hospitals had originally been organised to deal with the afflictions of the ‘deserving poor’, but few attempts appear to have made to examine patient backgrounds before mid-century. One of the first hospitals in Birmingham to take special precautions in order to ensure only deserving cases received treatment was the Children’s Hospital. Originally, when opened in

Birmingham’s voluntary hospitals

53

1862, the hospital accepted patients based on a system of notes from householders, but this broke down almost immediately, as persons of every class in the vicinity of the hospital signed notes for anyone who presented them. According to hospital managers at the time, a ‘[w]ant of trustfulness of individuals in this stratum of society renders it impossible to frame any regulations that can be effective for their exclusion’.72 Nevertheless, precautions were introduced and, though meant to continue for six months, proved so useful as to become a permanent feature of its admissions policy.73 Initially, enquiries into the earnings of patients’ families were conducted by the hospital’s dispenser, who, along with all his medicines, also dispensed admissions tickets. This task quickly passed to the porter and then to the hospital secretary, who enquired into a family’s earnings and size, the nature and duration of an illness, whether the family received parochial relief, and the number of children to be relieved. Interestingly, all shopkeepers, beer-house keepers and employers of labour were immediately refused tickets. Despite these regulations, the practice of limiting tickets eventually ended as they were found to go to ‘the strongest and rudest’, as well as those living closest to the hospital.74 The secretary also alleged ‘[t]he ease with which tickets are obtained brings all the gossips of the neighbourhood streets to the waitinghall, often over and over again in the year with the same child’. There were some well-publicised cases of abuse, both locally and nationally.75 Already in 1863 this had been drawn to the attention of the Children’s Hospital’s managing committee by an article that referred to parents who brought their children to the charity despite being able to pay for medical services.76 By 1866 the hospital’s secretary was to conduct inquiries into twenty random cases applying for tickets, in order to ascertain employers’ names and thereby determine the social fitness of applicants. The following year another twenty cases were examined, though only two were found to have understated their wages. The parents of children so tested included three labourers, as well as three warehousemen, a cabinet-maker, a gun-maker, two jewellers, a sugar-boiler, a picture-frame maker and a gardener.77 Of these, only one of the warehousemen understated his wages. He, identified as Mr McCleod, earned 20s a week, just under the hospital’s 21s limit for charity cases, but on applying to his employers, Smith & Chamberlain, it was discovered that his wife earned 5s or more a week from home. In general, employers answered all queries readily and ‘were pleased that the Committee took such pains in the administration of the Charity’.78 Hospital Secretary James Stilliard suggested the system of inquiry was not perfect, primarily as interviews were not sufficiently private. As a result, he claimed that ‘[p]ersons disposed to deceive are in a way prepared for it, by overhearing the questions put to others’.79 In any case, reports of investigations at the Children’s Hospital reveal that most patients were rejected for being over age as opposed to being able to pay. The number of outpatients continued to increase, and were drawn from a twenty-mile radius. A small fee was introduced to keep numbers down, as well

54 Jonathan Reinarz as to encourage the poor to contribute something, as they already did in order to obtain surgical instruments such as trusses and splints. When payment was introduced in May 1872 by way of a registration fee, the numbers applying to the charity rapidly declined. Through levying a charge of 6d on all outpatients, however, more than £160 had been collected, and paupers were now said to be absent.80 The following year nearly £250 was raised, and the governors even considered raising the fee. By 1877, fees alone comprised 10 per cent of the hospital’s income. Perhaps inspired by the Children’s Hospital, in February 1873 the managing committee at the Queen’s Hospital also expressed its desire more accurately to determine how many of their hospital patients could pay for medical treatment. Instead of adding to their secretary’s duties, however, they invited the aid of the local Mendicity Society. In June 1873, after a few months of careful investigation, the Society presented its report to the hospital’s finance committee. Of the 365 cases inquired into, only two refused information, thirty-three gave false addresses, six received parish relief, sixty-two cases were judged ‘obviously unsuitable’, and several others of ‘less obvious unfitness’, leaving 253 legitimate cases, or 69 per cent of the sample.81 Of inpatients admitted by ticket, the committee highlighted the case of a youth whose father lived in a ‘good house in the suburbs, and goes to business every morning by bus’.82 Moreover, the family kept a servant at home, who ‘refused admission to [the] Visiting Agent’. The report also discussed a widow who was found to be a case for the parish, and two single women, a mother and daughter, who were identified as ‘prostitutes of the upper class’. Inpatients admitted as emergencies included the only child of a miller; another widow, judged a case for the parish; the child of a ‘bus and cab proprietor’ said to be ‘in a good way of business’; the daughter of a travelling jeweller; a girl whose mother, ‘indignantly refused information’; and a drunken son, who was not only turned out by his family, but also jobbed at an inn and frequently made himself drunk, only to be ‘put straight’ by the hospital each time. Among outpatients they found many working parents who sent their children for treatment, and a single woman who was not home at the time of inquiry but whose landlady suggested she was ‘a person of means, which the nature and position of the house corroborate’. Finally, though not visited at home, one woman was immediately judged unsuitable as she came to the hospital ‘in stylish attire – green kid gloves with tassels, and a muff!’ Satisfied with the report, which had armed the committee with much useful knowledge, and convinced that abuse could be managed, the Queen’s Hospital’s house committee advised the introduction of a fee system, which took effect in January 1876. Enquiries were to continue, but would now be carried out by hospital almoners in an office in the outpatient department. As predicted, a decline in subscriptions followed given that the hospital no longer offered their subscribers the right to recommend patients, but this amounted to less than £40, while registration fees brought in approximately £400 annually. As importantly, medical officers had also gained greater control over the admissions procedure. As the results of the Queen’s experiment perhaps suggest, hospital financial records at the close of the nineteenth century attempted to compile more detailed

Birmingham’s voluntary hospitals

55

portraits of patients’ lives than ever before. This contrasts with the earlier nineteenth-century records, which reveal almost nothing about the recipients of medical charity. Paradoxically, even while charity was being democratised in the 1860s and 1870s, voluntary hospitals still knew very little about the circumstances of their working-class patients, who were generally, if at all, described collectively. Primarily concerned with proving themselves useful to potential supporters, hospitals added and enlarged outpatient departments, allowing staff to treat ever-increasing numbers of cases, despite at times having only a dozen beds. Even the smallest Birmingham hospitals built convalescent homes in order to free beds and increase patient turnover. What Derek Fraser has argued with reference to nineteenth-century philanthropy in general, seems equally to apply to Birmingham’s medical charities. Few inquired or researched into the real needs of recipients, and nobody in the breathless activity of collecting and spending funds had time to work out an order of priorities.83 This, however, was rectified at most hospitals by introducing more rigorous methods of investigation and even establishing hospital almoners’ departments. In this way, hospitals maximised collections while simultaneously satisfying middle-class subscribers that abuse was minimised. This, in turn, helped provide the funds required to modernise medical facilities. Interestingly, and less discussed by medical historians, the new scientific medicine had a very different effect on patients than did scientific charity. Though both attempted to measure and analyse patients, practices often found to be dehumanising whether carried out by physician or almoner, the new investigative methods of medical charity personalised the records of voluntary hospitals. Scientific medicine, on the other hand, by tracing disease to its primary locus, namely the cell, effectively ‘dissolved the integrated vision of the whole individual into a network of anatomical structures’ and ultimately depersonalised treatment in voluntary hospitals.84 Alternatively, if these medical developments were to have led to the disappearance of the sick man (as Jewson has described the late nineteenth-century shift away from a person-oriented towards an object-oriented medical cosmology), the sick man would quickly reappear in the financial records of medical charities. While modern medicine to some extent eliminated the individuality of each case through the application of foreknown diagnostic procedures, the investigations of the almoner or even, in some cases, hospital porter were only beginning to draw out the details of each charitable case. In this way, charity at the end of the nineteenth century can be seen to have countered the effects of medicalisation and, by reducing the distance between hospital and patient, prevented these institutions from overlooking those they were originally built to serve.

Notes 1 J. Thackray Bunce, A History of the Birmingham General Hospital and the Musical Festivals, Birmingham, Cornish Brothers, 1873; A. Elliott, The Music Makers: a brief history of the Birmingham triennial musical festivals, 1784–1912, Birmingham, 2000.

56 Jonathan Reinarz 2 S. Cherry, ‘Hospital Saturday, workplace collections and issues in late nineteenthcentury hospital funding’, Medical History, 44(4), 2000, 461–88. 3 K. Waddington, Charity and the London Hospitals, 1850–1890, Woodbridge, Suffolk, Royal Historical Society, 2000; G. Rivett, The Development of the London Hospital System, 1823–1982, London, King Edward’s Fund for London, 1986; F. Prochaska, Women and Philanthropy in Ninteenth Century England, Oxford, Clarendon Press, 1980; F. Prochaska, Voluntary Impulse: Philanthropy in Modern Britain, London, Faber, 1988. 4 H. Marland, Medicine and Society in Wakefield and Huddersfield, 1780–1870, Cambridge, Cambridge University Press, 1897, p. 114; Birmingham Central Library Archives (BCLA), Orthopaedic Hospital, Annual Report, 1895–6, HC/RO/Box 14; A. Berry, ‘Community sponsorship and the hospital patient in late eighteenth century England’, in P. Horden and R. Smith (eds), The Locus of Care: families, communities, institutions and the provision of welfare since antiquity, London, 1998, pp. 126–145. 5 BCLA, General Hospital, Birmingham, Annual Reports, 1800–1820, HC/GHB/1/3/1. See also Reinarz, The Birth of a Provincial Hospital: the early years of the General Hospital, Birmingham, 1765–1790, Dugdale Society Occasional Paper, LV, Stratford: Shakespeare Birthplace Trust, 2003. 6 L. Davidoff and C. Hall, Family Fortunes: men and women of the English middle class, 1750–1850, London, Routledge, 1994, p. 421. 7 K. Waddington, Charity and the London Hospitals, 1850–1898, p. 37. 8 E. Lomax, Small and Special: the development of hospitals for children in Victorian Britain, London, Wellcome Institute for the History of Medicine, 1996, p. 57; H. Marland, ‘Pioneer work on all sides: the first generations of women physicians in The Netherlands, 1879–1930’, Journal of the History of Medicine and Allied Sciences, 50, 1995, 441–77. 9 T. Wright, The Birmingham General Hospital, Birmingham, 1865, p. 12. 10 E. Smith and B. Cottell, A History of the Royal Dental Hospital of London and School of Dental Surgery, 1858–1985, London, Athlone Press, 1997, p. 14. 11 BCLA, Children’s Hospital, Annual Report, 1863, HC/BCH/1/14/1. 12 Birmingham Daily Post, 10 January 1865. 13 Bunce, A History of the Birmingham General Hospital and the Music Festivals, 1873, pp. 154–61. 14 Waddington, Charity and the London Hospitals, 1850–1898. 15 BCLA, General Hospital, General Minute Book, 1843–51; General Hospital, Annual Report, 1864, GBH 420. 16 S. Gamgee, Our Medical Charities and the Working Classes, Birmingham, 1884, p. 18. 17 BCLA, Queen’s Hospital, House Committee Report Book, 1863–6, HC/QU/1/2/1. 18 BCLA, Queen’s Hospital, Minute Book of the General Committee, 1886–96, HC/QU/1/1/5. 19 BCLA, General Hospital, Annual Report, 1810, MS 1921/414. 20 Ibid. 21 Ibid. 22 Ibid. 23 T. Wright, The Origins of Hospital Sunday in Birmingham, Birmingham, 1883, p. 3. 24 Ibid.; Women’s Hospital, Annual Report, 1900, HC/WH/1/10/4. 25 BCLA, Children’s Hospital, Annual Report, 1883, HC/BCH/1/14/4. 26 Ibid. 27 Ibid., 1901, HC/BCH/1/14/7. 28 Wright, Origins of Hospital Sunday, p. 13. 29 S. Cherry, ‘Beyond National Health Insurance: the voluntary hospitals and voluntary contributory schemes, a regional study’, Social History of Medicine, 5, 1992, 455–82; M. Gorsky, J. Mohan and M. Powell, ‘The financial health of voluntary hospitals in inter-war Britain’, Economic History Review, 55(3), 2002, 533–57.

Birmingham’s voluntary hospitals 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75

57

Birmingham Daily Post, 13 June 1873. Birmingham Daily Post, 27 February 1873. Birmingham Daily Gazette, 8 January 1873. Birmingham Daily Post, 17 March 1873. Birmingham Daily Post, 13 June 1873. BCLA, Minutes of General Committee, Queen’s Hospital, Birmingham, 1870–2, HC/QU/1/1/1. Ibid. Ibid. Ibid. Gamgee, Our Medical Charities, p. 21. Birmingham Daily Post, 17 March 1873. Birmingham Daily Post, 25 March 1873. Gamgee, Our Medical Charities, p. 5. BCLA, Children’s Hospital, Annual Report, 1884, HC/BCH/1/14/4. Ibid., 1892, HC/BCH/1/14/5. Birmingham Daily Mail, 26 December 1893. Birmingham Daily Post, 28 January 1873. Birmingham Daily Mail, 22 December 1875. BCLA, Children’s Hospital, Annual Report, 1913, HC/BCH/1/14/8. Ibid. Ibid., 1869, HC/BCH/1/14/2. Ibid. Ibid., 1876, HC/BCH/1/14/3. A similar case is made in Waddington, Charity and the London Hospitals, 1850–1898, p. 40. BCLA, Children’s Hospital, Annual Report, 1888, HC/BCH/1/14/5. Ibid. Ibid., 1880, HC/BCH/1/14/4. BCLA, Birmingham & Midland Free Hospital for Sick Children, Minute Book, 1861–70, HC/BCH/1/2/1. BCLA, Minute Book of the House Committee of the Children’s Hospital, Birmingham, 1864–74, HC/BCH/1/5/1. Ibid. Ibid. Waddington, Charity and the London Hospitals, p. 158. BCLA, Birmingham General Hospital, Medical Committee Minute Book, 1855–68, HC/GHB/68. BCLA, General Hospital, Medical Committee Minute Book, 1877–85, HC/GHB/70. Ibid. Ibid., General Hospital, Annual Report, 1896, HC/GHB/431. Ibid., Orthopaedic Hospital, Annual Report, 1897, HC/RO/Box 14, Annual Reports. Ibid. BCLA, Queen’s Hospital, Minute Book of General Committee, 1886–96, HC/QU/1/1/5. Ibid., Women’s Hospital, Annual Report, 1898, HC/WH/1/10/4. Ibid., General Hospital, Annual Report, 1897, HC/GHB/432. BCL, Local Studies, Birmingham Eye Hospital, Annual Report, 1886. BCLA, General Hospital, Annual Report, 1898, HC/GHB/432. Ibid., Birmingham & Midland Free Hospital for Sick Children, Minute Book, 1861–70, HC/BCH/1/2/1. Ibid., Children’s Hospital, Annual Report, 1863, HC/BCH/1/14/1. Ibid., Children’s Hospital, Annual Report, 1872, HC/BCH/1/14/2. M. Simey, Charity Rediscovered: a study of philanthropic effort in nineteenth-century Liverpool, Liverpool, University of Liverpool Press, 1992, pp. 83–93.

58 Jonathan Reinarz 76 Ibid.; Birmingham & Midland Free Hospital for Sick Children, Minute Book, 1861–70, HC/BCH/1/2/1. 77 Ibid. 78 Ibid. 79 Ibid., Newspaper cuttings of Children’s Hospital, 1862–1898, HC/BCH/6/2/1. 80 Ibid. 81 Ibid., Minutes of General Committee, Queen’s Hospital, Birmingham, 1872–6, HC/QU/1/1/2. 82 Ibid. 83 D. Fraser, The Evolution of the British Welfare State, London, Macmillan, 1973, p. 120. 84 N. D. Jewson, ‘The disappearance of the sick man from medical cosmology, 1770–1870’, Sociology, 10, 1976, 238.

4

Regional comparators in the funding and organisation of the voluntary hospital system, c.1860–1939 Steven Cherry1

Introduction This article examines voluntary hospital provision in two very different areas: East Anglia and industrial South Yorkshire. A brief national survey of changes in hospital finances and their suggested impact is offered with a view to the diversity and sustainability of the sector. The related and more difficult task is to consider whether the case examples indicate that a functioning regional voluntary hospital system, the model most frequently prescribed by the sector’s supporters, had emerged in these areas by 1939.

Background Voluntary hospitals have been seen by their devotees as flagships of philanthropic effort, bringing ‘the personal touch’ to health care.2 Yet critics might argue that they facilitated the expansion of precisely the scientific, researchbased medicine that allegedly depersonalised the doctor–patient relationship and that patients, first as charitable cases and later as subjects for the attention of the hospital almoner, saw ‘the personal touch’ rather differently.3 In caring for the acute physically sick for over two centuries, the hospitals’ focus upon charitable treatment for the non-pauperised poor blurred into provision for a broader social clientele, expected to contribute towards treatment costs, and to contract work for local authorities and central government agencies.4 Levels of co-ordination within the voluntary hospital sector, in relation to former Poor Law and local authority hospitals for the chronic or infectious sick, and in the context of general health care, were not highly developed. Indeed, in the early twentieth century fears of municipalisation or nationalisation largely provided the spur for voluntary sector regional planning, as advocated by Voluntary Hospitals Commission, the British Hospitals Association and the Nuffield Provincial Hospitals Trust.5 Many voluntary hospitals were also beset by financial difficulties, notably in the 1870s, immediately after the First World War and, particularly in London, on the eve of the Second World War, prior to their nationalisation.6 Excluding Abel-Smith’s landmark study, a substantial literature dealing

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mainly with individual hospitals offers few in-depth criticisms of the voluntary hospital system as such, and investigation of the hospitals in their regional context is comparatively recent.7 Work on the sources of hospital income has confirmed great diversity among voluntary hospitals, according to geographic location, size and function, whilst suggesting significant longer-term changes.8 From the 1860s, increasing patient demand, more costly and more complex medical and surgical procedures, and deficiencies in the funds and physical fabric in many voluntary hospitals became subjects for national concern.9 The hospitals developed, reforming their admissions procedures, hygiene levels and nursing systems, although their successes rested partly upon the emergence of rudimentary public institutions for chronic sick, infectious and pauperised patients. Motives in hospital philanthropy, beyond the altruistic or ‘other-regarding’, included the desire to influence or control the behaviour of patients or particular institutions.10 Voluntary hospital growth might still be driven by legacies and bequests, but the use of industrial capital, often in conjunction with fundraising by employees, also featured. So did the efforts of ambitious doctors, notably in association with medical schools or special hospitals.11 In less urbanised areas, cottage or smaller district hospitals similarly reflected a range of interests, from landowner patronage to professional advancement and workers’ initiatives.12 Grand donations were no longer the sole influence upon modern hospital development and they became relatively less important, particularly in day-today funding.13 Innovations such as Hospital Sunday and, particularly, Hospital Saturday or workplace collections, were increasingly significant in fundraising.14 The latter amounted to half the subscription income at Glasgow Royal Infirmary by the 1850s, for example, and Burdett’s initial survey revealed organised works collections for hospitals in forty provincial centres in the 1880s.15 Workplaces already featured as ‘subscribers’ at hospitals in the West Midlands, the North East and North West, providing uneven but often substantial proportions of their annual income.16 These new income sources developed into organised forms of pre-payment for hospital treatment, using the principles of insurance and pooled resources. They were indicative of popular appreciation of hospital services, beyond a simple resort to charity or the passive adoption of self-help doctrines, arising partly from the perceived achievements of scientific medicine and the experience of nineteenth-century club medicine before state health care under the 1911 National Insurance Act.17 This legislation stimulated general practitioner referral of patients to hospitals, but matching resources were not provided. Moreover, the inflation associated with the First World War dramatically raised the hospitals’ costs.18 Most hospitals responded to increasing workloads and financial pressures by introducing patient charges. This placed arrangements with works collection schemes more definitely onto a quasi-insurance basis, since contributions exempted patients from charges, and many hospitals established directly controlled contributory schemes. Such voluntary efforts partly addressed the hospital facility missing from the 1911 state scheme, securing cover for contributors and,

Regional comparators c.1860–1939

61

usually, their dependants. These measures, assisted by falling costs in provisions if not in salaries, drugs and medicines, enabled most hospitals to escape their post-war financial difficulties for the rest of the 1920s and early 1930s.19 However, related issues concerning accountability, participation or entitlement to treatment, already discernible in some hospitals by 1900, became more pressing.20 With direct payments from better-off patients and a widening social clientele, public expectations concerning hospitals increased further by the 1930s.21 Table 4.1 provides information on hospital income and its main components in provincial England, Wales and Scotland, along with the differently compiled data for metropolitan hospitals.22 Burdett’s sample of roughly 160 hospitals offers a guide to their pre-1914 finances, skewed towards the larger institutions. Their ‘total income’ was noticeably influenced by the ‘windfalls’, legacies and endowments used in capital accounts, which exceeded the more regular sources of ‘ordinary’ income. More extensive information suggests that from 1920 the hospitals’ ordinary income rose steadily, interrupted only by the 1926 General Strike and the 1931 financial crisis. This also comprised a much larger

Table 4.1 Composition of British voluntary hospital income (quinquennial/decennial means), 1890–1938 1890–99 1900–04 1910–14 1920–24 1925–29 1930–34 1935–38 (a) English Provinces, Wales and Scotland Income (£m) Total Ordinary Composition (%) Subscribers etc. Investments Contribution Patient payments Local authorities

0.71 0.54 47 26 14 3

3.43 1.44 50 26 18 3 3

4.34 1.82 45 27 22 3 3

10.48 7.27

24 13

13.70 9.11

16.11 10.75

17.58 12.79

33 17 28 15 7

27 16 28 19 9

23 14 55 8

(b) London Income (£m) Ordinary Composition (%) Gifts Investments Patients payments Public authorities

0.66 39 53 2

0.45 46 47 2

0.60 50 44 3

2.50

30

3.07 43 20 34 8

3.46 38 19 34 8

4.12 36 17 38

Sources: 1889–99, Burdett Hospital Annual, Hospitals and Charities; 1900–14, Burdett, Hospitals and Charities; 1920–24, Vol. Hosps of GB, Annual Reports, Burdett, Hospitals and Charities; 1925–38, Hospital Yearbook, Braithwaite, Voluntary Citizen. Notes 1890–1914 data relate to 160 provincial and twenty-six London hospitals; 1920–38 data is for approx. 900 provincial and 145 London hospitals.

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proportion of their total income, varying between 66 per cent and 77 per cent, with current account surpluses often transferred to investment stocks and building funds. An end to aggregate deficits in 1923 and cumulative surpluses of £7.75 million between 1929 and 1937 suggested a relatively healthy financial position overall. However, the apparently chronic deficits of London hospitals exceeded surpluses in provincial and Scottish hospitals by 1939 to produce a notional voluntary sector shortfall of £414,000.23 Such developments reflected significant changes in voluntary hospital funding. Subscriptions and donations provided almost one-half of ordinary income in provincial hospitals before 1914, but only one-quarter by the 1930s. ‘Gifts’ to London hospitals declined less markedly, mainly because contributions from the Hospital Savings Association were included.24 Income from properties and investments fell everywhere: this represented some 30 per cent of ordinary income in London teaching and Scottish hospitals by the late 1930s, but the provincial hospital average was 12 per cent.25 Newer income sources were also variable. Early twentieth-century government and local authority funding increased as hospitals were contracted for particular services, but levelled off and rarely exceeded 10 per cent of hospital ordinary income. In contrast, the proportion from patient payments expanded to comprise 33 per cent, 25 per cent and over 15 per cent respectively in London, provincial and Scottish hospitals by 1939. Hospital income from legacies, endowments and investments, totalling £6.5 million, was then exceeded by the £7 million from collection and contributory schemes and direct patient payments.26 It is possible, generalising from best practice examples, that this newer funding could have sustained the voluntary hospital sector.27 Yet as provision for the chronic sick and infirm on a direct payment or insurance basis, at rates affordable to the poorest, could not be assumed, local or central government assistance was necessary and attention was then likely to focus upon the role of voluntary hospitals and their relationship with the emerging public sector.

East Anglian and South Yorkshire examples The seven East Anglian hospitals considered here were the principal institutions in Norfolk, the former counties of East and West Suffolk, and Cambridgeshire.28 The Norfolk and Norwich and the East Suffolk and Ipswich Hospitals provided the bulk of specialist services and accounted for over half of hospital financial resources in their respective counties. The Lowestoft, Yarmouth, and West Norfolk and Kings Lynn Hospitals were established between 1825 and 1838; each derived from an early nineteenth-century dispensary and was of modest size – roughly fifty beds by 1900. There were between 1.05 and 1.1 voluntary hospital beds per thousand population in Norfolk and Suffolk in 1911, slightly less than the national average of 1.2 beds.29 The Lowestoft and the West Norfolk and Kings Lynn Hospitals, both of which ran successful contributory schemes, doubled their bed capacity between the wars, though there was no increase at Yarmouth.30 Table 4.2 shows the changing composition of ordinary income in these five hospitals.

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Table 4.2 Composition of ordinary income in five Norfolk and Suffolk hospitals, 1900–39 1900–14

1921–25

1926–30

1931–35

1936–39

103.7

125.1

140.2

170.2

54.7 24.7 10.8

21.2 10.1 33.0

18.3 9.3 48.2

15.1 8.0 53.2

13.5 6.6 55.1

2.7

7.2

7.1

28.5

8.0 5.2 11.0

8.6 4.9 10.2

10.7 5.0 9.1

Ordinary income (£000 p.a.) 25.7 Composition (%) Subs/donations Investments Collection and contributory schemes Patient payments Local authorities Other

Sources: Annual Reports, Norfolk and Norwich, East Suffolk and Ipswich, West Norfolk and Kings Lynn, Yarmouth, and Lowestoft Hospitals.

All the hospitals experienced rapid decline and then levelling off in subscriptions, donations and investment income, at slightly below suggested national averages. Local authority payments were stationary and, as with patient payments, proportionately less than national equivalents.31 The role of contributory schemes was thus vital, particularly as there were few works collections before 1900 outside Ipswich, Norwich and Cambridge. These produced 54 per cent of ordinary income at the five hospitals in the 1930s, with corresponding figures of 46 per cent at the West Suffolk General (Bury St Edmunds) and 60 per cent at Addenbrookes Hospital (Cambridge). What was the financial situation in hospitals in the very different environment of industrial South Yorkshire? Coal mining featured prominently but not exclusively in an arc of towns from Chesterfield, north Derbyshire, through Rotherham, Worksop, Doncaster and Barnsley to the north. Smaller hospitals specifically serving mining communities were also noticeable, and Mexborough is included as a representative. Hospitals in Doncaster, Barnsley and Rotherham also developed from dispensaries, though each was small (initially with less than twenty beds) and established rather later than the Norfolk and Suffolk town hospitals.32 ‘New’ income sources were evident at the outset. Mineworkers’ donations part-funded a new Barnsley Beckett hospital in 1872, and a penny-collecting scheme provided one-third of ordinary income by the mid1880s.33 Works collections represented 22 per cent of inaugural income at the Rotherham hospital and a similar proportion at Doncaster by the 1890s.34 A fourteen-bed cottage hospital at Mexborough was largely run by worker governors and funded by a halfpenny scheme from 1889. These four South Yorkshire hospitals expanded more rapidly than their East Anglian comparators, providing 290 beds in 1911 and over 600 beds by 1938.35 Their main sources of income are summarised in Table 4.3.

64 Steven Cherry Table 4.3 Composition of ordinary income in four South Yorkshire hospitals, 1900–39 1900–14

1921–25

1926–29

1931–35

1936–39

41.7

58.3

73.5

89.6

37.0 18.6 37.0

25.2 10.9 51.3

20.2 9.5 58.2

20.2 7.4 55.4

21.9 6.0 62.8

1.1

4.4 2.6 5.4

4.5 2.6 5.1

3.7 4.6 8.6

2.3 5.7 0.8

Ordinary income (£000 p.a.) 11.4 Composition (%) Subs/donations Investments Collection and contributory schemes Patient payments Local authorities Other

6.3

Sources: Annual Reports, Mexborough Montagu Hospital, Doncaster Royal Infirmary, Barnsley Beckett Hospital, Rotherham Infirmary. Note Collection and contributory schemes at Chesterfield Royal Infirmary grew from 50% of ordinary income 1900–14 to 58% 1930–39.

Although Poor Law and later municipal facilities were available in each town, the local voluntary hospital attracted strong community financial support. This is difficult to break down precisely, for the hospitals did not adopt the uniform accounts system until the late 1920s.36 Works collections sometimes figured within Hospital Saturday income, as in Doncaster, or even jointly with Hospital Sunday, as in Barnsley. Moreover, traditional subscription income did not differentiate between workers, employers or individuals in industries other than coal mining, steel-making or the railways, and ‘donations’ also included collections in workingmen’s clubs or at galas, attributed elsewhere to Hospital Saturday income. This may explain the inter-war durability of such sources. Investment income was proportionately lower than national averages: these hospitals and particularly their worker governors were diligent about financial reserves and debt-free expansion, but inclined to improve facilities when possible, not least because ‘windfall’ income for such projects was rarer and less extensive.37 Patient payments, which included private patients at each of the hospitals, were proportionately low, reflecting the social structure of the area and the likelihood that better-off clientele sought access to the larger Sheffield hospitals and their specialist facilities. Local authority contributions were also limited, though increasing in support of maternity wards established at the Mexborough and Doncaster hospitals. Direct workplace collections, already the largest single source of hospital income in the South Yorkshire hospitals by 1900, comprised more than half the ordinary income at Chesterfield and a similar proportion throughout the area between the wars. This regular source was occasionally vulnerable, for income from it in Sheffield and South Yorkshire fell by over £41,000 during the 1926 miners’ lockout, and unemployment had adverse effects.38 Overall, such collections were producing more than 60 per cent of hos-

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65

pital ordinary income by the late 1930s, before more general adoption of graduated ‘1d in the £’ or contributory scheme formats and integration with the Sheffield-based scheme generated still further funding

The Sheffield hospitals: a crisis averted A more detailed examination of the Sheffield voluntary hospitals illustrates the problems and practicalities of hospital funding. Sheffield was unusual in that independent Health Committee administration of Poor Law infirmary facilities (the Union Hospital at Fir Vale and the infirmary block at Eccleshall) dated from a Local Government Board Order in 1906, rather than the 1929 Local Government Act.39 Voluntary hospital provision comprised the Royal Infirmary (founded 1793), the Royal Hospital (1832), the Jessop Hospital for Women (1864), the Children’s Hospital (1876) and the Edgar Allen outpatient orthopaedic facility (1909). These offered some 700 beds, or roughly 1.4 beds per 1,000, to an immediate district population approaching 500,000 circa 1914. Financial constraints dogged the voluntary hospitals, as traditional income was limited and new income sources attracted controversy. Hospital Sunday dated from 1867 and provided 6 per cent of the hospitals’ ordinary income in 1900, but collections were stagnating and subject to allegations (from a clergyman), that in some churches an ‘. . . amount was taken out from the total received. And it was a pretty good average they took out in such cases’.40 Hospital Saturday fundraising fared little better: after a false start in 1873 early efforts were closely tied to the Royal Infirmary and reached a pre-war peak of £1,700 annually in the early 1900s.41 Direct workplace collections provided £3,000 or almost one-quarter of ordinary income for the Royal Infirmary in 1900, but the lack of accountability or some variant upon subscriber-recommendation principles rankled with the labour movement.42 Early in 1912 the Sheffield Trades and Labour Council passed a resolution condemning ‘the principle of workers’ contributions to hospitals being controlled by the hospitals, and demand(ing) municipalisation of the institutions’.43 If some Sheffield employers had an interest in social reform, this as yet had little practical consequence for voluntary hospitals.44 When the local hospitals applied for Red Cross grants in 1918, they were rebuffed with the comment that ‘large fortunes’ had been made in wartime Sheffield and employers should boost hospital funding.45 An open letter from the Joint Hospitals Medical Staff to hospital authorities and the local press in March 1919 described inpatient accommodation as ‘altogether insufficient’. Over 2,000 people awaited hospital admission, mainly surgical cases and 10 per cent of them ‘urgent’. Facilities for children were particularly poor, the nursing shortage acute and training deficient, and the absence of co-ordinated hospital effort was deplored. Whilst overall needs should determine individual hospital planning, ideally a new single-site hospital was favoured.46 A Joint Consultative and Advisory Hospitals Council, established in May 1919, and a joint financial appeal was the hospitals’ formal response.47 The

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appeal stated that subscriber-recommendation principles were inadequate, that hospital charges would be introduced, and that increased works collections were essential in reducing the hospitals’ current £20,000 deficit.48 None of this was unique to Sheffield, but proposals for graduated ‘1d in the £’ workplace contributions without income limit, deducted from wages and supported by pro rata contributions of one-third from employers, were. These originated with local steel-makers F. M. Osborn but, mindful of pre-war tensions, the Sheffield labour movement was directly and extensively involved. Inauguration of the ‘1d in the £’ scheme included a circularised appeal from ‘Sheffield leaders of labour’ stating ‘the only fair method . . . is that everyone should contribute in proportion to income’.49 An Association of Hospital Contributors, utilising quarterly delegates’ meetings, obtained direct representation on each hospital Board of Management and elected an Executive Committee to represent members at the Joint Hospitals’ Council.50 The contributors were initially workplace-based, but geographic, ward and district groups soon developed, often using local Co-op society branches, and sections for the unemployed, domestic servants, shopkeepers and the self-employed were established. Membership grew dramatically to 240,000 plus dependants by 1926, and then stabilised before renewed growth towards 300,000 in the late 1930s.51 This comfortably exceeded the number of Sheffield workers covered by state national health insurance, which averaged 207,000 in the 1920s and 215,000 in the 1930s, and can be seen in the context of a total 1931 Sheffield population of 519,000.52 In common with other large collection or contributory schemes, the Sheffield model offered convalescent and special treatments, and ambulance, nursevisiting and sick-room facilities. Its success produced significant improvements on pre-1914 arrangements, and some influence with hospital and local authorities. Within two years the scheme could claim a role in a ‘working arrangement with Union (Poor law) hospitals without any taint of pauperism’, helping urgent cases or those ‘where continued waiting is the cause of suffering’ because the voluntary hospitals were full.53 It also secured voluntary hospitals’ agreement not to charge unemployed non-contributors, pensioners, widows, children or ‘the necessitous poor generally’. This suggests concerns beyond voluntary hospital fundraising, reflected also in the monitoring of employer contributions and successive campaigns to uprate children’s hospital and then maternity hospital facilities.54 The impact of the scheme on Sheffield hospital finances can be seen in Table 4.4. Extraordinary income sources, which varied between 20 and 30 per cent of ordinary income from 1900 to the late 1920s, declined to an additional 10 per cent in the 1930s, making the obtaining of regular income of particular importance. Before 1914, Sheffield hospitals relied heavily upon subscriptions, donations and investment income – particularly the Royal Infirmary and Royal Hospital, which accounted for three-quarters of the financial resources. Collection income was unexceptional, considering the urban environment and the situation in neighbouring South Yorkshire hospitals. After 1920, however, the hospitals’ finances were tied to the fortunes of the contributory scheme. It pro-

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Table 4.4 Composition of ordinary income in the four Sheffield voluntary hospitals, 1900–39 1900–14 Ordinary income (£000 p.a.) 31.0 Composition (%) Subs/donations Investments Collections and contributory schemes Patient payments Local authorities Other

10.8 18.0 0.5 5.0

1921–24

1925–29

1930–34

1935–39

102.7

127.8

137.6

185.0

19.8 11.3 54.9

11.4 12.1 64.3

10.7 9.0 63.8

8.1 73.4

7.7 4.0 2.8

8.3 3.5 1.2

8.3 2.9 2.2

6.8 2.6 0.1

Sources: 1900–14, Burdett Hospitals and Charities; 1920–39, Sheffield Joint Hospitals Council, Annual Reports, Hospital Yearbook.

vided over half their ordinary income almost immediately, then almost two-thirds of it through a difficult economic period for the city, and nearly three-quarters in the late 1930s. The community nature of the scheme partly explains the greater than average decline in subscriptions and donations in Sheffield, and also the relatively low level of direct patient payments.55 Limited local authority contributions to the Sheffield hospitals reflect the extent of public sector hospital provision (which included facilities for accident and emergency cases) in the city.

Contributory schemes, fundraising and the co-ordination of services The significance of collecting and contributory scheme funding is discernible in a range of areas. Nationally, this became the primary source of inter-war provincial hospitals’ ordinary income and the second largest source in London and Scottish hospitals. It was critical to their financial recovery in the early 1920s, and in most cases helped to delay renewed difficulties.56 As shown, at least onehalf of hospital ordinary income was so provided by the 1930s in South Yorkshire and East Anglia. Saturday funds or works collections, already important by 1900 in Yorkshire mining districts, grew further or were joined by rapidly developing contributory schemes in the early 1920s throughout both regions, whilst schemes based upon a much wider social or patient clientele had developed by 1939 in Cambridge and Sheffield. Moreover, the Sheffield and west Norfolk schemes covered their members’ treatment and maintenance costs by the mid1930s, with the Norwich-based version, for most of Norfolk and north-east Suffolk, providing more than 80 per cent towards this objective.57 Collecting and contributory schemes were also able to provide additional funding and release windfall resources for capital projects. In South Yorkshire, additional donations partly offset lost contributions associated with the General Strike, but financial difficulties were compounded by the impact of economic

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recession.58 Appeals in Sheffield in 1932 for an ‘extra penny’ and a minimum contribution of twopence achieved a 98 per cent response rate and pro rata contributions by employers ‘in almost every case’.59 With this ‘splendid success . . . income from the contributory scheme will not only continue to pay the full cost of services, but will also provide sufficient income for the voluntary hospitals to meet annual expenditure and leave a balance towards reducing bank overdrafts’.60 F. M. Osborn, Chairman of the Sheffield Hospitals Joint Council, also confirmed that ‘the relief given to Boards of Management by the steadily increasing income from the “1d in the £” for maintenance . . . justified them using their legacies for capital expenditure’.61 Such assistance was timely, considering the relative decline of extraordinary income and the requirements of capital funding. Grand donations often governed hospital expansion, but other sources certainly featured in South Yorkshire. In Barnsley, grants from the Miners Association assisted the extension of the hospital in the early 1900s. The collieries’ penny fund provided more than onequarter of the £21,000 Mayoral Appeal, which cleared post-war debts and raised a further £22,000 for building projects by 1930.62 More than half of the £34,000 inter-war building costs at Rotherham infirmary were provided by miners, steelworkers and the local Co-operative Society.63 A weekly ‘extra penny’ in workers’ contributions directly funded capital accounts from 1920 in Mexborough and from 1934 in Doncaster. In the latter example, a power struggle, spearheaded by mineworkers’ representatives and a grant of £25,000 from the Yorkshire Miners’ Welfare Association, led to the overdue building of a completely new hospital by 1939.64 A similar grant provided a new seventyeight-bed block at Sheffield’s Royal Hospital after its 1932 Centenary Fund Appeal had raised only £46,000 of the projected £100,000.65 Where local authority or central government funding or public hospital facilities were limited, the voluntary hospitals were more clearly identifiable as a sector than as an organised system. Left to their own devices, hospital authorities inclined to institutional and financial isolationism rather than co-ordination with other forms of health care.66 The receipt of the referred serious or ‘interesting’ case, individual Poor Law cases or contract work for local authorities constituted the main peacetime examples of voluntary and public sector co-operation. Within the voluntary sector, referrals by GPs or cottage hospitals to teaching hospitals followed similar lines, or otherwise facilitated the admission of those patients able to pay hospital consultants for complex or intensive treatments, although patients generally had little influence. However, indirect or direct forms of patient payment were much less expressions of support for a particular institution than quasi-insurance measures for contributors and their dependants or purchases of hospital services. This point was increasingly emphasised by the contributory-scheme representatives, who favoured the movement of patients between hospitals to access services and thereby promoted the development of a hospital system.67 In most examples the movement of a contributory-scheme patient between hospitals involved cash transfers. Regionally based schemes, as in Norfolk in the

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1930s, acted as a clearing-house and made payments to the appropriate hospital. Where contributory schemes were tied to a particular institution, such transfers meant loss of income unless compensatory arrangements were made. East Anglia provides evidence of hospitals gaining (Norfolk and Norwich) or losing (Yarmouth) from these operations, to the point where the latter’s contributory scheme was absorbed into the Norwich-based version.68 Larger hospitals (such as Addenbrookes) sought to maximise income from their own contributory scheme by restricting convalescent treatments or treatments for ‘Cambridge’ patients in other hospitals, much to the annoyance of the scheme’s lay representatives.69 Smaller or cottage hospitals were encouraged by the Norwich Hospitals Contributors’ Association and pressured by the economic effect of patient transfers to accept post-operative cases from the Norfolk and Norwich Hospital, or to perform basic operations on contributory-scheme patients when there were waiting lists at Norwich.70 An extending network of arrangements was formalised with the adoption of contributory-scheme vouchers interchangeable at East Anglian hospitals. This helped to develop a regional voluntary hospital system, the goal of the British Hospitals Association, and was noted as a model of its kind in the mid-1930s.71 Similar progress was initially less rapid in South Yorkshire. High accident rates and industrial disease featured prominently, and the relatively late establishment of town hospitals resulted in the admission of considerable numbers of patients from the surrounding area into Sheffield institutions before 1900. With their financial difficulties aggravated by the failure of the 1911 national insurance scheme to provide resources, and faced with rising wartime costs and postwar waiting lists, Sheffield hospital authorities blamed ‘the collieries’ for underpayment and labelled the neighbouring hospitals as unco-operative.72 Plans to absorb Barnsley, Rotherham and Mexborough into the ‘1d in the £’ scheme were rebuffed as these hospitals zealously guarded their roles and financial assets, particularly while hospital debts featured in Sheffield. Moreover, their largely GP staffs had little professional interest in operating in hospitals identified as Sheffield outposts.73 With some justification, the Sheffield hospitals asked, in 1923, ‘is it not fair and equitable that, if beds are vacant in the county and cottage hospitals, they should take our Sheffield light cases in return for their large number of serious cases which we take?’74 Yet 23 per cent of Sheffield’s contributory-scheme income originated outside the city that year, and the allocation of 6 per cent of collections to local hospitals suggests some interchange of patients and resources. Informal reciprocal arrangements followed the Sheffield hospitals’ ‘friendly understanding’ with Chesterfield Royal Infirmary and Worksop Victoria Hospital, and area conferences held under the aegis of the Voluntary Hospitals Commission. However, grassroots initiatives involving collecting and contributory-scheme representatives in the South Yorkshire hospitals were particularly important. The latter negotiated with the ‘1d in the £’ scheme to cover complex or special treatments in Sheffield institutions and encouraged the opening of clinics using Sheffield-based consultants, paid from local funds.75

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Medical and lay opinion favoured the co-ordination of accessible specialist services, a major step in the development of a regional hospital system.76 The ordering of voluntary hospital services noted in Norfolk occurred partly for geographic reasons, but patient transfers from satellite cottage or district hospitals to the Norfolk and Norwich Hospital featured substantially, and both hospital and contributory-scheme secretaries attributed the growth of specialist departments in Norwich to the scheme’s financial and promotional success.77 As a prominent local consultant noted, scheme funding also helped to resolve the related problem that, in a low wage area, ‘the poor and semi-poor have always required more specialist services than practice among the well-to-do pays for’.78 Ministry of Health hospital surveys for East Anglia and the Sheffield area similarly recognised that contributory schemes had encouraged special services and hospital coordination beyond the inclinations of individual hospital authorities and the possibilities of private practice provision.79 By 1939 GP hospital staffs in Barnsley and Mexborough had ‘almost completely withdrawn from clinical work’, now left to Sheffield-based consultants, and although this process was less advanced in Chesterfield, Rotherham and Doncaster, links with and referrals to Sheffield hospitals were noted.80 Similarly with the forty-one-bed Fullerton Denaby Main Colliery hospital, whose facilities featured ‘X ray and surgery . . . more elaborate than usual for a hospital of this size’, though it had no contact with the Mexborough hospital two miles away.81 With the predominance of work-related accident and emergency cases or surgery in many local hospitals, the referral of contributory-scheme members’ dependants to Sheffield hospitals was noteworthy.82 Regionalisation also reflected the influence of the university medical school, the growth of specialist surgery and the establishment of centres for radium therapy, which focused hospital effort on Sheffield. Nevertheless, it was ‘as a result of the financial security obtained from the “1d in the £” [that] all the various specialities could be inaugurated and developed with a fully trained expert staff’.83 A last example of voluntary hospital co-ordination involves relations with public sector services. Poor Law hospital facilities in Norfolk and Suffolk were limited, and local authority appropriations, even in Norwich and Ipswich, were delayed until the eve of the Second World War. Consequently, voluntary hospital authorities had very little to liaise with and contributory schemes could only abandon the distinction between voluntary and public hospital treatments once there was a public option. Patient waiting lists and treatments for chronic patients were addressed in East Anglia by recourse to cottage hospitals and public assistance infirmaries respectively, but the approach in Sheffield differed. Early municipalisation of Poor Law provision and the acute shortcomings of voluntary hospitals by 1918 led to the referral of potential voluntary hospital patients to public hospitals. From 1922 this was accompanied by corresponding payments and guarantees of non-stigmatised treatment and, though neither feature was problem free, more than 800 patients were transferred annually in the late 1920s.84 This increased the speed of patient treatments and reduced the medical and financial loads of voluntary hospitals.

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The formation of a Sheffield Municipal and Voluntary Hospitals Joint Committee in 1930 produced a rationalisation and co-ordination of resources, successively prioritising accident and emergency services at the public City General Infirmary, the expansion of maternity beds at Jessop Hospital, and improvement of facilities at the Children’s Hospital.85 By 1939 the City General had over 600 dedicated accident, emergency and acute illness beds, roughly one-quarter of the 3.6 acute beds per 1,000 population then provided in Sheffield. Improving municipal hospitals in Barnsley and Rotherham also utilised Sheffield specialists.86 Neither the minimal East Anglian nor developed Sheffield models provided much scope for contributory schemes beyond efforts to reduce public service stigma and to maintain voluntary hospital commitments to poorest patients. In other areas contributory scheme resources also featured: on Merseyside and in Birmingham respectively, 16 per cent and 11 per cent of contributory-scheme allocations were for municipal hospitals by the early 1930s.87 Such payments assisted more than 2,000 transfers of patients from voluntary hospitals or waiting lists to municipal hospitals in Birmingham each year.88

Conclusion Although their own financial difficulties undermined the voluntary hospitals’ claims to an independent role within the NHS, their continuation and expansion until the Second World War represented a considerable achievement.89 This was possible only because of changes in organisational principles and funding within the voluntary sector. Day-to-day operations and maintenance now relied heavily on forms of patient payment or pre-payment, supplemented by philanthropic effort. In East Anglia and South Yorkshire, areas with very different economic infrastructures and social and political backgrounds, the changes in the sources of the hospitals’ regular funding were remarkably similar, particularly the reliance upon post-1919 collecting and contributory-scheme income. In Sheffield and the South Yorkshire hospitals, capital funding also depended upon donations from workers’ or popular organisations rather than by wealthy individuals.90 Signs of an emergent voluntary hospital system can be detected in Norfolk and South Yorkshire, and in Sheffield of limited co-ordination with public sector facilities.91 In the regions examined, the correlation between extensive hospital contributory schemes and voluntary hospital expansion seems particularly strong, involving the development of specialist services and a degree of co-ordination on an area basis. Similar conclusions seem to apply with the Coventry, Birmingham and Merseyside hospitals.92 Of all the major provincial hospitals, those in Bristol and Manchester ran the largest deficits on maintenance accounts during the 1930s. Local contributory-scheme networks were underdeveloped in both cities: Manchester was ‘a backwards centre’ in comparison with Glasgow or Newcastle.93 It appears that national aggregate information obscures diversity and notably low levels of contributory-scheme funding in London and much of the South.94 Wartime government subsidies temporarily eased the hospitals’

72 Steven Cherry financial problems, and the full employment levels achieved briefly encouraged hopes that contributory schemes nationally could be further expanded.95 However, the British Hospitals Association’s effort to combine assertions of independent voluntary sector status with growing financial dependency within a national hospital system represented an unconvincing position in negotiations concerning a future national health service.96 Although advanced hospital coverage for a considerable proportion of local populations could be provided, as in Cambridge, Sheffield and Norwich, contributory insurance could not offer comprehensive health care at affordable rates for all the population. By the same token, neither could the voluntary hospitals. In Scotland and much of rural England defective hospital services were not the sole responsibility of the voluntary sector, and in some areas inadequate public sector provision undermined those voluntary hospitals whose financial position was otherwise relatively sound.97 Gloucestershire and Glasgow, Oxfordshire and Merseyside were contrasting areas in which public sector services were improving and the prospects of co-ordination with the voluntary hospital sector were reasonable.98 Sheffield and possibly the rest of South Yorkshire might be added to this list, but not East Anglia. Further regional studies may throw light on the co-ordination of hospital services, just as they have on hospital finances. Yet it should not be forgotten that support for a more restricted but still independent role for voluntary hospitals ebbed quickly as new principles of wartime service organisation and funding were established, and the nationalisation of hospitals became identified with the attainment of a more uniform, ‘optimum’ national health service.99

Notes 1 I wish to thank staff at the Wellcome Trust, British, Cambridge University, Collindale and Sheffield Central Libraries, and at the Archives in Sheffield, Barnsley, Rotherham and Doncaster for their help. 2 See for example, A. Evans and L. G. Redmond Howard, The Romance of the British Voluntary Hospital Movement, London, Hutchinson, 1930. 3 S. Sturdy and R. Cooter, ‘Science, scientific management and the transformation of medicine in Britain c. 1870–1950’, History of Science, 36, 1998, 421–66. 4 S. Cherry, Medical Services and the Hospitals in Britain 1860–1939, Cambridge, Cambridge University Press, 1996. 5 Respectively from 1923, throughout the 1930s and from 1937. 6 S. Cherry, ‘Hospital Saturday, workplace collections and issues in late nineteenthcentury hospital funding’, Medical History, 44, 2000, 461–88; and ‘Before the NHS: financing the voluntary hospitals, 1900–39’, Economic History Review, L(2), 1997, 305–26. 7 B. Abel Smith, The Hospitals 1800–1948, London, Heinemann, 1964; R. Pinker, English Hospital Statistics, 1861–1938, London, Heinemann, 1966. See also J. T. Hart, ‘The inverse care law’, The Lancet, 298(7721), 1971, 405–12; G. Rivett, The Development of the London Hospital System, 1823–1972, London, King Edward’s Hospital Fund for London, 1986; J. V. Pickstone, Medicine and Industrial Society: a history of hospital development in Manchester and its region, Manchester, Manchester University Press, 1985. 8 See H. C. Burdett, Hospitals and the State, London, Churchill, 1881, Appendices pp.

Regional comparators c.1860–1939

9 10

11

12 13 14 15

16 17 18 19 20 21 22 23 24 25 26 27

28 29

73

16–19; Hospitals and Charities, London, Churchill, 1890–1930; King Edward’s Hospital Fund for London Statistical Report from 1903; the Order of St John’s Annual Reports on the Voluntary Hospitals of Great Britain, London, Central Bureau of Hospital Information (from 1919); and the Hospital Yearbook, London, Central Bureau of Hospital Information (from 1929). See also Cherry, ‘Before the NHS’; F. Prochaska, Philanthropy and the Hospitals of London, Oxford, Faber and Faber, 1992; and M. Gorsky, J. Mohan and M. Powell, ‘The financial health of voluntary hospitals in interwar Britain’, Economic History Review, LV(3), 2002, 533–57. For example, J. S. Bristowe and T. Holmes, Report on the Hospitals of the United Kingdom, 6th Report of the Medical Officer of the Privy Council, London, 1863. G. Finlayson, Citizen, State and Social Welfare in Britain, 1830–1990, Oxford, Clarendon Press, 1994; K. Waddington, ‘Bastard benevolence: centralisation, voluntarism and the Sunday fund’, London Journal, 19(2), 1995, 151–67; and ‘ “Unsuitable cases”: the debate over outpatient admissions, the medical profession and the lateVictorian London hospitals’, Medical History, 42, 1998, 26–46. See M. J. Peterson, The Medical Profession in Mid-Victorian London, Berkeley, California, University of California Press, 1978; L. Granshaw, ‘Fame and fortune by means of bricks and mortar; the medical profession and specialist hospitals in Britain 1800–1948’, in L. Granshaw and R. Porter (eds), Hospital in History, London, Routledge, 1989, pp. 199–220. S. Cherry, ‘Change and continuity in the cottage hospitals, 1859–1948’, Medical History, 36(3), 1992, 271–89. Cherry, ‘Before the NHS’, pp. 321–2; Prochaska, Philanthropy, p. 25; and Gorsky et al., ‘Financial health’, pp. 533–57. Hospital Sunday began in 1859, Hospital Saturday in 1870. See R. Caffney, ‘The development of hospital provision in Glasgow between 1867 and 1897’, Unpublished PhD thesis University of Glasgow, 1979; H. C. Burdett, Hospitals and Asylums of the World, London, J. and A. Churchill, 1893, Vol. 3, pp. 172–3. Cherry, ‘Hospital Saturday’, Appendix, pp. 486–7. See D. Green, Working Class Patients and the Medical Establishment, Aldershot, Gower Press, 1985; J. C. Riley, Sick, not Dead, Baltimore, Johns Hopkins University Press, 1997. For wartime treatment costs, see Finlayson, Citizen, State and Social Welfare, p. 236. Gorsky et al., ‘Financial health’ (pp. 542–6) surveys the hospitals’ rising costs. S. Cherry, ‘Accountability, entitlement and control issues in the financing of voluntary hospitals, 1860–1939’, Social History of Medicine, 9, 1996, 214–33. V. Walters, Class, Inequality and Health Care, London, Croom Helm,1980 and Gorsky et al., ‘Financial health’ (p. 553) emphasise the rise of direct patient payments. See Cherry, ‘Before the NHS’, pp. 310–15. Hospital Yearbook, 1940, p. xxxvii. I estimate the specific HSA contribution at 15 per cent in the 1930s. Prochaska, Philanthropy, pp. 84–5; Cherry, ‘Before the NHS’, Table 4, p. 313. C. Braithwaite, The Voluntary Citizen, London, Methuen, 1938, p. 151; Yearbook, 1940, pp. 60–3. See Cherry, ‘Before the NHS’, pp. 322–3. D. Green, ‘Medical care without the state’, in A. Seldon (ed.), Re-privatising Welfare after the Lost Century, London, Institute of Economic Affairs, 1996, pp. 21–38, likens hospital insurance to a ‘galloping horse’ (pp. 33–4). S. Cherry, ‘Beyond National Health Insurance: the voluntary hospitals and hospital contributory schemes. A regional study’, Social History of Medicine, 5(4), 1992, 172–3. Ibid., pp. 459–60; Pinker, Hospital Statistics, p. 114.

74 Steven Cherry 30 Ibid., pp. 467–9, 482. 31 In both World Wars, government contributions represented 20 per cent of ordinary income at the Ipswich and Norwich hospitals. 32 Namely Doncaster 1865, Barnsley 1868, Rotherham, 1871. 33 Barnsley Beckett Hospital, Annual Report, 1885/6. 34 Rotherham Advertiser, 4 May 1872, and Rotherham Hospital Annual Report 1872/3. 35 Namely 1.6 beds per 1,000 population at the 1911 census and 1.7 per 1,000 in 1938; Ministry of Health, Hospital Survey: Sheffield and the East Midlands (1945), pp. 10–16. 36 The uniform accounts system, credited to H. C. Burdett and W. Laundy, was used in Hospitals and Charities and elsewhere to standardise and compare financial information. 37 Nationally, inter-war extraordinary income averaged roughly 30 per cent of ordinary hospital income, considerably higher than in Sheffield and South Yorkshire hospitals. 38 Namely reduction on 1925 collections: Doncaster miners £3,600, Mexborough £5,000, Barnsley £4,700, Chesterfield £6,000, Rotherham £2,400, Sheffield £19,500. 39 The Union Hospital (1881) and Eccleshall facility (1865) became the 800-bed City General and 500 bed Nether Edge Hospitals in 1929. 40 Rev. Smith, 21 December 1910, Sheffield Hospital Sunday Minutes 1897–1919. Sheffield Archive 333 H25/1. 41 ‘Newspaper reports’, September 1873, Sheffield Archive, JC 1364; Sheffield and Rotherham Red Book, 1900–5. 42 Burdett, Hospitals and Charities, 1902. Hospital Saturday provided almost 7 per cent of SRI ordinary income. 43 Sheffield Telegraph, 10 January 1912. 44 For Sheffield Chamber of Commerce, see R. Hay, ‘Employers and social policy in Britain: the evidence of welfare legislation, 1900–14’, Social History, 4, 1977, 435–55, esp. 442, 448. 45 Reported in Hospital, 11 October 1919, p. 43. 46 Sheffield Voluntary Hospitals Joint Committee (SHJC) Report, 1920, p. 13. Voluntary hospital bed provision in Sheffield was 1.7 per 1,000 population, cf. Bristol 2.9, Newcastle 2.7, Manchester 2.6, Leeds 1.5 and Birmingham 1.4. 47 For an account emphasising developments in scientific medicine and medical education and of the pursuit of hospital efficiency, see S. Sturdy, ‘The political economy of scientific medicine: science, education and the transformation of medical practice in Sheffield, 1890–1922’, Medical History, 36(2), 1992, 125–59, esp. 143–6. 48 SHJC, Record of the 1d in the £ scheme, 1919–48, 1948, p. 14. Weekly hospital charges of £1.75p were introduced in 1920. 49 SHJC, Appeal, April 1921. Signatories included the Trades and Labour Council, the district (National) Insurance Committee and the National Federation of Women Workers. 50 The SDAHC existed ‘to voice the views of contributors and their dependants; to watch over the interests of these . . . to secure efficient, adequate and prompt treatment so far as the accommodation of the hospitals will allow’. SDAHC Handbook, Clauses 4c, 4d. Direct representation on each hospital board increased from one to two in 1923, and to three from 1934. Attendances at the first six quarterly meetings averaged over 300, each delegate representing up to 500 contributors. SHJC, Report, 1922, 1923. 51 Sheffield Yearbook, 1926, Hospital Yearbook, 1938, p. 274. A. T. Page, Pennies for Health, Birmingham, 1949, Appendix. 52 NHI figures from Sheffield Yearbook. 53 SDAHC Quarterly Meeting, 6 June 1923. 54 Cherry, ‘Accountability’, pp. 225–7. 55 Direct patient payments increased from 4 per cent to 6 per cent of ordinary income between the wars, but NHI contributions within ‘patient payments’declined.

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56 Cherry, ‘Before the NHS’, p. 319. 57 In West Norfolk contributory-scheme members comprised 73 per cent of inpatients and allocations covered 80 per cent of all inpatient costs. WNKL, Annual Report, 1935; NHCA Annual Report, 1935, p. 6. 58 For example, the Sheffield Royal Hospital overdraft exceeded £60,000 by 1932 and the Jessop Hospital transferred £10,000 from capital accounts to cover cumulative current deficits 1927–32. 59 SHJC, Report, 1934. 60 Ibid., p. 40. Income now exceeded expenditure at each of the Sheffield hospitals. 61 F. M. Osborn, ‘Board of Management view’, in SHJC, Record, p. 14. 62 These included new casualty, outpatient and convalescent wards. 63 This hospital increased from seventy to 130 beds, adding two new wards, an X-ray theatre, and outpatients department and nurses’ residences, simultaneously building investment funds from £45,700 to £60,900 between 1918 and 1939. 64 Between 1918 and 1939, Doncaster Royal Infirmary expanded from eighty-five to 185 beds in a new hospital, debt-free and with investment funds exceeding £38,000. Doncaster R.I. Annual Reports, 1934, 1939, p. 8. Mexborough Montagu Hospital grew from forty-eight to 120 beds during the same period. 65 This provided accident wards, operating theatres, X-ray, ENT and orthopaedic facilities. These were topped by penthouse-style private wards, later destroyed by the Luftwaffe. 66 M. Powell, ‘Health provision before the NHS: territorial justice or inverse care law?’ Journal of Social Policy, 21(2), 1992, 145–63. Pickstone, Medicine and Industrial Society, notes the proactive role of hospital consultants in Manchester. 67 Cherry, ‘Accountability’, p. 231. 68 Cherry, ‘Beyond NHI’, p. 468. 69 Cherry, ‘Accountability’, p. 225; A. Rook, M. Carlton and W. Graham Cannon, The History of Addenbrookes Hospital, Cambridge, Cambridge University Press, 1991, pp. 302–305. 70 Cherry, ‘Change and continuity in the cottage hospitals’, pp. 281–2. 71 PEP, Report on the British Health Services, 1937, p. 262 and Appendix 2. 72 SHJC, Report, 1923, p. 50. 73 Mexborough Montagu Hospital, Report, 1923; Rotherham Hospital, Report, 1937. 74 SHJC, Report, 1923, p. 79. 75 The Yorkshire Miners’ Association representatives and disbursements also promoted the regional development of services and specialism. 76 D. M. Fox, Health Policies, Health Policies, Princeton, Princeton University Press, 1986, outlines medical influence in the adoption of regional hierarchies, and the 1935–7 Voluntary Hospitals Commission (Sankey) Report advocated regionalisation. 77 Cherry, ‘Beyond NHI’, p. 474. East Suffolk cottage hospitals also developed links with the Norfolk and Norwich Hospital, and West Suffolk with Addenbrookes, rather than with their ‘appropriate’ county hospitals. 78 A. J. Cleveland, A History of the Norfolk and Norwich Hospital, 1900–46, Norwich, Jarrold, 1948, p. 81. 79 Ministry of Health, Hospital Surveys, London, 1945, L. G. Parsons, S. Clayton Fryers and G. E. Godber, ‘Sheffield and the East Midlands’, pp. 4, 61; S. Savage, C. Frankham and B. Gibson, ‘The Eastern Area’, pp. 3–4. 80 Ibid., Sheffield, p. 24. 81 Ibid., p. 25. 82 Ibid., p. 20. 83 FRCS, ‘Medical and surgical staff views’, in SHJC, Record, p. 18. 84 SHJC, Report, 1931, p. 10. 85 Sheffield Medical Officer of Health, Report, 1930, p. 56. 86 Hospital Survey, Sheffield, p. 25.

76 Steven Cherry 87 J. E. Stone, Hospital Organisation and Management, London, Faber and Faber, 1939 edn, pp. 352, 354. 88 S. Barnes, The Birmingham Hospitals Centre, Birmingham, Stanford and Mann, 1952, p. 29. 89 The proactive role of the emergent public sector is emphasised in C. A. LewisRoylance, ‘General hospital provision in Liverpool in the voluntary and publicly funded sectors c.1918–38’, Unpublished PhD thesis, Edge Hill College/Lancaster University, 2004. 90 cf. Prochaska, Philanthropy, pp. 101–2. 91 Anticipating the 1929 Local Government Act, eleven hospitals in the five English provincial conurbations already offered 9,500 ‘municipal’ beds. Yearbook, 1929, Table 51. 92 Cherry, ‘Before the NHS’. ‘1d in the £’ schemes in Birmingham and on Merseyside from 1927 quickly provided 35–45 per cent of those areas’ hospital ordinary income. In 1934, 1,600 members of the Coventry and Warwickshire Hospital Saturday Fund Scheme received treatment in sixty-four different hospitals in England and Wales under reciprocal arrangements. D. T. Tugwood, The Coventry and Warwickshire Hospital 1838–1938, Coventry, Coventry and Warwickshire Hospital Saturday Fund, 1987, p. 44. 93 Hospital and Health Review, 1923, 21, 266. However, the contributory scheme adopted in Manchester in 1935 offset one-quarter of Manchester Royal Infirmary expenditure the following year. 94 The 1930s contributory schemes provided 50 per cent or more of hospital ordinary income in Stoke, Wolverhampton, Swansea, Middlesbrough, Sunderland, York, Preston, Bolton, Lincoln, Coventry, Oxford, Reading and Colchester. Figures exceeding 40 per cent applied in Birmingham, Leeds, Newcastle, Hull, Nottingham, Leicester, Derby and Winchester. The lowest proportions were Bristol (12 per cent), London (14 per cent) and Manchester (17 per cent). Cherry, ‘Before the NHS’, Appendix 1, p. 324. An overall surplus of £1.8 million was reported in 1940. Yearbook, 1941, p. xiv. SHJC, Report, 1945. That year, the Norfolk Hospitals Contributors Association launched a £400,000 Appeal to upgrade county hospital provision. 95 I. Levitt, Poverty and Welfare in Scotland 1890–1948, Edinburgh, Edinburgh University Press, 1988, p. 170; M. A. Crowther, The Workhouse System 1834–1929, London, Methuen and Co., 1981. 96 British Hospitals Association, Report of the Council 1939–41 and Annual Meeting, London 1941. 97 Levitt, Poverty and Welfare, p. 170; Crowther, The Workhouse System, p. 186. 98 Political and Economic Planning, Report on the British Health Services, London, PEP, 1937, p. 234. See also J. Mohan and M. Gorsky, Don’t Look Back?, London, Office of Health Economics and Chartered Accountants, 2001, pp. 84–90. 99 C. Webster, The National Health Service, A Political History, Oxford, Oxford University Press, 1998, pp. 6–7.

5

‘The caprice of charity’ Geographical variations in the finances of British voluntary hospitals before the NHS1 John Mohan

Introduction ‘Charity almost always does too much or too little; it lavishes its bounty in one place, and leaves people to starve in another’ John Stuart Mill2 ‘in the health services charity often begins at home, where, in many cases, it is least needed’ Political and Economic Planning3 In the Second Reading debate on the NHS Bill, in 1946, Aneurin Bevan commented that, owing to the ‘caprice of charity’, the voluntary hospital system was best-developed in the more prosperous parts of the country rather than those places which needed it most.4 As the quotation from John Stuart Mill indicates, Bevan was following in famous footsteps in his questioning of the benefits of voluntarism. This chapter explores these comments with reference to the financial resources available to the voluntary hospitals of England, Wales and Scotland. The period covered is from 1891 to 1937, though some of the analyses refer only to the late 1930s. More specifically, the intention is to provide estimates of variations in hospital expenditure, and to make distinctive contributions in analysing the extent of convergence or divergence in hospital finances, and in offering a regional disaggregation of sources of hospital income. Voluntary institutions are the characteristic means whereby welfare services have been pioneered in Britain. Voluntarism is praised by its supporters for its capacity to respond to new needs, to provide public goods supplied by neither market nor state, to focus on particular client groups or local issues, and to develop fresh strategies for service provision. The appeal of voluntarism can be decidedly localist, stressing the particular characteristics and problems of a locality, which demand a response from the concerned public. In a contemporary frame of reference Deakin has spoken of the ‘rediscovery of the local’ as a site for the activities of civil society, and this comment could certainly be applied to the mix of localist initiatives characteristic of the pre-NHS era.5 Studies of voluntary hospitals have stressed the somewhat capricious and

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spontaneous character of the process of hospital development. Rather than being established through central initiative, voluntary hospital establishment depended entirely on the motivations of local elites: doctors, church-leaders, businessmen and professionals. Foundations might result from ad hoc conjunctures of circumstances which brought some or all of these groups to work together in a common cause, or from the initiative of a prominent individual.6 Localists and provoluntarists would no doubt celebrate the initiative and responsiveness inherent in this modus operandi, but it meant that hospital facilities were distributed in an uneven, even idiosyncratic, manner across the country. One official investigation succinctly summed up the situation: each hospital ‘stands where chance or choice has placed it’.7 Despite this, the uneven geography of hospital finance has received relatively little attention. Previous work on the voluntary hospitals has emphasised uneven access to beds and qualified staff, demonstrated that geographical variation was an inherent feature of the pattern of service provision which persisted over several decades, analysed the degree of correlation between patterns of provision and various indicators of need, and, through a reconstruction of the pattern of hospital utilisation in 1938, demonstrated the extent to which the probability of receiving treatment varied substantially between places.8 The foregoing studies convincingly establish the diversity and variability of voluntary hospital provision, but there are few analyses of variations in the financial resources available to the hospitals. Yet we might reasonably expect that fundraising initiatives would vary in their success, because of regional variations in economic structure, wealth and wage rates. However, our understanding of financial aspects of hospital provision remains sketchy. Contemporary writers emphasised net aggregate surpluses and the steady increase in total income, using such figures to defend an argument that the voluntary hospitals exhibited continued vitality.9 Financial problems were said to have arisen not because of a failure to increase resources, but because of pressures for increased expenditure.10 More recent academic discussions of funding have tended to concentrate on headline figures such as aggregate surpluses or deficits, or alternatively the proportion of hospitals experiencing deficits. Gray emphasises the proportion of hospitals in deficit, and also comments on the respective contributions of different income sources; Webster cites deficits in London’s voluntary hospitals as giving impetus to proposals for reform in the late 1930s; Cherry describes cumulative surpluses during the 1930s, representing a significant recovery since the 1920s. Prochaska also argues that not all deficits were symptomatic of crisis and that a relatively favourable picture can be presented by examining aggregate figures. In contrast, analysing a consistent set of hospitals in the 1930s, Gorsky et al. demonstrate that the numbers experiencing deficits at first fell, but then rose steadily in the second half of the decade.11 These studies have provided a national overview of hospital finances, but previous work has had little to say about variations in income and expenditure between hospitals and between places. Pinker drew attention to broad compar-

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isons between London and the provinces, reflecting the disaggregation available in the statistical source, the hospitals’ yearbooks.12 Cherry noted regional contrasts in income sources, but did so by examining a sample of hospitals that is somewhat skewed towards northern locations. In this volume he extends this analysis with his detailed comparison of East Anglia and South Yorkshire, and demonstrates through these case studies how differences in the resource base affected the nature of provision. There are also various studies of individual hospitals (or of groups of hospitals) in different locations, and some work on the financial circumstances of hospital provision in London and in the ‘Special Areas’ (locations eligible for regional policy assistance because of the effects of economic depression). Overall, however, there is no systematic analysis of variations between places in the resources available to hospitals. To begin to develop such an analysis, this chapter draws on the data collected in Burdett’s Hospitals and Charities, published annually between 1889 and 1930, and its successor, The Hospitals Yearbook.13 Despite minor omissions, these yearbooks contain a uniform and systematic record of beds, patients, staffing, income and expenditure in about 1,300 individual institutions. It should be noted that the original source relied on voluntary reporting and therefore contains sets of hospitals which vary from year to year, and it only provided limited spatial disaggregation (London; the rest of England; Wales; Scotland). To overcome this limitation a digital version of selected elements of this source has been produced, permitting disaggregation by geographical area (e.g. county or county borough) and by size and type of hospital, and which allows extraction of consistent sets of hospitals for reporting purposes. The structure of this chapter is as follows. First, there is an analysis of total expenditure on voluntary hospital services, in which expenditure is related to bed provision (rather than to population) at the county level. The degree of variability over time is also analysed, and there is an assessment of whether or not there was convergence in hospital expenditure between regions over time. To demonstrate effects of levels of resources on the ability of hospitals to treat patients, expenditure is then related to hospital throughput. Third, there is an investigation of variations between places in hospital income sources; here the spotlight is on the balance between payments by patients and forms of philanthropy, such as legacies and donations. This is an attempt to chart the contours of the shift away from traditional charity and towards contribution and charges – a theme that has been discussed in other chapters in this volume.

Variations in hospital expenditure To demonstrate the variability between geographical areas, the first pair of maps (Figure 5.1) presents hospital expenditure per bed for counties in 1891 and 1937. The data are for ‘ordinary’ or ‘maintenance’ expenditure, as distinct from ‘extraordinary’ expenditure, the latter generally referring to capital investment; all hospitals in each county, and county boroughs where applicable, are included. Expenditure is related to beds, rather than to population, because we would (in

80 John Mohan the absence of data on the areas of origin of patients) have to assume that hospital expenditure was related only to the residents of the area in which it was located. This clearly was not the case. The problem is particularly acute around London, where hospitals treated patients, and drew income, from large sections of the Home Counties, and there are many other examples, especially where hospitals are located close to administrative boundaries. Several authors have pointed to the difficulties this poses, but it is impossible to resolve these for the whole of the period with which this chapter is concerned, although, for 1938, data on the pattern of hospital utilisation permit an estimate of the geographical distribution of hospital expenditure per head of population.14 Consequently, it is argued here that a more appropriate way forward is to compare expenditure per bed. Even if we do not know which areas were being served by hospitals, this gives us a measure (which may be compared over time) of the resources available for patient treatment. To minimise possible distortions, caused, for example, by small hospitals having unexpected windfalls, counties were excluded if they had under twenty-five hospital beds in 1891, and under fifty in 1937. The most obvious feature of the map for 1891 is the contrast between urban and rural areas, and in particular the low levels of resources available to hospitals in rural Scotland and Wales. Of thirteen counties where expenditure per bed was under £30 (compared to a national average of £54), only one (the Holland division of Lincolnshire) was in England, the rest being in Wales and Scotland. Expenditure per bed was as low as £15 in Morayshire, north-east Scotland.

1891 £ Expenditure per bed 45–78 37–44.99 32–36.99 ⬍ 31.99 no data

Figure 5.1 Voluntary hospital expenditure per bed, 1891 and 1937.

1937 £ Expenditure per bed 276 157–196 136–156.99 118–135.99 64–117.99 no data

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These figures may reflect variations in staff costs, at least in part, but this is unlikely to explain the scale of variability. At the other end of the spectrum expenditure per bed in London and on the Isle of Wight was over £70, though the latter figures are influenced by the presence of specialist institutions such as the Royal National Hospital for Consumption. There is some evidence of a north–south split, but some counties such as Monmouthshire, Lanark and Northumberland feature in the highest quartile, reflecting the success of early working-class collections and contributory schemes rooted in the heavy industries of these counties. A similar urban–rural contrast is evident for 1937; six counties (mainly in rural Scotland) had expenditure per bed figures of less than half the national average of £174. London’s position is unchallenged (£276), and it is followed by Warwickshire (£196 per bed), Staffordshire (£192), Middlesex (£191), Northants (£187) and Leicestershire (£180). Interestingly, several counties with high levels of provision (Berkshire, Surrey, Oxfordshire) do not rank so highly on expenditure per bed, perhaps indicating something about the difficulties of large-scale fundraising in areas where there were few big urban centres. What of the degree of variability over time? There is evidence that this declined, but was not eliminated, as more hospitals were founded and as institutions diversified their income sources. Trends over time can be captured through the coefficient of variation, which is a measure of the degree of variability in a set of observations.15 The coefficient of variation for the expenditure : population ratio reduced from 0.84 in 1891 to 0.66 in 1937; for the expenditure:bed ratio it dropped from 0.33 to 0.24, both of these reductions indicating a degree of convergence. Nonetheless, by 1937 expenditure per bed still varied by a factor of more than three, even when London is excluded, the range being from £65 in Ross and Cromarty, and Flint, to £204 in Warwickshire. These figures may be affected by variations in the numbers of hospitals reporting to the hospitals’ yearbooks, (and therefore the database from which these figures are drawn), and by omissions where, for example, a hospital did not submit a return for a particular year. To overcome this problem, regional convergence or divergence in voluntary hospital finances is investigated through an analysis of the fortunes of 296 hospitals, classified as either general hospitals or hospitals with medical schools, which appeared in the yearbooks in each of the five years 1891, 1911, 1921, 1931 and 1937, the latter year being chosen because of missing data for some important hospitals for the last peacetime year, 1938. A concentration on general hospitals removes distortions caused by the presence of specialist institutions, and the institutions selected represent the major general hospitals available to the public in each region. Even in a set of 296 hospitals, small numbers of institutions could mean the possibility that regional averages could be distorted by the presence or absence of wealthy (or poor) institutions. However, in only three areas – the subdivisions of Scotland – was this a major issue. In West Central Scotland and Midlothian there were five and three hospitals respectively appearing consistently in this set, and these were large hospitals. Thus, in 1937 the average size of hospitals in this set for West

82 John Mohan Central Scotland was 364 beds and for Midlothian it was 450 beds. For comparison, the figure for London was 298 beds. The Scottish figures might be regarded as aberrations, but they are a reasonable reflection of the pattern of hospital provision in that country, because the majority of hospital beds were concentrated in major general or teaching institutions in Glasgow and Edinburgh respectively. The settlement pattern across much of central Scotland – characterised by small mining or industrial towns – was simply not conducive to the foundation of voluntary hospitals capable of drawing patients away from the two major cities. In England, regional averages are relatively low in the South-west (seventy beds) and in the West Midlands; in both of these cases the consistent set of hospitals incorporates numerous small rural institutions, which depresses the average size of hospitals. Overall the 296 institutions contained 43,682 beds, which is rather more than half of the total in England, Wales and Scotland in 1937. This can be regarded, therefore, as a representative dataset. What, then, can be said about regional trends in hospital finances? Was there convergence or divergence in the fortunes of hospitals in different parts of the country? Expenditure per bed is standardised as a proportion of the national average figure for each of the five years in question. This circumvents difficulties caused by the general upward trend in expenditure per bed, which increased by a factor of three, from £54 in 1891 to £183 in 1937 (in real terms this represents an approximate doubling of the resources available per bed). The results of this exercise are shown in Figure 5.2, and the most notable feature is the position of London, where expenditure per bed was at or around 50 per cent greater than the national average throughout this period. Partly because of this, no other region actually attained national average levels of expenditure in the years under consideration, with the sole exception of west central Scotland in 1921. These figures provide striking testament to the ability of the major hospitals in London to attract income from a diverse range of sources, as will be shown later in this chapter. What of other regions? It is clear that the degree of variability did not decline over time. The coefficient of variation assesses the degree of dispersion in a dataset and is not affected by the mean, and over time the coefficient of variation for expenditure per bed fluctuated. It was 0.27 in 1891 and dropped to 0.21 in 1911, but it then rose again, to 0.26 by 1937. This demonstrates what is fairly clear from the graph, namely a lack of convergence. The experience of individual regions is also of note. In the northern region of England, expenditure per bed was 76 per cent of the national average in 1891, but it then rose to 95 per cent in 1921 – the closest any English region came to the national average figure. However, by the 1930s the region’s principal hospitals were spending around 70 per cent of the national average per bed. Wales and West Central Scotland experienced a similar pattern, and it is not difficult to relate these trends to the changing fortunes of the staple industries of these regions over time, characterised by a period of relative prosperity in the early years of the twentieth century followed by relative economic decline consequent upon the depression of the inter-war years.

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London

Expenditure per bed as percentage of national average

150 North West North-west West Midlands West Midlands Midlothian Midlothian South East South-east Yorkshire Yorkshire East Anglia East Anglia Central Central Scotland Scotland East East Midlands Midlands Wales Wales South West South-west Northumberland Northumberland

140 130 120 110 100 90 80 70 60

Rest

d

otlan

of Sc

50 1891

1911

1921

1931

1937

Year

Figure 5.2 Regional trends in expenditure on voluntary general hospitals, 1891–1937.

In support of this statement there is certainly evidence that individual institutions suffered greatly as a consequence of unemployment in the inter-war years, with income fluctuating greatly or even almost ceasing in some cases.16 Indeed, the wartime Hospital Surveys, which gathered data on the state of hospital services in 1938, suggest that hospitals had not always been able to open all the beds available to them, implying that finances may have had an impact on the availability of services, although it is also possible that redevelopment work may have necessitated temporary closures.17 However, nothing could be done about the divergent resources available to individual institutions. Inter-war assessments did refer to the ‘thousand separate Exchequers’ of the voluntary system and expressed the hope that some pooling of resources might yield beneficial results, but it is clear from this analysis that disparities between hospitals remained substantial.18 These findings contradict Powell’s rather generalised assertion that, as a result of the diversification of hospital income sources, it was ‘not obvious that hospitals from traditionally wealthy areas retained their financial advantage’.19 Powell’s claim is made without benefit of supporting evidence

84 John Mohan (ironically, it appears in an article criticising the misuse of evidence in evaluations of the pre-NHS hospital system), but it cannot be supported by the analysis presented here.

Hospital expenditure and throughput We might expect these patterns of expenditure to be reflected in variations in the numbers of people treated by hospitals, and this is confirmed by Figure 5.3, which plots expenditure per bed against inpatients treated per bed in general hospitals for 1937. There is a strong positive association between these variables. London is a clear outlier, with expenditure per bed of £295, against a throughput of seventeen patients per bed. The lowest levels of expenditure and throughput are found mainly in rural counties, especially in the more sparsely populated parts of Scotland and Wales, where we might expect communities to have difficulties in raising the sums of money required to enable hospitals to provide sophisticated equipment. This graph prompts consideration of relationships between hospital inputs and outputs. For example, there are eleven counties where throughput is between fifteen and sixteen patients per bed, but expenditure per bed in these counties ranges from £102 (Caernarvonshire) to £164 (Surrey). There are

25

Inpatients per bed

20

15

10

5

0 0

50

100

150

200

250

Expenditure per bed (£)

Figure 5.3 Expenditure versus throughput for voluntary hospitals, 1937.

300

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thirteen counties where expenditure per bed was between £150 and £160, but throughput ranged from 14.6 per bed (Glamorgan) to 20.7 (Cardiganshire). Our knowledge of the reasons underpinning these variations is sketchy. One possibility is that they reflect variations in the mix of cases treated by a hospital – for example, some institutions concentrated on the treatment of industrial accidents and therefore it is possible that they would have a high throughput. It is also possible that hospitals lacked the capital equipment and laboratory facilities necessary to carry out complex operations, while throughput could vary according to whether or not a hospital had access to a convalescent home, which would reduce length of stay. As to resources, some variations in expenditure per bed may reflect the extent to which it was possible to use voluntary labour. We know that institutions found it necessary to pay salaries to nursing staff depending on labour market conditions, and some of these cost variations will reflect this.20 For example, the average cost per inpatient per week in provincial general hospitals having at least 100 beds in 1938 ranged from £2.66 (the London) to under £0.80 (Portsmouth Royal; North Lonsdale, Barrow).21 Cost variations may also reflect the capital intensity of hospitals – for example, variations in provision of diagnostic facilities such as pathology and X-ray services. Hospitals may also have deliberately prioritised selected aspects of the caseload. There has been little work on these issues. Titmuss made disparaging comments in 1950 about the lack of information, for British hospitals in general, on lengths of stay and case-mix.22 Hollingsworth and Hollingsworth also considered the comparative costs of voluntary and municipal hospitals, but did not discuss variations in expenditure and throughput within the voluntary sector.23 Further work on comparative costs, and on the case-mix of hospitals, would be desirable, the former in order to investigate whether differences in resource inputs were more apparent than real, the latter to begin to explore variations in the contribution of hospitals to relieving the burden of morbidity in a range of places.

The geography of income sources The analysis has so far focused on total expenditure per bed. What of the components of income, which could vary between hospitals and between places? The difficulty here is that extracting a suitably representative set of institutions is more problematic, because a breakdown of income sources is available for only a minority of institutions, and once disaggregation is attempted there are very small numbers in particular regions. There is also the problem that selecting an individual year runs the risk that a single large donation or legacy might distort the pattern. The approach taken here has therefore been to group hospitals by region and select those appearing consistently in each of the three years 1937–39. The result is that 180 of the largest hospitals are selected, and this covers some 65 per cent of voluntary hospital beds. There are small numbers of hospitals in some regions – only three in East Anglia and six in the northern region of England – but, as these provided

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the bulk of inpatient care in the voluntary sector in those regions, the pattern is representative. Income sources have been categorised in the same way as that used by Pinker, whose commentary did refer to variations between places in income sources. For instance, he described a provincial shift towards a dependence on patients’ payments and workmen’s contributions by 1921, but this is based on an analysis of the percentage contribution of each source of income. This is the basis of Pinker’s famous statement that ‘charity, as the Victorians understood it, had long ceased to be the mainstay of the voluntary system. Payments, either in cash or from insurance contributions, were the principal source of revenue’.24 In previous work on a set of sixty-three provincial hospitals it has been shown that contributory schemes were the main driver of financial growth during the 1930s, but to what extent was this experience consistent across the country? 25 Pinker categorised hospital income for 1938 into four groups: philanthropy, or voluntary gifts, including subscriptions, donations and congregational collections; receipts for services rendered, including patients’ contributions, payments for public services, fees and other receipts; investment income; and extraordinary income. This classification has been followed here, but to highlight the significance of payments from public authorities, these have been shown separately. There is also a residual ‘other’ category. The proportionate contributions of these sources of income are shown on pie charts (Figure 5.4) in which the size of the circles are proportionate to the average figure for income per bed in the region in 1937–39 combined, and in which the area shaded gives the contribution of the income source in question. The principal feature in all the English regions is the significance of payment by patients, which accounted for over 50 per cent of hospital income in six regions, peaking at 66 per cent in East Anglia (reflecting the relative success of contributory schemes there), while proportions well in excess of 50 per cent were recorded for Yorkshire (57 per cent) and the West Midlands (60 per cent), compared to a national average of 42 per cent. What is notable, however, is that while London’s hospitals have a relatively low share (28.9 per cent) of income generated by patients’ payments, the actual sums produced in this way equate to £90 per bed, which was exceeded only by four regions. This reflects the substantial sums raised by the Hospital Saving Association. Despite growth in patient payments, charitable income sources were by no means defunct in the late 1930s. Voluntary sources (subscriptions and donations), interest on endowments, and extraordinary income accounted for nearly 28 per cent of hospital income in London and over 20 per cent in South-east England, the East Midlands and Lancashire. Elsewhere, the proportions raised were typically in the range of 12–16 per cent. Interest on endowments alone was responsible for 18.8 per cent of the income of London’s principal hospitals, though it must be said that nearly one-third of this relates to the substantial income from endowments at St Bartholomew’s, and very substantial sums were also provided by endowment income at Guy’s, the London, St Thomas’ and the Middlesex Hospitals. When combined with voluntary income, London’s hospi-

Figure 5.4 Sources of income of voluntary hospitals, 1937–39.

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tals received over 47 per cent of their income from what could be classed as philanthropic sources. It is also the case that extraordinary income accounted for a further 15 per cent of the income of London’s hospitals. All this might lead one to endorse Prochaska’s arguments about the continued vitality of voluntarism, compared to novel sources of income such as patients’ payments. However, a somewhat different emphasis can be given if one considers only general hospitals; in London, patients’ payments accounted for 39 per cent of the income of such hospitals compared to 28 per cent for London hospitals as a whole. Conversely, voluntary sources (including interest on endowments) accounted for some 42 per cent (compared to 46 per cent) of hospital income. This suggests that specialist institutions continued to rely heavily on voluntary sources. What patterns emerge elsewhere? Clearly, the significance of patients’ payments in some regions meant, as a corollary, that voluntary contributions and interest combined rarely exceeded 30 per cent of total income, and this proportion fell below 20 per cent in the West Midlands and East Anglia. When we separate out investment income, this falls below 10 per cent of hospital income in the South-east, East Anglia and the Midlands, and perhaps this is a comment on the time needed to accumulate endowments, especially in small urban centres, in contrast to London’s hospitals, at least some of which had been building up endowments for centuries. The distribution of income from public services shows that the South-east led the way with over 17 per cent of income derived from such sources, followed by the South-west and West Midlands, which were the only regions where public services accounted for over 10 per cent of total income. This might be thought surprising, as the authorities that spent most on municipal hospital provision were generally large county boroughs in the North. There were few county boroughs in the South, and county councils (excepting the LCC, Essex and Middlesex) spent very little on hospital treatment.26 It is clear, however, that the pattern of public payments is an artefact of the distribution of hospitals. The South-east contained numerous specialist institutions, for example for the treatment of TB, or sea-bathing institutions, which were located in the region for sound environmental reasons.27 Such institutions drew as much as 83 per cent (Royal Sea Bathing Hospital, Margate) of their income from contractual arrangements with the public sector. This was also true of orthopaedic institutions in other locations – significant hospitals such as Harlow Wood (near Mansfield) and the Robert and Agnes Jones Hospital (Oswestry, Shropshire) also relied heavily on public contracts. If we therefore remove such specialist institutions we find that, typically, public payments accounted for between 5 and 10 per cent of hospital income. The key feature of the pattern of income sources in the 1930s was therefore the proportion of funds generated by patients’ payments, either directly or through contributory schemes. Typically, these accounted for some 50 per cent of resources available to hospitals. Endowment income and traditional forms of charity nevertheless remained significant, especially in London. Indeed, these

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sources were concentrated in the capital; of the 244 institutions reporting a breakdown of their income sources, the London hospitals accounted for 40 per cent of endowment funds. Finally, although public payments to voluntary hospitals grew in the 1930s, these payments were largely made to specialist institutions and therefore the geographical distribution of those payments is a function of where those institutions were located.

Conclusion It is hardly surprising that there were disparities in the resources available to hospitals, but the contribution of this analysis has been to show how substantial and persistent those variations were. Moreover, we cannot dismiss these variations because they did have an effect on the capacity of hospitals to treat patients. There are strong associations between hospital expenditure and patient throughput at an aggregate level, so that the probability of receiving treatment was a function of the resources available in the community. Moreover, as analyses of utilisation rates have shown, there was an inverse relationship with need: the greater the level of need in a locality, on average, the lower the hospital utilisation rate.28 There remain possibilities for further analysis of these variations. Cherry29 argued that: income variations might be completely unrelated to hospital performance and reduced expenditure could equally reflect efficient use of facilities, falling prices, ward closures, or premature discharge of patients. Future work might usefully explore the reasons behind the variations revealed here. For example, did the case-mix of apparently similar hospitals vary, with doctors in some institutions concentrating on a narrower range of conditions than others? Did hospitals with convalescent homes attached succeed in achieving higher levels of throughput than equivalent institutions without convalescent homes? What variations existed in the availability and use of specialist (e.g. diagnostic) equipment? What was the degree of variability in the pattern of expenditures by hospitals? (This drew attention from hospital reformers from the late nineteenth century, and one could usefully explore whether there had been a reduction in the degree of variability between hospitals in terms of, say, cost per inpatient case, or in the cost of various inputs such as wages, food and drugs.) How did hospitals respond to fluctuations in their income – for example, did they seek to restrict admissions or even to close beds, as implied by the evidence in the wartime hospital surveys? It is nevertheless notable that there is relatively little contemporary discussion of these issues in, for example, journals such as The Hospital, where one might expect attention to be drawn to the variations that existed between hospitals in the resources available. Nor can discussion be found of whether and to what extent the resources available to the hospitals were in any sense ‘adequate’ and, as Cutler points out, this contributed to the underestimation of the resources

90 John Mohan required for hospital provision under the National Health Service.30 Wartime Ministry of Health papers occasionally referred to variations in costs between hospitals and to variations in the resources available to them, but this does not appear to have translated into an assessment of whether and to what extent the variations revealed were defensible. In particular, the failure to anticipate and estimate the rise in salary costs consequent on nationalisation of the voluntary hospitals was regrettable, because the consequence was that NHS expenditure began to increase rapidly almost from the inception of the NHS. As a result, Conservative critics were able to paint a picture of profligacy and waste, and thereby to claim that the NHS was inherently inefficient.31 In a more contemporary frame of reference, two final reflections are appropriate. First, charitable fundraising did not disappear under the NHS. In a concession to the English (but not Scottish) teaching hospitals, their Boards of Governors were permitted to retain control over endowments (in other hospitals, inherited endowment funds were pooled).32 It was not until 1980 that the Conservatives permitted a significant expansion of such activity. An analysis of the distribution of charitable funds in England in 2002 shows clearly that, if anything, the pattern of endowments is more unequal than was the case prior to the inception of the NHS. The combined assets available to NHS Trusts totalled £1.65bn, of which 46 per cent is accounted for by Guys’ and St Thomas’, Bart’s and the London Great Ormond Street, and University College Hospital.33 Periodically, it has been suggested that inequalities in the availability of such funds may affect the operation of the internal market in the NHS, by making it possible for Individual trusts to distort their prices.34 Charitable resources also feature in the process whereby NHS Trusts bid for capital funds, by defraying some of the capital costs of investments and thereby reducing the amount of capital a Trust needs to borrow.35 Thus, charitable funds have the potential to distort needs-based planning in the NHS, by giving hospitals a competitive advantage. Second, the recent development of NHS Foundation Trusts will extend this process of competition for resources. The process of capital development of hospital provision is now supervised by a new Independent Regulator. It might be anticipated that the regulator will be largely unconcerned about the sources from which Trusts draw their funds, as long as they are financially viable and can fulfil their objective of meeting demand for NHS services. Foundation Trusts are autonomous from direct accountability to the Secretary of State for Health, which means that if they get into financial difficulties they will not be bailed out. These Trusts will therefore have strong incentives to diversify their sources of income and seek to maximise the funds available to them from non-statutory sources such as charity. A return to the inequalities of the pre-NHS era is unlikely, but we can expect – on the basis of the figures quoted above – a greater emphasis on charitable fundraising, which will principally benefit a relatively small elite of institutions. Although Ralf Dahrendorf recently praised the ‘delightfully creative chaos’ of the voluntary sector,36 the situation is hardly likely to become less chaotic, and a key issue for contemporary policy-makers is the extent to which this chaos can be deployed to creative advantage for the benefit of all.

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Notes 1 I am grateful to the Leverhulme Trust for support for the research on which this chapter is based, and to Martin Gorsky and Sally Sheard for comments and suggestions. 2 Quoted in T. Lloyd, The Charity Business, London, John Murray, 1993, p. 178. 3 Political and Economic Planning, Report on the British Health Services, London, 1937, p. 401. 4 House of Commons Debates, 5th ser, v. 422, c. 46–7. 5 N. Deakin, In Search of Civil Society, Basingstoke, Palgrave, 2001, p. 17. 6 M. Gorsky, J. Mohan and M. Powell, ‘British voluntary hospitals 1870–1944: the geography of provision and utilisation’, Journal of Historical Geography, 25(4), 1999, 474–99. 7 Report of the Voluntary Hospitals Committee (the Cave Committee), London, 1921, Cmd. 1335, p. 13. 8 R. M. Titmuss, Problems of Social Policy, London, HMSO, 1950, pp. 66, 504; Gorsky, Mohan and Powell, ‘British voluntary hospitals’; M. Powell, ‘Hospital provision before the NHS: territorial justice or inverse care law?’, Journal of Social Policy, 21, 1992, 145–63; J. Mohan, ‘Voluntarism, municipalism and welfare: the geography of hospital utilisation in England in 1938’, Transactions, Institute of British Geographers, 28, 2003, 57–74. 9 C. Braithwaite, The Voluntary Citizen, London, Methuen, 1937, p. 135; J. E. Stone, Hospital Organisation and Management, London, 1927, p. xvi. 10 S. M. Herbert, Britain’s Health, Harmondsworth, Penguin, 1939, pp. 112–13; J. Hollingsworth, A Political Economy of Medicine, Baltimore, Johns Hopkins University Press, 1986, p. 29. 11 A. M. Gray, ‘A mixed economy of health care: Britain’s health service in the interwar period’, in A. McGuire, P. Fenn and K. Mayhew (eds), Providing Health Care: The Economics of Alternative Systems of Finance and Delivery, Oxford, OUP, 1991; C. Webster, The Health Services Since the War (Vol. I), London, HMSO, 1988, p. 22; S. Cherry, ‘Before the NHS: financing the voluntary hospitals, 1900–1939’, Economic History Review, L, 1997, 305–26; F. Prochaska, Philanthropy and the Hospitals of London, Oxford, Clarendon, 1992, p. 129; M. Gorsky, J. Mohan and M. Powell, ‘The financial health of voluntary hospitals in inter-war Britain’, Economic History Review, iv, 2002, 533–57. 12 R. Pinker, English Hospital Statistics, 1861–1938, London, Heinemann, 1966. 13 Burdett’s Hospitals and Charities: The Yearbook of Philanthropy and Hospital Annual (London); Central Bureau of Hospital Information, The Hospitals Yearbook issued under the auspices of the Joint Council of the Order of St John and the British Red Cross Society and the British Hospitals Association. 14 S. Cherry, ‘The hospitals and population growth’, Population Studies, 34, 1980, pp. 59–75. Mooney et al. attempt to assess precisely which areas were served by individual hospitals in London, by analysing individual data from admission and discharge registers of a small number of hospitals, but this exercise could not be replicated for the whole country; see G. Mooney, W. Luckin and A. Tanner, ‘Patient pathways: solving the problem of institutional mortality in London during the later 19th century’, Social History of Medicine, 12, 1999, 227–69. Hospital expenditure for 1938 can be re-aggregated in proportion to patterns of patient flows given in the Hospital Surveys; see J. Mohan, ‘Disaggregated estimates of expenditure on voluntary hospital services in England for 1938’, paper presented to European Social Science History Conference, Berlin, 2004. 15 Technically, the coefficient of variation is calculated by dividing the standard deviation by the mean. The closer the coefficient is to zero, the more the observations are clustered around the mean.

92 John Mohan 16 J. Mohan, ‘Neglected roots of regionalism?’, Social History of Medicine, 10, 1997, 243–62. 17 The evidence is based on the distinction made by the Surveyors between the bed complement of a hospital and the number of beds which were ‘open’. In 173 hospitals the former exceeded the latter, implying that a total of 1,531 beds were closed; in thirtyseven hospitals this figure equated to at least 10 per cent of the hospital’s bed complement. Ministry of Health/Nuffield Provincial Hospitals Trust, Hospital Survey (10 vols), London, HMSO, 1945, 1946. 18 British Hospitals Association, Report of the Voluntary Hospitals (Sankey) Commission, London, 1937, p. 8. 19 M. Powell, ‘A tale of two cities: a critical evaluation of the geographical provision of health care before the NHS’, Public Administration, 72, 1992, 67–80, esp. 75. 20 Gorsky et al., ‘The financial health of voluntary hospitals’. 21 Hospitals Yearbook, 1940, Table 16, pp. 129–33. 22 Titmuss, Problems of Social Policy, p. 65. 23 J. R. Hollingsworth and E. Hollingsworth, ‘Differences between voluntary and public organisations: the behaviour of hospitals in England and Wales’, Journal of Health Policy, Politics and Law, 10, 371–97. 24 R. Pinker, English Hospital Statistics, 1861–1948, London, Heinemann, 1966, p. 154. 25 Gorsky et al., ‘The financial health of voluntary hospitals’. 26 For county boroughs see the tabulations in A. Levene, M. Powell and J. Stewart, ‘Patterns of municipal health expenditure in inter-war England and Wales’, Bulletin of the History of Medicine, 78, 2004, 635–99. For county councils, the evidence for this is that (a) total expenditure by county councils, excluding London, on general hospital services in 1936–1937 was £1.08m; (b) although the amount spent on general hospital services by individual counties is not identified, it is aggregated into a category of ‘miscellaneous’ public health services totalling £3m; of this, £1.38m was spent by Middlesex and £0.24m by Essex, with only Lancashire, Cheshire and West Yorkshire exceeding £100,000. See Local Government Financial Statistics, 1936/7, pp. 6–7, 20–21. 27 For example, over 40 per cent of patients at the National TB Sanatorium, Benenden (Kent) were recorded in the Hospital Surveys as coming from unnamed ‘other’ counties: Ministry of Health/NPHT, The Hospital Services of London and the Surrounding Area, London: HMSO, 1945, Appendix I. We do not have information on the referral networks through which these institutions received patients, which would help in clarifying which public authorities were placing contracts for services. 28 Mohan, ‘Voluntarism, municipalism and welfare’. 29 Cherry, ‘Before the NHS’, p. 311. 30 A. Cutler, ‘Dangerous yardstick? Early cost estimates and the politics of financial management in the first decade of the NHS’, Medical History, 47, 2003, 217–38. 31 House of Commons Select Committee on Estimates, Seventh Report, Session 1948–9: The Administration of the National Health Service, Evidence, Q.1033–1080. 32 For an illustration of the use of pooled endowment funds, see J. Mohan and M.Gorsky, Don’t Look Back? Voluntary and Charitable Finance of Hospitals in Britain, Past and Present, London, Office of Health Economics, 2001, pp. 91–5. 33 Source: Department of Health, CTF01 Returns: Funds Held on Trust, 2001–2. 34 L. Fitzherbert, Charity and the National Health, London, 1989; M. Lattimer and K. Holly, Charity and NHS Reform, London, Directory of Social Change, 1992; M. Lattimer, The Gift of Health, London, Directory of Social Change, 1996; Mohan and Gorsky, Don’t Look Back?, pp. 96–107. 35 J. Mohan, Planning, Markets and Hospitals, London, Routledge, 2002, pp. 199–201. 36 R. Dahrendorf, ‘Foreword’, in J. Kendall, The Voluntary Sector: comparative perspectives in the UK, London, 2003, p. xiv.

Part II

Local government and medical institutions

6

Paying for the sick poor Financing medicine under the Victorian Poor Law – the case of the Whitechapel Union, 1850–1900 Keir Waddington

Historians of the New Poor Law have focused on the plight of those admitted to the workhouse, to confirm or modify Dickensian images, or explained development in terms of changing conceptions of poverty and social policy.1 Although there has been a growing emphasis on local experiences and on the impact of the Poor Law on the economy, analysis has marginalised the financial underpinning of the very institution it seeks to explain.2 Monetary concerns were central to the new Poor Law, but studies of financial policy focus on expenditure or the near collapse of the poorer unions in London’s East End in the 1860s. Income is only considered in the context of the poor rate or in relation to demands for equalisation.3 This emphasis reflects that of the New Poor Law itself. It was a response to fears about over-spending, a reaction to the perceived financial extravagance and irresponsibility of the old administration. Reform in 1834 did not have a longterm stabilising influence on expenditure, which after an initial decline resumed its upward momentum. At first, lack of resources frustrated administrators’ exertions to implement the principles of the 1834 Poor Law Amendment Act. However, after 1850, modifications to the Poor Law’s financial base saw expenditure rise, working with public opinion and changing notions of relief to favour the sick, the young and the aged. Increasingly, medical care assumed a greater importance not only in the services provided by local Poor Law unions but also in the financial demands placed upon them. The result forced a process of financial diversification as the nature of Poor Law finance changed with the dimensions of relief. This process is exemplified by the experiences of the Whitechapel Union in London’s East End. For much of the nineteenth century, this area was characterised by intense overcrowding and insanitary living and working conditions. It was associated with high levels of poverty, crime, immigration, sweated labour – mostly connected to the clothing industry – and violence, a reputation confirmed by the Ripper murders in 1888. Whitechapel made up a relatively small part of the East End, but was considered by the respectable classes as a breeding ground for criminals, prostitutes and layabouts; a centre for depravity, degradation and disease. Levels of poverty and disease were high in the district, and it was these problems that shaped the Whitechapel Union’s provision of relief.

96 Keir Waddington Although it had been forcibly created under the 1834 Act in the face of local opposition, by the late nineteenth century it had become a model union. The medical services developed by the board of guardians were representative of the shifting nature of poor relief and were closely connected to the changing financial structure of the metropolitan Poor Law. Taking the Whitechapel Union as a focus, this chapter explores the financial framework that was used to fund medical care under the late Victorian Poor Law. However, much of the funding was undifferentiated – often no specific income was set aside to support the sick or fund medical services. This makes it necessary to examine the general financial structure of the Union to understand how medical services were funded. In looking at how the Poor Law was financed, the chapter suggests that a change in the nature of the metropolitan Poor Law was reflected in the way institutional medical services were paid for, and that without a change in how local Poor Law unions were funded this shift would not have been possible.

Financing the Union The scale of funding required for a Poor Law union, even a small one, made the money raised by Victorian voluntary hospitals appear paltry.4 The 1834 Poor Law Amendment Act had created a network of local unions that replaced the old parish system of relief. This produced a complex pattern of finance that makes it difficult to determine where funding came from, especially as the emphasis in the cash-conscious Poor Law was on expenditure. A uniform system of accounting was only introduced by the central Poor Law Board in 1879; before this date it is a matter of piecing together what little information remains. Further problems are encountered when it comes to reconstructing the way medical provision was funded, as income was not explicitly set aside for medical care. Money for health care came out of unions’ total resources and had to compete with the demands of other relief functions. Hence, it is necessary to examine how Poor Law unions were financed to understand where the money for medical services came from. Despite these problems, Poor Law funding did fit within a broadly defined system closely tied to the poor rate, loans and grants. The main source of income for the New Poor Law was the poor rate and, until a shift in the pattern of borrowing in the 1860s, this set the parameters of relief. It was not exclusively a rate for the maintenance of the poor, but provided the foundation of local government finance. The rate was based on property values, not the expanding wealth of industry and commerce, and this led to inequitable distribution, further complicated by obsolete or partial valuations. The absence of professional valuers and an uneven pattern of urban development ensured that the poor rate seldom reflected economic reality. Poorer parishes also tended to undervalue property in their annual assessments to reduce the rate burden, often ignoring the homes of the poor in their assessments.5 Although responsibility for valuation was transferred from parishes to boards of guardians under the 1862 Union Assessment Committee Act to ensure more realistic rate assessments, problems persisted. In 1891, the London County

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Council’s (LCC) valuers’ department estimated that one-third of London was under-assessed, amounting to £900,000 in lost revenue.6 Within this system of finance where ‘poverty rather than wealth’ dominated, the medical services provided by unions progressed at the rate the poorest parish could afford, especially as, prior to 1861, parishes’ contributions to Union costs were assessed according to their relief expenditure on their own paupers, rather than on their property valuation.7 This inequality was transferred to the ratepayers, and the rate fell mainly on the shoulders of the working classes. Although stories about the poor being forced to pawn their goods or being driven to suicide under the burden of the rates are hard to support, most poor ratepayers were reluctant to pay; few paid punctually.8 This created problems for local parishes, although they also used non-payment as an excuse to criticise the ‘heavy claims’ they felt were being imposed on them.9 With many guardians and parishes aware that the weight of relief fell most heavily on those districts and social groups least able to pay, many hesitated to exert pressure on their ratepayers, which in turn restricted income and slowed the development of medical services. Pressure to resolve the problems of inequitable distribution was partly answered by the 1865 Union Chargeability Act. The 1861 Irremovable Poor Act had extended the number eligible for poor relief by shortening the residence requirement for aid and, in combination with a rise in the numbers relieved, threatened to bankrupt the metropolitan Poor Law. The solution was a partial restructuring of the rating system. Under the 1865 Act, local relief expenditure was transferred from individual parishes to a central common fund. Assessment shifted from poverty to property. Although the Act has been seen as a ‘milestone on the road to social justice’, introducing a redistributive element into the Poor Law, many problems were left unresolved.10 The 1865 Act did nothing to reconcile the discrepancies between localism and functional reality. Paupers did not necessarily take notice of administrative boundaries. With a relaxation of the settlement laws under the 1861 and 1865 Acts, metropolitan Poor Law unions found themselves offering relief to other districts’ paupers.11 Financially, this was intolerable. To relieve the burden on their finances, guardians charged relief to the pauper’s nominal union of settlement, creating a form of internal market. Amounts were not fixed, but they were pursued with energy as they reduced local expenditure. Over time, this was replaced by ‘consent’ agreements.12 It would appear that guardians had decided that it was easier to relieve other districts’ paupers and receive reciprocal rights than to charge the pauper’s union of settlement. Although Pat Thane has concluded that ‘the poor rate . . . continued to be the guardians’ only source of income’, redistributing costs on the basis of relief, metropolitan Poor Law unions could never depend entirely on the poor rate.13 Poor-Law finance was inherently diverse. Borrowing had always provided an important source of local government and Poor Law funding. However, when the lending arrangements offered by the Public Works Loans Board were extended and credit restrictions relaxed in the

98 Keir Waddington 1860s, borrowing within the Poor Law assumed a new importance, rising by nearly £2m in under a decade without increasing the burden on the rates.14 Loans on the strength of local rateable values were used to improve specialist services and in particular institutional medical care – for example, the Whitechapel Union borrowed £8,000 in 1870 to extend the workhouse on Mile End Road and a further £2,600 in 1876 to convert the Baker’s Row workhouse into an infirmary.15 The major insurance companies responded to this change and lent heavily to unions, since they represented a safe and profitable market.16 Although loans were a long-term drain on resources, they provided an immediate source of capital and became indispensable in the development of medical services. The programmes of capital expansion, which became an inherent feature of the metropolitan Poor Law after 1860 as attitudes to relief changed, could not be provided out of the sensitive poor rate, so unions had to borrow. Central government, aware that the poor rate and loans were insufficient to meet local union expenditure, allocated a certain proportion of national taxation through grants-in-aid to provide additional funds, contrasting with its general reluctance to provide financial support to local government.17 Introduced in 1846 as part of Robert Peel’s Corn Law repeal package to act as a sweetener to agricultural interests, grants were designed to compensate for the withdrawal of protective tariffs by defraying some of administrative costs of the Poor Law.18 The effect went beyond agriculture and created a stable source of income that involved no local financial responsibility, but could be used by the central board to encourage unions to implement policy or extend services. Under the Local Government Board (LGB) there was a dramatic increase in grants. As Sheard demonstrates in Chapter 7, the creation of the LGB in 1871 was intended to provide a national co-ordinating mechanism through which local public services could be monitored and influenced.19 Although the LGB suffered from the consequences of Gladstonian financial methods, in which all expenditure was resisted, and was hence rarely a dynamic force for change, it did provide new opportunities to improve medical provision, including the construction of Poor Law infirmaries and municipal hospitals.20 This was part of the LGB’s long-term policy to encourage indoor relief, and from this many of the developments in the metropolitan Poor Law took shape. Although Bellamy has claimed that the LGB failed to use grants to promote national policy, economic incentives were regularly invoked to manoeuvre local boards into following its policy and expanding medical services.21 The intention was to use grants to bribe local authorities to overcome their natural reluctance to spend money, increase the poor rate and establish services. The crusade against outdoor relief clearly illustrates the way in which grants were used to influence the nature of relief unions offered.22 From 1870 onwards, indoor paupers were included in these grants, encouraging unions to restrict out-relief. This reinforced the LGB’s attempts to restrict outdoor relief and manipulated the ratepayers’ natural inclination towards parsimony. Given the clear financial advantages of indoor relief, more paupers were consequently relieved within the workhouse. Grants did materially reduce the rates, creating a practice of central

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government intervention to establish additional services and provide a minimum level of efficiency. As such, they were more than a simple top-up to the income raised by the poor rate. The influence the central board was able to exert through grants and loans was customarily not as defined or as blatant as it was over out-relief. A more regular device was the reports provided by Poor Law inspectors and the pressure of information, which encouraged guardians to improve facilities or make alterations.23 However, grants did provided an important mechanism through which central policy was encouraged. With the production of biannual financial statements at a national and local level after 1879, the composition of income becomes easier to discern. Grievances over rating had resulted in a series of piecemeal concessions that were reflected in the structure of finance. The rateable unit of the metropolitan Poor Law was extended, certain kinds of expenditure were combined in a common fund and distributed at a metropolitan level, and grants from central government were increased. The structure of income remained biased in favour of the poor rate, but the diversification already present in the 1860s had escalated. Loans continued to provide for capital expansion and made possible the building of separate workhouse infirmaries. The formation of the LCC in 1888 extended credit facilities to metropolitan authorities by making money available from its credit reserves, and London unions received nearly half the London County Council’s (LCC’s) loans. However, after 1898/9, when credit was restricted by high interest rates and the government’s demands increased, borrowing was curtailed despite growing pressure on the Poor Law to expand medical services. This led to renewed demand for further grants, and generated friction between local and central government at a time when their economic relationship was being questioned and the nature of local funding was under debate.24 The old grants-in-aid system had been succeeded by contributions from the LCC in the form of assigned revenues, redistributed local taxation and government grants. Reorganisation had been discussed in 1871, but it was not until 1888 that the Liberal Party was prepared to consider new proposals to aid the rates and reduce the claims on national taxation arising from increases in local authority expenditure. It was hoped that by assigning revenue, local demands on national taxation would be ‘choked-off’.25 Under the 1888 Local Government Act, local authorities were allocated certain excise taxes and licence duties in the same proportion as they were collected locally to replace the profusion of central government grants. In addition, 40 per cent of probate fees were allocated. By including probate, the Conservatives’ aim of taxing personalty as well as land was partially conceded.26 Probate allocation was fixed at the same proportion as the total grants-in-aid received by the authorities in 1887/8, linked to numbers relieved. Setting the revenues at the 1888 level proved insufficiently elastic to keep pace with local spending, and the hope of limitation was defeated.27 Subsidies rose with prosperity. They doubled nationally in five years, from £4 million in 1887 to £8 million in 1892, and came to cover the payment of Poor-Law

100 Keir Waddington teachers; school fees for pauper children; maintenance of pauper lunatics; medical officers’ salaries; medical expenses; and grants against outdoor relief. Between 1890 and 1895, contributions from grants to the Whitechapel Union amounted to 5.5 per cent for outdoor relief and 10 per cent for indoor relief.28 As local rating resources seldom correlated with local needs, in effect this was reimbursing the union for the development of central services and at the same time stimulating their extension. A new source of income was added to the existing structure of finance by the 1867 Metropolitan Poor Act. Passed in response to an economic crisis in the metropolitan Poor Law, the Act established the Metropolitan Common Poor Fund (MCPF) and Metropolitan Asylum Board (MAB).29 Whereas the MAB sought to extend hospital provision, the fund was a concession to the poorer unions where, given their economic and occupational structure, demand for relief outstripped possible income. Through the fund, the rate was partially redistributed from the wealthier unions which had fewer pressures on their facilities. This was not always deemed to be fairly proportioned: the Whitechapel Union’s protests to the MAB about ‘inequality of assessment’ in 1868 received widespread support from other unions, but resulted in no change.30 For MacKinnon, the fund ‘permitted poor unions to make their workhouses properly curative or deterrent largely at the expense of the richer unions’.31 It reflected an awareness that some problems were of a metropolitan rather than of a purely local nature. The Act allowed unions to contribute towards the services of the MAB at an average of 4d in the pound ‘upon the Rateable value of property within the Metropolis’, and then claim back expenditure from the MCPF. Not all items were accepted: the £1 5s spent by the Whitechapel guardians on the maintenance of boys sent to the Seamen’s Hospital, Greenwich, in 1874 was disallowed, but generally the union received over twice as much as it contributed.32 Between 1890 and 1895 the fund provided 14.4 per cent of the Whitechapel Union’s income, bridging the gap between income and expenditure and covering the medical services provided by the MAB. In this respect, the fund reduced expenditure on vaccination, paupers admitted to fever hospitals and, after 1883, the provision of ambulance services. Without the MCPF many of the unions in London’s East End would have been unable to afford the services offered by the MAB or the expense it imposed through its encouragement of institutional growth. Although other sources of funding remained marginal, one is of interest for what it reveals about the changing nature of poor relief. The Whitechapel Union, like other metropolitan unions, collected money from the families of inmates for medical relief. From 1879 the remit of the Poor Law began to alter. Investigations had revealed that over 90 per cent of those admitted under the MAB could be classified as non-pauper inmates, forcing a modification of the principle of less eligibility. In response, the 1879 Disqualification Act empowered guardians to recover ‘the cost of maintenance’ from those who were deemed able to contribute. Initially only patients admitted to MAB fever hospitals were covered, but under the 1885 Redistribution Act the principle was extended. Given

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contemporary anxiety about pauperism, this was an attempt to solve the problem of treating non-pauper patients. In the Whitechapel Union a maintenance committee assessed and distributed charges to those receiving relief, but there is no evidence to suggest that they were means-tested or linked to treatment. William Vallance, the zealous clerk to the Union, expressed the belief that ‘we get some of the money back, but not to any large extent. Where we do get it back it is rather through the persistence of the collector.’ Despite the difficulties of enforcement and the small amounts recouped – often less that 1 per cent of the total union income – the LGB habitually reaffirmed its commitment to the principle of payment and the need for legal action if necessary, and local unions did their best to comply.33

Understanding diversification By the 1890s, the funding of metropolitan Poor Law unions had evolved to produce an income mix that took account of changing policies to indoor medical relief and institutional expansion. Diversification became a salient feature of metropolitan unions’ financial structure from the 1860s. It replaced a system of finance that had been inelastic and inequitable, unresponsive to periods of industrial distress, hampered by clerical inaccuracies and hostage to the ratepayers’ latent abhorrence of increased expenditure. This shift in how metropolitan unions and medical services were funded was a consequence of expansion. Extension of provision and a resultant rise in expenditure made diversification a consequence of the institutional provision of health care in a changing environment. This was not how contemporaries at first perceived the situation. There was a tendency to ascribe development in the Poor Law to ‘the importunate demands of the working-class electorate – even though . . . many working class men were themselves ratepayers and showed little inclination to be more extravagant than their middle-class counterparts’.34 By the 1890s, attitudes had begun to alter. The impetus that had inspired the 1834 Act had been modified in the face of a growing awareness of poverty and altered ideas as to its solution. As the LGB wrote: since workhouses were established . . . the circumstances connected with the administration of relief, and the character of those for whom accommodation in workhouses has to be provided, have so materially changed. . . . It may be pointed out that whilst workhouses were in the first instance provided chiefly for the relief of the able bodied, and their administration was so intentionally deterrent, the sick, the aged and the infirm now greatly preponderate, and this has led to a change in the spirit of the administration.35 The need to offer relief to the aged, the sick and the young strained resources, forcing provision to escalate beyond the simple relief of poverty. This change can be seen in the administration of the Whitechapel Union: in 1850 the Union

102 Keir Waddington had six subcommittees, eight were in operation by 1872, and twelve by 1898.36 These reflected the Poor Law’s new purpose and additional medical functions, as the stone-yard committee and the medical committee gave way to dispensary, vaccination, infirmary, boarding-out and children’s committees. Expansion was also seen in the increase in the numbers relieved. Studies of the new Poor Law usually stress the avoidance of relief by all classes of society, portraying the workhouse as a social nadir. However, as Hollen Lees has argued, the poor utilised the metropolitan Poor Law to solve temporary problems, negotiating relief on their own terms.37 Workhouses were still feared, and the prospect of a pauper funeral or the possibility of dissection inspired terror, but increasing numbers did use the institutional medical services unions offered – a view that runs counter to the criticisms levelled at them by the 1905–1909 Royal Commission on the Poor Laws.38 The poor saw the workhouse as a familiar and accepted donor of medical services, and regularly asserted their right to relief. In Whitechapel (and other metropolitan unions) this process was aided by the separation of the infirmary from the workhouse in 1876, physically isolating poor relief from medical care and treatment, and by the removal of the electoral disqualification for medical relief, which saw a rise in the numbers willing to use the union’s medical facilities. Nowhere was this clearer than over maternity care in many London unions, including Whitechapel.39 The shift towards the workhouse not only drove up expenditure and forced financial diversification, but also marked a change in the nature of the new Poor Law with the crusade against outdoor relief. In the 1860s, the options for those seeking relief narrowed as the policies of 1834 were enforced with a new vigour. Inspiration came from Gladstone’s attempts to cut public expenditure and minimise governmental activity, aided by the climate of ideas generated by the Charity Organisation Society (COS) and the emphasis given to the full deterrent power of the workhouse in the Goschen minute of 1869.40 The minute reasserted that the Poor Law was designed only for those who were absolutely destitute and that no help could be given to those who were working, even though they might be on the verge of destitution. Building on concerns about urban pauperism and an abuse of charity by the undeserving, Goschen gave his full support to the workhouse in the belief that institutional care would avoid a situation in which charitable donors subsidised a public authority and in which Poor Law guardians might find that they were supplementing undeclared support received from charities.41 The crusade against outdoor relief, linked to the economic crisis of the 1860s and the fears aroused by urban pauperism, encouraged the development of a complex set of institutions to deal with the sick, the old and the young. Relatively few in London could now obtain out-relief, and then only for short periods. Such restrictions encouraged an expansion of the workhouses’ ancillary services, forcing unions to adopt a new indoor strategy and provide new institutions where they had previously relied on existing buildings or made use of voluntary services as part of a mixed economy of welfare. New wards were added that reflected changing ideas about medical practices; separate infirmaries, fever hospitals, asylums and district schools multiplied.

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Zealots within the Whitechapel Union, led by Vallance, wholeheartedly adopted the policy. As Vallance explained, ‘it is rather hereditary pauperism and the permanent form of relief that we have set our forces against’, although at the time no mention was made of expenditure or economic incentives.42 From a Union without a systematic policy towards relief, which granted doles of outdoor relief and used the stone-yard for the unemployed, Whitechapel became a model administration. The guardians closed the stone-yard in 1870, sent the able-bodied to the workhouse, built an infirmary, and dealt with the old, widows and children as best they could, assisted by charity.43 Statistically the results were spectacular: the cost of out-relief fell, and only one in ten of those offered relief were prepared to enter the workhouse. By 1886, ‘with the single exception of Bethnal Green all large unions and parishes of the metropolis are now provided with infirmary accommodation’, reflecting new attitudes to role of medical relief in the Poor Law and the impact of new disease transmission theories.44 Increasingly, metropolitan unions ‘dispensed aid largely through the medium of specialist asylums’. In turn, this shaped the financial demands on unions, encouraging financial diversification as new sources of funding were used to support medical services.45 The high incidence of sickness in London, especially in the East End, meant that most of those seeking relief in Whitechapel were classified as sick. Although the complex network of local voluntary hospitals and medical charities remained the preferred option for the local poor, many of these services were overburdened and did not admit all categories of sick. With voluntary services not always available, the need for medical care, where the only proof was that the recipient could not afford a doctor, therefore drove many to the state. Responsibility for vaccination after 1840 and the separation of Poor Law infirmaries from the workhouse blurred the boundaries of welfare, reducing perceptions of pauperism and allowing the inclusion of greater numbers. In response, local unions were forced to develop medical services, though medical officers were often over-stretched. Admissions to the Whitechapel Union’s sick wards and later to the Baker’s Row infirmary, which rose from 2,200 in 1855 to 5,252 in 1895, expanded faster than the population of the area, and reflected this transformation.46 As already noted, the separation of the infirmary from the workhouse and the removal of the electoral disqualification for medical relief saw a rise in the numbers willing to use the Union’s medical facilities. There was a consequent improvement in conditions and care offered, for the more the workhouse or its associated infirmary was seen as an institution for the sick and infirm, the harder it was to justify a policy of less eligibility. This did not mean that the metropolitan Poor Law came to be accepted as a viable source of non-pauperising medical care. Based on details of occupation listed in the admission records, categories that could be considered above the working classes and the traditional poor represented only a small proportion of those treated in the Whitechapel Union, with middle-class patients representing rarely over 4 per cent of admissions. With Whitechapel considered a place where ‘the people were dirty and bedraggled, the children neglected, the streets

104 Keir Waddington littered and ill-kept, the beer shops full, the shops shut up’, most of the admissions to the infirmary continued to come from poor and unhealthy districts in the Union.47 However, its experience does demonstrate how Poor Law unions could become an important component in the complex network of medical care available not only to the poorest sections of the local community. Yet, despite the shift in finance to reflect the growing medical functions of the Poor Law, no union could be entirely self-sufficient. The Whitechapel Union maintained its paupers under other unions’ care or paid for medical services it could not afford to provide itself. For example, although the Whitechapel Union had a district school until 1897, it lacked a separate asylum. Mostly pauper lunatics were therefore sent to the Coley Hatch Asylum, which charged 9s 7d per patient per week.48 Medical services were contracted out to local voluntary hospitals and medical charities, suggesting a policy of co-operation between unions and local charities and local networks of aid. For example, the guardians signed a treatment agreement with the nearby London Hospital in 1857 to ensure the admission of its paupers.49 When the Industrial School was overrun with ophthalmia, the Union subscribed five guineas to the Royal Ophthalmic Hospital in 1865 to provide specialist medical care. By 1898 the guardians subscribed to eleven separate charities, suggesting a comprehensive policy of co-operation between the Union and local charity. Other metropolitan unions used charitable services in a similar way.50 A mixed economy of welfare continued to exist, driven by the need to restrict expenditure and avoid expensive institutional solutions which were already met by local voluntary bodies. A shift in the nature of the Poor Law to favour institutional relief and an expansion of medical care encouraged a dramatic increase in expenditure. Expenditure relating to the Whitechapel Union’s new Baker’s Row infirmary alone rose by 29 per cent between 1881 and 1892.51 The Poor Law Board explained these developments in terms of the ‘growing number of the more costly classes of pauper’ and a ‘higher standard of efficiency’.52 Nationally between 1871/2 and 1905/6, total indoor expenditure rose by 113 per cent, though the number of indoor paupers increased by only 76 per cent.53 The Whitechapel Union shows this development on a local scale, with a dramatic fall in the amount spent on outdoor relief as the Union enforced the workhouse test.54 Other items of expenditure evolved with the metropolitan Poor Law. By 1895, the guardians paid £3,124 towards the Metropolitan Sick Asylums District and £3,582 to the MAB for those under their care admitted to fever hospitals and lunatic asylums.55 The relative weight of poor relief and medical relief within the metropolitan Poor Law had shifted. By 1900 it was medical care, both within the individual unions and in the wider context of the MAB, which had become the largest single item of expenditure, reflecting increased medical provision and the growth of specialist services. Expansion was not the sole reason for rising expenditure and the need for financial diversification, for pressure was also created by the local guardians’ attitude to relief. Although guardians came to be associated with discharging their duty ‘with the least possible demand upon the philanthropy of the

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ratepayer’, the experiences of the Whitechapel Union do not fit this traditional model of parsimony or match assessments that lay guardians thwarted the development of medical services.56 Nor was Whitechapel unique: other London unions equally implemented favourable policies, and the same picture was repeated in the provinces.57 Despite Whitechapel being one of the four metropolitan areas that opposed the 1834 Act, from 1850 the guardians were keen to expand provision, though efforts to remedy poor conditions were slow. Although they operated a restrictive policy of out-relief, they had a liberal attitude to the treatment of the sick and were ‘ever willing to do all that can be done for the comfort of the poor under their care’.58 In the 1860s, the workhouse was rebuilt and a separate infirmary was added. Regular improvements were made to both, with small projects directed at improving conditions for the sick driving up expenditure.59 This did not prevent problems from occurring, however. When in 1851 the guardians were informed that their provision for the care of pauper lunatics was in need of improvement, they were quick to respond.60 An affront to the guardians’ work did much to spur them into making improvements. The results of these improvements saw the LGB praise the guardians for their ‘administration of the infirmary’ in 1895, following efforts to improve the nursing and make ‘some of the wards . . . brighter and more cheerful looking’.61 Ratepayers were suspicious of all schemes that increased the burden on the rate, and it is doubtful that the Whitechapel guardians thought differently. However, a personal knowledge of the conditions of the poor encouraged a sympathetic attitude and made them more agreeable to utilising loans and grants to develop medical services. Although a number of guardians identified themselves as ‘gentlemen’ or ‘professionals’, the majority were only Keith Lucas’s ‘men of substance and property’ in regard to the social distance they had from the recipients of relief (see Table 6.1). Here the Whitechapel Union reflected a common pattern for London unions, especially those in the East End.62 The Whitechapel guardians came from the middling social groups in Whitechapel, and were not socially far from the classes they assisted. Thomas Lulham, for example, was removed from the Board in 1855 as he was no longer able to contribute to the poor rate.63 As the same guardians were returned annually, their attitudes provided institutional continuity. Edwin Chadwick described these men as ‘those whose attention and services are of little value’, but it was these men who were responsible for the implementation of the Poor Law at a union level.64 Some guardians took a very active role. Vallance, the Clerk, dedicated his life to the Union and consequently much of the policy reflected his conceptions of relief. In the 1860s Thomas Craven had considerable leverage over policy, influencing the establishment of a separate infirmary as a route to greater discipline among the able-bodied, ‘it being very desireable [sic] to have the sick separated from all other classes of inmates’.65 Thomas Brushfield dominated the board of guardians as Chairman for much of the period. According to Henrietta Barnett, he snapped out his orders, ‘often before the applicant had stated his case, or the guardians had had any opportunity of giving their opinions’.66 These men were determined

106 Keir Waddington Table 6.1 Occupational background of elected guardians (Whitechapel Union), 1853–73 Occupation

Gentleman Professional Public Service Teacher Shopkeeper Merchant Manufacturer Building trade (small) Printing Clothier Boot and Shoe Transport Total

Number per year 1853

1863

1873

2 2 2 0 7 1 5 2 1 2 1 2

4 1 0 0 7 4 7 2 0 1 0 0

4 1 0 1 6 6 2 2 0 2 1 2

27

26

27

Source: LMA: Minutes of the Whitechapel Board of Guardians, Wh/13, 33, 54.

to follow the Goschen minute, elevating the importance of the workhouse and so driving up the cost of relief, which in turn necessitated financial diversification. However, guardians seldom submerged themselves in the basic tenets of policy. They focused on the mundane matters of the day-to-day administration, and jealously defended local autonomy. Provision in the Whitechapel Union was continually adapted by the guardians’ conception of local circumstances. This view was shared by many other localities, accounting for the gradual adoption of the 1867 Metropolitan Poor Act, which was initially seen as ‘arbitrary, uncalled for and unconstitutional’.67 The central authority recognised that too rigid an insistence on the letter of the Poor Law, or a blatant resort to financial leverage, would merely provoke a reaction and a return to the obstructionism of the late 1830s and early 1840s.68 Often the central authority was willing to defer to local judgements and was hesitant to carry out new measures that would fail to secure local support. The main priority was to preserve legitimacy and acceptability, and this not only meant a cautious policy but also one of compromise.69 The Select Committee on Poor Relief admitted that ‘the guardians should within certain limits be able to adapt their policy to the particular circumstances of each district’.70 It was the exact nature of these limits that the central board and local guardians contested. Other concerns played a role in deciding policy and shaping expenditure. The bad publicity surrounding the Lancet’s investigation into metropolitan workhouses in 1866 caused a stir within the Whitechapel Union, as did later reports hinting at inadequate provision, embarrassing the guardians into a flurry of activity.71 More liberal attitudes to the purpose and method of relief further helped rationalise and inform the guardians’ activities as the image of poverty

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and pauperism changed. Influential members of the Poor Law Conference movement argued that medical care was an economy and should be encouraged, as it was considered cheaper to treat well and quickly than to care for whole families because of sickness.72 The Whitechapel guardians were not immune to these ideas or concerns to lower the poor rate. For Vallance, ‘by admitting the man to the infirmary we take security for his early recovery, as well as for his early entrance into the labour market again’.73 The Whitechapel guardians adopted a vocabulary of relief that reflected COS rhetoric, but at the same time linked effective medical relief to a reduction of the poor rate, producing an incentive to improve standards of care. The development of the Poor Law services and funding encouraged the guardians’ inclinations. New sources of income were created as a consequence of institutional growth and the development of medical services. Without fiscal diversification the same degree of expansion would not have been possible and would have strained the rates – outcomes the state wanted to avoid. Resources were tailored to institutional expansion: by 1890–95, 30 per cent of the income came from outside the Whitechapel Union’s poor rate. An inhibiting financial framework based on the rates, on which the acceptable limits of expenditure were set, was replaced by one tailored to growth. The MCPF and contributions from the LCC were added to the old staples of loans, sales and grants. Without these new sources of funding, an already overburdened rate would have failed to keep pace. They met the cost of loan charges for the new relief facilities through a system in which the ‘charge’ was continuously redistributed within London between local and central government. This was not so much a strategy of finance; more an ad hoc expansion of central services to meet increased demands and provision.

Conclusion The 1860s marked a watershed for the metropolitan Poor Law. The decade saw a strengthening and remodelling of the system. After 1867, there was a move to re-establish the ideas that the 1834 Act and the local boards had failed to implement. Pauperism and expensive outdoor relief once more became the concerns of the administrators as they were enthused by the old ethic in a new guise. They replaced the lenient system of outdoor relief with the more expensive one of institutional care. By the 1900s, the main problem of Poor-Law administration had become one of finance, with development limited not so much by the ideas embodied in the 1834 Act as by the growing cost-consciousness of local ratepayers.74 The financial problems of the 1900s had already been seen in the late Victorian period. The period between 1850 and 1900 had witnessed an escalation of expenditure, causing a partial revision of the structure of Poor Law finance as new sources of funding were added. Institutional expansion provides the key both to this diversification of income and to the increase in expenditure. At the same time, expansion also demanded more precise central influence to ensure that these ideas were adopted. This linked finance with authority and provided

108 Keir Waddington the ground on which the local and central administration struggled to ensure that their conceptions prevailed. A shift in the funding mechanism of the metropolitan Poor Law encouraged a modification of the authority of the guardians. Local guardians ran the union, but were constrained by the financial base of the Poor Law, and by the wishes of the ratepayers, parishes and central board. As income diversified, the guardians became less reliant on the poor rate, and consequently able to pursue their policies with greater freedom. However, at the same time they were frustrated by a permanent tussle for influence with the Central Board. Much of the discussion was over funding, and it was finance that increased the impact which the Central Board had on local policy. The Poor Law Commissioners had initially struggled with the Whitechapel guardians to implement provision and provide a workhouse, but the building schemes of the LGB and the accompanying government grants made the Whitechapel Union more inclined to follow central initiatives. When the Central Board could use finance as a restriction on action, or conversely as a lever for policy, its influence was at its most extensive. However, to achieve a full adoption of policy, financial incentives had to mesh with local conceptions of relief and attitudes to pauperism. This is seen in Whitechapel in the restriction of outdoor relief, where the guardians managed to outpace the LGB’s attitude towards relief, making the union a model administration, but not one beyond truculence. Perhaps because it supported the state’s ideas on outdoor relief, it was less inclined to adopt other measures that conflicted with local attitudes to relief. Ultimately, however, it was the Central Board that provided the direction and the income to achieve this transformation, but it was the local unions that set the pace and established the facilities, within their own understanding of what relief entailed.

Notes 1 N. Longmate, The Workhouse, London, Temple Smith, 1974; M. A. Crowther, The Workhouse System 1834–1929: the history of an English social institution, London, Methuen, 1983; C. Edwards, ‘Age-based rationing of medical care in nineteenth century England’, Continuity and Change, 14, 1999, 227–65; R. G. Hodgkinson, ‘Provision for pauper lunatics, 1834–71’, Medical History, 10, 1966, 138–54. D. Roberts, The Victorian Origins of the British Welfare State, New Haven, Yale University Press, 1960; and R. G. Hodgkinson, The Origins of the National Health Service. The Medical Services of the New Poor Law, 1834–71, London, Wellcome Historical Medical Library, 1967 are among those who discuss the new Poor Law as an antecedent of the welfare state. For a seminal study of the making of the new Poor Law, see A. Brundage, The Making of the New Poor Law: The Politics of Inquiry, Enactment and Implementation, 1832–39, London, Hutchinson, 1978. 2 See G. Boyer, An Economic History of the English Poor Law, 1750–1850, Cambridge, Cambridge University Press, 1990; and D. Green, From Artisans to Paupers: economic change and poverty in London, 1790–1870, Aldershot, Scolar Press, 1995. As Andrea Tanner has noted, this local interest focuses on ‘the supposedly rebellious north of England’, and she provides an excellent introduction to this historiography: A. Tanner, ‘The casual poor and the City of London Poor Law union 1837–1869’, Historical Journal, 42, 1999, 183–206. 3 See P. Ashbridge, ‘Paying for the poor: a middle-class metropolitan movement for

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4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

23 24 25 26 27

109

rate equalisation 1857–67’, London Journal, 20, 1997, 107–22. P. Wood, ‘Finance and the urban Poor Law: Sunderland Union, 1836–1914’, in M. E. Rose (ed.), The Poor and the City: The English Poor Law in its Urban Context, 1834–1914, Leicester, Leicester University Press, 1985 is one of the few studies which looks at PoorLaw finance. See K. Waddington, Charity and the London Hospitals, 1850–98, Woodbridge, Boydel, 2000. J. Roebuck, Urban Development in Nineteenth Century London: Lambeth, Battersea & Wandsworth 1838–88, London, Phillimore, 1979, pp. 30–31. A. Offer, Property and Politics 1870–1914: Landlords, Law, Ideology and Urban Development in England in England, Cambridge, Cambridge University Press, 1981, p. 193. Cited in Wood, ‘Finance and the urban Poor Law’, in Rose (ed.), The Poor and the City, p. 26. M. Caplan, ‘The New Poor Law and the struggle of union chargeability’, International Review of Social History, 22, 1978, 283. London Metropolitan Archive (LMA): Minutes of the Whitechapel Board of Guardians, 3 February 1852, Wh/13; ibid., 5 November 1861, Wh/31. Caplan, ‘The New Poor Law and the struggle for union chargeability’, pp. 285, 296–9. M. E. Rose, ‘Settlement, removal and the New Poor Law’, in D. Fraser (ed.), The New Poor Law in the Nineteenth Century, London, Macmillan, 1976, pp. 25–44. LMA: Minutes of the Whitechapel Board of Guardians, 22 November 1881, Wh/64. P. Thane, ‘Women and the Poor Law’, History Workshop Journal, 6, 1978, 40. Wood, ‘Finance and the urban Poor Law’, in Rose (ed.), The Poor and the City, p. 38. LMA: Whitechapel Union loan account, 1891–1904, Wh/143. H. A. L. Cockerall and E. Green, The British Insurance Business, 1547–1970, London, Heinemann Educational, 1976, p. 70. R. Millward and S. Sheard, ‘The urban fiscal problem, 1870–1914: government expenditure and finance in England and Wales’, Economic History Review, 48, 1995, 501–35. Offer, Property and Politics, p. 165. P. Thane, ‘Government and society in England and Wales, 1750–1914’, in F. M. L. Thompson (ed.), Cambridge Social History of Britain, 1750–1950, vol. III, Cambridge, Cambridge University Press, 1990, p. 37. See R. Macleod, ‘The frustration of state medicine, 1880–99’, Medical History, 11, 1967, 15–40. C. Bellamy, Administering Central–Local Government Relations: the Local Government Board in its Fiscal and Cultural Context, Manchester, Manchester University Press, 1988, p. 67. For the nature of the crusade, see M. MacKinnon, ‘English Poor Law Policy and the Crusade against Outrelief’, Journal of Economic History, 47, 1987, 603–25; E. Hurren, ‘Welfare-to-work schemes and a crusade against outdoor relief’, Family and Community Historian, 4, 2001, 19–30. See J. L. Brand, Doctors and the State: the British medical profession and government action in public health, 1870–1912, Baltimore, John Hopkins Press, 1965, pp. 90–1. J. Harris, Unemployment and Politics: a study in English social policy, 1886–1914, Oxford, Clarendon, 1972; Offer, Property and Politics, pp. 283–313. G. Baugh, ‘Government grants-in-aid of the rates in England and Wales, 1889–1990’, Historical Research, 65, 1992, 218. Offer, Property and Politics, pp. 201–2. E. P. Hennock, ‘Finance and politics in urban local government in England, 1835–1900’, Historical Journal, 6, 1963, 224–5.

110 Keir Waddington 28 LMA: Whitechapel Union, financial statement, Wh/142/1. 29 The MAB was created shortly after the passing of the 1867 Metropolitan Poor Act. The Board, comprised of guardians and officials, was established to erect and manage hospitals, dispensaries and asylums for the treatment of persons (at first only for paupers) who were insane or were suffering from infectious diseases. Its responsibility covered the whole of London, with funding provided by the MCPF. For a full account of the MAB, see Hodgkinson, The Origins of the National Health Service. 30 LMA: Minutes of the Whitechapel Board of Guardians, Wh/48. 31 MacKinnon, ‘English Poor Law Policy and the Crusade against Outrelief’, p. 612. 32 LMA: Minutes of the Whitechapel Board of Guardians, 13 January 1874, Wh/55. 33 Select Committee on Poor Law Relief, PP (1888) xv, p. 513. 34 J. Harris, ‘The transition to high politics in English social policy, 1880–1914’, in M. Bentley and J. Stevenson (eds), High and Low Politics in Modern Britain, Oxford, Clarendon, 1983, pp. 74–5. 35 LMA: LGB circular, 29 January 1895, Wh/107/43. 36 LMA: Minutes of the Whitechapel Board of Guardians, Wh/13, 54, 80. 37 L. Hollen Lees, ‘Survival of the unfit: welfare policies and family maintenance in nineteenth century London’, in P. Mandler (ed.), The Use of Charity: The Poor on Relief in the Nineteenth Century Metropolis, Philadelphia, University of Pennsylvania Press, 1990. 38 Minority Report of the Royal Commission on the Poor Laws, London, HMSO, 1909. 39 See L. Marks, ‘Medical care for pauper mothers and their infants: Poor Law provision and local demand in East London 1870–1929’, Economic History Review, 46, 1993, 518–42. 40 For the COS and poor relief in London, see Robert Humphreys, Poor Relief and Charity, 1869–1945. The London Charity Organisation Society, Basingstoke, Palgrave, 2001. 41 Twenty-Second Annual Report of the Poor Law Board, 1869–1870, London, 1870. 42 Select Committee on Poor Law Relief, p. 407. 43 LMA: Minutes of the Whitechapel Board of Guardians, August 1898, Wh/80. 44 Fifteenth Annual Report of the Local Government Board, London, 1885/6, p. 25. 45 Hollen Lees, ‘Survival of the Unfit’, p. 74. 46 LMA: Whitechapel Union, Infirmary Porter’s Admission Book, Wh 123/1; Infirmary Admission and Discharge book, Wh 28. The Whitechapel Union was not unique, as there were a similar upward movement in infirmary admissions in other unions, see LMA: Shoreditch Board of Guardians Infirmary Admission Records, ShBG/145/1-2. 47 H. Barnett, Canon Barnett, His Life, Work, and Friends, London, John Murray, 1918, p. 69; LMA: Whitechapel Union Infirmary Admissions Registers, Wh/123. 48 See LMA: Whitechapel Union Guardians’ Minutes, Wh/54. 49 Ibid., Wh/21. 50 See Tanner, ‘The casual poor’, p. 186. 51 LMA: Whitechapel Union, General Ledger, Wh/145/2. 52 Twenty-second Annual Report of the Poor Law Board, London, 1869–70, pp. xii–xiv. 53 M. E. Rose, The Relief of Poverty, London, Macmillan, 1972, p. 41. 54 LMA: Whitechapel Union, General Ledger, Wh/145/2. 55 LMA: Whitechapel Union, Financial Statement, 1890–5, Wh/142/1. 56 Lancet, 1877, vol. 1, p. 540; M. A. Crowther, ‘Paupers or patients? Obstacles to professionalisation in the Poor Law medical service before 1914’, Journal of the History of Medicine, 39, 1984, 40. 57 See Tanner, ‘The casual poor’, pp. 183–206. 58 LMA: Minutes of the Whitechapel Board of Guardians, 4 August 1867, Wh/47. 59 Ibid., 13 August 1861, Wh/30. 60 Ibid., 27 May 1851, Wh/13. 61 Ibid., 18 June 1895, Wh/77.

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62 B. Keith-Lucas, English Local Government in the Nineteenth and Twentieth Centuries, London, Historical Association, 1977, p. 13. 63 LMA: Minutes of the Whitechapel Board of Guardians, 18 September 1855, Wh/17. 64 E. Chadwick, On the Evils of Disunity in Central and Local Administration, especially with Relation to the Metropolis; and also on the New Centralisation for the People, together with Improvements in Codification and in Legislative Procedure, London, Longman, 1885, p. 104. 65 LMA: Minutes of the Whitechapel Board of Guardians, 20 August 1867, 30 July 1867, Wh/43. 66 Barnett, Canon Barnett, p. 201. 67 LMA: Minutes of the Whitechapel Board of Guardians, 5 March 1867, Wh/42. 68 See N. C. Edsall, The Anti-Poor Law Movement 1834–44, Manchester, Manchester University Press, 1971. 69 Bellamy, Administering Central–Local Government Relations, p. 149. 70 Select Committee on Poor Law Relief, p. x. 71 LMA: Minutes of the Whitechapel Board of Guardians, Wh/40. 72 Lancet, 1897, vol. ii, 1306–8. 73 Select Committee on Poor Law Relief, p. 492. 74 N. McCord, ‘Ratepayers and Social Policy’, in P. Thane (ed.), The Origins of British Social Policy, London, Croom Helm, 1978, pp. 21–35.

7

Reluctant providers? The politics and ideology of municipal hospital finance 1870–1914 Sally Sheard

Introduction The creation of the Local Government Board in 1871 was intended to provide a national mechanism which would offer new opportunities to improve the public’s health, including through the creation of municipal hospitals. These were initially established as isolation hospitals to treat patients with infectious diseases. However, their adoption by local authorities appears to have been piecemeal throughout England and Wales prior to the First World War. A quote from Sidney and Beatrice Webb’s 1910 book, The State and the Doctor, provides a useful way into what is a rather complex and under-researched area of British medical and economic history. The Webb’s frustration at their inability to obtain information on municipal hospitals is clear:1 It is somewhat remarkable that there is neither systematic governmental inspection nor central audit of . . . municipal hospitals. In the absence of this inspection and audit the Town Councils are in practice, quite free. Beyond sanctioning the loans for hospitals under the Public Health Acts, the Local Government Board, we understand, has no other official knowledge of this branch of civic activity than it can glean from its own Local Taxation Returns, and from reading the Annual reports of the 1800 Medical Officers of Health with which it is supplied but which it does not for publication summarise or review statistically. There appears to be no official statement of how many sanitary authorities, or what proportion of the whole, either maintain their own hospitals, or make arrangements to use other hospitals, or make no provision at all. A subsequent ‘snapshot’ of municipal hospitals in 1913 reveals over 1,148 institutions containing 39,541 beds.2 This position had been achieved after several decades of expansion of municipal hospital provision – a survey conducted in 1879 showed that of all the 1,593 sanitary authorities in England and Wales, only 296 had isolation hospital provision.3 In 1913 they ranged from excellent modern facilities which had expanded to treat a wide range of infectious diseases, such as those provided in Liverpool (which encompassed 1,074

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beds spread over seven sites), to poor services like Shrewsbury’s, which charged patients extortionate fees and asked them to arrange for their own food to be delivered and to find their own doctors to come in to treat them.4 The common assumption has been that there was a very uneven provision of hospital services before the creation of the National Health Service in 1948, yet there have been few examinations of the primary data available to substantiate this view. Powell, however, has used the Ministry of Health and Nuffield Provincial Hospitals Trust Hospital Surveys of 1938 to look both at inequality (geographical unevenness) and inequity (a poor distribution of services relative to need).5 He concludes that the provision of voluntary hospitals was geographically inequitable, but that this was compensated for by more equitable provision of municipal hospitals, which by this time had included many former Poor Law institutions, appropriated after the Local Government Act (1929). He suggests that the situation in 1938 reflected the historically differential efforts of local authorities to provide a service for their populations.6 While this may be true, it is more difficult to accept his statement in a later paper that ‘it was inevitable that local authorities should be at different points on the route to a municipal hospital system. Moreover, that journey had only started in 1930.’7 This chapter seeks therefore to illuminate the longer history of municipal hospitals and their transition from isolation facilities into more general facilities, and to further engage in the debate over the ‘failure’ of municipal medicine in the 1930s. It also addresses a number of related issues. First, why did local government invest in municipal hospitals, rather than financing additional capacity within the voluntary sector or the Poor Law hospitals, as the latter also had to fulfil obligations for infectious diseases? Second, was this innovation generated by central government (through the Local Government Board), and what role did it play in sanctioning and arranging hospital expenditure? Third, did municipal hospital provision reflect local need, or was it related to a capacity to spend with richer areas providing a bigger service?

Development of the principle of isolation The terminology applied to this type of hospital was often confusing, with the use of terms such as isolation hospitals, infectious diseases hospitals, municipal hospitals and fever hospitals. For the purposes of this chapter the term ‘municipal hospital’ has been used throughout to make a clear distinction from Poor Law and voluntary hospitals. The basic principle of municipal hospital provision was first articulated in the 26th section of the 1866 Sanitary Act, which allowed a medical practitioner to:8 . . . direct the removal to such hospital or place for the reception of the sick, at the cost of the nuisance authority, of any person suffering from any dangerous, contagious, or infectious disorder, being without proper lodging or accommodation, or lodged in a room occupied by more than one family, or being on board any ship or vessel.

114 Sally Sheard However, the 1866 Act did not require local authorities to establish or maintain their own municipal hospitals. It recognised that the institutions already in existence could be used. This was the preferred option for many local authorities, and arrangements were often made with the Poor Law authorities to use their infirmaries. However, as we shall see in the Liverpool case study in this chapter, the relationships between the different branches of local government were often strained. The 1875 Public Health Act required compulsory isolation of infectious diseases and provided authority to erect hospitals for the treatment of such patients.9 The precise phrase used was ‘hospitals or temporary places for the reception of the sick’. Many local authorities used this Act to open small, poorly staffed and equipped hospitals. The actions of local authorities at this time need to be seen in the context of the contemporary advances in the knowledge of disease transmission. During the second half of the nineteenth century, although progress was made in identifying the mode of transmission of diseases (particularly cholera) there was a gradual acceptance of new theories.10 The new knowledge, whilst maintaining a focus on sanitation policies, increasingly emphasised the importance of isolation as a controlling mechanism. After the decline of cholera, other infectious diseases were in the spotlight. The smallpox epidemic of 1870–73 killed over 44,000 people in thirty months, and further major outbreaks in 1881–82, 1884–85 and 1893 all increased the demand for the provision of isolation hospital facilities.11 Scarlet fever was equally significant in promoting the expansion of the municipal hospital. Eyler has shown, however, that the medical profession was often divided on the potential benefits to be gained from isolation of this disease.12 The second factor in the development of municipal hospitals was the restructuring of the public health services in the late nineteenth century. The appointment of Medical Officers of Health, which was made compulsory through the 1871 Local Government Board Act, provided a medically qualified spokesperson in each district to campaign for health services. Pickstone also identifies in the 1880s a growing disenchantment with the ‘ultra-sanitarians’, who focused exclusively on the removal of dirt and the improvement of the urban environment.13 This approach ignored the benefits of treating diseases which would respond to careful nursing, good diet and experienced medical attention – conditions that could only be fulfilled in a hospital environment. The most important stimulus for development of municipal hospitals came with the creation of the Local Government Board in 1871. Through the inspections of the Medical Department’s officers many local authorities were compelled to upgrade or establish services, sometimes against their own wishes. The early annual reports of the Local Government Board from the 1870s make frequent reference to isolation hospital provision and usually the tone of these references leaves the reader in no doubt that the Inspectors felt they were fighting a hard battle:14 We still however too often find that the pressure of an epidemic is required to induce Local Authorities to incur the expenditure which the provision of

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such buildings entails, and we have frequently had to point out that the most essential requisite with regard to a hospital for infectious disease is that it should be ready beforehand . . .

The 1882 Report The proposed location of infectious diseases hospitals was frequently the stumbling block for local authorities which were under pressure not to site them in residential areas, despite reassurances from the Local Government Board that there was no increased risk of disease to the surrounding neighbourhood.15 The smallpox epidemic of 1876–77 provided an opportunity for the Local Government Board to conduct an investigation into the arrangements for infectious disease isolation in London. Then, because of recent cases of smallpox close to the Metropolitan Asylum Board’s hospital at Fulham, the inquiry was widened in 1880 into a national study, directed by Dr Richard Thorne Thorne, Assistant Medical Officer at the Local Government Board. This investigated the arrangements made by individual towns for infectious diseases cases, and the effect (if any) of the hospital on disease rates in its locality. In addition to collecting information about the English use of isolation hospitals, in 1881 the Architect to the Local Government Board, Percival Gordon Smith, made a tour of hospitals in France and Germany to investigate their designs and operations. This reflected the growing internationalism in research, also seen in the discussion of the bacteriological studies of Louis Pasteur and Robert Koch in Britain.16 Gordon Smith noted the costs of construction, the design of the site and space between the buildings, even the minute details of the construction of bed mattresses to enable thorough disinfection. One of his main findings was that the amount of space, expressed as square feet of site per patient, was much greater on the continent than in even the newest English isolation hospitals. At St Denis (Paris) the ratio was 1,570 square feet per patient and Heidelberg had 1,140 feet/patient, while at the new Salford hospital the ratio was 296 feet/patient, and fell to 140 feet/patient at Fulham.17 Gordon Smith also noted that the heating and ventilation was superior in the continental hospitals, a feature considered important in the prevention of cross-infection of patients, and that the wards were smaller and more self-contained than in English hospitals. The Report on the Use and Influence of Hospitals for Infectious Diseases was presented to the Local Government Board in 1882. It made use of the 1879 Return, which showed that only 296 of the 1,593 sanitary authorities in England and Wales had some arrangement for hospital isolation facilities, either of their own or shared with neighbouring authorities.18 The author of the report, Thorne Thorne, had subsequently selected a range of examples from the Return and inspected sixty-seven hospitals. He found that where good hospitals had been provided they were well used by the local population, but that most of the ones he visited had been the outcome of panic from anticipated or actual epidemics. Thorne Thorne cited a number of hastily and poorly built hospitals. He also criticised the lack of co-operation between some authorities, most notably Bradford,

116 Sally Sheard Leeds, Manchester and Middlesbrough, where surrounding sanitary authorities did not use the centrally provided hospitals.19 Thorne Thorne incorporated into his report some suggestions for site, ward layout and a ‘substantial fence or wall at least 6ft. 6in. high’ to prevent communication between patients and the outside public.20

Costing the solution The cost of hospital sites frequently gave grounds for local authority opposition to their development. Some authorities used their own land, if it was suitably situated, but others had to include the purchase of sites in their applications for Local Government Board sanctioned loans. Authorities were encouraged to plan ‘well-appointed’ hospitals with good facilities, ambulances, disinfecting stoves, administration blocks and space for future expansion. In the 1882 Report, the cost of establishing the hospitals was expressed as cost (excluding site) per bed provided. The number of beds per 1,000 population was also calculated to indicate the range of provision existing in England and Wales in 1879. The establishment (capital) cost ranged from £116 per bed in Tonbridge to £347 in Cheltenham (although further planned beds would reduce the cost to £224). The number of beds per 1,000 population again showed a wide range, from Sheffield with 0.2 beds per 1,000 to Darlington at 1.3 beds per 1,000 population. There were other solutions to providing infectious diseases accommodation, such as the transfer of Poor Law infectious diseases wards to local sanitary authorities. This was achieved with great success at Goole, Settle and Warwick, although the inspectors noted that where the workhouse was adjoining the hospital there was a deterrent to its use unless a separate entrance could be found to the building.21 A measure of the success of isolation hospital provision was considered to be the number of patients admitted – the fewer following the first notification the better – although the 1882 Report admitted the difficulty of gaining an accurate number of cases. Various methods of notification were discussed, including a compulsory system as at Leicester and Warrington. The system at Alcester was praised, where the Rural Sanitary Authority paid a fee of 2s 6d for each notification received. However, it was difficult to use hospital mortality rates as measures of success. Often the milder cases of diseases such as scarlet fever were treated at home, with the more serious ones sent to hospital, thus pushing up mortality rates. All this gave the Local Government Board few useful data with which to coerce other authorities to build hospitals. The patients’ fear of payment may have also been a deterrent to the effective use of some municipal hospitals. The issue of financing the admission of nonpauper patients was addressed in section 132 of the 1875 Public Health Act: such expenses incurred ‘shall be deemed to be a debt due from such patient to the local authority, and may be recovered from him at any such time within six months after his discharge from such hospital, or from his estate in the event of his dying in such hospital’. Section 139 of the 1875 Act also empowered the

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Local Government Board to force local authorities to act together in providing hospital accommodation where they considered it appropriate, and to make the necessary financial arrangements. There was evidence that recouping the cost from the patient was difficult, and that sliding scales of charges were difficult to implement because of problems in accurately establishing patients’ incomes. There was a wide range of charging policies operating within hospitals. For example, at the Bradford Fever Hospital during the three years 1878–80, of the 812 patients admitted 443 were treated free of charge.22 Pauper patients were normally treated in Poor Law infirmaries. If there was an arrangement for paupers to be admitted to municipal hospitals, their costs were recouped from the Poor Law authorities. Relationships between Poor Law Guardians and local authorities were often strained over the provision of isolation facilities, with the two systems failing to work together to plan an integrated service for the same geographical area.23 The majority of patients who were admitted to municipal hospitals were from the working classes, who could not provide isolation facilities at home, and paupers who were transferred from workhouses. Yet a more fundamental argument for universal free treatment was increasingly made:24 There are also instances where it is felt that since the entire cost of constructing the hospital and also maintaining both it and the staff, and all the patients occupying the public wards, is defrayed out of the public rates, any member of a ratepayer’s family is entitled to use the means of isolation provided, free of cost. In other places it is further felt that all isolation carried out is for the benefit of the community at large rather than for that of the individual patient, and hence that the cost of it should in every case be borne by the community. This latter practice is indeed becoming more and more common. The 1882 Report coincided with the Report of the Royal Commission on Metropolitan Hospitals, which stated (erroneously) ‘that large smallpox hospitals in populous neighbourhoods have “proved appreciable sources of infection to their neighbourhoods” ’.25 The Royal Commission prompted the revision and re-issue of the 1876 Local Government Board Memorandum on hospital provision to all local sanitary authorities, and undoubtedly stimulated a new wave of hospital construction in the 1880s.26 The interest in isolation hospitals was maintained throughout the 1880s by persistent outbreaks of smallpox around some of the London hospitals. Despite these crises, the Local Government Board’s attitude towards isolation hospitals remained comparatively restrained. There were few references in the main Local Government Board reports or in the annual reports of the Chief Medical Officer. Yet, as Hardy has noted, a huge change did occur, particularly in London after the de-pauperisation of Metropolitan Asylums Board Hospitals following the 1883 Disease Prevention (Metropolis) Act. Whereas in 1880 most of the sick had been kept at home, by 1890 there was so much demand that the MAB could not take patients from outside its area.27

118 Sally Sheard

1889–1914 The Infectious Disease (Notification) Act of 1889 pressed the Local Government Board into advising increased isolation provision, now that local authorities had more complete information on the incidence of infectious diseases in their districts. This was partially achieved through the Isolation Hospital Act in 1893, which allowed the newly formed county councils to make provision for their areas and to cut across sanitary district boundaries.28 The same year also saw the publication of a hospital survey conducted by the British Medical Association which concluded that a ratio of ten beds per 10,000 population was the basic requirement for isolation provision.29 The creation of county councils in 1888 had eased the administrative complexity of local government in England and Wales, and in 1894 the sanitary administration was reorganised into Urban and Rural Sanitary Districts (to cover the county areas) and separate arrangements for county boroughs. The Isolation Hospitals Act of 1893 had opened up new possibilities and during the 1890s a number of Joint Hospital Boards were established, funded by loans adopted by the county councils on their behalf. They had the authority to use the county rate to fund capital projects, and to recover this, with interest, from the local rate of the contributing local authorities. There were a few appeals to the Local Government Board by local authorities coerced into hospital provision in this way, but these were not usually upheld and the Joint Hospital Boards were imposed on them, along with their associated capital and recurrent costs. The requirements for hospital design and construction were by this stage so well prescribed that the Local Government Board in effect would not sanction loan expenditure for anything that did not meet its blueprints. This frequently involved the local authorities in building more elaborate (and expensive) hospitals than they may have wished, although a number still made use of converted houses and factories, and after 1900 the Local Government Board refused to sanction loans for corrugated iron hospitals. It also insisted that isolation hospitals be able to cope with at least three diseases at the same time – which meant a minimum of six wards arranged in three blocks.30 However, the issue of location remained paramount. The persistence of smallpox cases in the vicinity of isolation hospitals prompted a revision and re-issue in 1895 of the Memorandum on Hospital Accommodation. It advised against placing a smallpox hospital within half a mile of a populous district, but there was still no clear policy within the Local Government Board on how to cope with this problem. The period 1900–1914 has been identified by Pickstone as a third era, during which the smaller rural authorities were ‘prodded and pushed’ by county councils into providing isolation hospitals.31 Yet the smaller authorities were at a financial disadvantage. They were unlikely to have the same number of infectious diseases patients as the larger towns, and also did not have the same rating ability to pay for the permanent isolation facilities which the Local Government Board strongly recommended. The changing disease panorama, as displayed in the annual reports of the Registrar General, also suggested that smallpox was

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presenting less of a threat, and that separate isolation provision for smallpox could be scaled down. A further Local Government Board Memorandum was issued in August 1900: On the Provision of Isolation Hospital Accommodation by Local Authorities.32 This again stressed the importance of having facilities ready at all times, and of the advantages for smaller sanitary districts of joint hospitals, where the local topography allowed. The following year another Isolation Hospitals Act was passed, which allowed the transfer of hospitals from local authorities and joint hospital boards to county councils, and gave permission to recoup patient costs and make agreements to take patients from other districts. It also permitted county councils to contribute to the cost of local authority hospitals which were formed under the 1875 Public Health Act.33 The regulations for the repayment of loans taken out by county councils were also relaxed, so that districts which benefited did not have to pay directly, thus allowing poorer and smaller areas to join Hospital Boards. For those loans already in progress the interest rate at which repayments were due was made flexible, instead of the fixed 4 per cent per annum, which had proved difficult for some authorities at a time of national economic decline.34 The changes initiated through this Act formed the backbone of the local authority system, which was subsequently seen as an alternative to the voluntary hospital system in the 1930s discussions on the arrangement of British medical services.35

Variation in municipal hospital provision Most research to date has used hospital bed numbers as an indicator of service, as this information is relatively easy to obtain. However, bed provision does not accurately reflect operating costs. It fails to recognise that some hospitals may be more efficient than others, and that economies of scale are significant. It also fails to identify local authorities which had contracts with Poor Law or voluntary hospitals to treat patients, and those local authorities that had taken advantage of the terms of the 1875 Public Health Act to jointly own hospitals. Thus a financial rather than physical analysis is also desirable, permitting examination of the political economy of municipal hospitals as part of the wider local authority public health strategy. One rich source of data that has rarely been used is the Local Taxation Returns.36 From 1871, under the conditions of the Local Government Board Act, all local authorities had to make annual financial returns which recorded their income and expenditure, and further separated annual recurrent expenditure from loan expenditure. The Returns for a sample of thirty-six English and Welsh towns for the forty-three-year period from 1871 to 1914 have formed the basis for a broader study of local government finance.37 The Local Taxation Returns, as the Webbs correctly identified, are the only solution to the problem of investigating the development and extent of municipal hospital provision before the Ministry of Health and Nuffield Provincial Hospitals Trust surveys of the late 1930s.

120 Sally Sheard Between 1871 and 1914 there was a sustained increase in total local authority expenditure, both annual recurrent and capital. In fact, local authority investment accounted for 90 per cent of all public investment during this period.38 Sources of income were variable, but the basic split was 60 per cent from local rates, 30 per cent from central government in the form of fees and grants, and up to 10 per cent from municipal trading activities (such as waterworks, gasworks, electricity and tramways). An analysis of the Local Taxation Returns shows that county boroughs were more adventurous than the smaller municipal boroughs in their range of activities, and thus could expect to generate profits to subsidise other services. Possibly this was because they had acquired a wider range of statutory duties and legislative opportunities. Expenditure on services had both a regional and a category bias. The highest annual recurrent expenditure per capita was in the North of England and the lowest in the South. County boroughs spent most per capita, followed by London, the municipal boroughs and then the county areas. Demand for services was sensitive to the costs facing the local authorities, independent from all other factors such as housing conditions and mortality rates. Expenditure on municipal hospitals is documented within the Local Taxation Returns for the period 1885–1914. Figure 7.1 illustrate the total annual capital and recurrent hospital expenditure for all local authorities in England and Wales. Whilst the recurrent expenditure shows a steady rise, capital expenditure is marked by a ‘boom’ period between 1897 and 1907. When expressed as a percentage of total local authority spending, recurrent hospital costs averaged less than 0.5 per cent per annum in 1885, rising to a small peak in the early 1900s at 1,600,000

1.8

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1885 1886 1887 1888 1889 1890 1891 1892 1893 1894 1895 1896 1897 1898 1899 1900 1901 1902 1903 1904 1905 1906 1907 1908 1909 1910 1911 1912 1913

400,000

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Figure 7.1 Annual expenditure by local authorities on hospitals in England and Wales, 1885–1913.

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around 1 per cent per annum and then falling back slightly by 1914. Meanwhile, hospital capital expenditure expressed as a percentage of total local authority capital expenditure moved from 0.5 per cent in 1885 to a plateau of 1.4 per cent between 1895 and 1906, before falling to between 0.4 and 1.2 per cent.39 It is clear that there was a major period of municipal hospital construction between 1897 and 1907. Total annual hospital capital expenditure for England and Wales rose from £100,000–200,000 in the 1880s to a peak of £543,288 in 1903–04. Total capital expenditure by all local authorities in England and Wales shows a similar pattern, with a rapid rise in expenditure in the 1890s and 1900s. This is mainly accounted for by investment in water, sewerage and road projects. From a town-based study it emerges that the largest towns were not always the biggest spenders on hospitals in terms of annual recurrent expenditure, which represents the actual running costs of hospitals. From a sample study of thirty-six towns of varying sizes, there are some interesting cases. Large towns with a high provision of municipal hospital services were consistently spending below the national average percentage of total annual recurrent expenditure during the period 1885–1914. Good examples of this include Bradford (⫺1 per cent) and Manchester (⫺1.5 per cent). Conversely, middle-sized towns like Nottingham, Plymouth, Norwich and St Helens spent more than the national average, allocating 2–3 per cent of their total annual recurrent expenditure to municipal hospitals. Presenting hospital expenditure in this relative way gives some indication of the variation at town level. Hospital costs must be seen in the context of competing costs of other municipal services, and also the availability of alternative accommodation for infectious diseases in local Poor Law and voluntary hospitals (although most voluntary hospitals had exclusion policies for these types of patients).

The Local Government Board and capital expenditure The Local Government Board’s attitude to and influence on capital expenditure forms an integral part of the explanation of the varying provision of hospitals by local authorities. All capital expenditure had to be financed through loans received – a principle enshrined in the 1875 Public Health Act and the 1875 Local Loans Act. By using a proxy of outstanding loans to uncover the extent of all local authority capital investment, it is possible to identify a massive increase from £84.2 million in 1873–74 to £652.6 million in 1913–14 (the national debt in 1913–14 was £706 million).40 Yet financing capital projects was easier for some local authorities than for others. Analysis of the Local Taxation Returns identifies a number of conflicts between the Local Government Board and the large local authorities. The Local Government Board held the ‘trump card’. It had to authorise all projects which required capital finance, and to fix the loan terms. It favoured longer repayment periods of up to sixty years, as stipulated in the 1875 Public Health Act, but this was at odds with the Treasury’s determination to restrict loans to a thirty-year period, effectively capping the borrowing

122 Sally Sheard ability of local authorities. There was a way around this Local Government Board/Treasury limitation, through a private Parliamentary Act to authorise a loan, but this incurred its own costs. Between 1875 and 1880 Parliament authorised £27.1 million of local authority loans through private Acts, which represented 35 per cent of all loans raised.41 Private Act loans increased to over 50 per cent of total loans for the periods 1890–93 and 1897–1902, stimulated by the 1890 Public Health Act, which widened access to this type of funding.42 Once permission had been obtained for a loan, the local authority had a number of choices. It could apply to the Public Works Loans Commissioners (PWLC), but the interest rate was fixed at a relatively high 5 per cent and the maximum period of repayment was only twenty years. Thus, although the PWLC had been ‘upgraded’ through the 1875 Public Health Act, it remained a minor contributor to local authority investment, contributing only 14 per cent between 1875 and 1880, and rising to 18.7 per cent between 1897 and 1901. There were more cost-effective options than the PWLC, particularly for large local authorities. There was considerable diversity in the types of loans which could be arranged, including mortgages, bonds, annuities and debentures. The large county boroughs could also issue stock, which gave them added flexibility in gaining loans. In an attempt to assist the smaller local authorities, the Treasury restricted access to PWLC loans after 1900 by excluding large towns from this source of finance. However, it seems that for the whole period 1870–1914 all local authorities were able to raise loans for capital expenditure easily, although the terms were relatively better for the larger authorities, which could ‘shop around’. The ultimate limitation for all local authorities, irrespective of size, was the ability to repay the loan capital and interest. This repayment could only be met through rate income, which financed the majority of local authority expenditure. There was a rise in the average rate charge levied during the period, from 3s 6d in the £ in 1885 to 6s 9d/£ in 1914.43 There was also a rise in rateable values, which increased rate income for England and Wales from £19.3 million in 1875 to £71.3 million in 1914. Thus larger towns with a bigger rateable income should have been in a comparatively better position to fund the provision of municipal hospitals, and this is substantiated by Preston, who found a correlation coefficient of 0.86 between rate fund expenditure per capita and local wealth.44

The Liverpool case study Pressure from above to implement a municipal hospital building programme was only one part of the equation, in that the influence of the Local Government Board could be diffused at the local level. No amount of inspections, orders and memoranda could produce services in a town which did not have the necessary financial ability or political inclination. Liverpool is a good example of how national pressure was translated into local action.45 It was very active in the creation of new public health policies in the nineteenth century, starting with the Liverpool Sanatory Act in 1846 and the appointment of England’s first Medical

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Officer of Health in 1847.46 As a large and prosperous urban area, it should have been able to meet the financial requirements to fund investment in municipal services. Investment was persistently delayed in the face of considerable pressure from the Local Government Board. A surprise finding is that the Medical Officer of Health for the period 1863–78, Dr William Stuart Trench, was not in favour of municipal hospitals, viewing isolation provision as a Poor Law responsibility for those who could not isolate themselves effectively in their own homes. Throughout the 1860s and 1870s there was pressure on the Town Council, and the Health Committee in particular, to provide facilities for the isolation of infectious diseases. Yet the response for the next decade continued to be the erection of temporary accommodation during epidemics. The Council had reluctantly contributed £5,000 towards the cost of building a new voluntary hospital at Netherfield Road, which fulfilled its obligations under the 1866 Public Health Act. This donation secured a number of beds for the use of patients admitted by the Medical Officer of Health. However, by 1882, in the wake of smallpox and typhus epidemics in Liverpool, a special committee of the Council was formed to consider hospital provision. This was followed by a letter from the Local Government Board in 1883 urging the Council to make adequate provision for infectious diseases. In 1885 the Local Government Board again wrote to the Council, urging them to make immediate provision.47 The Local Government Board even went as far as to specify the ideal number of beds required – 750 – to supplement the Poor Law infirmary accommodation. The Special Committee reduced the estimate to 650 beds on the advice of the Medical Officer of Health and the Liverpool Medical Institution, but when the matter went before the full Town Council it was decided that the most they would provide was 160 beds split between two small hospitals. This plan was finally approved by the Local Government Board in April 1886. Netherfield Road Hospital, which had formerly had voluntary status, was improved, and a new hospital to serve the south of Liverpool was built at Grafton Street in Toxteth. A change in Medical Officer of Health with the death of Trench in 1877 brought Dr John Stopford Taylor to the post. He saw municipal hospitals as an essential part of the public health services of the local authority. In each of his annual reports from 1880 to 1890 he lamented the lack of investment and attributed the high mortality rates from infectious diseases to the lack of isolation facilities. In 1888 the Poor Law Guardians in Liverpool attempted to force the council’s hand on the issue of bed provision. They had traditionally taken infectious patients referred by the Medical Officer of Health, thus averting several threatened epidemics; however, they increasingly saw this as an abuse of the Poor Law system, and they gave notice that from the end of 1888 they would not accept municipal patients. The council’s planning was tested very soon afterwards. A measles epidemic early in 1889 forced the council to beg for emergency cover, and the Poor Law Guardians reluctantly agreed. Again in 1890, during a scarlatina epidemic, patients had to be kept at home because there were no beds for them in the temporary accommodation provided.

124 Sally Sheard The Local Government Board was well aware of the problems Liverpool was experiencing, but it was not until 1894 that a public inquiry was held. The outcome was the decision of the Council to extend the hospital at Netherfield Road and to devise a longer-term strategy to cope with the planned expansion of the city, rather than relying on the traditional practice of crisis management which had consistently failed during the previous twenty-eight years.48 A change of Medical Officer of Health in 1894 to the ambitious and entrepreneurial Dr Edward William Hope also increased the impetus for expansion. Figure 7.2 illustrates the progressive increase in hospital recurrent expenditure in Liverpool, which mirrors the national trend seen in Figure 7.1. The sudden upturn from 1903 relates to the opening of the Fazakerley Hospital and sanatorium. The capital cost for this ambitious 510-bed establishment was estimated at £130,000. In the same year, the Local Government Board also authorised Liverpool City Council to spend £53,000 on extending the facilities at another municipal hospital at Mill Road.49 Thus the number of beds increased from 540 in the five municipal hospitals in 1895 to 1,074 in 1907. By 1911, Liverpool was recognised as having one of the best municipal hospital provisions in the country. The Liverpool case study represents some of the issues which can account for the variation seen within the thirty-six town sample, despite the degree of central 80,000 70,000 60,000

£

50,000 40,000 30,000 20,000 10,000

1885 1886 1887 1888 1889 1890 1891 1892 1893 1894 1895 1896 1897 1898 1899 1900 1901 1902 1903 1904 1905 1906 1907 1908 1909 1910 1911 1912 1913

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Figure 7.2 Liverpool hospital annual recurrent expenditure, 1885–1913.

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direction from the Local Government Board. Certainly the negative attitudes of Dr Trench must have handicapped the early efforts of public health campaigners in the council, yet his views were logical in the context of contemporary views on disease, poverty and personal responsibilities. However, the facilities offered by the Poor Law Guardians in their workhouse infirmaries, with the stigma of pauperism they brought upon the patient, could never be a comprehensive service for all infectious disease in a community. A visibly separate provision was necessary. Liverpool’s financial capacity also partly explains the council’s delaying tactics. In the 1870s the city had to start the construction of a second costly waterworks project after an earlier failure, and a significant component of its income had been lost when the Mersey docks separated from the City Estate in 1857. Yet Liverpool, as did several towns, chose to offset some of the cost of isolation hospital provision through instituting a variable patient charge: 42s per week in first-class wards, 21s per week in second class wards and 10s per week in third-class wards.50 The full cost of isolation was therefore never born by the council.

Conclusion Many of the studies of the Local Government Board have portrayed it as a significant determinant in the course of local authority development. It certainly wielded the threat of being able to withdraw the block grant on which so many local authorities depended to supplement rate income to provide basic services.51 Yet the example of Liverpool shows that it took many years of repeated criticism to achieve an expansion of the municipal hospital system. It is interesting that there are no references to financial sanctions being threatened in Liverpool. Perhaps the explanation lies with a lack of a clear policy on municipal hospitals within the Local Government Board itself. The mortality rates for infectious diseases such as typhus, smallpox and scarlet fever, which had been the raison d’être for the creation of the municipal hospitals in the 1870s, were beginning to decline in the first decades of the twentieth century, showing in part the success of isolation and hospital treatment.52 By 1913 there were over 39,000 beds available in England and Wales for infectious diseases patients. Medical Officers of Health increased the range of diseases which they would admit to include measles, whooping cough, meningitis and poliomyelitis, as a strategy to keep their wards full. Some wards were also converted into tuberculosis sanatoria after 1898.53 The 1911 National Health Insurance Act also changed the public perception of rights to medical treatment dramatically. Some of the new municipal hospitals that were constructed in the 1910s and 1920s were not justified by their infectious disease provision, but were explicitly general hospitals. This occasionally gave rise to concerns from ratepayers and the medical profession that some health services were being ‘put on the rates’ as part of a wider ‘municipal socialism’ movement.54 The period 1870–1914 was one of unparalleled reorganisation within British bureaucracy. It coincided with and to a degree assisted the transition from an era

126 Sally Sheard of sanitarian responses to infectious disease epidemics, to a phase of ‘personal prevention’ during which the focus of attention was isolation and treatment of the individual. The creation of the Local Government Board in 1871 provided a good opportunity for central government to influence and manipulate local activities. Legislation provided for Local Government Board control over most areas of local authority activity and investment. However, as the analysis of the development of municipal hospitals indicates, the Board’s attempts at coercion had only limited success. It was effective in providing guidelines for the design and construction, and thus required a certain level of expenditure from participating local authorities. Yet it could not insist on a timetable for hospital provision. The result was a gradual introduction of municipal hospital facilities across England and Wales which was determined by other factors than the pressure exerted by the Local Government Board. These factors were often financial, reflecting the increasing levels of debt of all local authorities, which were obliged to invest in new services yet had limited financial resources to pay for them. In some places the decision to recoup the hospital costs from patients resulted in such high fees that the hospitals went virtually unused – a clear example of financial expediency outweighing public health considerations.55 The chronology of hospital construction must therefore be integrated into a larger financial model, which recognises the priorities for huge capital investments such as waterworks and sewerage systems. These projects were easier to justify to the rate-paying electorate, particularly if they provided commercial benefits. Research has shown that there was a peak of capital investment in these large projects in the 1880s and 1890s,56 and this undoubtedly would have had implications for other potential projects. The Local Government Board and the local Medical Officer of Health would have had a hard time putting the case for further public services. Yet the evidence, as presented in rising recurrent and capital expenditures on hospitals in Figure 7.1, particularly in the period 1897–1904, suggests that they were successful in this competition. As this chapter has shown, they were aided by national legislation, especially the Infectious Diseases Notification Act of 1889 and the Isolations Hospitals Act of 1893, which made it easier to identify patients and funding respectively. The stimulus of fear, through continuing outbreaks of smallpox in Britain (and cholera in Europe), also continued to impress upon local authorities the need for permanent isolation provision. Furthermore, by the early 1900s the medical community was repositioning its case of need – particularly for scarlet-fever isolation – to stress the value of isolation for social and economic convenience, which enabled uninfected members of the household to continue to work and socialise unhindered.57 This new emphasis can be clearly seen in the Local Government Board’s report of 1912.58 An analysis of the development of municipal hospital services therefore illuminates a number of debates in late nineteenth-century England and Wales. It can be used to investigate the effectiveness of the Local Government Board, the contemporary medical knowledge on the transmission of certain diseases, the

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increasingly sophisticated local financial markets and the development of regional systems of service provision through the formation of Joint Hospital Boards. It further highlights the complexity of intra-urban socio-medical arrangements between local authorities, the Poor Law authorities and the voluntary hospital sector. This study has attempted to redress the balance of hospital historiography which to date has seen the municipal hospital as a limited participant. The extent of provision was considerable from the mid-1890s onwards, and was found throughout the local authority system, from small rural sanitary authorities to the largest County Councils. With the decline in infectious diseases like smallpox, many authorities found themselves with a well-constructed and staffed hospital which had the potential to form the foundation for general hospital services, although not all exploited this opportunity. The transition to a fully-fledged public hospital system could not have been achieved so easily if this significant ideological tension between Poor Law, municipal and private provision for infectious diseases had not already been resolved.

Notes 1 S. Webb and B. Webb, The State and the Doctor, London, Longman, 1910, p. 158 fn 2. 2 Local Government Board Return as to Hospital Accommodation in England and Wales, 1915. This number is comprised of 755 ‘fever’ hospitals with 31,149 beds, 363 smallpox hospitals with 7,972 beds and 30 Port Sanitary Authority Isolation Hospitals with 420 beds. 3 Tenth Annual Report of the Local Government Board 1881–81. Supplement on the Use and Influence of Hospitals For Infectious Diseases, iv. The 296 comprised 185 Urban, eighty-five Rural and sixteen Port Sanitary Authorities in England. The corresponding figures for Wales were seven, two and one respectively. 4 B. Abel-Smith, The Hospitals, 1800–1948, London, Heinemann, 1964; L. Granshaw ‘The rise of the modern hospital in Britain’, in A. Wear (ed.), Medicine in Society: historical essays, Cambridge, Cambridge University Press, 1992, pp. 197–218. 5 M. Powell, ‘The geography of English hospital provision in the 1930s: the historical geography of heterodoxy’, Journal of Historical Geography, 18(3), 1992, 307–16. 6 M. Powell, ‘Did politics matter? Municipal public health expenditure in the 1930s’, Urban History, 22, 1995, 361–79. 7 M. Powell, ‘An expanding service: municipal acute medicine in the 1930s’, Twentieth Century British History, 8(3), 1997, pp. 334–57; esp. 336. 8 1866 Sanitary Act. 29&30 Vict. C.90. In 1863 a report was produced on the Hospitals of the United Kingdom, which Sir John Simon found useful for identifying the facilities available for treating diseases. 9 1875 Public Health Act, 38&39 Vict. C.55. Section 131. 10 M. Worboys, Spreading Germs: disease theories and medical practice in Britain, 1865–1900, Cambridge, Cambridge University Press, 2000. See Chapter 7: ‘Preventive Medicine and the Bacteriological Era’, pp. 234–76. 11 A. S. Wohl, Endangered Lives, London, Dent, 1983, p. 133. 12 J. Eyler, ‘Scarlet fever and confinement: the Edwardian debate over isolation hospitals’, Bulletin of the History of Medicine, 61, 1987, 1–24. 13 J. Pickstone, Medicine and Industrial Society, Manchester, Manchester University Press, 1985, p. 4. 14 Sixth Annual Report of the Local Government Board 1876–77, xciv.

128 Sally Sheard 15 Ibid., xcv. 16 Eleventh Annual Report of the Local Government Board 1881–82, Appendix B, pp. 146–58. On the diffusion of bacteriological knowledge see Worboys, Spreading Germs. 17 Eleventh Annual Report of the Local Government Board 1881–82, p. 154. 18 Tenth Annual Report of the Local Government Board 1881–81. Supplement on the Use and Influence of Hospital For Infectious Diseases, iv. 19 Ibid., p. 8. 20 Ibid., p. 9. 21 Ibid., pp. 20, 21. 22 Ibid., p. 29. 23 A good case study of the rivalry thus induced can be found at Salford in the 1890s, as narrated by Pickstone, Medicine and Industrial Society, pp. 166–9. 24 Tenth Annual Report, p. 29. 25 Annual Report of the Medical Officer of the Local Government Board 1882, xi. 26 This Memorandum was based on one issued by the Medical Officer of the Privy Council in 1871. 27 A. Hardy, The Epidemic Streets: Infectious Disease and the Rise of Preventive Medicine 1856–1900, Oxford, Clarendon Press, 1993, pp. 277–8. 28 An Act for enabling County Councils to promote the establishment of hospitals for the reception of Patients suffering from Infectious Diseases. 56+57 Vict. C.68. 29 ‘An investigation of infectious hospital accommodation and administration in England’, British Medical Journal, 1, 1893, 185–7. 30 H. Richardson, English Hospitals, London, Royal Commission on Historical Monuments, 1998, p. 39. 31 Pickstone, Medicine and Industrial Society, p. 160. 32 Annual Report of the Local Government Board 1900–01, Supplement of the Medical Officer, p. 228. 33 They were already permitted to contribute to local authority hospitals formed under the 1893 Act. 34 An Act to Amend the Isolation Hospitals Act, 1893. 1EDW. (1901). Cap.8. 35 S. Cherry, ‘Before the National Health Service: financing the voluntary hospitals, 1900–1939’, Economic History Review, 50, 1997, 307; A. Marwick, ‘The Labour Party and the welfare state in Britain, 1900–1948’, American Historical Review, 73(2), 1967, 380–403. 36 An exception is C. Feinstein, National Income, Expenditure and Output of the United Kingdom, 1855–1965, Cambridge, Cambridge University Press, 1972. 37 R. Millward and S. Sheard, ‘The urban fiscal problem, 1870–1914: government expenditure and finance in England and Wales’, Economic History Review, 48, 1995, 501–35. 38 C. H. Feinstein and S. Pollard, Studies in Capital Formation in the United Kingdom, 1750–1920, Oxford, Clarendon Press, 1988. 39 Capital expenditure data for hospitals are only available as a national aggregate, not for individual towns. However, the Annual Reports of the Local Government Board provide a list of projects approved for capital expenditure, giving the name of the authority concerned, purpose of the loan, the amount and the repayment period. 40 J. Wilson, R. Millward and S. Sheard, Trends in Local Authority Loan Expenditure in England and Wales 1870–1914, University of Manchester Working Papers in Economic and Social History, 1993, no. 22, p. 4; J. Wilson, ‘The finance of municipal capital expenditure in England and Wales, 1870–1914’, Financial History Review, 4, 1997, 27–49. 41 Wilson, Millward and Sheard, Trends, p. 5. 42 Wilson, ‘Finance of municipal capital expenditure’, p. 36. 43 P. J. Waller, Town City and Nation, Oxford, Clarendon Press, 1983, p. 257.

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44 B. T. Preston, ‘Rich town, poor town: the distribution of rate-borne spending levels in the Edwardian city system’, Transactions of the Institute of British Geographers, 10, 1985, 77–94. 45 For an excellent municipal hospital case study, see John Eyler’s analysis of the facilities at Brighton. J. M. Eyler, Sir Arthur Newsholme and State Medicine 1885–1935, Cambridge, Cambridge University Press, 1997, pp. 85–118. 46 The 1846 Sanatory Act [sic] formed the basis for the later national Public Health Act of 1848. 47 Liverpool Record Office. Council Proceedings 1884–5, 1336. 48 An additional example of this can be seen in the fact that there was no full standing committee of the Council to deal with hospital affairs until 1893. 49 Liverpool Record Office 352 MIN/HOS/1/5, 241. 50 Return of Isolation Hospitals for Cases of Infectious Diseases, 1895, pp. LXXXIV. 51 See in particular C. Bellamy, Administering Central–Local Relations 1871–1919. The Local Government Board in its fiscal and cultural context, Manchester, Manchester University Press, 1988. 52 Hardy, The Epidemic Streets. 53 Worboys, Spreading Germs, pp. 272–3; B. Abel-Smith, The Hospitals 1800–1948, London, Heinemann, 1964, p. 127. 54 H. Fraser, ‘Municipal socialism and municipal policy’, in R. J. Morris and R. Rodger (eds), The Victorian City: a Reader in British Urban History, 1820–1914, London, Longman, 1993, pp. 258–80. 55 Report of the Royal Commission on Poor Laws, 1905–09, 942 (Minority Report). 56 R. Millward, ‘Urban government, finance and public health in Victorian Britain’, in R. J. Morris and R. Trainor (eds), Urban Governance: Britain and beyond since 1750, Aldershot, Ashgate, 2000, pp. 47–68. 57 Eyler, Scarlet Fever, p. 19. 58 H. Franklin Parsons, Report on Isolation Hospitals, Supplement to the Annual Report of the Medical Officer of the Local Government Board, 1910–11, pp. 4–15.

8

The Bradford Municipal Hospital experiment of 1920 The emergence of the mixed economy in hospital provision in inter-war Britain1 Tim Willis

Introduction In 1920 an agreement was reached between the Poor Law Guardians of Bradford and Bradford Borough Council to transfer hospital services from the Poor Law to the City Council. This chapter explores the social and political factors that led to this pioneering venture. The policy became a possibility due to the coalescence of several elements, including the perceived failure of voluntary hospital provision in Bradford, a wide acceptance in the city that the local authority should have some kind of legitimate stake in general hospital provision, the presence of a Minister of Health favourably inclined towards the scheme and, in no uncertain terms, the drive of the Borough Medical Officer of Health (MOH), John Buchan. Events in early twentieth-century Bradford illustrate one example of a local solution to the wider ‘hospital problem’ facing the country in the inter-war years. Contemporary medical and political press reports discussed the problems of increased patient demand, the paucity of beds, poor access, the decline of charitable revenue, and increased costs brought about by the modernisation and professionalisation of medical services.2 In broad terms, the Labour movement and the local authorities favoured a reformed system based on municipal control while the voluntary hospitals and the medical profession wished to see support for the charity-based voluntary hospital system. Policy-makers in Bradford wished to address a basic anomaly, that the city’s Poor Law hospital had large numbers of empty beds while the voluntary general hospital had large waiting lists. The municipalisation policy of St Luke’s Hospital Bradford was not to provide free hospital care, but to address the issue of citizenship entitlement to general hospital treatment, cater for a demand that was not being met by the voluntary system, and encourage the community to make use of publicly provided hospital care. John Buchan’s concern was the immediate and practical notion of using available resources to improve hospital services, yet there were wider implications and the scheme featured in debates about the appropriate level of local and national state funding for health care.

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After the First World War there were signs that hospital reform might be a significant aspect of the reconstruction. The Ministry of Health was created in 1919, followed a year later by The Dawson Report and the tabling of legislation intended to reform the role of local government in the administration of hospitals.3 At the national level, the impetus for reform was lost to the lean years of the depression. Events in Bradford illustrate that municipal acute medicine was a viable strategy, given the appropriate circumstances.

Bradford Bradford expanded rapidly during the late nineteenth century through the textile industry.4 The strongly working-class character of the place was noted by Ministry of Health inspectors in 1932.5 A large industrial working class with a corresponding small number of wealthy benefactors and potential middle-class subscribers to hospital funds made the prospects for voluntarism and for voluntary hospital support in the city somewhat minimal. In 1920 Bradford had two small specialist voluntary hospitals, The Royal Eye and Ear Hospital (which had 72 beds) and Bradford Children’s Hospital (which had 74 beds), and the city’s voluntary general hospital, The Bradford Royal Infirmary (BRI), which opened in 1824 and had 215 beds in the 1920s. As well as the municipal maternity hospital, the local authority was responsible for the City Hospital for infectious diseases, with 210 beds, as well as Odsall Smallpox Hospital (established in 1916) with fifty beds and which was used as a tuberculosis hospital.6 St Luke’s Hospital was originally the Bradford Poor Law Hospital, which opened in 1850 and was progressively upgraded throughout the late nineteenth century and early twentieth century, reaching 1,700 beds during the First World War.

The Bradford Royal Infirmary Before the introduction of the St Luke’s municipalisation scheme, moves were made to involve the local authority in general hospital care in other ways, either through the building of a completely new municipal general hospital or to take the ailing voluntary hospital, the BRI, into municipal control. Pressure for municipal action in the provision of a general hospital was evident as early as 1901, when attempts were made to persuade the City Council to obtain powers to manage all of Bradford’s voluntary hospitals. When the proposal was the subject of a Council debate, it was defeated by thirty-six votes to sixteen.7 Nevertheless the lack of general hospital care in Bradford was taken seriously by the City Council, and a special sub-committee was established in 1908 in order to examine the question of the municipalisation of the BRI.8 In 1912 the increasingly bad reputation of the BRI in press reports of overcrowding and refused admissions prompted an anonymous member of the hospital staff to write to the Bradford newspaper the Yorkshire Observer, stating that ‘the Infirmary staff have long informed the public of Bradford that it is impossible to give an efficient service . . . the public have no right to complain of

132 Tim Willis admissions being refused . . . till Bradford has supplied promises fit to carry on such a medical and surgical institutional service as Bradford requires.’9 In the same year at a Council debate on the future of the BRI, leading Liberal Councillors opposed the idea of the municipalisation of the voluntary hospital on the grounds that the public purse would not be able to carry the burden.10 A series of special meetings between City Councillors and hospital board members was held at the BRI in early 1914.11 The Board of Management of the voluntary hospital had submitted a scheme to the Council whereby the local authority would purchase the hospital buildings and the site for the sum of £100,000 in return for the Council having a quarter of the seats on the Board of the BRI.12 This was by no means an attempt at full municipalisation. The intention was for the Council to use the buildings for administrative purposes and for the BRI to be rebuilt on a new site. Through the implementation of this scheme, the Board of the hospital firmly believed that the voluntary nature of the BRI would be maintained. However, the war intervened and the scheme never progressed, although in times of financial crisis during the inter-war years Board members would frequently suggest that this scheme be revived to solve the financial problems of the BRI.13 In raising the possibility of the municipalisation of the BRI, it is possible that board members were employing scare tactics to stress the seriousness of the predicament of the voluntary hospital in an effort to encourage an increase in charitable donations. Once the notion of hospital municipalisation had been raised in the atmosphere of post-war reconstruction, a growing assumption developed in the Bradford press that the Health Committee of the Council would ultimately become responsible for the Bradford hospitals in light of the failure of voluntarism. Modernisation in social policy was expected in 1919, including an assumption that the end of the Poor Law was imminent. The Yorkshire Observer urged its readers to vote wisely in the Board of Guardians elections of April 1919, as it believed that this election would be the last.14 The Board of the BRI did not disguise the hospital’s problems, and openly recognised that the hospital needed to be completely rebuilt. The BRI established a New Infirmary Committee in 1914; however, problems of fundraising and finance persisted throughout the inter-war years and the new infirmary was not available for use until 1936. The difficulty of securing the position of the BRI and the voluntary hospitals in Bradford was attributed by a local physician to Bradford’s proximity to Leeds, a noted University hospital centre with a medical school.15

Municipal socialism? These discussions around the increased role of the local state in hospital provision followed an established record of innovative health schemes in early twentieth-century Bradford. Concerns over infant and maternal mortality rates led to the introduction of a municipal Infant Clinic in 1912, which replaced a ‘Babies Welcome’ run on a charitable basis.16 On the advice of John Buchan the city’s first municipal maternity home was opened in 1916, with an associated district

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midwifery service.17 Both Liberal and Labour politics in Edwardian Bradford added to the progressive attitude to health policies in the city. Prominent Independent Labour Party figures such as Fred Jowett (Chairman of the Health Committee 1892–1906) and Margaret McMillan (elected as an ILP candidate to The School Board in 1894) were instrumental in the pre-First World War health reforms of Bradford County Borough Council.18 As the Labour Party were in office in Bradford at the time of the municipalisation of St Luke’s, it is tempting to assume that the scheme was an early example of politically driven inter-war municipal socialism – such as the health policies instigated by Labour controlled local authorities in London and Sheffield in the 1930s.19 The term ‘municipal socialism’ itself is a slippery one, as it was originally intended as a term of abuse by critics of increased local government activity. A series of articles appeared in The Times, in 1902 and 1903, which expressed abject horror at the municipalising developments in local government and expressed fears over the growth of state involvement in the administration of the public sphere.20 The Times feared that British town halls were in danger of coming under the influence of ‘poorly paid secretaries of local trades unions’ and ‘labour representatives who have probably never earned more than 30 shillings a week, and may not possess practical knowledge of finance and industrial management’.21 The ILP in Bradford was all for municipal schemes – for example, ILP Councillor William Leach criticised the Council Budget of 1912 for omitting to make provision for the building of a new municipal general hospital.22 However, the view that the municipality was the only body capable of addressing the hospital problem in Bradford came to be accepted by non-socialists as well as socialists. The Labour Party actually held overall control of Bradford on only two occasions in the inter-war years.23 In the first municipal elections to follow the First World War, in November 1919, Labour made much headway in line with national trends, and took thirty seats on Bradford City Council to form a minority administration. The fact that the Conservative Party achieved twenty-seven seats and the Liberal Party twenty-six seats in 1919 was an ominous sign for the Labour Party, and throughout the inter-war period the anti-socialist parties formed an effective alliance. The anti-socialist pact ensured there were no threecornered contests in municipal elections, the anti-Labour vote was not split and Labour held overall control for only one year from November 1919 to November 1920.24 Prominent ILP figures were able to influence health-care developments in Bradford, such as the introduction of an Infants’ Department and a school meals service in the early years of the twentieth century. ILP Councillors and Guardians set a course that was picked up by the Liberals. The Chairmanship of the Health Committee from 1918 onwards was held by Liberals such as the businessman E. J. Smith. In the 1920s and 1930s the position was held by another Liberal Councillor, H. Thornton Pullan. His long tenure as Chairman of the Health Committee included the period of Labour control of the Council in 1920, which suggests that the Labour Group saw an ally in Pullan.

134 Tim Willis Municipalisation featured in the 1919 and 1920 local elections over the issue of a municipal clothing store. During their year in office, Labour established a subsidised clothing store. However, such forays into the collective provision of an otherwise commercial venture provided much political ammunition for the Liberal and Conservative opposition to question how far the Labour Party was prepared to go down the road of socialist schemes. On regaining power in November 1920, the Liberal council closed the store. It was against this background that the scheme to municipalise St Luke’s Hospital emerged. The prospect of Labour ‘squandermania’ coloured the municipal elections in Bradford in 1920, where Liberal and Conservative councillors criticised Labour muncipalisation schemes.25 Once back in office, however, the Liberals tended to become spending politicians and ensured that health and hospitals were a priority for the Council. As the prominent ILP member and businessman William Leach noted in the Yorkshire Observer in 1920, ‘when a Liberal or a Conservative becomes a chairman [of a council committee] he nearly always develops into a municipal socialist in that department’.26 Leach noted that Pullan, as Chairman of the Health Committee, faced accusations from his colleagues on the Chamber of Trade of conducting an ‘orgy on the rates’ in the field of health care in Bradford, yet Pullan was perfectly willing to accuse other committees of wasting ratepayers’ money. Health care remained a priority in Bradford’s municipal budget, and health spending in Bradford was above the national average for County Boroughs. The Ministry of Health noted in 1931 that expenditure per head of population in Bradford on health services was 31s 1d, compared to a County Borough average for England and Wales of 18s.27 Cross-party support for the scheme among City Councillors and Guardians was an acknowledgement that voluntarism, and the Bradford Royal Infirmary in particular, had failed to provide adequate general hospital accommodation for the city. St Luke’s Municipal General Hospital was administered under a nonsocialist council for the majority of its of its twenty-eight year pre-NHS existence. The Left in Bradford raised the policy idea, which came to be supported by all parties, yet it is doubtful whether the scheme would have seen the light of day without the organisational skill and influence of John Buchan, the city’s MOH from 1913 to 1946.

John Buchan Both John Buchan and his brother George (MOH for Willseden in London) were described as ‘household words in the public health service’ in the first half of the twentieth century.28 Both men were instrumental in public health, taking an active part in the Society of Medical Officers of Health and in the Royal Sanitary Institute.29 John Buchan was a graduate of Glasgow University, where he took an MB ChB in 1898 and an MD in 1905. He was called to the bar in 1909. Like his brother he took the DPH at Cambridge before moving on to public health work in Scotland, first as Resident Medical Officer for Motherwell Fever

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Hospital and then as Junior Assistant Medical Officer in Lanarkshire, where he eventually became Assistant Medical Officer. From 1906 to 1913 John Buchan was MOH for St Helens before taking up the position of MOH at Bradford. His obituary in the journal Medical Officer notes how the two brothers ‘presented a fascinating contrast of abilities and personalities, John being perhaps the prophet and George the administrator and negotiator’.30 George Buchan’s metropolitan base allowed him access to more elite public health circles and he was active in the British Medical Association’s (BMA’s) Medical Planning Committee, which was intimately involved in the creation of the National Health Service. John Buchan served as MOH for Bradford for thirty-three years, until his retirement in 1946. In 1927 he was appointed, on the recommendation of the Minister of Health, to the Health Section of the League of Nations to investigate public health services in Germany.31 He was an examiner in Public Health Medicine at the Universities of Aberdeen and Glasgow, and in 1946 was awarded the triennial Smith Award by the Royal Institute of Health and Public Hygiene.32 John Buchan may not have been at the forefront of the national medicopolitical discussions that shaped the NHS; however, his contribution to the field of public health through the development of municipal health services should not go unrecorded. As a well-qualified and dynamic character, John Buchan took full advantage of the opportunities open to MOsH in an era that can be regarded as the high-water mark of municipal medicine. Buchan himself provided an insight into the skilled negotiations and diplomacy required of a medical officer employed by a democratically elected administration. His Presidential address to the Society of Medical Officers in 1929 indicated the qualities required of an Medical Officer of Health, and therefore may be taken as an outline of his own skills for operating health policy as part of a political body:33 Public health is a branch of medicine, and its practice is to be carried out by or under the advice of a special kind of medical practitioner, but the control of all its activities lies in the hands of the elected representatives of the people, who are almost without exception at the beginning of their period of representation, ignorant of the health functions of the body to which they have been elected. Vicissitudes in party fortune change the personnel of these bodies rapidly, and it is no easy task without something more than needed knowledge to maintain continuity of effort in a service so recently developed as that of public health. Buchan was of the opinion that the relatively late development of Bradford in the late nineteenth century had had a profound effect on the outcome of the public health services of the city. In a Ministry of Health survey of 1932 Buchan expressed his view that the local authority should run hospitals in the city, noting that: ‘Bradford’s short history, for a town of its size, has resulted in the lack of a tradition of voluntary institutions and effort with the result that the community has been forced to look to its council to provide public services

136 Tim Willis which in older towns, have gradually grown up through private charity and the activities of voluntary organisations.’34 In the same interview Buchan stated that the BRI was unpopular with the citizens of Bradford as it was considered to be a ‘Masters Hospital’, which brought about a reluctance on the part of the working classes to make use of the hospital.35 Buchan’s Annual Report for 1919 reported that the Bradford Royal Infirmary was centrally located in the city and treated all forms of disease; however, ‘the general structural arrangements are bad and the hospital work is cramped by the antiquated and inconvenient buildings and the ill lighted wards’.36 Negative publicity appeared in 1919, when an ex-serviceman being treated at the hospital bitterly complained that during the limited visiting hours at the hospital his relatives and friends were canvassed to make contributions to the hospital’s funds. He suggested that if the food served at the hospital had been offered to the troops, it would have led to a mutiny. The ex-serviceman stated that:37 The crowning insult came upon my discharge from the Infirmary when I was given a card entitling me to further treatment as an out-patient. Across this was printed in unmistakable bold lettering “NOT TO BE USED FOR BEGGING PURPOSES”. The politicians cry let us make a country fit for heroes to live in. The pen of Lord Fisher would fail to express my indignation. Patient admission to the BRI was by subscribers’ recommendation letters, and inpatients were required to bring their own linen, soap, towels and supply of butter and eggs.38 The crisis at the BRI and the growing bad publicity inspired the hospital to ‘acquaint the public with the actual state of affairs’.39 In a letter to the Lord Mayor of Bradford in 1919, George Priestman, the Chairman of the Board of Governors of the BRI, outlined the state of the voluntary hospital in no uncertain terms.40 The Chairman of the Board recognised that the BRI was:41 out of date, inadequate and a disgrace to a city like Bradford. There can be no question that a new infirmary will have to be erected either by voluntary contributions or out of the rates and the sooner the public realise this the better. In the meantime the Board must be provided with the necessary funds to carry on the work effectively or they will have no alternative but to hand over the whole responsibility to the city, a very undesirable and from a rate payers’ point of view a very costly undertaking. Priestman was a staunch defender of the independence of the voluntary hospital and was clearly uncomfortable with the idea of the local authority being in control of the BRI. As part of the attempt to address the post-First World War financial crisis at the BRI, the Board invited a prominent local businessman, Sir William Priestly, to be President of the hospital. An indication of how widespread was the idea that it was entirely legitimate for the local authority to come to the aid of the BRI was seen in Sir William Priestly’s first comment as President of the BRI, that the hospital should turn to the local authority and enter into a

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joint venture to rebuild the Infirmary as a war memorial.42 By this stage, however, the City Council had moved away from any notion of municipalising the BRI, and plans were underway for the transfer of St Luke’s Poor Law Hospital from the Guardians to the local authority. Whether the solution to the problems of the voluntary hospital were seen as full municipalisation or increased reliance on public funding, a groundswell of opinion developed in Bradford that the local authority was the only body capable of addressing the general hospital needs of the city. The perception that municipalisation was commonly seen as the answer to Bradford’s hospital problem was commented on by Ministry of Health officials. In internal discussions prior to Addison granting consent for the St Luke’s Hospital scheme, Ministry officials reported that ‘there is a strong movement in the city in favour of municipal hospitals and it is not unlikely that the proposal for the renting of St Luke’s Hospital would be followed by a proposal to take over the Bradford Royal Infirmary’.43 The official impression that voluntarism had clearly failed in Bradford was boosted by the Chairman of the Bradford Board of Guardians, R. W. Dawson, on visits to the Ministry of Health. Dawson set out to ease the path to municipalisation by blackening the name of the BRI through hinting at corrupt practices. In a visit to the Ministry of Health in 1920 Dawson stated that the BRI was run not for the benefit of the sick poor but for the benefit of the consultant staff, where preference was given to patients who were able to pay a twoguinea consultation fee.44 In a damning indictment of the prospects for voluntarism in Bradford, Dawson was reported by Ministry officials as emphatically stating that ‘the voluntary principle is dead’ and that ‘Bradford had no use for it’.45

St Luke’s Hospital In 1912 the borough Poor Law hospital, the Bradford Union Hospital, was renamed St Luke’s Hospital, signifying the attitude of the Bradford Board of Guardians in attempting to down play the Poor Law nature of the institution. In that year there were 700 beds at the hospital. For the duration of the First World War St Luke’s Hospital, like many other infirmaries, was offered to the government for use as a military hospital. The wartime experience not only increased the number of beds to 1,700, it also saw a wider range of treatments introduced than would be expected to be found at a Poor Law hospital. Elsewhere in the country, once hostilities were over the temporary wartime hospitals were soon returned to their pre-war use. However, in Bradford the wartime transformation of St Luke’s Hospital, in a city where the shortage of general hospital beds was well known, was seen as an indication that the local state, with its previous record of municipal health schemes, should take on the running of a general hospital. Bradford required an institution that was more than a traditional Poor Law infirmary, serving the destitute and chronic sick. Such an undertaking, however, was beyond the scope of the Poor Law Guardians. As the military hospital returned to civilian use, negotiations began in June 1919 between the Board of

138 Tim Willis Guardians and the Health Committee over the possibility of transferring the hospital to the control of the Health Committee.46 The initial plan was for the hospital to be leased to the Council for a five-year period and for the lease to be renewed if the scheme was considered a success. Buchan’s Annual Report for 1920 expanded on his vision for the hospital. It was ‘not to be a mere sentimental exercise in name changing, but a complete departure from the old general medical treatment undertaken in Poor law Hospitals. St Luke’s it is intended should bring together a highly specialised staff dealing with different aspects of disease who could co-operate with one another for the welfare of the patients.’47 On transference Buchan, as Medical Officer of Health, was to have ultimate responsibility for the medical aspects of St Luke’s, and the staff appointed were to be responsible to him.48 The sick poor were to have priority of admission and municipal cases were to be charged on a sliding scale, initially based on the rateable values of their homes but later replaced by a means test administered by two Investigating Officers.49 By 1921, Buchan reported the appointment of two senior surgeons, a junior surgeon, a senior physician, a junior physician, a gynaecologist, an opthamologist and an anaesthetist.50 The plans for the transfer and the initial discussions had gone ahead without wider consultation with the Bradford medical profession. When the Bradford BMA requested a copy of the scheme it was referred by the Chairman of the Health Committee to articles in the Yorkshire Observer, as it was ‘the only public information available at present.’51 The Medical Superintendent of St Luke’s, Benjamin Holroyd Slater, described the special nature of the hospital in the press in 1922. He noted that:52 1. It is supported from the rates instead of voluntary contributions. 2. A graduated charge is made for patients. 3. It has no waiting list: all in need of treatment can receive it without delay. 4. Its out-patients department is purely for consultation not treatment. 5. The whole of its medical staff is paid. 6. The diet includes all extras thought necessary by the medical staff and does not require to be supplemented by the patient’s friends. 7. Personal laundry is done for the patients. When the hospital opened as a municipal general hospital on 1 April 1920, the Bradford press was still asking the question, ‘Municipal General Hospitals: Are They Legal?’53 The Ministry of Health had allowed the scheme to go ahead based on the 1875 Public Health Act, which allowed local authorities to open isolation hospitals for infectious disease cases. However, the Bradford scheme was a special exception as legal advice to the Ministry pointed out that ‘it is certain that the framers of the [1875] Act did not intend that local authorities should have the power to provide hospitals’. A deputation of the Bradford BMA petitioned Dr Addison in November 1920 over his decision to give a green light to the scheme. Addison instructed the doctors that the Council should be expected to consult local medical opinion; however, as a supporter of local authority action in hospital provision, Addison

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told the deputation that ‘neither centrally nor locally was it reasonable to expect preliminary consultation to be of such a nature as to stand in the way of effective executive action’.55 The Bradford municipal hospital scheme made practical sense to Addison, and its success added to the Ministry of Health’s policy until 1946 that health care and hospital reform was most likely to be based on local government structures. The Bradford scheme was controversial, and drew comment from noted health professionals. Sir Napier Burnett, a Newcastle physician who had examined wartime economies in hospital provision, did not believe that the two general hospitals in Bradford could co-exist. He believed that the management of municipal general hospitals would be inefficient, and that the voluntary hospital would suffer due to an unwillingness of the public to maintain subscriptions. His suggestion for the future of hospital policy was the reverse of the Bradford solution; Burnett believed that the voluntary hospitals and not the local authority should take over the running of Poor Law hospitals.56

Conclusion The Bradford municipal hospital experiment of 1920 was a pioneering venture that aimed to provide rate-supported hospital care for the whole community and not just the sick poor. The cross-party support for the scheme from Labour members who were keen on municipalisation schemes per se, as well as the Chairman of the Health Committee, Pullan (a Liberal), and the Chairman of the Board of Guardians, (Dawson a Conservative), indicates that there was an acceptance in the city that voluntarism had failed to provide an adequate general hospital service for the city. A characteristic spirit of independent local government action had been seen in Bradford with the early establishment of Edwardian municipal health facilities, and the municipal general hospital should be seen in this same vein. There was a tradition in the city of local agency which in 1920 saw an unusual window of opportunity. There was a coalescence of factors in 1920 which made the municipalisation scheme possible. The period from 1918 to 1921 was an era when reconstruction and social reform was a widespread expectation. Bradford was under a Labour Council from November 1919 to November 1920, which was keen to see a municipal general hospital and had the backing of key individuals from other political parties. At the centre, with executive power, was a Minister of Health (Addison) who was well disposed to the scheme, who recognised that the BRI was in difficulty and who was prepared to take a chance with a revolutionary step of dubious legality. The question remains how influential was the Bradford experiment? How effective was the two-way policy traffic between central and local government? Both critics and supporters of the municipalisation scheme felt that Bradford would set the trend for hospital administration. From the point of view of the medical profession, the British Medical Journal feared a ‘revolution in hospital organisation and management’ throughout the country.57 The Chairman of Bradford Board of Guardians, R. W. Dawson, stoked this fear by stating that he believed that every large town would follow the example of Bradford.58

140 Tim Willis In terms of influencing national policy for hospital administration, the Bradford experiment can be assessed on its short- and long-term effects. In the short term, events in Bradford can be said to have directly influenced central government health policy. The Bradford scheme inspired Dr Addison to amend legislation and introduce Clause 11 of the Ministry of Health (Miscellaneous Provisions) Bill. Although this Bill was a legislative dead end, the influence of the Bradford experiment on the Ministry of Health added to the long-held civilservice assumption that the municipalities would form the basis of a reformed hospital system. In the local government world, the Bradford policy encouraged other local authorities to take over Poor Law hospitals following the permissive hospital appropriation legislation contained in the Local Government Act of 1929. As a Mr G. Whyte Watson, Bradford Consultant Surgeon and Deputy Medical Superintendent at St Luke’s Hospital, noted in 1959, ‘the hospital grew from small beginnings to one of the largest in the country and was the pattern for London County Council hospitals and other municipal hospitals in the 1920s and 1930s.’59 John Buchan clearly believed that the Bradford scheme had been influential. His address to the Bradford Trades Council in 1930 stated that ‘there can be no doubt that the practical and successful running of the Municipal Hospital in Bradford was one of the factors which induced the government to bring in the Local Government Act of 1929, which gives to all local authorities the power to move along similar lines to us in Bradford’.60 The 1930s saw more responsibilities added to local government health services, with the Midwives Act of 1936 and the Cancer Act of 1939. As is well known, the final solution to the hospital problem was neither municipalisation nor the extension of the voluntary hospital system, but the wholesale nationalisation of the country’s hospitals. In the long term, then, the Bradford experiment could be seen as an interesting anomaly in twentieth-century hospital policy. Buchan, with the backing of the Health Committee, set about developing in Bradford a fully functioning Municipal Hospital in a very short period. He realised that simply changing the name over the door of a former Poor Law infirmary was not an adequate solution to encourage the public to use hospital facilities. For Buchan, what Bradford needed (and what the Council could provide) was a general hospital with a committed staff, medical classification of patients, and access to full-time medical and surgical professionals and to consultants. The popularity of St Luke’s was clear, with an increase in admissions from 3,804 in 1920 to 6,915 in 1929. Of these cases, 1,907 were referrals from the Poor Law and the vast majority 4,994 were ‘municipal’ (i.e. fee-paying public cases). Buchan estimated that 75 per cent of surgical and 90 per cent of medical cases treated in the city were treated at St Luke’s Hospital.61 Of course, the exact nature of the public’s attitude towards the former Poor Law hospital is impossible to gauge. The community certainly used the hospital; however, this could have been due to necessity, as the new BRI did not open until 1936. Yet the balanced assessment of T. S. McIntosh, the Ministry of Health surveyor of Bradford in the 1930s, was that ‘If one considers the whole, from the point of view of whether the various forms of medical services are available for all who need

The Bradford Municipal Hospital experiment

141

them, according to their means, I think that the conclusion must be that this is the case to an unusual degree.’62 Other towns with different social and political characteristics found different solutions to the inter-war hospital problem. In Sheffield, the four voluntary hospitals began the post-First World War era in a similar financial state to the BRI. However, with the successful introduction of the workers’ contributory health scheme the ‘1d in the £’ scheme, the financial situation of the voluntary hospitals in Sheffield was completely turned around. The Sheffield hospital contributory scheme had the full support of the Labour-led City Council, and enjoyed the backing of the Sheffield Trades Council.63 In Bradford, however, the Trades Council was committed to the municipal general hospital and objected to the promotion of voluntary hospital workers’ contributory schemes. The timing of the proposal to municipalise St Luke’s was fortuitous. With Christopher Addison as the first and short-lived Minister of Health, the Bradford scheme had an ally at the centre. It is doubtful whether another Minister of Health would have looked on the scheme so favourably. While the suggestions contained in the Dawson Report of 1920 remained shelved, the Bradford municipal general hospital scheme of 1920 was a plan that was put into action with its details being worked out on the ground. Buchan (the MOH) and Pullan (the Chairman of the Health Committee), together with Benjamin Holroyd Slater (the Medical Superintendent of St Luke’s), took advantage of a brief window of opportunity in the immediate aftermath of the First World War and established a municipal general hospital despite the protestations of the local medical profession and the cautious attitude of the Ministry of Health. All three men enjoyed a long tenure in office and provided a medico-political axis that was able to see the establishment and successful administration of the municipal general hospital. The larger issue of the future of hospital policy for the whole country remained in the hands of Whitehall. As Buchan stated in 1930, ‘we can make experiments in Bradford that may show the way to a solution, but it is a far bigger problem than we in Bradford can solve’.64

Notes 1 I would like to express my thanks to Paul Etherington for access to material collected as part of a doctoral research project examining municipal hospital provision in the inter-war years, which was supported by the Wellcome Unit for the History of Medicine, Manchester in the early 1980s. 2 For contemporary debates over the hospital problem, see the British Medical Journal, 13 November 1920, 753–4; ‘The hopeless position of the hospitals: why a national system is necessary’, Labour Magazine, 4(12), 1926, 535–7; W. E. Hart, ‘Hospitals as affected by the Local Government Act 1929’, Journal of the Royal Sanitary Institute, L, 1930, 469–80; S. Churchill, ‘A medical service for all’, Public Health, 16 April 1927, 177–80. 3 Lord Dawson of Penn was appointed chairman of the Consultative Council on Medical and Allied Services in 1919. The published (Interim) report of this committee recommended, in 1920, closer co-operation in health service planning, including the close working of general practitioners and local authorities. The first Minister of

142 Tim Willis

4 5

6 7 8 9 10 11 12 13 14 15 16 17 18

19

20 21 22 23

Health, Dr Christopher Addison, attempted to clarify the legal confusion over whether local authorities could establish general hospitals. Clauses were attached to a Ministry of Health (Miscellaneous Provisions) Bill of 1920, which was mainly concerned with housing, to allow local authorities to take over Poor Law infirmaries as municipal hospitals. The medical profession strongly objected to Addison’s intentions and the Bill was eventually defeated by the House of Lords. See the British Medical Journal, 6 November 1920, 126–8; and 13 November 1920, 753–4. Asa Briggs stated that nineteenth-century Bradford was ‘pre-eminently a textiles town’. A. Briggs, Victorian Cities, Harmondsworth, Penguin, 1963, p. 150. In 1850, 95 per cent of British worsted looms were in West Yorkshire. A Ministry of Health survey of 1932 noted that ‘Bradford has a small employer class and a large manual worker class with a relatively small middle class’. The National Archives (hereafter NA) MH 66/477 Public Health Survey S. 104 LGA 1929 Bradford County Borough. Bradford Medical Officer of Health Annual Report, Bradford, 1920. Yorkshire Observer, 5 July 1948. British Medical Journal, 24 October 1908. Yorkshire Observer, 13 May 1912. Yorkshire Observer, 13 July 1912. Bradford Corporation Special Committee Minutes, Bradford District Archives, BBC 1/56/3. Bradford Corporation Special Committee Minutes, 4 February 1914, Bradford District Archives, BBC 1/56/3. BRI Board Minutes, 12 July 1923, 1 August 1923, 2 June 1933. West Yorkshire Archive Service Headquarters (hereafter WYAS HQ), C501/2/10. Yorkshire Observer 20 March 1919. British Medical Journal, 2 October 1920. Bradford Council of Social Service, The Texture of Welfare, Bradford, 1923, p. 39. British Medical Journal, 26 March 1964, 187. K. Laybourn, ‘The defence of the bottom dog: the independent Labour Party in local politics,’ in D. G. Wright and J. A. Jowitt (eds), Victorian Bradford, Bradford, City of Bradford Metropolitan Council Libraries Division, 1982, pp. 223–44; J. A. Jowitt, ‘Late Victorian and Edwardian Bradford’, in J. A. Jowitt and R. K. S. Taylor (eds), Bradford 1980–1914: The cradle of the independent Labour Party, Leeds, University of Leeds Department of Adult Education and Extramural Studies, Bradford Centre, Occasional Papers, No 2, 1980; K. Laybourn, ‘The issue of school feeding in Bradford, 1904–1907’, Journal of Educational Administration and History, 14(2), 1982. Jowett was Health Committee Chairman for fourteen years, Bradford’s first Labour MP in 1906 and a member of the first Labour Cabinet in 1924. McMillan was elected to the Bradford School Board in 1894 and went on to national prominence in the field of education and welfare. D. E. Martin and J. Saville, ‘Frederick William Jowett’, in J. M. Bellamy and J. Saville (eds), Dictionary of Labour Biography, IX, Basingstoke, Macmillan, 1993, pp. 150–7. For details of inter-war health care and municipal socialism in London, see J. Stewart, The Battle for Health: a political history of the Socialist Medical Association, 1930–1951, Aldershot, Ashgate, 1999. For Sheffield, see T. Willis, ‘Politics, ideology and the governance of health care in Sheffield before the NHS’, in R. J. Morris and R. Trainor (eds), Urban Governance 1750–1950, Aldershot, Ashgate, 2000, pp. 128–49. See series of articles in The Times, September and October 1902, and 23 August 1903. The Times, 8 September 1902. Yorkshire Observer, 15 May 1912. Labour were in control of the Council from November 1919 to November 1920 and again in 1929 for a four-month period. Local election results are drawn from The

The Bradford Municipal Hospital experiment

24 25 26 27 28 29

30 31 32 33 34 35 36 37 38 39 40 41 42 43 44

45 46

47 48 49 50 51 52 53 54 55 56

143

Bradford Trades Council Annual Reports, passim 1919–1939. Bradford District Archives 66 D837/6. All twenty of the municipal seats contested in 1921 saw straight fights between Labour and anti-socialist candidates. D. James, Bradford, Halifax, Ryburn, 1990, p. 131. Yorkshire Observer, 1 November 1920. Yorkshire Observer, 27 October 1920. Ministry of Health Minute Wrigley to Macewen, 13 January 1931, NA MH 66/477. Obituary of John Buchan in Medical Officer, III, 1964, 187. George Buchan was President of the Royal Sanitary Institute 1925–26, John Buchan was President 1929–30 – the year that the government encouraged the transformation of Poor Law hospitals into municipal general hospitals through the Local Government Act of 1929. Obituary of John Buchan. Yorkshire Observer, 4 May 1938. Bradford Corporation Health Committee Minutes 30 March 1927. Bradford District Archives BBC 1/21/21. Bradford Telegraph and Argus, 2 March 1964. Medical Officer, 7 September 1929. NA MH 66/477, Public Health Survey Bradford, 1929, p. 4. Ibid., p. 36. Bradford Medical Officer of Health Annual Report, 1919, p. 7. Yorkshire Observer, 22 October 1919. Bradford Council of Social Services, The Texture of Welfare, Bradford, 1923, p. 139. BRI House Committee Minutes, 2 May 1919, WYAS HQ C501/2/9/2/14. George Priestman was a local Quaker businessman, and was Chairman of the Board of Management of the Bradford Royal Infirmary from 1919 until his death in 1942, Yorkshire Observer, 21 April 1942. Priestman to Lord Mayor, 14 July 1919, BRI Special Committee Minutes, West Yorkshire Archive Service, HQ C501 2/15/2. Bradford Royal Infirmary House Committee Minutes, 5 June 1919, West Yorkshire Archive Sservice HQ, C501/2/9/2/14. NA MH 57/2, LGB to Morant 9, 20 January 1920. Ibid. The notion that charity was being exploited at the BRI through the preferential treatment of paying patients was expressed as early as 1903 by the then Chairman of the Bradford Board of Guardians F. W. Bentham, British Medical Journal, 31 January 1903. LGB to Morant NA MH 57/29, 20 January 1920. Both the minutes of the Guardians and the Health Committee are reticent on this point. With the move being a controversial measure, it is likely that initial discussions were informal and therefore were unrecorded. An interview with R. W. Dawson in the Yorkshire Observer gives this date as the initiation for the dialogue. Yorkshire Observer, 1 April 1929. I am grateful to Paul Etherington for this source. Bradford MOH Annual Report, 1920, p. 121. Bradford District Archives 63D75/2, Bradford Union, Lease of St Luke’s Hospital to the Corporation, Bradford, 1920, p. 3. Bradford District Archives BBC 1/21/17, Bradford Health Committee Minutes, 18 July 1923. Bradford MOH Annual Report, 1921, p. 89. Yorkshire Observer, 6 November 1920. Yorkshire Observer, 13 December 1922. Yorkshire Observer, 1 April 1920. NA MH 57/29, Ministry of Health Minute, Lithiby to Lowry, 25 April 1919. British Medical Journal (supplement), 6 November 1920. British Medical Journal, 23 October 1920.

144 Tim Willis 57 C. Buttar, ‘The municipalization of hospitals: the Bradford experiment’, British Medical Journal, 2 October 1920 and 9 October 1920. 58 Yorkshire Observer, 1 April 1920. 59 Bradford Telegraph and Argus, 25 February 1959. 60 J. Buchan, ‘Address to The Trades Council on the St Luke’s Hospital Scheme’, Bradford Trades and Labour Council Annual Report, 1930, Bradford District Archives BDA 66 D83/7/6. 61 NA MH 66/477, p. 39. 62 NA MH 66/477, p. 43. 63 See Chapter 4. 64 J. Buchan, ‘Address to the Bradford Trades Council on the St Luke’s Hospital Scheme’.

Part III

General practice and health insurance

9

Friendly society health insurance in nineteenth-century England1 Martin Gorsky

Introduction The focus of this chapter is the emergence of medical insurance provided by the friendly societies. These were voluntary-sector mutual associations whose activities were later to influence the structure of health care under the early welfare state. Not only was sickness insurance, in Beveridge’s words, ‘the invention of friendly societies’, but the system of panel practice, by which GPs were contracted by the state to attend National Health Insurance (NHI) patients, also built on existing friendly society arrangements for the employment of doctors.2 Indeed, the legislation which established NHI was shaped to accommodate and exploit the existing framework of mutual assurance.3 By the early twentieth century the growth of friendly society medical care had made a consultation with the doctor a ‘customary rather than an unusual thing’ for working-class patients, and the aim of this chapter is to explore the causes and implications of this process.4 Friendly societies, or ‘benefit clubs’, first proliferated in the later eighteenth century, though examples can be traced to at least the 1680s, and both their administrative procedures and fraternal ethos resembled earlier practices of the craft guilds.5 Members paid a small monthly subscription, entitling them principally to a cash sickness benefit when illness prevented them working, and a death benefit for their family. Key elements were the conviviality of the monthly ‘club night’ at which subscriptions were paid, and the solidaristic practices of sick-visiting, ceremonial events and funeral attendance.6 Initially their characteristic form was the independent local club, typically based in an alehouse (where the ‘box’ containing the fund was kept). In the early nineteenth century ‘county’ societies were started by philanthropists seeking to make working-class thrift more sober and financially secure, though these remained a minority. The major development discernible by the 1830s and 1840s was the growth of the ‘affiliated orders’, most notably the Independent Order of Oddfellows Manchester Unity, the Ancient Order of Foresters (AOF), the teetotal Rechabites, and the Loyal Order of Ancient Shepherds. These were national or regional grouping of friendly societies, with central authorities that advised on procedural and actuarial matters, and networks of local branches which adopted

148 Martin Gorsky standardised administrative practices and cultural identities. A range of other lower-cost clubs were classed as friendly societies, including burial societies, which catered principally for death benefits, and slate clubs, in which savings rather than benefits were the priority. Through the nineteenth century, then, friendly societies were the leading form of male working-class associationalism, their members far out-numbering trade unionists. Much friendly society historiography concentrates on their social and political import rather than their welfare role. However, recent work by Green and Riley has shown how sickness benefit developed in the nineteenth century from a simple cash payment, to include the employment of qualified practitioners to assess and treat claimants. Green’s are polemical accounts which argue that friendly society contracting allowed individuals to wield considerable power over self-interested medical professionals, and that this consumer control was sacrificed when statutory insurance began after 1911. For him, friendly societies provide a model for the organisation of a more flexible, responsive and democratic social insurance system.7 Riley’s main concern is the morbidity experience of society members, and his quantitative analysis is supported by detailed examination of the role of doctors employed by the AOF. Broadly he depicts this relationship as cordial, with members receiving medical services of satisfactory quality at a low cost. The present chapter begins with a discussion of the early growth of the movement, assessing the role in its inception of the demand for medical services and protection against new occupational health risks. The second section contains a brief empirical survey of the numbers of friendly society members and the proportion of these with sickness insurance encompassing medical attendance. The central sections focus on the interdependence of the societies and their doctors, the former in their quest for actuarial soundness, and the latter striving for a niche in the ‘overcrowded profession’. The concluding discussion of club practice on the eve of NHI highlights still unresolved questions about the extent of coverage and the impact of demographic change on friendly society medical care.

Sickness and the emergence of the friendly society The earliest national survey of friendly society membership, undertaken in 1803, showed that some 27 per cent of English males over the age of fifteen belonged.8 The clubs’ striking growth in the eighteenth century is often assumed to have arisen from ‘the increasing pauperization brought about by the Industrial Revolution’.9 Beyond such generalisations, explanation has centred on workers’ capacity to buy insurance and the changing nature of risk.10 Standard-of-living optimists stress the greater opportunities for saving and consumption which improved earnings offered.11 The more pessimistic view sees mutual association as essentially a defensive reaction to the heightened lifecycle risks attendant upon new work patterns.12 Both these interpretations have implications for medical history: the former aligning friendly society growth with the commodi-

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149

fication of sickness insurance and medical care, and the latter aligning it with changing occupational health risks. Although it is difficult to generalise about the causes of friendly societies’ foundations, a consideration of their geographical distribution suggests their growth is most plausibly understood as an aspect of the structural labour market change which characterised the eighteenth century. Membership in 1803 was weakest in agricultural counties such as Sussex, Dorset and Berkshire, and strongest in the mining, textiles and metal manufacturing counties, like Lancashire, Derbyshire, West Yorkshire, Stafford and Shropshire.13 Table 9.1 explores the relationship between friendly society membership in the English counties and various economic indicators. Three variables represent the density of membership (both total and female only), and these are set against rates of population growth, numbers on poor-relief and agricultural wage levels. The figures shown are correlation coefficients: where these are in excess of 0.31 (or ⫺0.31) they are considered statistically significant, indicating a greater likelihood that a relationship of some sort exists between the variables under consideration. This analysis shows a positive relationship between membership density and strong population growth, underlining the link with industrialisation, which could stimulate internal migration and higher fertility. There is also a significant negative association with numbers receiving poor relief, and this suggests that benefit clubs flourished in counties with higher employment. There is no obvious relationship between membership and agricultural wage levels, again suggesting sickness benefit was a feature of industrial rather than agrarian England. Workers moving from agriculture into the industrial and service sectors gained from higher wage differentials, but abandoned the implicit contract of rural labour whereby irregular earnings were sustained by perquisites and generous out-relief based on the parish settlement. Rapid urbanisation also undermined stable familial networks which had given support during sickness episodes.14 Table 9.1 Correlation coefficients between friendly society membership density and socio-economic variables in forty-one English counties, 1803

MBR1 MBR2 WOM MED1 MED2 PPR AGW POP

MBR1

MBR2

WOM

MED1

MED2

PPR

AGW

POP

1.00 0.99 0.53 0.11 0.41 ⫺0.54 0.16 0.54

1.00 0.50 0.06 0.42 ⫺0.50 0.16 0.57

1.00 0.13 0.31 ⫺0.56 0.09 0.45

1.00 ⫺0.41 0.11 ⫺0.06 ⫺0.005

1.00 ⫺0.38 0.25 0.49

1.00 ⫺0.31 ⫺0.40

1.00 0.52

1.00

Notes MBR1, 1803 members as % of 1801 population; MBR2, 1803 members as % of 1801 families; WOM, women as % of 1803 members; MED1, number of medical practitioners, 1783; MED2, no. persons per doctor, 1801; PPR, % 1815 pop receiving poor relief; AGW, weekly agricultural wages, 1795, s.d.; POP, population growth rate 1700–1801.

150 Martin Gorsky Given this association between friendly societies and economic growth, can it be argued that working-class sickness insurance was also a product of the burgeoning Georgian medical marketplace? In other words, did the rationale for subscription go beyond income replacement to include the purchase of medical services? Table 9.1 gives some suggestion that friendly society membership was higher in counties with better ratios of doctors to head of population.15 However, this need not imply a relationship. Several counties with high membership density, such as Derbyshire, Lancashire, Staffordshire and Nottinghamshire, were also those with poor practitioner/population ratios (1 : 3,000 or more). Documentary evidence in early society rulebooks does not suggest that doctors were commonly employed before the 1840s, though this does not exclude the possibility that benefits might be spent on medical attendance: for instance, some offered a lying-in benefit of a half or one guinea, corresponding to the level of midwifery fees paid by poorer patients.16 More probably the apparent correlation is coincidental, and doctors’ residential choices were determined by their perception of where wealthier patients were located. Indeed, an increasing ‘regional split’ occurred through the nineteenth century between a ‘well-doctored’ South and poorly provided North, while friendly societies remained concentrated in the industrial North.17 Thus it is equally likely that the relative difficulty of obtaining orthodox medical attendance, either commercially or through the Poor Law, encouraged mutual sickness assurance as an alternative strategy.18 If friendly society growth is unlikely to have been driven by demand for medical services, should it be seen instead as a defensive response to heightened occupational health risks? At first sight this seems unlikely: eighteenth-century crude death rates were highest in the 1720s and 1730s and unexceptional in the period 1770–1800, when the friendly society ‘mania’ began.19 However, national aggregates obscure regional differences and divergent sectoral trends.20 Arguably this period saw a ‘distinctive occupational pathology’, arising from the growth of manufacturing and increased division of labour.21 It also saw the first appearance of a medical literature on occupational health.22 The connection between occupational health and the rise of sickness benefit is most plausible in trades where conditions were worsening. In coal-mining for example, numbers of fatal accidents rose markedly in the later eighteenth century; one estimate suggests the underground workforce faced a one in three chance of a fatality.23 Colliers’ and iron-miners’ friendly societies explicitly responded to such risks. Thus Tipton’s Society of Miners provided a pension in 1805 for any member who met ‘. . . with a misfortune so as to be disabled from getting his Bread’.24 Copper and tin miners experienced similar pressures, with Cornish friendly society membership concentrated in the mining districts of Gwennap and Illogan.25 The high mortality of cutlery grinders in the Sheffield region was notorious, and risk of respiratory disease worsened as production was concentrated in poorly ventilated factories.26 Eden noted in 1797 that in Sheffield ‘almost every manufacturer is a member of a Friendly Society’, and the 1803 survey bears this out: 27 per cent of Sheffield’s population, or 89 per cent of males over fifteen, belonged to a benefit club.27 Innovation also brought

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new dangers, for example in white lead manufacture, where the air-drying of lead paste in open-sided sheds gave way to drying stoves which increased the amount of dust in the air.28 The use of the metal in glazing made lead poisoning commonplace in the pottery industry too, and the Potteries were another early centre of mutuality, with membership running at 25 per cent of population in Stoke and 15 per cent in Burslem.29 Nonetheless, many such occupational health risks had been recognised before the eighteenth century, while there were other trades in which mutuality was well-entrenched where physical hazards were not obviously intensifying.30 For example, the postural, respiratory and digestive illnesses of tailors and shoemakers were hardly peculiar to the period, yet by 1848 these two groups made up 7 per cent of the membership of the Odd Fellows Manchester Unity.31 Furthermore, the emergent literature of occupational health may have been primarily a manifestation of ‘broader currents of social reform’ rather than an unambiguous indicator of a worsening situation.32 How conscious were friendly society members of occupational health risks? Early rulebooks and constitutions sometimes referred to ‘unforeseen calamities’ and ‘sickness dire’ which menaced the ‘Labouring Mechanic’. Rather more ubiquitous were the exclusion clauses, which demonstrate awareness that workplace health risks could mean higher claims.33 Exclusions varied considerably, but trades deemed ‘pernicious’ included painters, plumbers, tilers, plasterers, drug and colour grinders, workers with white lead or mercury, bailiffs, sheriff’s officers, firemen, policemen, miners, soldiers, sailors, publicans, liquor dealers, brothel keepers, gunpowder and firework makers, type founders, needle pointers and brass castors.34 Thus, far from the friendly society being a response to heightened risk, many clubs sought to guard against burdensome claimants. In the West Midlands, Tipton’s Society of Tradesmen refused to pay benefits to members hurt in the ‘Stone or Coal mine’, a local example which demonstrates why miners increasingly organised into separate societies.35 Responses to the 1874 Friendly and Benefit Building Societies’ Commission suggest that discrimination against unhealthy trades gradually disappeared, though separate clubs for miners, colliers and seamen remained; the growth of the affiliated orders with death benefit funds organised at district level was one factor distributing risk more equitably.36 In sum, while new occupational health risks probably contributed to friendly society growth in some areas, they cannot explain the rise of the movement nationally. There were simply too many members in comparatively safe trades, in village societies catering to rural labourers and craftsmen, in female clubs formed to address the ‘. . . equal, if not greater suffering’ to which women ‘. . . are exposed’, and so on.37 Nor was provision of a doctor in times of sickness the original concern. To reiterate, the ‘take-off’ of mutual sickness insurance was an aspect of sectoral labour market change, as uncertain prospects in rural areas were exchanged for higher wages and more buoyant employment in the towns and industrial regions. In the absence of established networks of family and parish welfare, friendly societies met new needs of social and financial support at times of life crisis.

152 Martin Gorsky

The growth and extent of friendly society medical care If the societies’ initial focus was income replacement, when did medical attendance become an aspect of the benefits? While a few clubs employed doctors from the 1790s, the practice was probably uncommon before the mid-nineteenth century. Surviving records of pre-1830 friendly societies in Bristol show only one using doctors, to certify cases of chronic illness and vouch for sick members living at too great a distance for the club stewards to visit; from the 1840s however, medical care of members starts to appear.38 Elsewhere it was earlier. In Devon and Staffordshire, for instance, some friendly societies in the late eighteenth century employed a ‘surgeon or apothecary’ for both the assessment of liability and attendance on the sick, lame and infirm.39 Reports made to the 1874 Commission suggest that employment of club doctors started to become the norm for the affiliated orders from the 1840s, spreading to local societies, workplace sick clubs and occasionally even to burial clubs, but by no means becoming universal.40 Some societies offered medical attendance as an optional extra, some preferred an annual subscription to a dispensary, some paid doctors’ fees on an ad hoc basis, and others feared that a doctor’s presence would raise costs by encouraging the men to ‘go on more’.41 This partiality of coverage renders later estimates of numbers insured for medical attendance dubious, and the problem is compounded by the unreliability of official aggregate membership figures. In 1874, if we make the assumption that all members of the larger affiliated orders and the county societies in England and Wales had access to a club doctor, then coverage extended to about 1.26 million, some 5.5 per cent of the population and 25 per cent of families (based on the 1871 census).42 This is a minimum as it excludes all local societies, for which no membership totals are available. More precise estimates of coverage in particular locales can be made drawing on reports made for the 1874 Commission, though the sample of unions and towns cannot be deemed representative. Table 9.2 sets out this information, showing coverage as a proportion of population and families (as recorded in the 1871 census), first for all friendly societies (columns A and B), and then for those assumed to contract doctors: the local societies and branches of the orders (columns C and D). The oddity here is Macclesfield, where a unique system of cheap burial clubs with medical attendance also covered dependants.43 Excluding Macclesfield, medical coverage in these towns extended on average to about one in ten of the population, or two out of every five families.

Why did clubs employ doctors? This section explores the combination of factors which created a shared interest for practitioners and members in friendly society practice. From the perspective of doctors, club attendance not only eased the problem of building a viable practice, but was also important to claims of professional status and monopoly power. For the societies, the use of the doctor helped by enhancing financial security and adjudicating on claims.

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Table 9.2 The extent of friendly society membership in selected localities, 1874 Place

A B Members as % of: Population Families

C D Sick benefit members as % of: Population Families (estimated)

Poor Law Unions: Ashby-de-la-Zouch Aylesbury Banbury Chester-le-Street Luton/Dunstable Macclesfield Medway Stratford-on-Avon

12 11 11 17 13 84 10 10

54 47 48 78 56 n/a 47 41

11 7 11 15 13 84 6 10

52 30 48 69 56 n/a 26 41

Boroughs: Bradford Bristol Exeter Norwich Oxford Preston

7 11 18 9 7 9

31 50 79 36 31 39

7 10 6 9 6 9

31 43 25 36 28 39

Mean:

16

49*

15

40*

Source: PP 1874 xxiii pt. 2 Friendly and Benefit Building Societies Commission: Reports of the Assistant Commissioners. Note * excludes Macclesfield.

During the first half of the nineteenth century newly qualified practitioners were held to be leaving the medical schools and teaching hospitals at too fast a rate, given the ‘overstocked state of the profession’.44 Part-time posts in hospitals and dispensaries were coveted for the boost to profile and reputation which they gave while the pool of private patients was developed. Less desirable, but still sought after, was the job of Poor Law medical officer, which also offered young doctors an entrée to a new area. As one Poor Law union surgeon put it in 1844: ‘it is by no means an unimportant position for me to hold; . . . I cannot be too much occupied, and I cannot be too much seen, nor can I be too much talked of’.45 However, while competition amongst new entrants to the profession intensified, the Poor Law medical service was becoming less accessible and attractive. The 1834 Poor Law Amendment replaced the system whereby officers were employed by individual parishes with one in which they were engaged by the Poor Law union. As a result, fewer positions were available (at least, in the desirable areas), the increased workload was remunerated at a lower rate, and doctors were appointed on annual contracts, vulnerable to underbidding by a rival who would work for a lower fee.46 This was the situation in the 1830s and 1840s, when friendly society

154 Martin Gorsky attendance was becoming commonplace, suggesting that doctors turned to club practice from the need to increase the number of patients at the low-cost end of the market. In some areas the experiment of medical aid clubs was tried, where Boards of Guardians, local philanthropists or groups of practitioners ran subscription schemes for sickness insurance, but these remained localised.47 Their failure can be attributed in part to the profession’s general view of them as ‘oppressive and unconstitutional’ for encouraging ungentlemanly competition and forcing down fees for private practitioners and Medical Officers.48 Friendly societies were more acceptable to workers who disliked the taint of charity or poverty, and were preferred by most doctors because they kept women and children as private patients and relieved practitioners of the responsibility of administering their own plans. What did friendly society practice entail? First, the medical attendant became the arbiter of actuarial risk, vouching for the good health of applicants, confirming that sickness and lying-in claims were bona fide and, following legislation in 1858, providing death certificates before burial money was paid.49 Second, the doctor was to ‘attend on and provide medicines for the members’, ideally at the patient’s own home.50 The rewards for this varied by region, much like the Poor Law medical service, but payment was most usually made as an annual fee calculated according to the number of members, at rates which generally ranged from two to five shillings per head.51 Attendance was predominantly on the adult male members of the club, although a few societies offered a supplementary subscription to cover treatment of wives and children.52 What did doctors feel about club practice? The complaints of those dissatisfied with the emoluments and conditions of society attendance indicate some resentment at the whip hand held by the clubs in the medical labour market, and fees could be kept down in areas where practitioners were prepared to underbid their colleagues.53 Also, where medical attendants combined to force their price up, societies sometimes responded by grouping together to establish dispensaries and ‘Medical Aid Associations’ which employed their own doctors.54 However, it would be a mistake to conclude from this that friendly society work was uniformly disliked. Generally the editorial tone in professional journals was supportive of provident initiatives, though the suspicion that sometimes wealthy honorary members used club insurance to avoid private fees was a long-running rankle. Otherwise the medical press concerned itself with technical issues, such as the doctor’s right to sue if a contract was terminated early, the questions of whether delirium tremens and venereal disease should be treated under club schemes, and so on.55 Gripes over fees in the Lancet and British Medical Journal arose initially from regional disputes rather than widespread animosity, and the ‘battle of the clubs’ (see Chapter 10) did not occur until the end of the century. By this time the issue of low fees was accentuated by another phase of intense competition to establish practices, coinciding with growing confidence on the part of doctors in the value of their services to the patient.56 What were the benefits to medical men? Club appointments helped young doctors seeking experience and a foothold in a new area. Even though meagre,

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the fixed fees collected by the societies were preferable to bad debts or gratuitous care of impoverished patients.57 Club treatment of male family members helped secure other business at market rates; since ‘the wives of club members are often fruitful vines’, the low returns could be boosted by midwifery fees.58 As far as remuneration was concerned, some clubs readily raised per capita rates from two to five shillings per annum if they valued the doctor’s skills and were convinced that ‘good drugs (would) be more surely forthcoming’.59 The question of whether club attendance diminished professional status is more complex. The 1844 Select Committee on Medical Poor Relief heard that ‘this kind of practice is not in high odour, and that enquiries about it would be disagreeable to the profession’.60 Many doctors were reluctant to list their club work in the London and Provincial Medical Directory, though they assiduously catalogued military, Poor Law, hospital and life assurance appointments.61 However, two aspects of club practice helped to raise doctors’ social status: first, it extended working-class acceptance of qualified practitioners rather than quacks; secondly it entrenched scientific medicine within the fields of life and sickness insurance. Although Poor Law services and medical charities also provided lowerincome patients with access to trained doctors, they had inherent disadvantages which the clubs did not. A request for aid from the union doctor automatically pauperised the applicant and thus deterred usage: pauperisation conferred a stigma and could jeopardise citizenship rights such as claims on endowed charities.62 Nor was access to trained doctors via voluntary hospitals and dispensaries always straightforward, due to the subscriber note admission system; it is likely that those without subscriber patronage were slow to present non-emergency cases.63 Qualified practitioners capitalised on these disadvantages after the 1858 Medical Act ruled that only registered doctors were eligible for club contracts.64 Thus friendly society practice contributed to the extension of scientific medicine’s monopoly power by squeezing quacks from the low-cost end of the market. The second outcome, the elevation of the doctor to arbiter of actuarial risk, was a concomitant of developments within commercial life assurance.65 Medical men were vital to the early nineteenth-century proliferation of life offices – as members of company boards, as promoters of provincial branch offices, and most notably as referees of policy applications.66 Though some were employed directly, GPs also provided letters of recommendation for those seeking insurance to guarantee that they were not suffering from an illness. The profession was eager that this service be considered indispensable and argued that doctors should receive a non-returnable fee for references.67 Life-assurance work quickly became an aspect of medical jurisprudence, and by 1837 University of London students were instructed in the procedure. The conscientious referee was expected to evaluate ‘countenance’, posture and ‘complexion’, to look for tremors and paralysis, to examine the skin and tongue, then the heart and lungs by stethoscope, to enquire after family history of stone or gravel, to establish whether the patient had been vaccinated against smallpox, and to discover if he

156 Martin Gorsky or she abused opium or ‘spiritous liquors’. The afflictions sought included heart, intestinal and kidney problems, dyspepsia, phthisis, gout, fits, and any other diseases ‘tending to shorten or endanger life’.68 Medical opinions on friendly society candidates similarly asserted doctors’ claims to particular skills which lay people lacked. Surviving documents reveal little of the nature of physical examinations. Certification might oblige the doctor to state how long he had known the applicant, and to confirm that he was ‘sober and temperate’ and free of any threatening ‘disorder or infirmity’.69 It is unlikely that certification was a perfunctory exercise: club doctors had a strong incentive to exclude high-risk patients, since remuneration was per capita.70 By contrast the private practitioner writing an honest appraisal for a life company had more to lose, since an unhelpful reference would likely offend a paying patient. Friendly society work was therefore central to doctors’ claims to professional status. A Lancet editorial in 1863 characterised friendly society assurance certification as ‘an illustration of the vast confidence necessarily reposed in members of the medical profession. . . . It is through these societies that medical practitioners become as it were, part of the working machinery which regulates the social happiness and comfort of the operative community’.71 What did the clubs gain from medical men? It may have been the case, as Green has argued, that the employment of doctors on annually renewable contracts encouraged a good standard of care for the patient and held costs down (though Riley shows that fees rose broadly in line with wages).72 However, this was a result of club practice, and not its initial motivation. The evidence from early rulebooks suggests that the policing role of the club doctor came first, and that caring and therapeutic activities developed as an aspect of supervision rather than as a service for the individual patient. Why was the external figure of the doctor, rather than the club steward, given this supervisory task? The medicalisation of the friendly societies occurred when it did because of concerns about actuarial stability. Two problems were paramount: establishing a secure and equitable balance between contributions and payments, and dealing with moral hazard – the risk of duplicitous claims. To some extent the friendly society world militated against false claims, since these were small groups of men from the same social milieu, whose bonds of trust were consolidated through regular convivial activities.73 However, the clubs were never sufficiently local and intimate to preclude moral hazard. From the outset societies varied considerably, from small and tight-knit to large and impersonal. In 1803, average club size in towns with populations above 5,000 ranged from twenty (Yarmouth) to 256 (Beverley), with a mean of ninety-one, and a standard deviation of sixty-nine.74 Foresters’ courts in Bristol between 1860 and 1875 ranged from seventy-two to 392 members, and Odd Fellows’ lodges from sixty-three to 278.75 Large societies could not rely on alehouse sociability to guarantee mutual trust, and even where members were drawn from close residential networks illegitimate claims could prompt branches to ‘discipline their more unruly members’.76 Many were, anyway, apathetic about monthly club night. An Exeter Forester explained that his branch was often inquorate, with attendance down

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from 149 to a nucleus of ten or twelve: many only paid subscriptions quarterly, often through intermediaries.77 It is therefore likely that many clubs were neither sufficiently small-scale nor fraternal to restrain imposition, and it is noteworthy that the adoption by the affiliated orders of sub-Masonic rituals and regalia to create communal ties occurred at much the same time as they began to use doctors.78 Thus it seems likely that club employment was initially intended to check excessive claims. The first societies to employ doctors used them to examine new candidates, to detect fraud, to assess cases where sickness benefit was paid long-term, and to vouch for claimants living at too great a distance for stewards to visit.79 A similar approach was taken by the more impersonal county societies, which eschewed alehouse conviviality, took deposits through agents or savings banks and employed professional actuaries. In 1829, for example, the Hampshire Friendly Society used doctors, much as in commercial life assurance, to certify ‘freedom from any kind of disease, and the appearance of such a state of good health as may justify admission’. Payment of benefit required weekly receipt of a signed certificate detailing the symptoms of the ‘disorder’, and managers urged doctors to expose ‘dishonest and unfounded pretences’.80 Treatment and medication were less to succour an ailing brother, and more to ensure that the funds were not depleted for longer than necessary. The need for professional assessment was maintained in the second half of the century as members aged. Clubs were typically formed around the nucleus of a particular age cohort, so sickness claims would be likely to rise as the society aged and more members became vulnerable to loss of earnings through chronic illness or debility.81 Indeed, it is arguable that some members used friendly society sickness benefit as unemployment benefit or ‘quasi-old age pensions’.82 This in turn underlines the extent to which the doctor’s role was as much to adjudicate on the validity of claims as to cure the claimant.

Club practice on the eve of NHI If friendly society medical attendance had begun as an aspect of management, by the end of the century the curative role was well entrenched. Society members were individual consumers as well as mutual guardians of the club fund, and appreciated the opportunity to secure doctors’ services at a cheap rate. Advances in medical education and diagnostic skills had made practitioners more confident in their ability, and by the 1890s friendly society members were increasingly deferential towards them.83 As Chapter 10 shows, the BMA also became more assertive in its approach to pay and conditions. This final section discusses two aspects of club practice at the turn of the century. First, do the numbers covered for sickness benefit suggest that the voluntary sector was successfully delivering national health insurance prior to state intervention? Second, did the changing morbidity regime challenge the system’s viability? Two approaches have been taken to estimating coverage in the early twentieth century. At one extreme Johnson has relied on registration figures which

158 Martin Gorsky suggest that, by 1911, 4.43 million members had sickness insurance.84 At the other, Green argues that the existence of unregistered societies means that official figures ‘may safely be doubled’ to reach the true number protected: nine million in 1910.85 The former would imply that some 38 per cent of adult males were covered, the latter suggests 82 per cent, and is also rather closer to the 11.5 million covered by NHI in 1912.86 Green’s justification is the opinion which Edward Brabrook, the then Registrar-General, expressed to the 1906 Royal Commission on the Poor Laws, that the 1874 Friendly Societies Commission had supposed the number of unregistered societies to be equal to those which were registered and that ‘Nothing has happened since to lead us to think that the proportion, whatever it was, has been diminished’.87 On closer inspection, however, Green’s estimate appears over-optimistic. The Poor Law Commissioners elicited from Brabrook that the ‘proportion of unregistered societies is a matter which is not within my knowledge’, and that they were most likely dividing societies and slate clubs – small savings institutions rather than sickness insurance providers.88 The Commissioners duly set out only the membership of registered societies.89 Moreover, Brabrook misrepresented the 1874 Commissioners. Their actual conclusion was that about 40 per cent of branches and local societies were unregistered, and this was no more than a guess based on Assistant Commissioner Stanley’s investigations of Oldham and Ashby-da-la-Zouch, coupled with returns from six other unions.90 They excluded various places investigated by Assistant Commissioner Young, where those unregistered were fewer, such as Bristol (where they accounted for 11 per cent of members), Exeter (9 per cent) and Norwich (1 per cent), on the grounds that Young had probably missed ‘a number of small dividing and shop clubs’.91 However, since shop clubs provided additional sick funds organised at the workplace, whose registration would have prevented members remaining in their original clubs, non-registration of these simply disguised doublemembership. Other absent categories were held to be large burial societies and dividing societies – those typically not offering sickness insurance.92 Much else in the Commission is at odds with the claim of under-registration. Stanley noted that the orders now required all lodges and courts to register and that, at least outside Lancashire, ‘this has very generally been obeyed’; otherwise, registration was the norm for the affiliated orders, barring exceptions like the United Order of Free Gardeners.93 Responses from Poor Law guardians testify to widespread registration in many unions.94 The central bodies of the orders increasingly consolidated control over branches, and by 1890 the Registrar associated non-registration only with failing clubs and ‘the smallest and poorest societies’; between 1876 and 1890 the annual number of registrations rose from 301 to 600.95 Precise national figures for those covered by the full friendly society sickness benefit remain elusive. The voluntary sector succeeded in expanding these numbers significantly by the early twentieth century, but there is little justification for significantly inflating the numbers of registered members to estimate eligibility for sickness coverage.96 Low-paid or casual workers, and women

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remained largely outside the safety net, and the high rates at which society memberships lapsed (perhaps 50 per cent in 1895) underscore the insecurity of the system.97 Thus it is safest to conclude that friendly society coverage fell far short of that obtained under the state NHI scheme. Another important question concerns the impact of demographic change on the burden of sickness confronting societies and their doctors. The established view is that the societies faced gathering financial problems as a result of improved life expectation, with a rising elderly population exerting increasing pressure on funds.98 Moreover, Britain’s mortality decline was accompanied by an epidemiological transition characterised by the retreat of acute infectious diseases; thus by the later nineteenth century friendly society sickness claims became ‘typically long-term, seasonal and chronic’.99 An impending demographic crisis may therefore largely explain why, despite some resistance from the leadership, the broad mass of friendly society members welcomed state intervention in welfare provision.100 The most compelling evidence that morbidity rose as death rates fell comes from Riley’s study of AOF records.101 He finds an increase in morbidity rates c.1840–1910 (measured in sick days per member per year), caused by the rising duration of claims as sickness episodes became longer both for elderly members and for younger adults. Riley’s explanation emphasises the growing numbers of frail survivors, who in earlier times would have died of infectious disease; ‘insult accumulation’ (the cumulative impact of illnesses suffered over the life course which diminish the body’s capacity to recover); and medical attendance, which enhanced survival chances. Recent work on individual-level data from a large county society modifies this picture, attributing rising morbidity more firmly to the growing proportion of elderly members, for whom both the incidence and duration of claims were rising; for example, for members aged over fifty years the incidence of claims for heart disease, strokes and digestive and genito-urinary diseases rose, as did the duration of claims for physical injuries, respiratory and skin diseases and musculo-skeletal afflictions.102 Other historians are more sceptical that sickness claims are unproblematic indicators of morbidity experience, pointing to alternative determinants of claim behaviour which may underpin a ‘cultural inflation of morbidity’, such as shifting norms of the ‘sick role’ and the growing wealth of insurance funds.103 MacNicol stresses in particular the changes in the labour market which affected older members, suggesting that doctors colluded in certifying as sick elderly claimants for whom ‘the boundaries between “sickness”, “unemployment” and “old age” were exceedingly blurred’.104 The implication of this is that friendly society acceptance of state welfare was less a product of demographic determinism and more a political response to the plight of those affected by labour market insecurity.105

Conclusion Friendly societies developed in the eighteenth century not to provide medical care but to secure the family against loss of income when the breadwinner was

160 Martin Gorsky sick. Rising occupational health risks in some industries are part of this story, but essentially the clubs were new welfare structures which emerged in response to economic restructuring. The widespread adoption of club doctors occurred in the middle decades of the nineteenth century because it suited the career aspirations of medical men and protected society finances by providing professional certification of sickness. By the late nineteenth and early twentieth centuries members had come to rely on their doctors both for certification and for cure, as professional confidence grew and the duration of sickness claims increased. What still remains controversial is the precise nature of the relationship between friendly societies and doctors in the late Victorian and Edwardian periods. How extensive was sickness insurance coverage? And was there a rise in morbidity which heightened members’ dependence on practitioners, consolidating popular support for NHI? Hopefully these complexities can be unravelled as future historians turn their attention from official sources and national aggregate data to the local archives of the societies themselves.

Notes 1 I wish to thank Bernard Harris, Peter Hennock, John Mohan and Martin Powell for helpful advice. 2 W. Beveridge, Voluntary Action: a report on methods of social advance, London, Allen & Unwin, 1948, p. 81; P. H. J. H. Gosden, The Friendly Societies in England 1815–1875, Manchester, Manchester University Press, 1961, p. 149. 3 E. P. Hennock, British Social Reform and German Precedents: the case of social insurance 1880–1914, Oxford, Oxford University Press, 1987, pp. 114–15, 121, 140–1, 174–9, 188–95, 198, 204–5. 4 J. C. Riley, Sick Not Dead: the health of British workingmen during the mortality decline, London, Johns Hopkins University Press, 1997, p. 49. 5 M. Gorsky, ‘Mutual Aid and Civil Society: friendly societies in nineteenth-century Bristol’, Urban History, 25(3), 1998, 302–22. 6 Gosden, The Friendly Societies, Chs II, III. 7 D. G. Green, Re-inventing Civil Society: the rediscovery of welfare without politics, London, IEA, 1993; ibid., Working Class Patients and the Medical Establishment, Aldershot, Gower, 1985; ibid., ‘Mutuality and voluntarism: a “third way” of welfare reform?’, Social Policy Review, 10, 1998, 75–84. 8 M. Gorsky, ‘The growth and distribution of English friendly societies in the early nineteenth century’, Economic History Review, li(3), 1998, 489–511. 9 H. Levy, ‘The economic history of medical benefit since the Puritan revolution’, Economic History Review, xiv, 1944, 145. 10 B. Supple, ‘Legislation and virtue: an essay on working class self-help and the state in the early nineteenth century’, in N. McKendrick (ed.), Historical Perspectives, Studies in English Thought and Society, in Honour of J. H. Plumb, London, Europa, 1974, pp. 220–21, 225–38. 11 R. M. Hartwell ‘The rising standard of living in England, 1800–50’, in A. J. Taylor (ed.), The Standard of Living in Britain in the Industrial Revolution, London, Methuen, 1975, pp. 103–5. 12 E. P. Thompson, The Making of the English Working Class, London, Penguin, Harmondsworth, 1963, p. 462; N. J. Smelser, Social Change in the Industrial Revolution: an application of theory to the Lancashire cotton industry 1770–1840, London, Routledge and Kegan Paul, 1959, pp. 353, 356 note.

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13 Gorsky, ‘The growth and distribution of English friendly societies’; N. F. R. Crafts, British Economic Growth during the Industrial Revolution, Oxford, Oxford University Press, 1985, pp. 65–8. 14 Gorsky, ‘The growth and distribution of English friendly societies’. 15 Simmons’s Medical Register of 1783, see J. Lane, ‘The medical practitioners of provincial England in 1783’, Medical History, 28, 1984, 353–71 (Yorkshire is excluded from this exercise). 16 Fees: A. Digby, Making a Medical Living. Doctors and Patients in the English Market for Medicine, 1720–1911, Cambridge, Cambridge University Press, 1994, pp. 255–6; I. Loudon, Medical Care and the General Practitioner 1750–1850, Oxford, Oxford University Press, 1986, pp. 95–7; rulebooks: The National Archives: Public Record Office (TNA:PRO) FS 1, 315, 553, 640. 17 Digby, Making a Medical Living, pp. 20–23; M. Purvis, ‘Popular Institutions’, in J. Langton and R. J. Morris (eds), Atlas of Industrializing Britain, Methuen, 1986, p. 195. 18 Northern under-provision: Third Report from the Select Committee on Medical Poor Relief, PP 1844 ix, pp. 113, 696, 728–9; H. Marland, Medicine and Society in Wakefield and Huddersfield, 1780–1870, Cambridge, Cambridge University Press, 1987, pp. 57–8. 19 E. A. Wrigley and R. S. Schofield, The Population History of England 1541–1871: a reconstruction, Cambridge, Cambridge University Press, 1981, p. 529; quotation: B. Supple, The Royal Exchange Assurance: a history of British insurance, 1720–1970, Cambridge, Cambridge University Press, 1970, p. 54. 20 M. J. Dobson, From Old England to New England: changing patterns of mortality, Oxford, Oxford University Press, 1987, pp. 18–21. 21 J. Rule, The Labouring Classes in Early Industrial England, 1750–1850, London, Longman, 1986, p. 138; ibid., The Experience of Labour in Eighteenth-Century Industry, London, Croom Helm, 1981, Ch. 3. 22 Thomas Percival, Observations on the State of the Population in Manchester, 1789; William Heberden, Observations of the Increase and Decrease of Different Diseases, 1801; Charles Turner Thackrah, The Effects of the Arts, Trades, and Professions on Health and Longevity, 1831 edn, London, W. H. Smith, 1989; James Phillips Kay, The Moral and Physical Condition of the Working Classes, 1832, pp. 57–61. 23 Thackrah, The Effects of the Arts, pp. 86–9; M. W. Flinn, The History of the British Coal Industry 2 1700–1830: The Industrial Revolution, Oxford, Oxford University Press, 1984, pp. 412–29. 24 TNA:PRO FS 1 639, 253. 25 Abstract of Answers, P.P. 1803–4, xiii; Rule, The Experience of Labour, pp. 84–5. 26 Thackrah,The Effects of the Arts, pp. 92–4; D. Hey, The Fiery Blades of Hallamshire: Sheffield and its Neighbourhood, 1660–1740, Leicester, Leicester University Press, 1991, p. 103. 27 F. M. Eden, The State of the Poor, Vol. III, 1797 edn, Bristol, Thoemmes Press, 1994, p. 873; Abstract of Answers, P.P. 1803–4, xiii. 28 D. J. Rowe, Lead Manufacturing in Britain: a history, London, Croom Helm, 1983, p. 211; Thackrah, The Effects of the Arts, pp. 103–6. 29 Ibid., pp. 120–21; Rule, The Experience of Labour, p. 79; Abstract of Answers, P.P. 1803–4, xiii. 30 Rowe, Lead Manufacturing, p. 209; F. E. Halliday (ed.), Richard Carew of Antony: the survey of Cornwall, 1692 edn, London, Melrose, 1953, pp. 92–5. 31 Thackrah, The Effects of the Arts, pp. 25–8, 30–31; Gosden, The Friendly Societies, p. 74. 32 P. Weindling, ‘Linking self help and medical science: the social history of occupational health’, in P. Weindling (ed.), The Social History of Occupational Health, London, Croom Helm, 1985, p. 12.

162 Martin Gorsky 33 TNA:PRO FS 1 259B, 479, 1 (Gloucs) 555. 34 Bristol Record Office, Quarter Sessions Papers (BRO QS) 1, 5, 6a, 9, 31; TNA:PRO FS 1 (Gloucs) 581. 35 TNA:PRO FS 1 639, 255 (1807); Gosden, The Friendly Societies, pp. 82–7. 36 PP 1874 xxiii pt. 2 Friendly and Benefit Building Societies Commission: Reports of the Assistant Commissioners, Cheshire Derbyshire . . . by Hon. E. Lyulph Stanley (Stanley); Southern and Eastern Counties of England by Sir George Young, Bart, PP 1874, xxiii pt. 2 (Young), p. 472. 37 BRO QS 14 (1800); D. Neave, Mutual Aid in the Victorian Countryside: friendly societies in the rural East Riding 1830–1914, Hull, Hull University Press, 1991. 38 BRO QS 10 (1827), TNA:PRO FS 1 3, 548 (1847), 580, 581, 626, 716. 39 TNA:PRO FS 1 626, 20, 24; FS 1 69, 1, 7. 40 Stanley, pp. 266, 269–70; Young, pp. 453–6, 481, 487, 507, 528, 534–6, 539–40, 565, 567. 41 Stanley, p. 386; Young, pp. 546, 555, 578. 42 Membership: Gosden, The Friendly Societies, pp. 30, 38, 46, 54, I have deducted 100,000 to take account of affiliated orders’ members outside England and Wales; Census 1871, England and Wales, no. families: Vol. 4, p. xxi. 43 Stanley, p. 265. 44 Lancet, 27 January 1849; Loudon, Medical Care, pp. 306–9. 45 S.C. on Medical Poor Relief, PP 1844 ix, p. 185. 46 Report from the Select Committee on the Poor Law Amendment Act (1838), p. 24; Lancet, 16 April 1836, 18 June 1836, 25 August 1838; Loudon, Medical Care, pp. 238–9; M. A. Crowther, The Workhouse System: the history of an English social institution, London, Methuen, 1981, p. 158. 47 S.C. on Medical Poor Relief, PP 1844 ix, pp. 107, 738, 635–6; R. G. Hodgkinson, The Origins of the National Health Service: the medical services of the new Poor Law 1834–1871, London, Wellcome, 1967, Ch. 8; Lancet, 18 June 1836, 9 July 1836, 17 August 1836, 24 October 1840. 48 Lancet, 9 July 1842, 15 November 1846, 6 December 1846. 49 TNA:PRO FS 1 (Gloucs) 580; Stanley, p. 409; Hodgkinson, The Origins of the National Health Service, pp. 604–5. 50 TNA:PRO FS 1 (Gloucs) 581. 51 Stanley, pp. 305, 398; Young, pp. 481, 528, 547, 558–9; ‘An investigation into the economic conditions of contract medical practice in the United Kingdom’, British Medical Journal, ii (supplement), 1905, 22 July, pp. 12–15, 35–6. 52 Young, pp. 481, 507, 556. 53 Green, Working Class Patients, pp. 12–32; Loudon, Medical Care, pp. 254–5. 54 Lancet, 14 June 1854, 11 October 1856, 25 November 1865, 3 August 1867, 24 October 1868, 2 December 1870, 11 December 1869, 20 August, 17 September 1870, 28 January 1871, 28 September 1878; Stanley, pp. 404–5; Green, Working Class Patients, pp. 21–7; British Medical Journal (supplement), p. 44, q. 2555; Levy, ‘The economic history of medical benefit’, p. 157, note 1. 55 Lancet, 27 May 1848, 28 June 1856, 6 July 1867, 7 November 1863, 17 September 1870, 8 October 1870, 10 June 1871, 11 September 1873, 17 October 1874, 11, 18, 25 November 1876. 56 Green, Working Class Patients, pp. 27–9; E. Shorter, Bedside Manners: the troubled history of doctors and patients, Harmondsworth, Viking, 1986, Ch. 4; Digby, Making a Medical Living, pp. 123–4, 146–8. 57 Ibid., pp. 155–6, 249–52; Loudon, Medical Care, p. 263; Riley, Sick Not Dead, p. 86. 58 Lancet, 22 January 1870. 59 Lancet, 6 April 1878, 3 November 1877. 60 Third Report from the Select Committee on Medical Poor Relief, PP 1844 ix, p. 635.

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61 London and Provincial Medical Directory, e.g. for Sheffield (1848, 1858, 1868) only three friendly society doctors were listed, all 1868. 62 Hodgkinson, The Origins of the National Health Serivce, pp. 8, 24, 129; Minutes of Evidence Taken Before the Select Committee on Medical Relief, PP 1854 xii, pp. 503–5. 63 B. Abel-Smith, The Hospitals 1800–1948, London, Heinemann, 1964, pp. 35–7; F. B. Smith, The Peoples’ Health 1830–1910, 1979 edn, Aldershot, Gregg, 1993, pp. 253–5. 64 C. Newman, The Evolution of Medical Education in the Nineteenth Century, London, Oxford University Press, 1957, pp. 154–8. 65 M. W. Dupree, ‘Other than healing: medical practitioners and the business of life assurance during the nineteenth and early twentieth centuries’, Social History of Medicine, 10(1), 1997, 79–103. 66 Supple, The Royal Exchange Assurance, pp. 24, 54–6, 104, 111–17, 136–7, 177; C. Trebilcock, Phoenix Assurance and the Development of British Insurance, Volume I 1782–1870, Cambridge, Cambridge University Press, 1985, pp. 530, 570–1, 608; E. P. Leigh-Bennett On This Evidence, London, Baynard, 1936, pp. 51, 53–4, 114; W. Schooling, The Standard Life Assurance Company 1825–1925, Edinburgh, Blackwood, 1925, pp. 30, 52, 113. 67 Lancet, 27 January 1849, 2 February 1850, 9 July 1859, 15 September 1860, 3 January, 8 February, 1 March 1860, 11 January 1862, 7 November 1863, 2 May, 15, 29 August 1868, 9 January, 6 March, 19 June, 28 August 1869. 68 A. T. Thomson, ‘Lectures on medical jurisprudence’, Lancet, 18 February 1837. 69 Young, p. 599. 70 Young, p. 507. 71 Lancet, 7 November 1865. 72 Riley, Sick Not Dead, p. 91. 73 H. Southall, ‘Neither state nor market: early welfare benefits in Britain’, in A.-M. Guillemard (ed.), Comparing Social Welfare Systems in Europe: Volume 1, Paris, MIRE, 1996, pp. 77–8. 74 Abstract of Answers, PP 1803–4, xiii. 75 Abstract of the Quinquennial Returns of Sickness and Mortality experienced by Friendly Societies for the Periods between 1855 and 1875, PP 1880 lxviii. 76 S. d’Cruze and J. Turnbull, ‘Fellowship and family: oddfellows’ lodges in Preston and Lancaster, c. 1830–1890’, Urban History, 22, 1995, 25–47, 46. 77 Young, pp. 482, 547–8, 576. 78 W. G. Cooper, The Ancient Order of Foresters Friendly Society, 150 Years, 1834–1984, Ipswich, Ancient House, 1984, pp. 4, 7–10, 16–17; S. J. Brown, ‘Friendly societies and their symbols and ritual’, Group for Regional Studies in Museums, 10, 1982, 7–11; Odd Fellows’ Magazine, lxxxii (907), 1951, 143–4; J. J. Turner, ‘Friendly societies in South Durham and North Yorkshire c. 1790–1914: studies in development, membership characteristics and behaviour’, unpublished PhD thesis, University of Teesside, 1992, pp. 331–2. 79 TNA:PRO FS 1 71, 34; FS 1 626, 24; BRO QS 10 rules 8, 13. 80 Hampshire Record Office 18M89/2/1 HFS, Minutes of the Board of Management, 7 December 1829, 3 August 1833, 18M89/3/5, /170, HFS Annual Report, 1830, 1877. 81 Stanley, pp. 206, 346; Young, p. 587; Turner, ‘Friendly societies’, pp. 205–11; Riley, Sick Not Dead, p. 81. 82 Southall, ‘Neither state nor market’, pp. 72–6; Young, p. 589; J. MacNicol, The Politics of Retirement in Britain, 1878–1948, Cambridge, Cambridge University Press, 1998, p. 118. 83 Shorter, Bedside Manners, Chs 4 and 5; Digby, Making a Medical Living, pp. 312–13, 315–16; Riley, Sick Not Dead, pp. 115–22. 84 P. Johnson, Saving and Spending: the working-class economy in Britain 1870–1939, Oxford, Oxford University Press, 1985, p. 57.

164 Martin Gorsky 85 Green, Working Class Patients, p. 95. 86 N. Whiteside, ‘Counting the cost: sickness and disability among working people in an era of industrial recession, 1920–1939’, Economic History Review, 2nd series xl(2), 1987, 228–46, esp. 230. 87 Royal Commission on the Poor Laws and the Relief of Distress (hereafter RCPL), Appendix III, evidence of Edward Brabrook, PP 1909 xl, pp. 999–1012, q. 35147. 88 Ibid., qs. 35174–35181. 89 RCPL: Majority Report, 1909, Part 2, p. 75. 90 Friendly and Benefit Building Societies Commission: Fourth Report of the Commissioners (Fourth Report), PP 1874 xxiii pt. 1, pp. 153–5. 91 Young, pp. 479, 481, 491–2, 506; Fourth Report, p. 155. 92 Ibid., pp. 158–9, 160, 163, many societies prohibited double membership; see also Fourth Report . . . Appendix xvi p. 281, Northern Counties, p. 788, Third Report . . . Minutes of Evidence, p. 146, A. Blyth qs. 27152, 27157, p. 150, H. Longley q. 27,258; Turner, ‘Friendly Societies’, p. 141. 93 Stanley, pp. 217, 296–7; Young, pp. 447, 450, 479. 94 Fourth Report . . . Appendix xiii, pp. 35–8. 95 Gosden, The Friendly Societies, pp. 213–15; Report of the Chief Registrar of Friendly Societies and Trade Unions & co., PP 1890–91 lxxix, p. 205, registration figs. pp. 41–2 (original pagination) relate only to local societies (1876, 118; 1890, 216) and branches of the orders (1876, 183; 1890, 384). 96 B. Harris, The Origins of the British Welfare State: Social Welfare in England and Wales, 1800–1945, Basingstoke, Palgrave, 2004, pp. 81–4. 97 MacNicol, Politics of Retirement, p. 114. 98 B. B. Gilbert, The Evolution of National Insurance in Great Britain, London, Michael Joseph, 1966, pp. 171–3. 99 Marland, Medicine and Society, pp. 202–3. 100 See MacNicol, Politics of Retirement, pp. 119–20, 125; J. H.Treble, ‘The attitudes of friendly societies towards the movement in Great Britain for state pensions, 1878–1908’, International Review of Social History, 15, 1970, 266–99. 101 Riley, Sick Not Dead, p. 123, Ch. 6. 102 M. Gorsky and B. Harris, ‘The measurement of morbidity in inter-war Britain: evidence from the Hampshire Friendly Society’, in I. Borowy and W. Gruner (eds), Facing Illness in Troubled Times. Health in Europe in the Interwar Years, 1918–1939, Berlin: Peter Lang Verlag, 2005, pp. 129–63. 103 M. Gorsky, C. Edwards, B. Harris and A. Hinde, ‘Sickness, insurance and health: assessing trends in morbidity through friendly society records’, Annales de Demographie Historique, 1, 2003, 131–67; J. E. Murray, ‘Social insurance claims as morbidity data: sickness or absence?’, Social History of Medicine, 16, 2003, 225–45. 104 MacNicol, Politics of Retirement, pp. 129–31. 105 Ibid., p. 136.

10 ‘Strong combination’ The Edwardian BMA and contract practice1 Andrew Morrice

The British Medical Association . . . is a powerful combination. It has numbers, it has a sound working scheme, and all its members are perforce educated people who do not hanker after trade union methods, but merely desire the fair treatment that will enable them to do their work under proper conditions.2 . . . the public . . . regard anything in the nature of a cry for reform among medical men either as proof that the ranks of the profession are overcrowded, or as a design upon the part of certain operatives banded together by a mysterious tie called medical etiquette, to strike for higher pay.3 Squire Sprigge, Medicine and the Public, 1905

Introduction The concern of this chapter is the campaign conducted by the British Medical Association (BMA) in the early twentieth century to improve the pay and conditions of doctors working in ‘contract practice’. This was the contemporary term for any medical work provided on a subscription or capitation basis, as opposed to the fee-for-service payments customary in private practice. Numerous types of organisation employed doctors to provide contract medical services, and these became an important source of income for the majority of family practitioners.4 They ranged from the friendly societies (like the Foresters and Oddfellows) through provident dispensaries and works schemes (such as colliery medical clubs) and included commercial concerns such as medical aid societies and life assurance companies. These were, almost without exception, lay-controlled organisations, but the term ‘contract practice’ was also applied to private doctors’ clubs organised by doctors themselves and to employment in the public medical services.5 They offered a wide variety of benefits to their members, of which medical attendance could be but one, and this variety was further compounded by widely varying rates of capitation, rules, rates for family members and terms of service. The attitudes of doctors, organisers and users of these services also varied in each locality. Numbers covered by contract practice are difficult to estimate, owing to uncertainty over the proportion of friendly societies which offered a sickness benefit; the most optimistic estimate is that three-quarters of those eventually

166 Andrew Morrice covered by National Insurance were already covered for medical attendance by mutual aid organisations.6 By the close of the nineteenth century, however, relations between doctors and lay organisers were deteriorating rapidly in many areas, and the sporadic ‘local difficulties’ that had occurred previously were becoming more complex and rancorous. Broadly, the objections were that capitation rates were too low to provide a reasonable standard of medicine without pauperising the doctor, that subscribers or organisers were too demanding or clinical workload unreasonably onerous, and that people who were wealthy enough to afford full private fees were subscribing to contract arrangements. Doctors began to use professional bodies such as the Medical Defence Union, the BMA and General Medical Council (GMC) to redress their grievances, and friendly societies for their part organised new forms of contract practice to overcome opposition, such as medical institutes which employed a full-time medical officer. The BMA’s campaign attempted to cut off the supply of doctors to organisations which did not operate according to principles the Association had laid down. This was enforced by the threat of professional ostracism and boycotting of doctors who continued in posts of which the local BMA branches disapproved.7 However, in many instances where organised resistance was tried, there were local or incoming doctors willing to enter into these contracts or to undercut the rates of their professional brethren. Thus whilst contract practice had begun as a concession to the sick or provident poor and as a useful way to build up a practice, many felt it had become nothing more than a systematic method of obtaining medical attendance at a low price. The chapter will provide an account of the campaign against contract practice. Its central contention is that this was not just an issue of pay, and indeed the increase in remuneration required by many doctors was very modest. Rather, the campaign reflected a clash between the whole nature and organisation of contract practice and the professional ideals of medico-politically active doctors. The clash occurred in a society that was keenly aware of fine social distinctions and complex hierarchies, in which the professional ideals of Edwardian practitioners were based in part on an aspiration to gentility.8 Statements and assumptions that doctors were gentlemen are common in the medical literature of the time.9 However, the actual conditions of work and levels of remuneration in contract practice did not always fit with this ideal.10 Doctors sought control of contract services not least to ensure their pay reflected their putative status as gentlemen. Perkin’s comment that ‘due to a trick of the English language . . . “Profession” came to mean an occupation which so effectively controlled the market that it never had to behave like a trades union’ brings us neatly to the heart of the problem.11 The Edwardian profession was still working to gain effective control of the market. In the struggle to alter contract practice arrangements and become more gentlemanly and less tradesman-like, the profession had to use the methods and tactics of a trade union, whilst remaining reluctant to recognise that the BMA was acting as such. The BMA was not registered as a

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trade union until 1971, but in this context it is clear that it was far from being purely a ‘friendly and scientific’ gentleman’s club.12 Although the discussion here will be from the perspective of the BMA’s national committees, it is important to emphasise that much of the effort to alter the organisation and remuneration of contract practice was made at a local level. The BMA during this period existed not only to represent its members, but also to empower and advise local groups of doctors which had considerable freedom to act. It was local BMA divisions and branches that decided which contract practice posts in their area were unacceptable; the central organisation supported this and refined the mechanism (most elements of which had been proposed by local groups) by which a boycott was carried out. At the heart of the boycott scheme were the so-called ‘ethical rules’.13 These were essentially a framework within which local groups of doctors could meet and condemn the behaviour of a practitioner as ‘contrary to the honour and interests of the medical profession’. The behaviours or activities which could attract censure were not defined exclusively by a written list, or even specific written principles. Instead, local groups were, in accordance with the ideal of gentlemanly behaviour, seen as ‘courts of honour’, able to adjudicate questions of professional conduct.14 A second core theme of this chapter is an emphasis on continuity in a period which is usually considered one of profound change. The National Insurance Act is often seen as pivotal in the social and medical history of early twentiethcentury Britain. However, from the standpoint of the BMA and its campaign against contract practice it may be argued that the coming of statutory National Health Insurance (NHI) changed remarkably little. Many of the new panel patients experienced similar treatment to that received under contract practice, often because they were exactly the same people, belonging to the same societies.15 Medical opposition to the Act, and the changes known as the ‘Cardinal Points’ which the BMA tried to win from Lloyd George, were largely formulated during the Association’s organised campaign against the various collecting societies, which would administer the medical and other benefits of NHI.16 The boycott scheme was left in place and actively used all through this period, and was only altered in 1920.17 The Associations’ success in enshrining in the Act at least some of the principles and practices for which they had already long been fighting explains the fact that the outcome of the Insurance Crisis of 1911–12 was widely seen at the time and since as a victory for the profession.18 Under its provisions the incomes of general practitioners rose steadily, and the power of the friendly societies over individual doctors was reduced by the Insurance Committees, on which both doctors and societies were represented. Rates of pay were no longer set locally, and the system was open to all doctors – not just those selected by the societies.19 A less agreeable form of continuity was the retention of characteristics that had offended local doctors by some of the contracting organisations which now became ‘approved institutions’ for administering NHI. In South Wales in particular, and possibly elsewhere, Section 15(3) of the Act was used to set up and run contract practice arrangements that had all the features so deplored by doctors before 1912.20

168 Andrew Morrice The analysis will begin with a survey of the doctors’ grievances against contract practice as they developed at the turn of the century. It will then explore the growth of conflict between the profession and contracting organisations, culminating in the BMA’s survey of contract practice in 1903–05. The following section examines the ramifications of this, with the emergence of the boycott arrangements and the consolidation of the BMA’s position in the period of policy debate which led up to NHI. In the concluding discussion, the longerterm significance for the profession and its self-identity will be considered.

The doctors’ complaints Following a contract practice dispute in Cork in 1894, which became known as ‘The Battle of the Clubs’, the Lancet started a regular column under the same title and employed a special correspondent, Adolphe Smith, to travel around Britain reporting on local contract practice disputes. The British Medical Journal also ran regular columns entitled ‘Contract Medical Practice’ from 1900 onwards.21 These columns contain a wealth of information on doctors’ attitudes to contract practice, which was no longer seen as a question of supporting a charitable effort to relieve the sick poor. One noted that The members of these societies, if not satisfied with their club doctor, can, and often do afford to employ another medical man, and when required most of them can find a consultant’s fee. Many of them draw more money in sick pay than they get in wages. Hence they can afford to engage two doctors, and we find that one man’s club patient is another man’s private patient. . . . There was a time when the doctor bled the patient; now the patient bleeds the doctor.22 The important element of class-consciousness in doctors’ objections to contract practice is illustrated by this Nottinghamshire practitioner, writing after a speech by a miners’ leader, which noted the workers’ 60 per cent increase in pay over thirteen years. This speech, he said, made very interesting reading for the medical men in the Teversal district . . . [these miners] are the same men who in 1896 reduced their club doctors salary [sic] by 1s. per head per annum, and 1901 dismissed them when they refused to attend their wives in confinement at a rate 50% below that current in the district . . . working men are frequently most tyrannical . . . argument does not appear to have much effect . . . if the medical profession wants justice it will have to fight for it, and by strong combination show the workmen’s associations that it is able to follow their example.23 A Dr Ballie McKnee, discussing the ‘unmitigated evil’ of contract practice, drew attention to ‘an ever-increasing tendency to the reduction of our earnings to a mere living wage’. However, ‘the artisan’ now enjoyed:24

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a degree of prosperity hitherto unknown. Combination [that is, trades unionism] has greatly increased his earnings . . . the working class patient is today more capable than formerly of appreciating careful treatment, and paying for it. To contrast contract practice with ‘careful practice’ he quoted another writer on the subject, a Dr Larking who opined:25 We all know what club practice of the present day means. A list of stock mixtures is kept containing drugs which possess the common virtue of being cheap – magnesium sulphate, ammonium carbonate, potassium bromide and ‘sacch. ust.’ are useful in this particular. Sodium Salicylate, bismuth, cinchona and potassium iodide are seldom used. Then how can a medical man visit 40 or 50 patients a day, many of them very ill, diagnose their ailments, sign their certificates, and give general directions as to diet? How can it be done when perhaps he has to travel three miles in one direction and three miles in another? I must confess it is done in many cases, and it speaks well of the physical and mental capacity of the club doctor that more calamities do not take place. Larking thought that club practice was not just dangerous, but demoralising. Any doctor who loved the intellectual challenges of disease and its scientific investigation ‘could not possibly continue at this work. He would become either heartbroken or he would degenerate into a machine . . .’.26 It was also unremunerative. Larking ‘unhesitatingly’ blamed contract practice for the situation where for most doctors ‘reasonable provision for old age, after family expenses are met is too often a practical impossibility’.27 It was also widely held that the subscription rates of contracts and best medical practice were incompatible, especially when doctors were expected to pay for all medicines, splints, plasters and appliances from the capitation money of perhaps a halfpenny per patient per week.28 The gulf between club and commercial rates was demonstrated by one doctor who set a fracture for a patient whose club practitioner was unavailable. He charged his colleague, who received 3s per patient per annum, 10s 6d for the work. Not all doctors agreed that radical steps were needed, however. ‘Medicus’ commented that doctors lost out by complaining about conditions of service, citing his loss of £400 per annum in earnings when local clubs organised into a Friendly Societies Association, adding that they had ‘no difficulty in getting in a man’. He went on:29 what we lose (and it is doubtful if we do) on individual club members we gain through attendances on their families, hence the folly of any aggressive attitude on our part. Many correspondents felt that the ease with which clubs could replace their doctors was the main obstacle to reform. The Cork ‘Battle of the Clubs’ had

170 Andrew Morrice demonstrated that unified action on contract practice could be effective, and here, as in many other places, the issue had been doctors’ demands for a wage limit to exclude well-to-do subscribers from the rolls of the city’s medical clubs. This and other reforms were refused, and the Cork doctors resigned their posts en masse, forming an alternative subscription service controlled entirely by themselves. The response of their former employers was to bring in more doctors from outside the city to attend their subscribers. The Cork medical men reacted with a unified refusal to meet [the imported men] as professional brethren. The imported men made little headway . . . patients deserted the clubs in large numbers, and returned on fair terms to their original medical advisors . . .30 Correspondents had many practical suggestions to make. For instance, one Sheerness doctor urged any readers interested in a particular post in the town to contact him first.31 Others pressed for a systematic survey of contract practice.32 Many were of the opinion that only total medical solidarity could break the control of friendly societies. One correspondent, signing himself ‘Unionist’, suggested that ‘due warning’ should be given in medical press of posts offered by offending societies, and any man ‘showing any inclination to accept . . . [should be] . . . waited on by a deputation from the medical men, and the facts fully explained.’ He went on:33 should any medical man have the temerity to accept it after this warning, I would do more than merely ostracise him, I would boycott him. Ostracism would affect this class of man very little, having no esprit de corps, he cares nothing for his professional brothers. . . . But a real, active and aggressive boycott would be different. . . . If the profession means to really fight this question, this is the way to begin.

Organising against contract practice One method of attacking contract practice was to define certain aspects as unethical. For example, some societies cut the cost of medical care by paying unqualified assistants to do routine work under a doctor’s supervision – an activity which became known as ‘covering’. Another practice to which BMA activists objected was the use of door-to-door canvassers paid on commission, a practice considered overly commercial.34 A GMC committee report of 1893 condemned many of these working practices, but provided no general statement on the issue.35 By 1905 it decided to produce a written notice of some of the behaviours or activities that could attract a charge of ‘infamous conduct in a professional respect’, and advertising, canvassing and covering were amongst seven offences given as punishable by erasure from the Register.36 Thus any doctor working for a society which advertised or canvassed or employed lay assistants could be found ‘guilty of infamous conduct’ and struck off. This simultaneously defined

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many clubs as ethically beyond the pale, and provided an important bargaining tool. The agitation against contract practice was furthered by the new structure of the BMA. This followed the Manchester Medical Guild’s conference in 1900, which discussed organising GPs through effective local associations and an annual conference.37 Alfred Cox, later BMA Medical Secretary (1912–1932), proposed that local medico-ethical societies and associations and the new proposed annual conference be combined to make the BMA ‘an energetic body, really representative of the majority of the profession’.38 This motion set in train the complete reorganisation of the BMA, which included an Annual Representative Meeting (ARM) elected by the local organisations, which would be able to steer BMA policy on ‘political and ethical’ issues.39 BMA members now automatically belonged to their local division, which was intended to act in matters of conduct and contract practice as ‘a court of honour [enabling] a system of ethical conduct to be evolved’.40 Despite the fact that the BMA was not officially a trade union, but rather a learned society and a company limited by guarantee, Squire Sprigge was not simply employing a colourful metaphor when he described the new BMA as ‘a fine fighting machinery’.41 All the procedures and rules underpinning what became the boycott scheme were put in place during the three years after the reorganisation of the BMA, following another motion by Alfred Cox.42 This instructed the Ethical Committee (later Central Ethical Committee, CEC) to investigate the ethics of GPs’ in contract practice ‘canvassing and holding of posts which their colleagues generally have declined’. The CEC also developed rules of conduct for the divisions, and much of its work between 1902 and 1906 was to consider, amend and approve ethical rules drafted by local organisations.43 Based largely on these it devised a set of model rules known as the ‘Bradford Rules’ after their approval at the Bradford ARM of 1905, which were used by a majority of divisions; Rules F, G and Z formed the heart of the boycott scheme.44 A permanent Contract Practice Sub-Committee (CPSC) was formed, which met between six and eight times a year to monitor the progress of various disputes around the country and advise local groups of doctors.45 The Medical Secretary, for instance, went to advise the Coventry doctors in their dispute with the Provident Dispensary.46 A central Emergency Fund was also set up to support local divisions in dispute, to which BMA members were asked to contribute along with their subscription renewals.47 Another important component of the boycott was the ‘Warning Notice’ in the British Medical Journal, later known as the ‘Important Notice’ in 1914, but widely known as ‘The Black List’, which was compiled initially by the CPSC but later by the Central Ethical Committee and Medical Secretary.48 These notices allowed local BMA leaders to warn off potential applicants by giving a list of areas in which doctors considering vacant contract posts were advised to communicate with the Secretary of the local division before proceeding.49 How did the boycott work? Any division could declare the holding of any post against its rules, or contrary to the honour and interests of the profession,

172 Andrew Morrice and if concerned was obliged to notify all members of the identity of any practitioner (regardless of his BMA membership) whose ‘conduct’ was ‘detrimental to the honour and interest of the profession’ or in breach of the local rules. Such a practitioner could only be met with in a medical emergency, and any doctor who otherwise professionally met or recognised an ostracised practitioner (in a consultation, for example) had to explain his actions to the local division, which could investigate and, if dissatisfied, ostracise him in turn. Such doctors could be expelled from the Association, and it was also possible for one division of the BMA to communicate details of ostracism to any other branch or division, which could then also participate. Significantly, the question of when the ostracism would be lifted does not appear in the committee minutes or published model rules. This social and professional isolation had far reaching implications. A practitioner relied heavily on colleagues to act as ‘consultants’ on difficult cases, or to provide surgical skills. The boycotted doctor was thus left without medical support of any kind, quite apart from the social stigma of being made a pariah.

The BMA investigation into contract practice, 1903–05 Whether by accident or design, 1905 was the year in which the boycott scheme crystallised. The GMC published its own ‘Warning Notice’ outlawing many methods used by friendly societies, in addition to the British Medical Journal’s notice; the Bradford Rules allowing organised ostracism were approved; and Squire Sprigge published his apologia for reform in Medicine and the Public. The year also saw the publication of the ‘very voluminous’ ‘Investigation into the Economic Conditions of Contract Practice in the United Kingdom’ on which the Medico-political Committee had been working since 1903, following Alfred Cox’s original motion.50 This investigation had been carried out by sending lengthy questionnaires to 12,000 practitioners. Doctors were asked to answer between thirteen and eighteen questions on each contract under which they worked, as well as some general questions about their attitudes to contract practice and the possibility of organised opposition to it. Detailed answers were required – for example: ‘What is your experience of the amount of medical attendance required per member per annum: (a) visits, (b) consultations at surgery, (c) medicine?’ Much more detail than had been sought was in fact provided under this and other headings, which was evidence of ‘already well-kept books’.51 Yet the overall response rate was low, with only 1,548 (12.9 per cent) questionnaires returned, giving information on about 2,300 contract practice posts; of the respondents, only 856 (59.2 per cent) were engaged in contract practice. Whether the poor response was due to the length of the questionnaire and the work involved in filling it out, or to other factors such as disapproval of the inquiry, it is impossible to tell. The questionnaires had been distributed by local BMA officials, and so we do not know how many were actually received by doctors. Full figures on rates, membership and attendances were given for 1,641 friendly society and other similar contracts,

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covering 40,893 individual members. This was far from representative, particularly if we accept the most optimistic estimate of numbers covered by contract practice by 1911, 9 million persons. Validity was limited not only by this low response, but also by the potential unreliability of the answers. As one respondent observed:52 Your attempt to glean information in the manner you are doing will be futile. You are only asking for a series of lying statements from the various members – anyhow that is what you will get. However, this was the most thorough survey to which the profession had contributed, and formed the basis of the BMA’s policy in this area for many years to come. What were the main findings? Responding doctors working under contracts had, on average, two or three such posts. The mode for subscription rates was 4s–4s 11d per patient per annum in friendly societies, and above 5s in doctors’ private clubs. In lay-organised contract practice, attendances per member per annum were higher in the higher subscription ranges, but this was more than compensated for by the higher subscriptions. The 8 per cent of contracts yielding 2s–2s 11d per member per annum earned the doctor an average of 8d per attendance, whilst the 24 per cent of contracts for over 5s per patient per annum would earn the doctor 1s 1d per attendance. Most contracts (53 per cent) earned 11d per attendance (Table 10.1). The report gave no comparable figures or extracts on rates in private practice, despite the fact that ‘the question relating to private fees has been on the whole very fully answered’. However, it is not possible accurately to interpret these answers, first because of the issue of bad debts, which could make a significant difference to earnings, and second due to uncertainty over whether reported private fees were net of the doctor’s expenditure on medicines.53 The 281 individual abstracts provided in an Appendix add little to this: only four statements as to private fees are included, ranging from 2s 6d–5s for a visit within a mile, 3s 6d per visit, 2s 6d per visit ‘for patients of the same class’ and 1s–1s 6d for a surgery consultation. Table 10.1 Distribution, attendances and earnings in contract practice contracts, 1905 Subscription band

% Contract practice contracts in band

% Private doctor’s clubs contracts in band

Attendances per member per annum

Remuneration per attendance (pence)

2s–2s 11d 3s–3s 11d 4s–4s 11d 5s and above

8.25 15.6 52.65 23.51

2 2 43 53

3.59 3.67 4.46 5.43

7.95 10.55 10.98 13.36

Source: BMA MPC, ‘Investigation into . . . Contract Practice’, British Medical Journal, ii (supplement), 1905, 35.

174 Andrew Morrice Some differences between doctors’ clubs and lay-organised contracts did emerge: 82 per cent of private doctors’ clubs included all family members, as against 5 per cent of friendly societies and other similar organisations; 69 per cent of friendly society schemes admitted juveniles between the ages of one and six, whereas 90 per cent of doctors’ private clubs admitted juveniles from birth. It therefore seems that doctors’ own arrangements tended to provide a family service, whilst the laycontrolled societies were more concerned with benefits for the working man. A distinction was also made between friendly societies and medical aid societies, the latter being run for profit, as opposed to mutual aid, by non-medical persons were thought to be particularly ‘objectionable’.54 Significantly, public service (Poor Law or municipal) appointments were excluded, along with individual contracts for medical services drawn up between a practitioner and private patient.55 The investigation was originally confidential, but the committee felt that individual doctors’ comments were of sufficient interest to obtain permission to print abstracts of their comments. These are particularly interesting on the issue of ‘abuse’ and the wage limit. For example: I have one man among my club patients who made a profit of £30,000 on a public house and who owns acres of houses [sic] in this district. . . . [such] men value their doctor at 1d a week, not the price of a decent cigarette, numbers of which they consume daily.56 I have a farmer, as an instance, worth £12,000, and only paying me 2s 6d. a year, and having to go over 4 miles to see him.57 [the society admitted] farmers and tradesmen, shopkeepers, publicans etc., who obtained medical attendance for 5s. a year, but did not care to ‘trouble the club’ that is, to draw 10s. or 12s. a week, but considered that they ought to get medical attendance for the same price as one of their labourers, and generally fussed more, and thought they ought to have more attention shown to them than the poorer members.58 These comments demonstrate that ‘abuse’ of contract practice was offensive and frustrating to the doctors concerned. Despite this, fifty-five of 619 doctors in contract practice who responded to a question about the introduction of an income limit for patients felt definitely opposed. One problem was that alongside medical services friendly societies also provided sick pay and funeral benefits, which they argued were inappropriate objects for income limits.59 Of doctors proposing a maximum income figure, 134 of 354 suggested a weekly wage somewhere between 20s and 30s, though there was a wide variation around this. Clearly, then, a significant number of those engaged in contract practice regarded arrangements as satisfactory. Overall, then, the report contains much information on the variety of organisation in contract practice, lengthy abstracts of opinion from nearly 300 respon-

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dents, and reasonably full figures on the rates of remuneration in contract practice. Crucially, though, it says next to nothing on the comparative earnings of doctors in lay or medically organised contract practice or those in private practice. The most revealing comment that survives in the abstracts is this:60 On the basis of figures I have collected I think that the sum of 5s. [per patient per year] . . . would just about bring in what the present rate for private practice (minus a deduction for bad debts) brings in from the same class. A number of hypotheses could be put as to why the BMA chose to omit the information on incomes from private practice, despite the questions on this being fully answered. Probably it did not suit the outcome most desired by those active in the BMA on contract practice. This is supported by the fact that the report’s conclusions and the Medico-political Committee’s recommendations do not even lead on clearly from the opinions or information that are contained in the published report. Discussing the findings, the report comments61 Many respondents appear to hold the view that almost all the disadvantages of Contract Practice can be expressed in terms of remuneration, and can be removed by raising this to a suitable amount. The data, however, show that many respondents were content with their pay: of those in contract practice, only 458 (53.5 per cent) thought their rates of remuneration were inadequate. The suggested rises in subscriptions were correspondingly modest: 38 per cent of those proposing a figure recommended 5s, while 70 per cent suggested a rate of between 4s and 6s per annum.62 Importantly, the report recognised the widely held view that some contract medical practice was necessary, especially in rural, mining and manufacturing areas.63 Despite this, the Medico-political Committee felt able to recommend, on the basis of the report, ‘effective abolition’ of contract practice rather than negotiations or even concerted action to secure higher rates of subscription. The ‘fundamental principle’ of the report’s recommendations was ‘that the conditions upon which medical practitioners in any district should undertake contract practice should be prescribed by themselves’. Each district should have a Public Medical Service, ‘the general control of which should be in the hands of an organised local body representative of the profession, such as a Division of the BMA’.64 The report set out model rules and regulations for these, as well as for provident dispensaries. Broadly, such organisations were to be entirely controlled by a committee of the medical men working within it. Public Medical Services were to be open to all local doctors, with patients free to choose a doctor within it. In this way contract arrangements would approximate to the conditions of private practice, whilst ensuring that any who could afford true private medicine were excluded from the system.65 The report ended with the ethical rules, including the Bradford Rules described earlier.

176 Andrew Morrice Whilst not stated overtly the various actions of the BMA, and to a more limited extent the GMC, between 1902 and 1905 had put in place a coherent ‘machinery’ to use against lay-controlled contract practice. The BMA had enabled local groups of its members to boycott all arrangements other than those they chose to control, and ensure non-members complied with the boycott by using the threat of professional and social isolation. The boycott apparatus was essentially a way of forcing doctors, whether members of the Association or not, to abandon lay-controlled contract practice and work within a structure designed by the BMA. However, the BMA had in its possession information contained in the report that showed how limited the true support for such a campaign would be.

The contract practice boycott The fact that the campaign was fought at a local rather than national level makes an overall assessment of its impact and practical scale difficult. No central list of disputes was kept, and those mentioned in committee minutes in central archive material may represent only actions of particular interest. For example, the minutes of the Contract Practice Sub-Committee for January 1906 mentions disputes at Helensborough, Manchester and Salford Provident Dispensary, Ebbw Vale, Macclesfield, Darlington, Hartlepool, Middlesbrough, South Shields and Chorley.66 A dispute at Coventry was also underway at this point, indicating that other actions were ongoing in addition to those listed. Indeed the Coventry case is worth considering more fully, not only because it demonstrated the public distaste for such campaigns but also because it led ultimately to the alteration of the ethical rules. In 1918, the BMA and three of its Coventry members were found guilty on several counts of slander, libel and conspiracy in operating the boycott scheme against three doctors working at the Provident Dispensary.67 The case was brought in 1915, after the British Medical Journal had labelled those working in ‘black-listed’ posts as ‘the failures of the profession’. The dispute had been active from the turn of the century, and the boycott had been in operation against all doctors working there from 1905. The Coventry Herald described it as ‘the cause of so much strife and ill-feeling in the City’, while the Midland Daily Telegraph thought ‘the whole dispute . . . an unedifying and a most unpleasant one’.68 That the campaign was unsuccessful in abolishing non-medically organised contract arrangements is a matter of record. There were, of course, enough doctors who regarded most contract arrangements satisfactory to enable those organisations to continue operating, just as there were enough doctors willing to support the Insurance Act to enable it to gather the momentum needed for its success. Weariness with the boycott was voiced by a London GP at the time of the case against the BMA in 1918:69 Exactly the same spirit of tyranny was shown by the same class of men when the Insurance Act was introduced. Doctors were threatened with ostracism if they went on the Panel to perform their national duty. One of

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these men has never spoken to me since . . . Such methods of tyranny defeat themselves . . . men who tried to frighten us from the panel are today almost without patients while I for one am making £2000 per annum. Thus, following the damaging court case the ethical framework underpinning the boycott had to be changed. A special committee was set up to consider the Association’s position. This committee considered many options, including registering the Association as a trade union, but finally opted to amend the rules underpinning the boycott scheme.70 The new rules disclaimed any responsibility for any actions taken by divisions which did not follow the rules to the letter. Disputed posts were placed in the renamed and toned down ‘Important Notice’ in the British Medical Journal. The rules allowed ‘any doctor or body of doctors the right to decline to meet any other doctor professionally, this being one of the common rights of citizenship’, but warned ‘it is wise not to specify any reason for such action’. Representatives of local divisions or branches of the BMA could meet with the holder of (or candidate for) a disputed post listed in the Notice, and ‘without threat’ inform him or her that the local profession ‘may not be disposed to meet them professionally’.71 CEC minutes give some idea as to the numbers of posts notified, and thus of the scale on which the boycott continued (although it should be borne in mind that a good proportion of disputed posts were now public service appointments). For instance, in 1925 a meeting of the CEC endorsed sixteen new notices, continued fourteen (eight of them in South Wales) and withdrew ten. The same meeting also noted that five doctors in South Wales had been found ‘guilty of infamous conduct’ in connection with medical clubs, and that Monmouth Branch had passed a ‘binding resolution’ against Ebbw Vale Workmens’ Medical Association.72

Conclusion For a short period during the first decade of this century influential medical men, particularly within the BMA, envisaged the ‘effective abolition’ of laycontrolled contract practice. Ideas of gentility shaped not only their opposition to it but also the mechanisms by which they hoped to achieve its demise. These methods were closely related to those of trade unionism, because both sprang from a common culture of occupational self-promotion. That most doctors were unwilling to call it trade unionism was partly a reflection of the class consciousness which itself provided much of the impetus in the events described. In reality, though, the profession was too divided for this project to come to fruition, so that whilst state or friendly society control were seen as twin threats by some, there were many who saw either or both as reasonable. For some this may simply have taken the form of a calculation as to likely income, but to others it was explicitly in keeping with their own views of medical professionalism – doing one’s ‘national duty’ or one’s ‘bit for the poor’. The profession supported both charitable and private practice, but was divided on the middle ground. The contract practice boycott scheme saw the BMA trying to bring this

178 Andrew Morrice contentious area firmly within its control, setting rates of subscription, income limits and conditions of work. These structures proposed by the BMA mimicked as closely as possible a model of private practice open to all local doctors, with free choice of doctor for the individual patients, whilst preserving as large a field for true private practice as possible. Thus it was hoped the profession would achieve independence, autonomy, full non-employee status and a final escape from the taint of trade. If successful, the scheme would have placed the financing of most British non-hospital services in the hands of the profession’s trade union and its local branches. However, the BMA had ignored the silence of the majority of practitioners and the clear statements from many who did respond to their questionnaire that by increasing the capitation rate a little all would be well. (It was almost exactly the same ‘little more’ that Lloyd George first offered the profession at the start of the National Insurance crisis; indeed his reading of the needs of contract doctors was probably not that wide of the mark, though his mistake was in ignoring their ‘bigger brethren’ active in the BMA.) The method the BMA evolved for raising the profession out of these ‘poorly’ paid contracts with committees of artisans was essentially negative. It consisted of a stark choice for practitioners: you are either one of us or you are on your own. The position of the ‘blackleg doctor’ was that of the ‘blackleg worker’ – a traitor to be attacked and abused. Those who refused to join in and use the method worked out for their salvation by their professional brethren were damned and cast out. Perhaps the heart of the problem facing the Edwardian medical profession was that of the worth or value of medical men and their work. This lay in their ideals as much as in their skills, and the aspiration to be scientific gentlemen practitioners meant that for some, contract practice was a ‘devaluation’ of medicine. Underlying the literature of complaint and the structures put in place to change contract practice was the idea that a doctor was worth a certain amount. In contrast, many lay organisers of contract practice were happy to shop around for the cheapest available man. Indeed it is hard to see why they should have been convinced of a minimum worth or value of medical work, when there seemed always to be doctors available at very low rates. Furthermore, such ‘cheap doctoring’ must often have been self-defining; it is hard to imagine how medical work done at the ‘bargain basement’ end of the contract market, whether organised by laity or doctors, can have been anything other than inferior and hurried. Whilst it is important not to ‘buy into’ the complaints of doctors uncritically, it is tempting to conclude that some contract subscribers can have expected little more from their club doctor than attention, a certificate and a comforting bottle, and that their doctors were faced with the choices of accepting this role, working extremely hard for little reward to provide more than this, or aspiring to higher social and professional goals. The lack of professional unity evident in the cases of both contract practice and National Insurance shows that individual doctors worked out many different solutions to this pay/quality problem, on the basis of different principles. Such variation in GPs’ responses to pay continue to this day. Whilst contemporary debates over the financing of medicine largely focus on the issue

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of expensive treatments created by technical innovations in medical care, it is often forgotten that healthcare budgets still consist largely of payments to professionals and other workers. For the Edwardians it was much more obvious that the cost of medicine was predominantly that of calling in the medical man, rather than medical treatments and technologies. Modern GPs perceived their workloads to have increased and their pay to have dwindled in comparison to other professions in the 1990s, and in 1997 they claimed that a rise of 58 per cent was needed to bring salaries back to 1980 levels of professional remuneration.73 In some ways they face similar choices as to whether to let pay and conditions define quality of work – ‘the traditional British compromise of implicit rationing’ – to continue to try to provide the best they are capable of, or to try to engage in a process to improve things.74 In all of these choices doctors are faced, as their Edwardian predecessors were, with sets of social, cultural and professional pressures and ideas which do not cohere to suggest a single solution.

Notes 1 I would like to thank Bill Bynum, Anne Hardy, Mark Harrison and Michael Neve for their help, encouragement and useful criticisms. Emily Naish at the BMA Archive, and Lesley Hall and Julia Sheppard at the Wellcome Institute Contemporary Medical Archive Centre, provided patient assistance. I also thank the Wellcome Trust and the Bath Royal United Hospital NHS Trust for supporting the research on which this chapter is based. This research later led to my thesis ‘Honour and interests: medical ethics in Britain, and the work of the British Medical Association’s Central Ethical Committee, 1902–1939’, University of London, 1999. An effective summary of this work appears in ‘ “Honour and interests”: medical ethics and the British Medical Association’, in A. H. Maehle and J. Geyer-Kordesch (eds), Historial and Philosophical Perspectives on Biomedical Ethics, Ashgate, Aldershot, 2002. 2 S. Squire Sprigge, Medicine and the Public, London, Heinemann, 1905, p. 234. 3 Ibid., p. 240. 4 A. Digby, Making a Medical Living, Oxford, Oxford University Press, 1995, pp. 94–5, 122–3; D. Green, Working Class Patients and the Medical Establishment, Aldershot, Gower, 1985. 5 BMA Medico-political committee (MPC), ‘Investigation into the economic conditions of contract practice in the United Kingdom’, British Medical Journal, ii (supplement), 1905, 22 July, 16–23. 6 Green, Working Class Patients, pp. 93–6; B. Harris, The Origins of the British welfare State, Palgrave, Basingstoke, 2004, pp. 81–4, 224 is more cautious. 7 The terms ‘ostracism’, ‘ostracisation’ and ‘boycott’ or ‘boycotting’ are used interchangeably and inconsistently in the contemporary sources; here, ‘ostracism’ is used to denote the more informal aspect of the isolation of doctors whilst ‘boycott’ is used to refer to systematic isolation. 8 J. Harris, Private Lives, Public Spirit, Oxford, Oxford University Press, 1993, pp. 123–49. 9 For examples, see J. de Styrap, A Code of Medical Ethics, 2nd edn, London, J. & A. Churchill, 1886, p. 18; Squire Sprigge, Medicine and the Public, pp. 30, 242; T. Horder, ‘Public education in health’, British Medical Journal, ii (supplement), 1926, 16 October, 168. 10 G. Bernard Shaw, preface on doctors, The Doctor’s Dilemma: a tragedy, London, Constable, 1932, p. 14.

180 Andrew Morrice 11 H. Perkin, The Rise of Professional Society, London and New York, Routledge, 1989, p. 28. 12 P. Bartrip, Themselves Writ Large: the British Medical Association 1832–1966, London, BMJ Publishing Group, 1996, pp. 69–71. 13 BMA MPC, ‘Investigation into . . . Contract Practice’, pp. 95–6. 14 Squire Sprigge, Medicine and the Public, p. 234. 15 A. Digby and N. Bosanquet, ‘Doctors and patients in an era of National Health Insurance and private practice, 1913–1938’, Economic History Review, lvi, 1988, 74–94. 16 Bartrip, Themselves Writ Large, pp. 140–164. 17 BMA, Revision of ethical rules of procedure: British Medical Journal, i (supplement), 1919, 24 May, p. 106; it was extended in 1905 to include public service posts such as Medical Officers of Health and School Medical Officers: BMA Archive (BMAA) B/54/2/12, BMA, Minutes of CEC, 7 April 1905. 18 Editorial, Westminster Gazette, nd. ?1912, ‘We all admire people who don’t know when they are beaten. The trouble with the BMA is that it doesn’t know when it has won’, quoted in E. Muirhead Little, History of the British Medical Association 1832–1932, BMA, London, 1933, p. 330; Perkin, The Rise of Professional Society, pp. 111–13. 19 R. W. Harris, National Health Insurance in Great Britain, 1911–1946, London, George Allen and Unwin, 1946, p. 140. 20 BMAA B/54/1/25BMA, Minutes of Central Ethical Committee, 8 July 1913. 21 ‘Contract medical practice’, British Medical Journal, i, 1900, 928. 22 J. D. Willis, letter, British Medical Journal, ii, 1905, 1556–7. 23 Letter, British Medical Journal, i, 1902, 679. 24 A. Baille McKnee, ‘Contract practice: the evil and its remedy’, British Medical Journal, i, 1902, 330. 25 A. E. Larking, ‘Contract practice and its difficulties’, British Medical Journal, ii, 1901, 1326. 26 Ibid., p. 1326. 27 Ibid., p. 1325. 28 F. W. Walters, letter, British Medical Journal, i, 1902, 726. 29 ‘Medicus’, letter, British Medical Journal, ii, 1902, 1546. 30 Squire Sprigge, Medicine and the Public, p. 53. 31 F. W. Walters, letter, British Medical Journal, ii, 1902, 726. 32 E. D. Kirby, letter, British Medical Journal, ii, 1902, 1256. 33 ‘Unionist’, letter, British Medical Journal, ii, 1902, 1615. 34 BMAA A/1/1/3 BMA, Report of Annual Representative Meeting, 1905, p. 162; Little, History of the BMA, p. 204. 35 General Medical Council, Minutes, XXIV (1893), Appendix XII, ‘Report of the Committee on Medical Aid Associations’. 36 GMC, ‘Warning Notice’, see GMC, Minutes, XXXVI, unpaginated pamphlet. 37 Bartrip, Themselves Writ Large, p. 143. 38 A. Cox, Among the Doctors, London, Christopher Johnson, 1950, pp. 74–6. 39 Little, History of the BMA, p. 86. 40 Ibid., p. 84; Squire Sprigge, Medicine and the Public, p. 234. 41 Ibid., p. 233. 42 BMAA A/1/1/2BMA, Minutes of Annual Representative Meeting, 1903. 43 BMAA B/52/4/2BMA, Report of Ethical Committee in Minutes of Council 28–31 July 1903. 44 BMAA A/1/1/3 BMA, Minutes of Annual Representative Meeting, 1905; BMAA B/54/2/12 BMA, Minutes of Ethical Committee, 18 March 1904. 45 BMAA B/54/2/14 BMA, Minutes of Contract Practice Sub-committee of Medicopolitical Committee (CPSC\MPC), 3 January 1906. 46 BMAA B/54/2/15 BMA, Minutes of MPC, 9 January 1907.

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47 BMAA B/54/2/16 BMA, Minutes of CPSC\MPC, 18 November 1908. 48 British Medical Journal, ii (supplement), 1918, 26 October, 60. 49 See British Medical Journal, ii, 1905, 1535. The notices were printed among the advertisements or in the inside cover of the British Medical Journal and therefore do not survive in bound series of the journal, although small notices drawing attention to the main notice were placed in the main pages. 50 BMA (MPC), ‘Investigation into . . . contract practice’, pp. 1–96. 51 Ibid., p. 2. 52 Ibid., p. 55. 53 Ibid., p. 16. 54 Ibid., p. 5. 55 Ibid., p. 2. 56 Ibid., p. 48. 57 Ibid., p. 8. 58 Ibid., p. 7. 59 Ibid., p. 7. 60 Ibid., p. 54. 61 Ibid., p. 27. 62 Ibid., p. 37. 63 Ibid., p. 9. 64 Editorial, British Medical Journal, ii, 1905, 195. 65 BMA (MPC), ‘Investigation into . . . contract practice’, p. 29. 66 BMAA B/54/2/14 BMA, Minutes of CPSC\MPC, 3 January 1906. 67 British Medical Journal, ii (supplement), 1918, 26 October, 60. 68 Wellcome Contemporary Medical Archive Centre, London, (CMAC) SA\BMA D140; Editorial, Coventry Herald, 19 October 1918; CMAC SA\BMA D140 article, Midland Daily Telegraph, 16 October 1918. 69 CMAC SA\BMA D140 Article, Daily Express, 17 October 1918. 70 BMAA B/158/1/1 Minutes of Committee on the position arising out of the Coventry Case. 71 BMAA, A/1/1/17 BMA (CEC), Memorandum of Instruction and Advice as to the powers exercisable by the BMA in regard to Medical Appointments for the guidance and Assistance of Honorary Secretaries of Divisions and Branches. Bound with CEC minutes for 11 May 1920. 72 BMAA, B/63/1/13BMA, Minutes of CEC, 6 October 1925. 73 GP Reporters, ‘Pay award is no reward’, General Practitioner, 14 February 1997. 74 J. Abelson, P. H. Maxwell and R. J. Maxwell, ‘Do professions have a future?’, British Medical Journal, 315, 1997, 382.

11 The economic and medical significance of the British National Health Insurance Act, 19111 Anne Digby Introduction Although the National Health Insurance Scheme of 1911 was a major step in the development of the health care of modern Britain, it has received little attention by historians in comparison with a growing literature on the National Health Service (NHS) reform of 1946/48. This chapter aims to help redress this situation by looking at connections between the economic and medical results of the 1911 scheme. There are some difficulties in attempting to analyse the quantitative significance of the National Health Insurance (NHI) scheme, because the Act did not come into effect until 1913 and was swiftly overtaken by the major upheaval of the First World War, thus making continuous statistical series a matter of good fortune rather than expectation. However, good qualitative evidence helps compensate for this. Membership of the scheme was not universal, as was the case with the later NHS, but was defined by changing age and income limits for those in employment, and hence discriminated against women and children not in the labour market. The scheme at first covered workers aged sixteen to seventy years. The upper age limit was reduced to sixty-five years in 1928, while in 1937 those aged less than sixteen years but who were already in employment were added. Initially workers earning under £160 per annum were included, and in 1920 this was raised to £250. These changes meant that whereas in 1914, 47 per cent of the adult population was covered by the scheme, this had risen to 54 per cent by 1936. This was more limited than the German scheme, which had originally influenced the British plan, where more than three-quarters of the population were covered. Dependants of workers were included in the German system, in contrast to the more restrictive situation of the NHI arrangements.2 Lloyd George promoted the scheme to the British electorate by stating that it offered ‘ninepence for fourpence’, with employee, employer and the state providing tripartite contributions. Under NHI workers gained a dual advantage: a cash benefit from the approved society or industrial society with which they were registered, and medical treatment from an insurance practitioner (the so-called ‘panel doctor’) whom they had chosen. Panel patients could receive freely from the doctor medical services ordinarily given by a general practitioner (GP) and

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not requiring special skill.3 Doctors who chose to go on insurance panels were paid for their services in most areas by means of a capitation payment. However, in Manchester and Salford local doctors elected to be paid on the basis of attendances or fees for services. This local initiative foundered later on competitive economic self-interest.

Doctors What were the financial implications of the panel scheme for general practitioners? NHI impacted on a medical profession that was demoralised after a decade of unprecedented anxiety centred on possible changes in Poor Law medical practice derived from the Royal Commission on the Poor Laws of 1905–09. Also, as Morrice shows in Chapter 10, there was concern over what was perceived to be the exploitation of doctors in club or contract practice. Here practitioners were employed for a fixed sum to look after the members of an organisation, typically a friendly society.4 Although numbers of entrants to the medical profession were now less than during the late nineteenth century, there was still considerable evidence of overcrowding and therefore of intense economic competition.5 Through the varied reactions of doctors to it, NHI threw into stark relief the fragmented state of the medical profession. Nationally, much antagonism came from consultants rather than from general practitioners;6 however, divided opinion in local branches also revealed the existing economic differentiation within general practice that strongly influenced a favourable or antagonistic stance towards the new scheme.7 In the Border Counties some felt that the state’s intervention ‘threatened the very existence’ of the doctor,8 and in South Wales those who were secure economically and had a good income from urban or even from some industrial practices tended to be antagonistic. Indeed, at first the principals or partners in general practice in this area also excluded their assistants from participating in discussions held by the BMA branch. Revealingly, they thought that NHI would act as a financial carrot in stimulating these younger men to form their own practices.9 The difference between the generations was very apparent in other geographical regions too. Older doctors (even those employed in the low-paid club or contract practice which the BMA had campaigned against) might well have preferred the status quo. One sixty-yearold club doctor wrote that ‘to have one’s practice revolutionised at my time of life is altogether too terrible to contemplate’.10 His anxiety was grounded in the legislative provision whereby collieries and works might apply to be approved units under NHI. Rather less than 1 per cent of patients in England and more than 4 per cent in Wales were in this category. In heavy industrial and mining areas the new scheme was at first perceived to be extremely problematic. Doctors engaged in tense bargaining over the private capitation fee that doctors would agree to for old and infirm members of the preexisting clubs who were now excluded from the new scheme, the fees to be charged to the dependants of NHI contributors, and the balance of lay versus

184 Anne Digby medical control.11 Problems continued in mining or heavy industrial areas of the country. During the 1920s and 1930s the government alleged that some workers were making excessive claims for sickness, either because of malingering or because this was a means of getting benefit when their limited unemployment benefit had run out. Collusion by panel doctors in certifying the unemployed as sick was a matter of intense concern in mining areas, particularly during the Coal Dispute of 1926–27.12 At the inception of NHI, general practitioners who scrambled to form a new panel practice too quickly attracted professional and public disapproval. By doing so they ignored the BMA’s attempts to ratchet up the price for medical involvement through getting members to sign a pledge against participation in the scheme. Thus, signing up panel patients very early in 1913 was seen as gaining an unfair advantage over fellow doctors. Once the scheme began, and the BMA had released doctors from their pledge not to take part, the vast majority indicated their willingness to be on the insurance list. Secure income through a capitation scheme beckoned in this enlarged medical market, which now included many people who earlier had received medical treatment in ways that financially benefited the doctor much less – through the Poor Law, outpatient clinics in hospitals, clubs, or medical altruism. In consequence, two-thirds to three-quarters of general practitioners participated in NHI during the period from 1913 to 1938, with as many as 19,000 on the panel by 1938. (This compared to four-fifths of doctors in the German insurance scheme.) The proportion of local doctors on the panel varied a great deal, from 100 per cent in a very industrialised area, through large urban areas such as Birmingham or Sheffield with 65 to 66 per cent, down to rural counties such as Devonshire with 54 per cent.13 A major influence in encouraging recruitment to the British panel was the doctor’s fear – as with Poor Law appointments during the Victorian and Edwardian periods – that if newcomers once got a toehold in a practice area, they would soon become well-established professional competitors.14 One of the more obvious effects of NHI was thought to be a ‘commercialisation of medicine’ associated particularly with newcomers to the profession.15 Indeed, the Dean of a London medical school later commented on the allegedly new type of person who was being attracted into medicine by the prospect of making a comfortable economic living.16 It was now much easier and cheaper for recent graduates to start up in a panel practice than it had been before 1911, when a common experience had been to try, and often fail, to build up a practice nucleus into one that gave a viable income.17 In Manchester and Salford payment by attendance was particularly favourable to younger doctors starting up in practice through recruiting panel patients, because here there were no panel lists to constrain entrepreneurial activity. In every area after 1911 it was possible to start up a branch or lock-up surgery in an under-doctored poor area, with assured income from capitation payments, and with no bad debts from poor patients to offset against notional income. In Scotland, where practice before 1911 had been particularly difficult in terms of giving an adequate income, panel practices were regarded as a ‘sound investment’ for the young entrant to the pro-

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fession.18 Doctors were easily able to sell these panel practices, not least because a list of panel patients was more easily transferable than a group of individuals who were private patients.19 It was even suggested that there was a rapid rise in the value of practices because of their improved economic potential, although this assertion is impossible to verify.20 An enhanced ability of young medical graduates to make a living in panel practices was strongly indicated by a shortage of young doctors applying for salaried hospital posts, or positions as doctors’ assistants or locums. The case of Dr H. R. Chibber-Want of Retford in Nottinghamshire indicated, however, that some acumen was needed even in panel practice. Acting as an assistant prior to starting up in panel practice enabled a young doctor to acquire knowledge of some of the necessary practicalities of running a panel practice. These organisational insights were not covered during medical training. Dr Chibber-Want had qualified early in 1922 and started a panel practice immediately, but had not read the relevant bureaucratic regulations for panel service. Within eighteenth months he had been censured so many times by the Nottinghamshire Medical Services Committee for lack of visiting, irregular prescription and certification of cases, as well as for wrongly charging panel patients for private treatment, that the Ministry of Health pointedly asked whether his continuance on the insurance list ‘would be prejudicial to the medical service of the insured.’ He remained because local doctors on the Medical Services Committee retreated into a bunker of professional solidarity in excusing their colleague’s inexperience on the grounds of recent qualification.21 However, professional life did not become any easier, and Dr Chibber-Want gave up his Retford practice in 1925/26. Medical directories suggest that it was as plain Dr Chibber that he moved back to Liverpool, where he had earlier trained. Here Dr Chibber gained a basic measure of professional acceptance and became a medical officer to one of the Poor Law divisions in 1934. For other young doctors with a greater professional capability, the 1911 Act provided early economic security and, crucially, made greater career flexibility possible. General practitioners could now start in panel practice, over time acquire private patients, and then sell off the panel part of the practice. Dr Ward of Brighton considered that the panel ‘affords experience and is a useful introduction to the district . . . it may be abandoned later if wished’.22 An example of this process occurred in 1920 in Workington, Cumbria, where the youthful Dr Adam Brown worked at first as an assistant to Dr Dudgeon for a few months, looking after panel patients. Brown then bought into a partnership by purchasing the ‘club’ part of the practice (principally that of St Helen’s Colliery, the Camerton Colliery and Brick Works, and the Seaton Lifeboat Club) and running it alongside the panel patients. This left his more experienced colleague, Dudgeon, to deal only with private patients.23 In this case both doctors agreed on the role of panel practice in their respective careers in the partnership. However, partnerships were fragile creations and the panel might occasion the end of the alliance, as happened with two GPs in Barrow, South Wales, where one practitioner wished to join the NHI scheme and the other did not.24

186 Anne Digby Alongside generational differentiation in the impact of the 1911 Act on the medical profession went racial and gender variation. Fewer female than male graduates entered general practice, and of those who did few entered panel practice at first. This was because medical women focused primarily or exclusively on female and child patients and these kind of patients were not much in evidence on the panel. Only about half as many women as men qualified for health benefits under the 1911 legislation, whilst juveniles under sixteen were largely excluded from the panel for most of the period.25 From the 1920s onwards there was a gradual increase in female panel doctors, so that by 1938 there were 400 of them.26 NHI also expanded opportunities for other hard-working professionals, prominent amongst them being Jewish, Irish and Scottish doctors, who would perhaps take on practices in impoverished inner city areas which had been previously neglected by the profession because they offered poor potential for making a medical living. Other newcomers whose ethnic or religious background might otherwise have made the development of a practice problematic also found a niche in NHI work. Amongst the medical fraternity in Burnley, for example, there was racist feeling expressed about a report that a Chinese assistant had been taken on in a local insurance practice, whilst the existence of socalled ‘Hindoos’ in London insurance practices was also deprecated.27 This kind of prejudice disregarded the fact that the boundaries of doctored areas were being extended in industrial and inner city areas so that poorer areas now received much more medical treatment than hitherto.28 Possible clinical corroboration that this process was occurring was suggested by a fall in the numbers of uncertified deaths.29 At first panel sizes were unregulated and on occasion reached 4,000 patients per individual doctor, so a ceiling had to be imposed by the Ministry of Health. The general limit imposed in 1920 was 2,500. A further 1,500 was possible if a doctor employed an assistant, although a medical duo could not exceed 3,000 patients without the sanction of the Minister. Individual insurance committees could vary these limits – as did Southend, with a maximum panel size of 2,000 patients. In Scotland the respective figures were 2,500 panel patients per NHI doctor, with a further 1,250 patients allowed if an assistant was employed. Local variation again existed. Glasgow, for example, limited the panel to 2,000, and permitted a further 1,000 patients if a permanent assistant was taken on in an insurance practice.30 If doctors with a substantial panel had acted with economic rationality, however, they should all have employed an assistant because a small salary would have been more than offset by the capitation of circa nine shillings multiplied by 1,000 to 1,500 panel patients. Did this happen? A favourable place to analyse the economic dynamics of panel practice is Birkenhead, a large port and manufacturing town in Cheshire where, unusually, the data on individual practitioners have survived. In Birkenhead a practitioner named Owen employed an assistant in 1925/26 to expand his practice substantially to 3,000 patients. Figure 11.1 indicates clearly the large upward movement in his gross income after doing so. (A small decline in his income after 1931 is the result of the government’s cut of 10 per cent in doctors’ capitation payment,

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Years

Figure 11.1 Dr Owen’s Birkenhead panel practice, 1924–33.

which was imposed as part of a national economy drive.) Owen had gone into panel practice later than other colleagues with large panels, but soon outpaced his professional competitors in terms of the numbers of his insurance patients. In Birkenhead there had been a growing differentiation among the size of the panels, and hence of the panel incomes of individual doctors, that began almost immediately after the inception of the scheme and continued thereafter. The Birkenhead doctors with the largest panel practices are shown in Figure 11.2. They were a mixture of very well-established practitioners (such as William Dalzell), others who had been in practice for some time but had failed to get well-remunerated, high-status appointments (Walter Crampton and William Kidd), and relative newcomers to the profession (Edward Evans and Arthur Owen).31 There had been a long-term trend to larger panels in the town, although not on the dramatic scale achieved by Owen, since almost no one followed his example in employing an assistant. However, three of these five doctors went into partnerships that would also have facilitated a larger practice.32 Owen’s colleagues failed to realise the full economic potential of the NHI scheme through the employment of an assistant who could have looked after additional panel patients, who were easier to recruit than private patients in this economically depressed era. This differentiation between practices fits into a national picture of varied take-up and panel revenue. By the mid-1930s nearly one-third of all general practitioners had incomes over £2,000, and in this group two out of five doctors used assistants. In contrast, relatively few amongst the 15 per cent of doctors who earned lower incomes of less than £1,000 per year used assistants; nationally, only one in fifty of these general practitioners employed them.33

188 Anne Digby

Patient numbers

4,000 3,500

1914

3,000

1919 1924 1934

2,500 2,000 1,500 1,000 500 0 W. Crampton

W. R. Dalzell

E. Evans

W. A. Kidd

A. G. W. Owen

Panel Practitioners

Figure 11.2 Large-panel practitioners in Birkenhead, 1914–34.

The average panel size for the inter-war period remained pretty constant at a figure of between 900 and 1,000 patients, much below the maximum allowed by the Ministry of Health.34 However, the differentiated distribution of panel sizes was more interesting. In 1926, 35 per cent of practices had a list of 600 or less, 30 per cent had between 600 and 1,200 patients, a further 21 per cent had between 1,200 and 2,000 patients, and 14 per cent had a list of over 2,000.35 Lists in Scotland were usually smaller.36 What factors were operating to determine these varied panel sizes? Some doctors with just a handful of panel patients had secure private practices. Their few panel patients were usually a byproduct of their private practice because they were the dependants of existing patients, being younger members of the family earning relatively low wages, or domestic servants.37 More commonly found were practitioners with genuinely mixed practices of private and panel patients, who typically had panel lists of between 300 and 500. In this category came virtually every country doctor; rural lists being on average only three-fifths the size of urban ones.38 Then there were the panel doctors operating in industrial or inner city areas, whose income either came entirely from insurance patients or from a panel practice combined with some club practice. Even in an industrial area, where it was usually reckoned that participation on the panel was pretty well universal, list size and panel income still varied considerably among a town’s GPs, as was the case in Birkenhead. As early as 1913, panel incomes in the three large northern towns of Manchester, Bradford and Leeds showed considerable differentiation. Figure 11.3 shows that within and between panel doctors in these communities there was great variation in income

The British National Health Insurance Act, 1911

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60 Manchester (n = 300) Leeds (n = 190) Bradford (n = 117)

50

% of practices

40

30

20

10

1, 00 0– 1, 49 9 1, 50 0– 2, 00 0

80 0– 99 9

50 0– 79 9

30 0– 49 9

50 –2 99

⬍ 50

0

£ per annum

Figure 11.3 Panel incomes in 1913.

from NHI. Nationally, in the later period between 1922 and 1938, when it becomes possible to construct an income series of doctors’ income from panels, insurance income averaged between £400 and £500 per NHI practitioner.39 This average obscured the fact that panel income per doctor varied a great deal. The impact of NHI was sufficiently dramatic for informed opinion to be unanimous in concluding that it had benefited the GP to a major extent financially. Henry Brackenbury, the Chairman of the BMA Council, stated:40 There are probably thousands of general medical practitioners today who without the insurance scheme, would not have been able to earn by the exercise of their profession a sufficient income on which to live . . . It is the greatly increased amount of work, which the scheme provides for a guaranteed reasonable . . . income that has led to this improvement. Some early financial hopes were dashed despite this generally buoyant impression, since possible income spin-offs from doctors’ clubs, created for panel members’ dependants, proved difficult to realise. Twice as many men as women were covered by NHI, and the rate of lapsed membership from the scheme was also much more rapid for women than for men.41 Thus, in theory, the panel doctor could anticipate getting the dependants of a largely male panel (frequently wives, and of course children) into doctors’ clubs formed for that purpose. Unfortunately for all concerned with general practice, there was a low

190 Anne Digby take-up of membership in doctor’s clubs; early expectations of two dependants per panel patient coming to the doctor had later to be downgraded to only one.42 The economic logic for an insurance practitioner, as for any other small businessman, was to attempt to maximise income and minimise expense. NHI signified a major financial gain for doctors in that the amount of book income that had to be written off as bad debts was now a thing of the past. Offsetting this to some extent was the fact that the government maintained a steady downward pressure on capitation payments for NHI patients. The insurance practitioner thus had every incentive to provide only basic amenities for panel patients. A shop converted into a lock-up branch surgery was a common response, although this still served to expand the practice area geographically through recruiting new patients.43

Patients From the patient’s perspective, what economic differences would have been noticed after the 1911 National Health Insurance Act? Worry about the financial impact of sickness had been widespread. It is surely significant that, even after NHI had removed the doctor’s bill, a panel doctor with a mixed practice wrote that his working-class patients still presented their illness with much more anxiety than did financially more secure patients.44 Before 1911 doctors had reckoned that about 8 per cent of their potential income had had to be written off for bad debt and the associated cost of debt collection, because patients were unable or unwilling to pay their bills. The ledgers of doctors in industrial areas (most obviously in surviving account books in north and south Wales) indicate just how much hard work the doctors had earlier put in to collect their money, and the worry this must have caused working-class patients. Doctors attempted to collect bills by instalments of money paid to collectors, and also through vigorous use of the county court for small debt retrieval. A patient’s letter from north Wales gives a revealing glimpse of patient–doctor relations in the years before the 1911 Act was implemented. It begs the doctor not to take court action:45 Dr Edwards, Sir, I am sending a line to tell you that we will come down next Saturday as we are afraid for you to put a cost on us. Please will you kindly wait until we come there as it is very hard on us now after such a strike . . . I am your obedient servant Mr and Mrs John Hughes. Once NHI had come into effect, many low-income, working-class families were less subject to this kind of financial apprehension when illness occurred – at least as far as the insured breadwinner was concerned. This must be assessed as one of the main elements in the economic significance of national health insurance. Worries about the cost of treatment for dependent wives and children still, of course, remained. The lightening of financial concern meant that earlier treatment could be

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sought for disease. Although a committed and thoughtful panel doctor considered that he was ‘attempting to relieve the effects of conditions which he has no power to alter’,46 informed observers considered that the nation’s health had improved and sickness rates in industry had declined as a result of NHI.47 Lloyd George stated, twenty-five years after the scheme had been implemented, that ‘The insured classes enjoy by means of it a degree of medical attention previously unknown as well as a measure of financial security in sickness to which they were once strangers. It has become the keystone of our social structure for the maintenance and improvement of the nation’s health.’48 Patients were encouraged to take up health services through health promotion campaigns. Medicine was a ‘free good’ for panel patients, and it is not surprising to find that take-up of the GP’s services increased. Before 1911 the government actuary (over optimistically in relation to earlier club experience) had estimated the likely take-up for each NHI patient as 1.7 items of surgery attendance or doctor’s visits per year, whereas by 1937 the take-up had become three times as great at 5.1 attendances or visits.49 At the same time, the national rate of NHI prescriptions had more than tripled, increasing from 18.3 million prescriptions in 1920 to fifty-nine million in 1935.50 At the local level there was a varied level of prescriptions to insurance patients, with industrial areas having a higher rate of take-up.51 Burnley in Lancashire was not untypical in that there was said to have been ‘a big rush on the chemists’ at the inception of NHI.52 (This was reminiscent of the alleged dash for free dentures and spectacles at the beginning of the NHS nearly half a century later.) Data are available on the rate of prescriptions for Gateshead and Southend. These showed a long-term trend of rising numbers and cost in prescriptions for both communities, although the northern industrial town of Gateshead was consistently above the south-eastern seaside, rural Southend in its consumption of medicine.53 The National Association of Clerks to Insurance Committees held a conference to discuss the problem of rising prescription costs. They denounced the ‘intense love of the insured person for a bottle of medicine’ and ‘the misguided faith in the bottle of medicine’.54 With rising numbers of prescriptions, surgery attendances and home visits, it is clear that the panel doctor was having to spend increasing amounts of time per panel patient. Indeed, there was some exaggerated personal testimony that pressure of work was driving panel doctors to an early grave, and also that panel doctors were ‘dying in harness’ rather than living to retirement.55 The implications for the allocation of practitioners’ time between panel and private patients were very clear. So too was the likely impact on the comparative standard of clinical treatment of different kinds of patients. The economic imperative was for a swift throughput of panel patients, since the capitation payment was not being enhanced sufficiently to take account of the increased number of services given by the doctor. Also relevant was the fact that relatively few panel patients changed their doctor. Faced with a largely ‘captive’ panel and a more fickle group of private patients, the economic rationale for favouring the latter was sufficiently obvious for it to influence practices, more particularly during the economically depressed inter-war years. A survey in 1914 found that

192 Anne Digby the average time for an NHI surgery visit was three and a quarter minutes, and that on a home visit four minutes was taken.56 A practitioner with an inter-war panel practice in Merthyr Tydfil gave three minutes per patient, ‘the only time possible with the numbers that you were dealing with’. Everybody ‘went out with a bottle of medicine’, which came from large Winchester bottles made up with stock mixtures, including one mixture entitled ‘Mis ADT’ or ‘Mis Any Damned Thing’ for ‘Somebody who you thought there was nothing wrong with, or you can do nothing for’.57 The logic of panel practice therefore pointed towards few examinations of patients and a standardised bottle of medicine. A brief and infrequent clinical note might also be made on the ‘Lloyd George’ record card, which had been introduced for NHI patients. In a Fife survey of 1922, only 10 per cent of these record cards detailed the medical treatment given.58 A surviving Glasgow set of these Lloyd George record cards for the period up to the NHS suggested that matters improved thereafter in terms of a diagnosis and clinical note being recorded for encounters with panel patients, although these were extremely terse in character.59 Frequently asserted in the press was the existence of a two-tier service for private and insurance patients.60 Many general practitioners denied that there was an inferior service for panel patients, and argued – not very convincingly – that in industrial areas, where every doctor was on the panel, doctors would soon lose their panel if they did not treat their patients well.61 Another rationale for uniform standards of treatment was that a doctor’s private patients might include the dependants of the insured. However, this begs the question as to whether this then meant a uniformly depressed standard for all patients. In larger practices (usually those in urban or industrial areas) an assistant was employed to look after the panel patients, and here a two-tier standard of care was virtually inbuilt. In country areas, where a small single-handed practice was the rule, the only doctor in an area necessarily had panel as well as private patients, and thus would find any marked discrimination difficult to effect. In this case the standard of care for insured patients was likely to have been raised towards that of private patients. When asked whether panel patients ‘received as good a service’ as private patients, the evidence from twenty-six English Associations of Insurance Committees gave a less than resounding affirmative, with nine counties equivocating. For example, West Yorkshire commented: ‘No evidence. In public opinion not so good.’62 Friendly societies and approved societies also considered that there was a mixed picture in which some treatment was ‘perfunctory and negligent’.63 A central problem in setting or defining the standards of NHI in the early years – and hence in interpreting this kind of evidence – was that the expectations, values and assumptions of the preceding club system were likely to have informed the attitudes of administrators, doctors and patients as to what was acceptable practice. Doctors in one locality made this assumption quite explicit with their view that ‘patients should only be supplied with drugs etc, which were dispensed to such patients prior to the Insurance Act’.64 Development of a two-tier system have might originated either from the panel practitioner’s own economics and economies and/or from official concerns

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over expense during a period of restrictive public expenditures. Levy, for example, criticised the Royal Commission of 1926 for failing to pay attention ‘to the fact that the remuneration of the panel doctor and his economic and social status must react immediately upon the degree of willingness to exert himself in the services he has to render’.65 Certainly, the furnishing of panel practitioners’ branch surgeries indicated that during the first decade of NHI little clinical examination had been done. In Nottinghamshire, for example, a preliminary survey of the county’s branch surgeries in 1922 indicated that ten out of the twenty-two surveyed lacked examination couches.66 Moreover, revealingly, a Burnley panel doctor’s response when criticised for providing inadequate waiting-room accommodation was to suggest longer surgery hours rather than any additional building.67 There were also more general economic regulatory pressures in the NHI scheme that militated against ‘excessive prescribing’. Doctors might have to justify to the District Medical Officer any prescription of expensive serum, vaccine or insulin, and there was a division of opinion as to whether practitioners felt that providing an explanation for their prescriptions removed this difficulty.68 A related element was the quality of the dispensing chemist. One county check on the accuracy of dispensing (performed as part of a national audit) found nearly one-third of NHI prescriptions to be sub-standard.69 After the 1911 Act there was alleged to be a more discernible rise in standards in Scotland than elsewhere, so that by the 1920s ‘the infinitely superior’ quality of Scottish panel over club was confidently asserted, whilst a clear improvement in Welsh medical services was also perceived.70 One problem in accepting such a comparative judgement is that it begs the question as to whether any actual rise was due to a lower standard of medicine in these countries compared with that in England before NHI. Further research would be needed to clarify this issue. It was also authoritatively stated that Scottish panel doctors were free to use the latest pharmaceutical remedies and that they prescribed them regularly.71 In certain areas there was much hard work performed to raise standards. In the English county of Nottinghamshire, for example, the county insurance committee refused to allow doctors to use stock mixtures in prescriptions, as some were inclined to do, precisely because this would encourage a reversion to club practice.72 In contrast, in Barrow in Furness, Lancashire, administrators selected a range of ten stock mixtures that insurance practitioners should use exclusively.73 Even in areas where an implicitly lower standard was viewed as inevitable under NHI, administrators of the scheme deemed certain routines unacceptable, as when panel doctors assumed that their dispenser could sign a panel patient’s prescription form. Panel doctors found the weight of this new regulatory bureaucracy irksome, since it constrained their professional – or in some cases less than professional – modus operandi.74 Panel doctors were under contract to give the services ordinarily expected of a GP, and much time was spent in adjudication to decide what these were. What was included in services not requiring special skill by the general practitioner? Fracture of a leg or reduction of a dislocated elbow was within the scheme, while removal of appendix, an operation for haemorrhoids or the removal of

194 Anne Digby tubercular glands in the neck was not.75 Unless the individual went to the outpatient clinic of the local hospital, anything outside these defined limits had to be paid for. This led to numerous cases of complaint to insurance committees, and much ill-feeling against certain doctors, since patients found it hard to understand the system and doctors did not always explain sufficiently clearly that even insured patients had to pay for more complicated treatments. There was also some concern that the circumscribed nature of the panel system had increased numbers of patients seeking free treatment at hospital outpatient clinics.76 Otherwise, the options were limited for the insured: either knowingly or unwittingly they became private patients of the GP, or they were referred to a consultant. Significantly, one consultant was told by a GP that ‘This is only a panel patient, so the case need not take you long’.77 An alternative system such as a fee-for-service insurance scheme, as in Germany, might have encouraged GPs to treat more complex cases so that the referral boundary would not have been so tightly drawn.78 Defects were apparent in clinical encounters under NHI. However, a check of complaints upheld against panel doctors in Nottinghamshire during the first decade of the scheme’s operation (1913–22), suggested that deficiencies were not too serious. With over 200 panel doctors and more than 100,000 panel patients, there were eleven cases of inadequate certification, three of charging panel patients as private ones, two of medical negligence involving a failure to visit and three involving discourtesy to patients.79 This hardly suggests wholesale negligence, even if the people evaluating the complaints were, in the first instance, doctors. Nationally, there were about 250 complaints per year against panel doctors, and the majority of these were judged to have ‘no substantial foundation’.80 As in a comparison between private and NHS medicine today, some of the differences between private and panel patients relate to contrasting circumstances surrounding clinical encounters. Arguably these set the tone, and so conditioned expectations. Typically, panel patients had fixed surgery hours, entered a cramped waiting room by a rear entrance – possible after queuing outside in the cold or wet – and had only a brief interview with the doctor’s assistant or the doctor. In contrast, private patients were more frequently seen in their own homes, or alternatively made appointments at their own convenience to visit the doctor, where they would be admitted by a maid at the front door and would receive a longer consultation with the practitioner.

Conclusion The NHI scheme of 1911 involved the incursion of the state into the realm of general practice, and this resulted in GPs achieving much more financially than they would have through market forces alone. After 1911 there was increased income, greater career flexibility and a diminution in bad debts, along with smaller costs in book-keeping. The boundaries of mainstream general practice widened to include many more working-class patients than had been treated

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before through a combination of clubs, marginalised ‘shilling’ doctors or outpatient hospital clinics. During sickness, working-class panel patients were now able to seek treatment earlier, consult their doctors more frequently and suffer less financial anxiety. Panel doctors were freer to treat poorer patients according to their needs rather than their incomes. The panel system also resulted in a better understanding of the clinical needs of the working class within the context of the health-care needs of a wider community. In turn this led to concern over exclusions from the scheme of many people because of their age, gender or employment record, and thus assisted in the adoption of a more inclusive health scheme for the nation in 1948.

Notes 1 I am grateful to the Wellcome Trust for the grant of a Wellcome Research Leave Fellowship to pursue research on general practice, of which this paper forms a part. See also A. Digby, The Evolution of British General Practice, 1850–1948, Oxford, Oxford University Press, 1999, Ch. 12 for a broader discussion of the 1911 scheme. 2 A. Newsholme, International Studies on the Relation between the Private and Official Practice of Medicine with Special Reference to the Prevention of Disease, Vol. I, London and Baltimore, Allen and Unwin, 1931, p. 159. 3 Newsholme, International Studies, Vol. III, p. 119. 4 H. Nelson Hardy, The State of the Medical Profession in Great Britain and Ireland in 1900, Fannin, Dublin, 1901, pp. 29–30; S. Squire Spriggs, Medicine and the Public, London, Heinemann, 1905; British Medical Journal (supplement), 22 July 1905; editorials in the Practitioner during 1910. 5 H. Nelson Hardy gave numbers of entrants to the profession as 1,452 per annum during 1891–95 compared to 1,152 during the years 1906–10 in The Medical Profession, Fannin, Dublin, 1913, p. 9. 6 Alfred Cox, later Medical Secretary to the BMA, quoted in B. B. Gilbert, The Evolution of National Insurance in Great Britain: the origins of the welfare state, London, Michael Joseph, 1966, p. 407. 7 See, for example, the professional divisions recorded in Nottinghamshire Record Office (NRO), DD 1440/23/1, Minute Book of Local Medical Committee of Newark, 1911–13. 8 Cumbria Record Office, Carlisle Branch (CRO), D50/38/1, Minutes of the Border Counties BMA Branch, 26 May 1911. 9 F. Maylett Smith, The Surgery at Aberffrwd, Some Encounters of a Colliery Doctor Seventy Years Ago, Hythe, Kent, Volturna Press, 1981, p. 104. 10 NRO DD 1440/23/40, Dr W. B. Hallowes of Newark on Trent to Dr E. Ringrose (Honourable Secretary of the Local Medical Committee), 27 February 1913. 11 See, for example, NRO DD 1440/23/1, minutes of meetings in January 1913; DD/1440/23/37–8, correspondence on NHI; Greater Glasgow Health Board Archives, HB 76 1/1, Lanarkshire Medical Practitioners Union Minutes, 19 March 1913; MidGlamorgan Record Office, D/D X/X 1/1, Glamorgan Insurance Committee Minutes, 1912–13 and D/D BMA, Monmouth BMA Division, 1911–12. 12 See, for example, National Archives of Scotland (NAS), HH3 6/6, Minutes of Fife County Insurance Committee, 21 September 1915, 5 May 1920, 13 January 1921, 25 April 1925, 14 and 28 July 1926; The National Archives: Public Record Office (TNA:PRO) MH 57/118, Report by Inspector Battersbury on the north-east of England, November 1926. 13 Newsholme, International Studies, Vol. III, p. 121.

196 Anne Digby 14 Lancet, 23 May 1913, p. 1491, for report on Colchester. 15 A. Gray, Some Aspects of National Health Insurance, London, P. S. King, 1923, pp. 27–8. Gray later served on the Royal Commission on National Health Insurance in 1926. 16 A. Digby and N. Bosanquet, ‘Doctors and patients in an era of National Health Insurance and private practice, 1913–38’, Economic History Review, XLI, 1988, 80. 17 A. Digby, Making a Medical Living. Doctors and Patients in the English Market for Medicine, 1720–1911, Cambridge, Cambridge University Press, 1994, Ch. 5. 18 Newsholme, International Studies, Vol. III, p. 469. 19 National Library of Wales, BMA collection of S. Wales and Monmouth, minute 12 May 1946. Dr Anderson of Ogmore Vale stated that when he had sold his practice only 5 per cent of his patients had taken the opportunity to transfer. See also H. B. Brackenbury, ‘Health Insurance in England’, Milbank Memorial Fund Quarterly, XII, July 1934, 5. 20 The National Insurance Gazette of 13 December 1913 suggested that the value had increased by 50 per cent. 21 NRO SONH 1/1, minutes of 11 January, 6 March, 20 April, 14 May, 25 September 1923. 22 E. Ward, General Practice: Some Further Experiences, London, Bale and Danielsson, 1930, p. 13. Ernest Ward, FRCS 1906, MD, 1907. 23 CRO DX 848/4, transfer of panel practice in Workington, 1920. 24 J. H. Williams, GPs of Barrow, 1885–1979, Barrow, Barrow Medical Society, 1979, p. 11. 25 A. W. Watson, ‘National Health Insurance: a statistical review’, Journal of the Royal Statistical Society, XC, 1927, p. 435. In 1923 there were 10 million men and 5.1 million women. 26 For example, it was in 1921 that the first medical woman entered the Southend panel, and in Burnley this was in 1925 (Essex Record Office (ERO), DZ/60/2 Southend NHI minute book), and Burnley News, 4 April 1925; British Medical Journal, 5 January 1939, 51. 27 Burnley Express, 18 January 1922. 28 Dr Harry Roberts in Daily Express, 2 August 1916. 29 TNA:PRO MH 62/151 Court of Enquiry into Remuneration of Insurance Practitioners. For 1906–12 between 1.6 per cent and 2.3 per cent of deaths in Scotland were uncertified, with a rapid fall after 1919 to 0.9 per cent by 1922. 30 ERO DZ 60/1, Southend Local Insurance Committee, 1915–20, 31 December 1919; Newsholme, International Studies, Vol. III, p. 458. 31 W. R. Dalzell (MA, Edinburgh, 1877, MB, CM, Edinburgh 1881); W. Crampton (MRCS, LRCP, London,1905); W. A. Kidd (LSA, 1896, MB, ChB, Liverpool 1904); E. Evans (LRCP and LM, LMCSI and LM, 1908 Catholic University, Dublin); A. G. W. Owen (BA Wales, 1903, MB, ChB, Liverpool 1909, MD, Liverpool 1911). 32 Cheshire Record Office, NIB 9/1–2, Birkenhead National Insurance Committee register of payments to practitioners, 1924–30 and 1930–34 and NIB 10, Birkenhead National Insurance Committee register of sums credited to practitioners, 1914–19. 33 A. Bradford Hill, ‘The doctor’s pay and day’, Journal of the Royal Statistical Society, CIV (1951), p. 23. 34 Digby and Bosanquet, ‘Doctors and patients’, p. 76. 35 Quoted in H. Levy, National Health Insurance. A Critical Study, Cambridge, Cambridge University Press, 1944, p. 1311, based on evidence (question 1222) by the Ministry of Health to the Royal Commission on Health Insurance in 1926. 36 Report for 1912–13 on the Administration in Scotland of the National Insurance Act, Part I, Cd. 6907, 1913, p. 347. Most counties were stated to have 300–400 and most boroughs 400–1,100 patients. 37 Newsholme, International Studies, Vol. III, p. 456. 38 TNA:PRO MH 62/151 Court of Enquiry into Practitioners’ Remuneration, 1923,

The British National Health Insurance Act, 1911

39 40 41 42 43 44 45 46 47 48

49 50 51

52 53 54 55 56 57 58 59

60 61

62

197

evidence of Scottish Association of Insurance Committees; Digby and Bosanquet, ‘Doctors and patients’, p. 84. Digby and Bosanquet, ‘Doctors and patients’, p. 76. H. B. Brackenbury, ‘Health insurance in England’, Millbank Memorial Fund Quarterly, XII, July 1934, 5. TNA:PRO PIN 1/3, draft report of Anderson Committee, appendix. Digby and Bosanquet, ‘Doctors and patients’, p. 89. TNA:PRO MH 62/151, replies from insurance committees, 1924. A Panel Doctor, On the Panel. General Practice as a Career, London, Faber and Gwyer, 1926, Ch. 3. Clwyd Record Office, Hawarden branch, D/DM/63/33, letter in doctor’s ledger. A Panel Doctor, On the Panel, p. 60. Newsholme, International Experience, Vol. III, p. 127; evidence of BMA to Royal Commission on National Health Insurance, 1926, quoted in H. Cabot, The Doctor’s Bill, New York, 1935, p. 175. Foreword by Lloyd George to D. W. Orr and J. W. Orr, Health Insurance with Medical Care. The British Experience, New York, Macmillan, 1938. For similar sentiments see also G. F. McLeary, ‘English health insurance and the standard of medical service’, Millbank Memorial Fund Quarterly, XI, April 1933. McLeary had been Principal Medical Officer of the NHI Commission. Digby and Bosanquet, ‘Doctors and patients’, pp. 86–7. TNA:PRO MH 62/258, evidence of Medical Practitioners Union to the Court of Enquiry into Capitation, 1937. TNA:PRO MH 62/151, Court of Enquiry into Insurance Practitioners Remuneration, 1923 for the evidence of the Scottish Association of Insurance Committees on figures for Ayrshire. See also Gateshead Insurance Committee. Reports of Clerk, 1931–35, unpublished typescript. Burnley News, 10 May 1913. ERO DZ 60/1, Southend Local Insurance Committee, 1915–20; Gateshead Insurance Committee. Reports of Clerk, 1931–35, unpublished typescript. ERO National Association of Clerks to Insurance Committees: Proceedings at a Conference at Scarborough, unpublished typescript, 1927, p. 54, contributions of Mr Abbott of Middlesex and Mr West of Cheshire. TNA:PRO MH 62/258, Court of Enquiry into Practitioners Remuneration, 1937, on evidence of panel doctors in letters to the Medical Practitioners Union. Medical World, 9 April 1914. Wellcome Archives, London, GP 29/2/59, transcript of testimony by Dr Samuel Isaacs of Merthyr Tydfil. NAS HH3 6/6, Minutes of Fife County Insurance Committee, 2 September 1922. Very few of these remain. A surviving set is held by the Greater Glasgow Health Board Archives, HB 57, records of Drs MacFarlane, Blair, Short and McQueen of west Glasgow. I am grateful to the practice principals for permission to consult these records, and to Alistair Tough, Archivist, for sampling and photocopying these records for me. See Digby, British General Practice, pp. 208–10 for a fuller discussion of these records. For example, Daily Sketch, 6 February 1923; Sunday Pictorial, 4 March 1923; Burnley News, 10 October 1928. R. Greene, retired London general practitioner, ‘Personal view’, British Medical Journal, 7 March 1970; Digby and Bosanquet, ‘Doctors and patients’, p. 90; Royal Commission on National Health Insurance, British Parliamentary Papers, Cmd. 2596, 1926, XIV, p. 37; Lancashire Record Office (LRO), ICBu/3, undated extract from Burnley News, circa 1923. TNA:PRO MH 62/151, Court of Enquiry into Insurance Practitioners Remuneration, 1923.

198 Anne Digby 63 F. Lewis, President of the National Conference of Friendly Societies in 1930, quoted in H. Cabot, The Doctor’s Bill, New York, Columbia University Press, 1935, p. 173. 64 Burnley News, 3 October 1914, reporting a meeting of the Local Medical Committee. 65 Levy, National Health Insurance, p. 125. 66 NRO SONH 1/3, Nottinghamshire NHI Medical Benefit Subcommittee, 1913–26, 1 November 1922. Insurance practitioners had a legal obligation to provide proper surgery and waiting-room accommodation (W. J. Foster and F. G. Taylor, National Health Insurance, 1937, London, Pitman and Sons, p. 157). 67 Burnley Express, 10 December 1924. 68 TNA:PRO MH 62/258, Court of Enquiry into Practitioners Remuneration, 1937, letter by Dr Ward to the Medical Practitioners Union. 69 NRO SONH 1/1, Nottinghamshire Insurance Committee Minutes, 1912–27, minute of 27 May 1921. This was part of a national audit. 70 TNA:PRO MH 62/151, Court of Enquiry into Insurance Practitioners Remuneration, 1923 for evidence from the Scottish Association of Insurance Committees, and from the National Association of Insurance Committees. 71 TNA:PRO MH 62/151, Court of Enquiry into Insurance Practitioners Remuneration, 1923, evidence of Scottish Association of Insurance Committees, p. 4. A. B. Gilmour, the Superintendent of the Central Checking Bureau in Glasgow, stated that ‘coal tar, arsenical compounds, colloidal preparations, vaccines, sera and insulin are regularly prescribed’. 72 NRO SONH 1/1 Nottinghamshire Insurance Committee, 1912–27, minute of 29 October 1915. 73 LRO IC Bo 17/I, Barrow in Furness Insurance Committee Correspondence, 1916. 74 NRO SONH/1/1, minute of 13 December 1915. 75 Newsholme, International Studies, Vol. III, p. 119 76 British Medical Journal, 23 April 1929. 77 M. Bligh, Dr Eurich of Bradford, London, Clarke, 1960, p. 231. 78 F. Honigsbaum, The Division in British Medicine: a history of the separation of general practice from hospital care, 1911–1968, London, Kogan Page, 1979, pp. 124, 158–9, 304, 306–7. 79 NRO SONH 1/1, Nottinghamshire Medical Services Committee, 1912–27. 80 G. F. McLeary, ‘English health insurance’, p. 86.

Part IV

Contemporary issues

12 A double irony? The politics of National Health Service expenditure in the 1950s Tony Cutler

Introduction A crucial financial feature of the National Health Service (NHS) has been the dominance of general taxation as the principal source of funding for the Service. A key implication of this mode of finance is that NHS funding is governed by de facto competition between spending departments for a share of public expenditure. Such competition is a central theme of this chapter, which examines the determinants of parsimony in NHS expenditure during the 1950s. The thesis advanced is that a key aspect of such parsimony was a political irony. The NHS lost out in the competition for resources because it was a ‘political success’. In contrast, education was an area of perceived political ‘failure’ and increased expenditure was a means of addressing the political threat stemming from this ‘failure’. The chapter is divided into five sections. The first seeks to show the pattern of parsimony in NHS spending in the 1950s and to set expenditure trends in the context of social services expenditure during this period, while the second examines the literature on the causes of restraint in NHS expenditure during the 1950s and identifies issues which remain unresolved in that literature. The third section considers the problems of policy on secondary education and how such problems were related to growth in education expenditure; and the fourth examines why the NHS did not pose similar problems and suggests reasons why the constraint on expenditure did not engender major perceived political difficulties. A conclusion draws together the themes of the chapter and points to the double irony that while the Service may have been a political ‘success’, parsimony engendered important problems for the NHS.

Parsimony and the competition for resources To set restraint on NHS expenditure during the 1950s in context, Table 12.1, shows trends in expenditure during that period, contrasting them with the first two Thatcher administrations and the first year of her third administration. Table 12.1 shows that, while the Thatcher years have often been seen as a period of particularly tight expenditure control in the NHS, the 1950s were a

6,593 6,280 6,254 6,102 6,294 6,578 6,709 7,149 7,221 7,927

1950–51 1951–52 1952–53 1953–54 1954–55 1955–56 1956–57 1957–58 1958–59 1959–60 ⫺4.7 ⫺0.4 ⫺2.4 ⫹3.1 ⫹4.5 ⫹2.0 ⫹6.5 ⫹1.0 ⫹9.8

Percentage increase over previous year

Source: J. Appleby, Journal of Health Services Research and Policy, 4, 1999, 84.

Expenditure 1985 prices (£ million)

Year

1978–79 1979–80 1980–81 1981–82 1982–83 1983–84 1984–85 1985–86 1986–87 1987–88

Year

15,826 15,461 15,955 16,350 16,730 17,068 17,093 17,350 17,697 18,006

Expenditure 1985 prices (£ million)

Table 12.1 National health expenditure in constant (1985) prices 1950–51 to 1959–60, and 1978–79 to 1987–88

⫺2.3 ⫹3.1 ⫹2.5 ⫹2.3 ⫹2.0 ⫹0.1 ⫹1.5 ⫹2.0 ⫹1.7

Percentage increase over previous year

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203

comparable period of parsimony.1 Thus from 1950–51 to 1959–60, cumulative expenditure in real terms rose by 14.7 per cent; from 1978–79 to 1987–88 the corresponding increase was 13.7 per cent.2 Funding of the NHS was (and is) strongly influenced by competition with other spending departments. With Cold War spending rising in the 1950s, and the absence of a significant ‘peace dividend’, scope for expansion of the health budget was determined by choices about other social service programmes.3 Table 12.2 shows the relative position of the four large programmes: social security, health, education and housing. Two programmes, education and social security, more than doubled their expenditure levels; in contrast, NHS expenditure increased by only 60 per cent over the period. In 1951/52, education accounted for 19.5 per cent of social services expenditure and health 23.1 per cent; by 1959–60, the respective proportions were 23.7 per cent and 21.2 per cent.4 In terms of the de facto competition between the major social service programmes, two key features are worth noting. The first is that social security was consistently both the largest programme and the one where expenditure increased at a rate in excess of average social service expenditure growth in every year from 1951/52 to 1959/60. The largest single item in the social security budget was retirement pensions, which consistently accounted for over twothirds of the total.5 Demographic and political pressures underpinned the growth in expenditure in this area. The numbers of claimants of retirement and contributory pensions rose from 4,263,000 in 1951 to 5,672,000 in 1960.6 The other key driver of expenditure was the (periodic) uprating of national insurance benefits including the basic retirement pension, and the very large increases shown in Table 12.2 from 1954/55 to 1955/56 and 1957/58 to 1958/59 relate to substantial benefit increases in April 1955 and January 1958.7 There was a lower cost option; as the Conservative Minister of Pensions and National Insurance (1951–55, Osbert Peake) suggested in a memorandum of December 1951, ‘the simplest solution would be to leave insurance benefits and pensions as they are and rely entirely on assistance for further provision for the old and sick’.8 There were two principal objections to following such a course. The Conservatives had regularly criticised Labour for failing to maintain the real value of national insurance benefits. In addition, insurance benefits were a significant revenue source, and a radical shift to means testing ran the risk of undermining the ‘contributory’ principle.9 Thus the combination of demographic pressures and uprating meant that social security would remain a substantial and growing social services programme. However, the second major feature, indicated in Table 12.2, was that if the level of social security expenditure meant constraints on the ‘financial space’ for the growth of expenditure in other social service areas, there was one other service where this was not the case: housing. In 1953–54 housing accounted for 21.5 per cent of overall social services expenditure. but by 1959/60 this had fallen to 11.7 per cent.10

416.1 (100) 449.0 (107.0) 472.3 (113.5) 517.7 (124.4) 567.4 (136.4) 671.3 (161.3) 756.8 (181.9) 810.4 (194.8) 882.3 (212.0)

1951/52

493.9 (100) 497.7 (100.8) 508.9 (103.0) 537.0 (108.7) 583.1 (118.1) 639.2 (129.4) 648.7 (138.6) 731.6 (148.1) 787.7 (159.5)

Health 105.7 (100) 119.8 (113.3) 118.6 (112.2) 120.1 (113.6) 129.4 (122.4) 142.7 (135.0) 132.6 (15.4) 136.1 (128.8) 144.9 (137.1)

Personal social services 701.7 (100) 844.8 (120.4) 888.2 (126.1) 914.1 (132.2) 1020.3 (145.4) 1067.7 (512.1) 1151.4 (164.1) 1387.1 (197.6) 1458.2 (207.8)

Social security 417.3 (100) 504.8 (120.9) 544.0 (130.4) 525.9 (126.0) 501.6 (120.2) 490.0 (117.4) 446.6 (107.0) 412.7 (98.9) 445.2 (106.7)

Housing

Sources: C. Webster, The Health Services Since the War, Vol. 2, London, The Stationery Office, 1996; Index numbers, author’s calculations.

1959/60

1958/59

1957/58

1956/57

1955/56

1954/55

1953/54

1952/53

Education

Year

2,134.7 (100) 2,116.1 (113.2) 2,532.5 (118.6) 2,614.8 (122.5) 2,801.8 (131.2) 3,010.9 (141.0) 3,172.1 (148.6) 3,477.9 (162.9) 2,718.1 (174.2)

Total

Table 12.2 Social service expenditure trends, United Kingdom 1951–52 to 1959–60, expenditure in £ million, actual prices (indices in brackets, 1951–52 = 100)

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205

This shift reflected the ambivalent approach of the Conservatives to housing policy. Between 1921 and 1951, the population of England and Wales increased by 15.8 per cent but numbers of households increased by 50.6 per cent.11 Wartime damage was estimated to have destroyed 200,000 houses completely and rendered a further 250,000 uninhabitable.12 At the same time, the demands of ‘total war’ meant that whereas there were 221,758 dwelling houses completed in 1939 the average for the period 1941–44 fell to 11,255.13 Such features contributed to the high political salience of housing, which was reflected in responses to a Gallup Poll of 11 June 1945. When electors were asked what they thought was the main election issue, 41 per cent chose housing as against 15 per cent full employment and, notwithstanding the significance of the Beveridge Report, 7 per cent social security.14 Under Labour, local authority provision was seen as the crucial means of meeting the need for dwellings, but the programme was vulnerable to cuts driven by economic crises post-1947.15 As a result, total completions fell from 232,463 in 1948 to 205,427 in 1950, and local authority completions fell from 193,548 to 167,917 over the same period.16 This opened up a political opportunity for the Conservatives, and in their 1951 manifesto they made a commitment to completion of 300,000 houses a year.17 The target was first achieved in 1953,18 and in that year nearly 75 per cent of completions were by local authorities.19 However, this did not indicate a Conservative commitment to collectivism. Harold Macmillan, the Minister for Housing and Local Government (1951–54), in a draft letter of 1953 to R.A. Butler, the Chancellor (1951–55), raised the possibility of a higher subsidy for slum clearance as against that for ‘general needs’.20 This was an indication that Conservative policy was beginning to shift, and this culminated in the Housing Subsidies Act of 1956 which targeted slum clearance with a subsidy level for this (residualist) purpose set at over double the ‘general needs’ level. By 1960 local authority house completions had fallen to 128,216, 52 per cent of the peak level of 1953, and in that year local authority completions had fallen to 42 per cent of the total.21 This change in policy is reflected in the trends shown Table 12.2, and the reduced role of public housing did open a financial space which could allow for significant expansion in other areas. The demands of social security meant that this area was necessarily a ‘beneficiary’. However, it was not the only one: the other key beneficiary was education. In the third section of this chapter the aim will be to explore the political problems in education policy which drove increased expenditure. However, before examining this issue it is necessary to examine the arguments in the literature on the reasons for restraint in NHS expenditure during the 1950s.

Explaining a decade of parsimony in NHS expenditure Webster characterises this period of expenditure restraint as exhibiting an ‘atmosphere of retrenchment’.22 In a similar vein, referring to the NHS between 1951 and 1957, Bridgen and Lowe see it as operating ‘in an almost permanent

206 Tony Cutler [situation] of economic crisis’.23 In attempting to account for this pattern Webster has referred to a situation where ‘the NHS struggled along in an atmosphere of suspicion in government quarters, the main objective foundations for which were the unrealistically low speculative estimates for the cost of the new service made before its inception’.24 What were the reasons for Treasury concerns over inadequate financial control in the NHS? They related, in part, to the experience of the first two fiscal years of the Service, when there were major cost over-runs. In 1948/49 gross NHS expenditure exceeded the estimate by 39 per cent, and in 1949/50 the overrun was 27.5 per cent.25 However, such concerns also reflected anxieties over the principle of a service free at the point of use. For example, Hale, then an undersecretary in the Treasury Social Services Division argued, in a memorandum of January 1949, that charges for dentures and spectacles were ‘right’ and that he had ‘never been able to see why people should get dentures and spectacles for nothing any more than houses, food and clothing’.26 The causes of these overruns were complex. In the case of dental and ophthalmic services, there was a major backlog of demand for dentures and spectacles relating to limitations in provision in the inter-war period, combined with difficulties in predicting levels of demand.27 The dental estimate for the 1948/49 (part-year) was £8,150,000, while actual expenditure was £21,800,000; the respective figures for the ophthalmic service were £2,330,000 and £14,970,000.28 Demand-side determinants were also significant in the case of pharmaceutical expenditure. Here, the key issue was not only the volume of demand but also the shift in the composition of provision to more expensive proprietary drugs.29 Hospital expenditure, easily the largest single element of NHS costs, was also over budget, by roughly 20 per cent in 1948/49, but the dental, ophthalmic and pharmaceutical services accounted for 54 per cent of the total cost over-run in 1948/49 and 46 per cent in 1949/50.30 More generally, though, the ‘atmosphere of suspicion’ arose from the estimates contained in the 1946 Financial Memorandum to the National Health Service Bill (giving the estimate for England and Wales) and its Scottish counterpart. These anticipated an annual cost of £152 million for England and Wales and £22 million for Scotland.31 This early estimate continued to function as a benchmark for NHS expenditure in the late 1950s. Thus Bridgen and Lowe refer to ‘continual harking back to the initial estimated cost of £175 million’, a rounded-up version of the Great Britain estimate contained in the two Financial Memoranda.32 Webster’s assessment of cost estimates preceding the creation of the Service as ‘speculative’ is supported by research on how they were constructed. The Financial Memorandum estimates were a marginal variant on that contained in Appendix E of the 1944 White Paper, A National Health Service.33 A contemporary critique by Robb-Smith (at the time the Director of Pathology at the Radcliffe Infirmary) in The Lancet, expressed grave doubts regarding the soundness of the 1944 White Paper estimates, and he (perceptively) raised the issue of political damage to the Service stemming from unrealistic expectations

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regarding cost in a communication to the then Minister of Health (Willink).34 Recent research has confirmed that Robb-Smith’s doubts concerning the viability of estimates of hospital costs were well founded, given expenditure trends in costs in leading voluntary and local authority hospitals in the 1930s.35 In addition, wartime cost estimates, which formed the basis for the 1944 White Paper and two Financial Memoranda figures, were deficient in other respects. In particular, both the ophthalmic and pharmaceutical estimates extrapolated expenditure on the services for the section of the population covered by National Health Insurance at the end of the inter-war period without attempting to take account of the backlog stemming from low levels of coverage prior to the creation of the NHS.36 Thus it has been shown that the perception of a lack of financial control in the NHS was related to inadequate cost estimates. However, another important aspect of the impact of the cost estimates relates to the approach to financial control adopted in the Treasury. The significance of this approach can be seen by examining the impact of the report of the Guillebaud Committee. The appointment of this Committee reflected pressure from the Treasury for an inquiry into NHS expenditure which was designed to increase pressure for cuts in expenditure.37 The Committee’s research on expenditure trends was subcontracted to the National Institute of Economic and Social Research (NIESR) and was undertaken by Brian Abel-Smith, then working at the Institute, with Richard Titmuss acting as a consultant,38 and was published as The Cost of the National Health Service in England and Wales.39 The NIESR research can be situated as part of a ‘social accounting’ approach to social services expenditure.40 This differed in a number of ways from the presentation of expenditure data in official sources. Inter alia current expenditure was related to change in national income, and there was an attempt to construct price indices for the Service so that an expenditure series could be constructed in ‘real’ terms.41 These differences in treatment had a significant effect on the conceptualisation and presentation of NHS expenditure. In current gross cost terms NHS expenditure in England and Wales rose 20.4 per cent between 1949–50 and 1953–54, but in Abel-Smith and Titmuss’s constant price series the increase was 8.6 per cent; over the same period the current gross cost of the NHS fell from 3.8 per cent of Gross National Product to 3.42 per cent.42 This research profoundly influenced the findings of the Committee. The Report stated ‘it may come as a surprise to many to find that the National Health Service has absorbed a decreasing proportion of the country’s resources since 1949–50 . . . the first full year of the Service’.43 The Committee also stated that it could not recommend any means which would ‘reduce in a substantial degree the annual cost of the Service’ nor suggest significant ‘new sources of income’.44 However, it is clear from the documentary record that the Treasury, far from being ‘converted’ by Guillebaud, received the report with dismay – a feature reflected in Bridgen and Lowe’s characterisation of this reception as ‘Guillebaud ignored’.45 Nevertheless, while Treasury hostility to the NHS was an important factor in expenditure restraint in this period, it was not necessarily decisive. In

208 Tony Cutler the case of the Conservative housing programme, Butler mounted a sustained attack on Macmillan’s housing targets throughout 1952.46 However, the issue was resolved in Macmillan’s favour at a Cabinet of July 1952 via the decisive intervention of Churchill.47 A further significant aspect of the politics of NHS expenditure in the 1950s is related to debates on consensus on the NHS in this period. In an important paper, Webster has argued that the view that Conservative governments (including those of the 1950s) ‘afforded a protected status to the NHS prior to the Thatcher era’ is unfounded.48 He points to major inter-party differences relating to the financing of the Service and its relationship to the redistribution of income. A central aspect of Bevan’s case for predominantly exchequer funding of the NHS was that this would have a strong redistributive effect.49 A much less significant source of funding for the NHS was a proportion of national insurance contributions. In line with Bevan’s approach, the ‘NHS contribution’ was not increased and accounted for a decreasing share of overall NHS funding. While this policy was initially continued under the Conservatives, there was a major change of direction in 1957. The NHS contribution was increased from 10d to 2s 4d in 1958, and this meant that the yield from this source rose to nearly 20 per cent of the gross cost of the NHS in 1958 as against 9 per cent at the beginning of the Service.50 Since insurance contributions were levied on a flat-rate basis, an increasing share of funding came from what a Conservative critic of the policy (John Boyd-Carpenter, Minister of Pensions and National Insurance 1955–62) termed ‘a regressive poll tax’.51 While such criticisms demonstrated that this policy shift was not uncontested, it also shows the extent of the gap between the Conservatives and Labour on the role of the NHS in promoting social equality In the case of the NHS, the literature also points to the political weakness of the Ministry of Health during the 1950s. In 1950, following Bevan’s move from Health to the Ministry of Labour, an important departmental restructuring occurred with the transfer of the housing function to the Ministry of Town and Country Planning. An effect of this change was a reduction in the staffing of the Ministry of Health from 5,300 to 2,700.52 Webster has argued that this contraction also meant that the Ministry was not seen as attractive to ‘high fliers’ in the civil service.53 There were also other sources of political weakness in the Ministry. After the restructuring, Bevan’s successor, Marquand, was not a member of the Cabinet. Cabinet status was restored with the Conservative election victory in 1951, although the next Minister, Crookshank, remained in the post for barely over six months and combined it with that of Leader of the House.54 After this the Minister of Health was not a Cabinet member again until 1962.55 Crookshank’s short tenure was part of a pattern, and between 1951 and 1958 there were five Conservative Ministers of Health.56 This turnover led Bevan to argue, in 1958, that ‘one of the difficulties about the National Health Service is that there have been too many Ministers’ and that lack of experience in post weakened the incumbent’s ability to ‘stand up against the importunities of the Treasury’.57 The emphasis on the political weakness of the Ministry of Health during the

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1950s is significant in the context of political bargaining over public expenditure. It raises the question of why ‘competitor’ departments had a higher political profile. This issue will be pursued in the next section, which seeks to explain the basis for the greater political salience of education issues during the 1950s.

‘Failure’ and funding: education expenditure and the politics of secondary education in the 1950s The argument in this section is that education, particularly secondary, posed a major political problem for the Conservatives in the 1950s. Under the selective system which operated in this period, a relatively small minority of pupils gained access to grammar schools. However, they were the principal route into further and higher education. There was also increasing popular interest in education, reflecting a view that a ‘better’ education opened up career opportunities, and this was manifested in increasing numbers of pupils staying on beyond the minimum school-leaving age. The political dilemma created by secondary modern schools being seen as inferior, but also the type of school attended by most pupils, was sharpened by the breakdown of a bipartisan policy. Up until 1951, Labour and the Conservatives had both supported selection for secondary education at ‘11+’. However, in 1951 Labour policy (if in an ambivalent fashion) switched to support for comprehensive education at secondary level. This combination of factors confronted the Conservatives with a major political challenge, and the object of this section is to examine their response and its implications for educational expenditure in the period. A key political issue in interdepartmental debates over funding priorities related to the implementation of the 1944 Education Act. The White Paper which preceded the Act stated ‘there will be three main types of secondary schools to be known as grammar, modern and technical schools’, the ‘tripartite’ system.58 However, ‘tripartism’ was something of a misnomer, given that the vast majority of pupils went to secondary moderns, a significant minority to grammar schools but only a small minority to technical schools – for example, in 1960 there were 1,637,379 pupils in secondary modern schools, 696,777 in grammar schools and 101,913 in technical schools.59 While the 1944 Act did not stipulate how pupils would be selected for each type of school, the most common approach was an examination at around the age of 11 which came to be known as the ‘11+’.60 Since selection was designed to fit the school to the pupil, all types of secondary school would be, in the words of the 1943 White Paper, of ‘equal standing’.61 However, one of the key problems which confronted the Conservatives was that the schools were not viewed in this way, and a grammar-school education was perceived as superior to that offered in secondary moderns. A crucial aspect of ‘equal standing’ was the extent to which grammar and secondary modern education gave differential access to career opportunities. A significant measure was the extent to which the populations of such schools had access to forms of further education. There was a massive disjuncture between

210 Tony Cutler rates of entry into further education between the two principal school types – for example, in 1951 just 1.2 per cent of boys and 3 per cent of girls progressed to further education from secondary modern schools, the respective figures for grammar schools being 17.5 per cent and 27.1 per cent.62 A survey of 1,400 parents in Hertfordshire, undertaken in 1952, found that overall 54 per cent of parents chose grammar schools as their preferred type of secondary school for their children, as against 16 per cent selecting secondary moderns.63 The inferior status of the secondary modern was also signalled in policy discussions. A memorandum from the Minister of Education (1954–57) (David Eccles) to the Cabinet in April 1955 stated: ‘it was hoped that the modern schools would attain “parity of esteem” with the grammar schools and that as a result the disappointment and jealousy felt by parents when their children failed to qualify for a grammar school would disappear. But this has not . . . happened and the resentment appears to be growing’.64 The political problem posed by the 11+ was exacerbated by the numbers of the potentially ‘disappointed’. Grammar schools never accounted for more than 29 per cent of maintained secondary school pupils in England and Wales (in 1951), and the proportion had fallen to below 25 per cent by 1960.65 This became more salient as a political issue when educational qualifications were seen as increasingly significant for employment opportunities. There was a trend to an increasing percentage of pupils staying at school after the minimum leaving age. In 1951, 1.9 per cent of secondary modern, 45.2 per cent of grammar and 36.1 per cent of technical school pupils in England and Wales stayed on at school after the minimum leaving age; by 1960 the respective figures were 4.5 per cent, 56.1 per cent and 41.5 per cent.66 There were also large increases in the number taking the General Certificate of Education (GCE) examination. Total GCE entries in England and Wales increased from 738,717 in 1951 to 1,603,894 in 1960, with passes increasing from 427,038 to 928,038.67 Thus the Minister of Education (1957–59) (Geoffrey Lloyd), writing to Macmillan in 1958, referred to the ‘millions of parents [who] are now seized with the case value of good educational qualifications’.68 While it could not be argued that grammar school entry was the sole condition of obtaining ‘recognised’ educational qualifications, the logic of tripartism meant that it was a common perception that children who did not gain entry to a grammar school had ‘failed’ the 11+.69 These concerns over the 11+ became more significant because of a breakdown in the bipartisan approach to tripartism. Labour’s implementation of the 1944 Act in government from 1945 to 1951 worked within this framework. However, A Policy for Secondary Education (1951)70 committed Labour to support for comprehensive education. What was significant for the Conservatives was that there was an electoral alternative to tripartism. Tripartism was thus perceived, by the mid-1950s, as posing a political problem for Conservatives. As Eccles graphically put it, ‘we cannot leave the 11+ where it is’.71 This raises the question of the nature of the Conservative response, and Eccles reviewed various options in his 1955 memorandum. One

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possibility ‘would be expansion of both grammar schools and the percentage going to university’.72 However, the grammar school was the sanctum sanctorum of state education for the Conservatives, and this precluded the option.73 Given this attitude it was also impossible to countenance support for a general comprehensive policy, since this would undercut grammar schools. Thus Eccles stated that he would approve the establishment of a comprehensive ‘only where no good school is to be swallowed up’74 (for ‘good school’ read grammar school) and that he would ‘not agree to a complete network of comprehensive schools in any area’.75 However, if the defence of the grammar school foreclosed these options, what was the alternative, given that the 11+ could not be ‘left as it is’? As Dean has shown,76 the response from the mid-1950s was to upgrade the secondary modern so that it represented an alternative route of ‘opportunity’. Eccles argued that, where secondary moderns offered ‘special courses with a vocational interest’, then ‘local education authorities are finding that complaints from parents are strikingly reduced’.77 To what extent does the rising spending on education shown in Table 12.2 reflect this upgrading strategy? An objection to the argument that increased spending reflected policy concerns was that expenditure was driven by demographic pressures.78 However, it is problematic to suggest that concerns over the politics of tripartism were not crucial. Over the period from 1951 to 1960, the secondary school population in England and Wales increased from 1,732,997 to 2,723,158.79 However, 17 per cent of this increase reflected greater numbers staying on beyond the minimum school leaving age.80 Thus the commitment of resources to secondary education reflected not just the size of the relevant age group but also a response to the increased demand for education discussed above. In addition, there was an increase in funding per pupil in real terms. Nominal expenditure per pupil in secondary education in England and Wales rose by 39 per cent between 1955 and 1960, while retail prices rose by 11 per cent over the same period.81 A key element in the increased funding of secondary education was the perceived need to ‘throw money’ at a problem. The next section will contrast this pattern with that in health.

Success and parsimony The object of this section is to investigate why the kind of problems relating to the politics of secondary education did not apply to health. Reviewing the position after the first decade of the Service, Webster has argued that ‘opinion polls showed that the NHS had achieved a settled position of esteem amongst the public’.82 A 1956 Gallup poll asked, ‘As far as you are personally concerned how would you rate the NHS – favourably or unfavourably?’ and responses were 89 per cent favourably, 4 per cent unfavourably and 7 per cent undecided.83 The American economist, Gemmill, obtained a similar result in a later survey. When he asked respondents whether they thought they were getting a satisfactory service from the NHS, 91 per cent answered yes, 9 per cent no.84 While he

212 Tony Cutler did not produce any quantitative data to support his claim, he stated that ‘the comprehensiveness of the Service’ was a basis for its ‘popularity’.85 He also cited a number of examples of support for the principle of a service being ‘free at the point of use’, giving examples of people who received either long-term or particularly expensive forms of treatment from the NHS and who commented on the freedom from concern over these costs which the Service provided.86 Thus while the opinion poll evidence in this period was not systematic by modern standards, there is some evidence to support the view that the NHS was popular during the 1950s and that the principles of a ‘comprehensive’ service and one ‘free at the point of use’ were factors in this popularity. It is necessary to state some caveats with respect to both principles. ‘Comprehensiveness’ has never meant that a complete range of medical treatments has been provided by the NHS.87 Further, even before the introduction of charges for dentures and spectacles under Labour, there were charges for ‘pay’ and ‘amenity’ beds which, for example, yielded respectively revenue of £2.3 million and £100,000 in 1949–50, the first full year of the Service.88 Notwithstanding such caveats, ‘comprehensiveness’ might have been more loosely understood in the 1950s as giving population coverage for a much wider range of services than had been offered before the creation of the NHS. Equally, the general pattern at the beginning of the 1950s was one where services were ‘free at the point of use’. In this respect, Conservative attacks on either of these ‘principles’ carried political risks. The Conservative approach was ambivalent. Bridgen and Lowe have argued that ‘many [Conservatives] remained extremely hostile to the NHS created by Bevan’ but that ‘most accepted by 1951 that the broad structure of the NHS had to be maintained’.89 This uneasy position can be seen with respect to policy on a ‘comprehensive’ service and one ‘free at the point of use’. With respect to the scope of the Service, the major changes considered were the suspension of the general dental service and the ‘supplementary’ ophthalmic service. The dental service was divided into a ‘priority’ service provided by local health and education authorities to mothers, infants and school children, and a ‘general’ service available to the rest of the population.90 The adjective ‘supplementary’ had been applied to the ophthalmic service since the long-term objective had been to organise a hospital based service. This, however, was not feasible at the beginning of the NHS because of shortages of medically trained practitioners,91 though by the end of the 1950s the ‘supplementary’ service, provided by opticians, was accepted as the basis of most long-term provision.92 Proposals to suspend the general dental service and the supplementary ophthalmic service were agreed by the Cabinet Economic Policy Committee in December 1951 with the expectation that this would generate savings of £20 million (dental) and £5 million (ophthalmic).93 In certain respects this would have reduced provision relative to the period before the creation of the Service, when dental and ophthalmic treatment were ‘additional’ benefits under National Health Insurance (NHI) and could only be offered by approved societies with an actuarial surplus. At the time of the Fifth Valuation of Approved Societies in

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1943, additional benefits were offered to 10,595,000 men and 4,930,000 women.94 Dental and ophthalmic benefits were the most popular additional benefits, with 84 per cent of men and 61 per cent of women covered under NHI qualifying for dental benefit and 84 per cent of men and 26 per cent of women qualifying for ophthalmic benefit.95 The suspension policy would effectively have withdrawn a state dental service from the working population, and given the limited character of ophthalmic provision from medically qualified practitioners referred to above would also have considerably restricted the scope of this service.96 In this respect these proposals are evidence of the Conservative hostility to what could be seen as a core NHS ‘principle’ to which Bridgen and Lowe referred. However, when these proposals went to Cabinet they were rejected, thus illustrating Conservative willingness to acquiesce in the ‘broad structure’ of the 1948 settlement.97 There were parallels with respect to policy on charges. Table 12.3 shows the NHS charges proposed by the Chancellor, Butler, in a memorandum to the Economic Policy Committee in December 1951. The list shows the extent to which the Conservatives were willing to contemplate a breach in the principle of a service free at the point of use. However, as Webster has shown, in a definitive account, the extent of charges was progressively whittled away.98 When Butler presented his ‘economy’ proposals to the Commons in January 1952, the anticipated ‘savings’ were £20 million with hospital charges omitted.99 The prescription and dental charges were unchanged, but the ‘appliance’, amenity bed and day nursery charges were expected to yield only £0.5 million.100 This was followed by a further reduction when exemptions from dental charges were extended to all those under twenty-one, a ‘concession’ which was estimated to cut a further £1 million of the yield.101 By deciding to apply an attenuated set of charges, the Conservatives failed to achieve their initial ‘economy’ target. However, they did gain two related political advantages. They were able to point to Labour precedents such as the power to impose prescription charges included in the 1949 NHS Amendment Act, and to deflect Table 12.3 Proposed NHS charges and estimated revenue yields, Great Britain, December 1951 Proposed charge

Expected yield

Prescription charge (1/- per form) Hospital charge* 2/6d per day Hospital charge* 3/- per day Dental charges** Appliance charges Increased charges for amenity beds Day nursery charges

£12.0 million £14.25 million £17.25 million £7.25 million £0.50 million £0.25 million £0.50 million

Notes * assumed that children would incur a charge of half the adult rate and infectious disease and tuberculosis patients would not pay a change; ** a flat £1 charge with 5/- payment by ‘priority’ classes.

214 Tony Cutler arguments that the charges introduced involved a fundamental breach in the principle of a service ‘free at the point of use’.102 If, however, Conservative caution on charging removed one source of political vulnerability, was there also the risk of a negative reaction to the policy of parsimony? Survey research during the 1980s has shown, for example, that popular support for the broad principles of the NHS coexisted with a negative reaction to restrictions on Service expenditure.103 There are no comparable detailed public opinion data for the 1950s, so it is not possible to investigate thoroughly whether this was also the case in that period. However, in the rest of this section it will be argued that there were two features which may have contributed to a lack of a comparable reaction to parsimony in the 1950s. The first point is that initial dental and ophthalmic expenditure reflected a backlog of demand, but expenditure then fell in nominal terms, even before the introduction of charging.104 Dental spending was £40 million in England in the first full year of the Service (1949/50), but this figure fell to £16.9 million in 1952/53 and did not return to the £40 million level until 1959/60.105 The fall in ophthalmic expenditure in England was even more marked, from £21.5 million in 1949/50 to £5.5 million in 1952/53, and it was still below £10 million as late as 1959/60.106 These falls made it easier to accommodate expenditure increases in other areas. Thus over the period 1949/50 to 1959/60, expenditure on hospitals and pharmaceuticals more than doubled in nominal terms.107 A second contributory feature was the relative treatment of current and capital expenditure. While it has been shown that there was considerable restraint on overall NHS expenditure in the 1950s, this of course does not mean that expenditure levels were in real terms lower than the situation prior to the creation of the NHS. However, there was one area where a reasonable case can be made that NHS expenditure levels were significantly lower than those at the end of the inter-war period. In 1956, Abel-Smith and Titmuss sought to estimate the level of capital expenditure in 1938–39 which could be compared with capital expenditure levels in the early 1950s. While they were aware of the problems involved in comparing the pre- and post-NHS situations, they estimated that the 1952/53 value of 1938/39 capital investment on hospitals was £32 million and that the 1952/53 capital expenditure level of £10 million was roughly one third of that at the end of the inter-war level.108 However rigorously this comparison was undertaken, it necessarily could only be approximate. On the other hand, the ‘one-third’ level is cited in other sources. A Ministry of Health estimate of December 1953 put 1938/39 capital investment at a slightly higher figure than did Abel-Smith and Titmuss (£10.6 million), and suggested that, to adjust for ‘current prices’, it would be necessary to increase the 1938/39 figures by 3.3. This gave a 1952/53 equivalent of £35 million, slightly higher but in the same type of range as the Abel-Smith and Titmuss calculation.109 To this extent, then, a relatively convincing case can be made that capital expenditure restraint was on a level well beyond that applied to current expenditure. It might have been anticipated that such a low level of capital expenditure

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would have given the Ministry of Health a basis for mounting a campaign which could have persuaded the Treasury to sanction a much larger capital programme. However, in an important contribution to the literature in this area, Mohan has demonstrated the problems which the Ministry encountered in making such a case. While the Treasury accepted that using obsolete capital and buildings was inefficient and hence that capital investment could be justified on grounds of promoting economy in current expenditure, this related to a ‘very narrow field’.110 Against this consideration, the Treasury was concerned that higher capital investment would fuel demands for higher current expenditure, particularly on staffing at new facilities.111 Capital investment in the NHS during this period was of a ‘make do and mend’ character, and Webster points to the failure to complete a single new hospital in the first decade of the service; this led to embarrassing estimates that, at prevailing expenditure levels, it would take 220 years to replace the existing capital stock.112 However, there were weaknesses in such arguments as a justification for a larger capital programme. For example, such estimates took the existing hospital capital stock as a benchmark, yet this led to the objection that this capital stock was, in certain respects, inappropriate in the context of changes in patterns of morbidity and mortality – for example, the hospital stock at the point of creation of the NHS included an ‘excessive’ provision for hospitals designed for the treatment of infectious disease.113 The low level of capital expenditure raises the question of why significant political problems did not result from such parsimony. Arguably, this question turns on questions of political visibility. Cuts in current expenditure raise the problem that they are highly visible, since there is an impact via either the withdrawal of a service or the manifest deterioration in its quality. However, while capital expenditure does clearly have implications for the volume and quality of service provision it is, by definition, not visible, since the asset concerned has not been provided.114 The NHS could thus be seen as a political ‘success’. Opinion-poll evidence supports the view that the Service was popular. There are also grounds for believing that the principles of a ‘comprehensive’ service and one ‘free at the point of use’ helped to underpin this popularity. Notwithstanding their desire to effect ‘economies’, the Conservatives drew back from major restrictions on service provision and limited ventures into charging.115 This reduced their vulnerability to accusations that they were undermining fundamental principles of the Service. While it is not possible to form a definitive view regarding the political impact of parsimony, there were also mitigating elements. The importance of backlogs in the demand-driven dental and ophthalmic services allowed the financial ‘room’ for higher expenditure growth in areas such as hospitals and pharmaceuticals. Equally, the most rigorous controls were in the less ‘visible’ area of capital expenditure.

216 Tony Cutler

Conclusion: a double irony? This chapter has sought to explain an irony. Following the move to a much more limited public housing programme in the mid-1950s, the financial space was created to expand other service areas. Given demographic and political pressures social security would absorb substantial resources, but sufficient scope remained to develop other programmes. The NHS was not the major beneficiary because it was a political ‘success’. The Service was popular and, given Conservative caution on overt service cuts and charges, they could represent their approach as bipartisan. In contrast, secondary education was a political ‘failure’. Secondary education was becoming an increasingly salient issue and the ‘preferred’ parental option, the grammar school, was available to a minority of the school population. Equally, with the breakdown of a bipartisan approach to tripartism, Labour offered an electoral alternative. Given the Conservative desire (at this stage) to defend tripartism, the alternative was to increase the credibility of ‘equal standing’ by improving standards in secondary moderns – a policy reflected in the greater resource commitment in this area. If, however, there was an irony, it was part of a double irony. In this discussion, ‘success’ has been used in a circumscribed sense of politically popular. However, if the NHS were judged by reference to explicit or implicit service objectives, a less sanguine view could be taken of the situation at the end of the 1950s. To give just one example, from wartime planning onwards it had been argued that the dental service ought to have a preventative emphasis and also that such an emphasis should be a universal characteristic.116 However, data from the Dental Estimates Board in 1960 showed that the England and Wales average was 4,608 population per dentist, but that provision varied from an average of 3,250 in London and the South-east to 6,390 in the North Midlands. In London and the South-east the average ratio of teeth filled to teeth extracted was 10 : 1; in the North Midlands it was 3.46 : 1.117 Such examples could easily be multiplied, as Chapter 13 in this volume indicates. It would be ingenuous to believe that all such inequalities could be dealt with via better funding. However, it is part of the double irony of the NHS in the 1950s that political ‘success’ acted to underpin restrictions on funding which could have contributed to resolving such limitations on NHS service provision.

Acknowledgements My thanks to Jim Tomlinson for suggestions on avenues for research on the final section of this chapter, and to Martin Gorsky and Sally Sheard for their comments on an earlier draft. Any limitations of the final version are naturally the responsibility of the author.

Notes 1 For a discussion of expenditure trends under the Thatcher administrations, see Radical Statistics Health Group, Facing the Figures, What is Really Happening to

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32

217

the National Health Service, London, Radical Statistics Health Group, 1987, pp. 37–50. Calculated from J. Appleby, ‘Government funding of the UK National Health Service: what does the historical record reveal?’, Journal of Health Services Research and Policy, 4, 1999, 84. Central Statistical Office, Annual Abstract of Statistics, 1952–60. Calculated from C. Webster, The Health Services Since the War, Vol. 2, Government and the National Health Service 1958–1979, London, The Stationery Office, 1996. Central Statistical Office, Annual Abstract of Statistics, 1961. London, HMSO, p. 51. Ibid. Ibid. The National Archives, Public Record Office (TNA:PRO), CAB 134/927, HA (P), 51, 4 Pensions Sub-Committee Pensions Review, Memorandum by the Minister of National Insurance, 13 December 1951. Ibid. Calculated from Table 12.2. A. Land, R. Lowe and N. Whiteside, The Development of the Welfare State 1939–1951: a guide to documents in the Public Record Office, London, HMSO, 1992, p. 69. S. Merrett, State Housing in Britain, London, Routledge, 1979, p. 236. Central Statistical Office, Annual Abstract, 1961, p. 60. R. McCallum and A. Readman, The British General Election of 1945, London, Oxford University Press, 1947, p. 237. Land et al., The Development of the Welfare State, p. 78. Central Statistical Office, 1961, op. cit., p. 60. F. Craig (ed.), British General Election Manifestos 1910–1974, Basingstoke, Macmillan, 1975, p. 146. Central Statistical Office, Annual Abstract, 1961, p. 60. Ibid. TNA:PRO, HLG 101/433 Draft Letter to the Chancellor of the Exchequer, Macmillan, undated with papers of May 1953. Calculated from Central Statistical Office, Annual Abstract, 1961, p. 60. C. Webster, The Health Services Since the War, Vol. 1, Problems of Health Care: the National Health Service before 1957, London, HMSO, 1988, p. 399. P. Bridgen and R. Lowe, Welfare Policy Under the Conservatives 1951–1964, London, Public Record Office, 1998, p. 43. Webster, The Health Services, Vol. 2, p. 5. Calculated from Webster, The Health Services, Vol. 1, p. 135. TNA:PRO T 227/185 Hale, National Health Service, 11 January 1949, see also Land et al., The Development of the Welfare State, p. 130. T. Cutler, ‘The cost of the National Health Service: problem definition and policy response 1942–1960’, unpublished PhD thesis, London School of Hygiene and Tropical Medicine, 2000, Ch. 5. Ibid., p. 184. T. Cutler, ‘Dangerous yardstick? Early cost estimates and the politics of financial management in the first decade of the National Health Service’, Medical History, 47, 2003, 231. Calculated from Cutler, ‘The cost of the National Health Service’, p. 183. Financial Memorandum to the National Health Service Bill, 1946, PP. 1945–46, III, Financial Memorandum to the National Health Service Bill (Scotland), 1946, PP. 1945–46, III. Bridgen and Lowe, Welfare Policy, p. 43.

218 Tony Cutler 33 See Cutler, ‘Dangerous yardstick?’, pp. 219–21. 34 See A. H. T. Robb-Smith, ‘The conjectures of Appendix E’, Lancet, I, 2 April, 1944, pp. 545–6; and TNA:PRO, MH 77/84 A. H. T. Robb-Smith to Henry Willink, 23 March 1944. 35 See Cutler, ‘Dangerous yardstick?’, pp. 213–16. 36 Ibid., pp. 225–9. 37 Bridgen and Lowe, Welfare Policy, p. 46. 38 Webster, The Health Services, Vol. 1, p. 207. Titmuss was at the time Professor of Social Policy at the London School of Economics, he died in 1973. Abel-Smith subsequently also held a chair in Social Policy at the LSE, he died in 1996. 39 B. Abel-Smith and R. Titmuss, The Cost of the National Health Service in England and Wales, Cambridge, Cambridge University Press, 1956. 40 W. Hagenbuch, ‘The welfare state and its finances’, Lloyd’s Bank Review, 49, 1958, 1–17. 41 Abel-Smith and Titmuss, The Cost of the National Health Service, pp. 13, 89. 42 Ibid., pp. 60, 63. 43 Report of the Committee of Enquiry into the Cost of the National Health Service, Cmnd. 9663, 1956, PP 1955–56, paras 720–1. 44 Ibid. 45 Bridgen and Lowe, Welfare Policy, p. 49; in part this relates to Treasury resistance to setting social service expenditure in the context of growth of national income, see J. Tomlinson, ‘Why so austere? The British welfare state of the 1940s’, Journal of Social Policy, 27, 1998, 63–77, esp. 74. 46 For example, TNA:PRO CAB 129/53, C (52) 40 Investment in New Building, Memorandum by the Chancellor of the Exchequer, 15 July 1952. 47 TNA:PRO CAB 128/25, CC (52), 73 Meeting, Conclusions, 24 July 1952. 48 C. Webster, ‘Conservatives and consensus: the politics of the National Health Service 1951–64’, in A. Oakley and A. Susan Williams (eds), The Politics of the Welfare State, London, UCL Press, 1994, p. 54. 49 Ibid., p. 64. 50 Ibid., pp. 66–7. 51 Ibid., p. 67. 52 Webster, The Health Services, Vol. 2, note 15, p. 832. 53 Ibid., p. 4. 54 See H. Jones, ‘The Conservative Party and the welfare state’, unpublished PhD thesis, London School of Economics, 1992, p. 292, for Crookshank’s lack of interest in the health portfolio. 55 Bridgen and Lowe, Welfare Policy, p. 278. 56 Ibid. 57 Bevan, Hansard, HC Debates, vol. 592, 1958, Col. 1395. 58 Board of Education, Educational Reconstruction, Cmd. 6458, PP., 1942–43, XI, para. 29. 59 Ministry of Education Report, 1960. 60 P. Vernon (ed.), Secondary School Selection: a British Psychological Society Inquiry, London, Methuen, 1957, p. 27. 61 Board of Education, op. cit., para. 2. 62 Ministry of Education Report, 1951. 63 D. V. Glass (ed.), Social Mobility in Britain, London, Routledge and Kegan Paul, 1954, p. 163. 64 TNA:PRO ED 136/861 Secondary Education, Memorandum from the Minister of Education, 18 April 1955. 65 Ministry of Education Reports, 1951–60. 66 Ministry of Education Reports, 1951 and 1960. 67 Ministry of Education Reports, 1951 and 1960.

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68 Lloyd to Macmillan, 1 January, 1958, NA, PRO, PREM 11/4171. 69 For Conservative concern over this perception, see TNA:PRO ED 147/635 Vosper to Woolam, 5 April 1956. 70 Labour Party, A Policy for Secondary Education, June, 1951, London, Labour Party. 71 TNA:PRO ED 136/861 Secondary Education. 72 Ibid. 73 Ibid. 74 Ibid. 75 Ibid., for the similarity with Lloyd’s views on this issue, see TNA:PRO PREM 11/4171 Lloyd to Macmillan, 24 December 1957. 76 D. Dean, ‘Preservation or renovation? The dilemmas of Conservative education policy 1955–1960’, Twentieth Century British History, 3, 1992, 3–31, esp. 14. 77 TNA:PRO ED 136/861 Secondary Education. 78 See, for example, B. Simon, Education and the Social Order 1940–1990, London, Lawrence and Wishart, 1991, p. 212. 79 Ministry of Education Reports, 1951 and 1960. 80 Calculated from Ministry of Education Reports, 1951 and 1960. 81 Expenditure per pupil figures calculated from Ministry of Education Reports, 1951 and 1960, retail prices figure derived from Central Statistical Office, National Income and Expenditure 1966. 82 Webster, The Health Services, Vol. 2, p. 2. 83 Cited in P. Gemmill, Britain’s Search for Health: The First Decade of the National Health Service, Philadelphia, University of Pennsylvania Press, 1960, p. 152. 84 Ibid., p. 135. 85 Ibid., pp. 104–5, esp. 107. 86 Ibid., pp. 110–11. 87 See M. Powell, Evaluating the National Health Service, Buckingham, Open University Press, 1997, pp. 56–7. 88 Abel-Smith and Titmuss, The Cost of the National Health Service, p. 27. 89 Bridgen and Lowe, Welfare Policy, p. 43. 90 Ibid., p. 81. 91 Webster, The Health Services, Vol. 1, p. 369. 92 Ibid., p. 373. 93 TNA:PRO CAB 134/856 Economic Policy Committee, Sub-Committee on the Economic Situation, Minutes, 6th Meeting, 12 December 1951, EA (E), 51. 94 Fifth Valuation of the Assets and Liabilities of Approved Societies, PP, 1942–43, vii, 1943. 95 Ibid. 96 Webster, The Health Services, Vol. 1, p. 370. 97 TNA:PRO CAB 128/23 Conclusions, Cabinet, 20 December 1951, C.C. (51), 19 Conclusion. 98 Webster, The Health Services, Vol. 1, pp. 188–94. 99 Butler, House of Commons Debates, vol. 495, 1951–52, Cols. 54–5, for a discussion of the problems of imposing hospital charges, see TNA:PRO MH 80/59 Hospital Inpatient charge, unsigned, no date, with paper of December 1951. 100 Butler, House of Commons Debates, Vol. 495, 1951–52, Cols. 54–5. 101 Crookshank, House of Commons Debates, vol. 498, 1951–52, col. 848. 102 Webster, The Health Services, Vol. 1, p. 146. 103 See N. Bosanquet, ‘An ailing state of National Health’, in R. Jowell, S. Witherspoon and L. Brook (eds), British Social Attitudes, the 5th Report, Aldershot, Gower, 1988, pp. 95, 97, 98. 104 Abel-Smith and Titmuss, The Cost of the National Health Service, pp. 40, 42. 105 Civil Estimates 1949–50, 1952–53 and 1959–60. 106 Civil Estimates 1949–50, 1952–53 and 1959–60.

220 Tony Cutler 107 108 109 110 111 112 113 114 115 116 117

Civil Estimates 1949–50 and 1959–60. Abel-Smith and Titmuss, The Cost of the National Health Service, Appendix F. TNA:PRO T 227/402 Marre to Clarke, Investment Programme, 16 December 1953. J. Mohan, Planning, Markets and Hospitals, London, Routledge, 2002, p. 148. Ibid. Abel-Smith and Titmuss, The Cost of the National Health Service, p. 52, and see Mohan, Planning, Markets and Hospitals, pp. 146–7; Webster, The Health Services, Vol. 2, p. 24. Mohan, Planning, Markets and Hospitals, p. 147. See P. Pierson, Dismantling the Welfare State, Reagan, Thatcher and the Politics of Retrenchment, Cambridge, Cambridge University Press, 1994, p. 14. See Webster, ‘Conservatives and consensus’, particularly pp. 60–64. See TNA:PRO MH 80/35 Report of a Committee on Post-war Dental Policy, 11 February, 1943. Figures from TNA:PRO MH 129/30 Dental Estimates Board for 31 December.

13 Inequalities, regions and hospitals The Resource Allocation Working Party John Welshman

Introduction This chapter is concerned with resource allocation in the early National Health Service (NHS), and the policy background to the creation of the Resource Allocation Working Party (RAWP) of the early 1970s. Inequalities in health, and geographical variations in access to health care, are among the most important themes in contemporary health policy. Yet while historians are increasingly aware of geographical variations in health provision in Britain before the Second World War, and of concerns about health inequalities in the period before the publication of the Black Report (1980), less attention has been paid to resource allocation under the early NHS.1 It therefore seeks to incorporate the theme of resource allocation into broader debates about the financing of British medicine since 1850. It is usually suggested that it was only with the formation of RAWP in the early 1970s that differences in resource allocation between NHS regions were acknowledged. The main interpretation has been that of Nicholas Mays and Gwyn Bevan. They see RAWP as ‘the culmination of a series of discussions between civil servants, health policy experts and Ministers stretching back to the Guillebaud Committee in the mid-1950s’.2 Writing in 1987, they suggested that this might explain the RAWP formula’s longevity since 1976. First, its concentration on geographical inequalities and a modest pace of change secured both Conservative and Labour support. Second, the involvement of senior NHS managers and the Department of Health and Social Security (DHSS) reduced opposition to RAWP in the NHS. Third, RAWP was explicitly formulated to create equal opportunity of access in the tradition of the 1946 NHS Act, but there was no mechanism to secure equality of access. Mays and Bevan therefore concluded that RAWP stands out as a ‘signal success in public policy initiatives over the last twenty years . . . resource allocation to health authorities was fundamentally altered by the RAWP report’.3 They suggested that its underlying objective and chosen methods of measuring an appropriate distribution of resources were likely to be ‘profoundly influential for the foreseeable future’.4 With the publication of the official history of the National Health Service, the implementation of the Hospital Plan (1962), the experience of particular

222 John Welshman Regional Hospital Boards (RHBs) and the issue of resource allocation itself have all begun to receive attention from historians.5 John Mohan has also explored spatial resource allocation policies in the 1980s, arguing that the technical deficiencies in the RAWP formula became an urgent political issue for the Conservatives only when policies of resource distribution threatened the geopolitical base of Conservative support.6 However, what has been neglected by historians is the earlier political and intellectual history of the coming of RAWP, and it is this neglect that this chapter attempts to remedy. Its main concern is with England, acknowledging there were parallel debates in Scotland and in Wales. Moreover, given that the main policy files remain closed under the thirtyyears rule, its sources are mainly published documents.7 This chapter is not concerned with the technical details of the formula for funding introduced by RAWP, and nor does it attempt to assess the effectiveness of RAWP in redressing inequalities in resource allocation from 1975 onwards. What it will do is to describe the changing position of resource allocation as a policy issue between 1940 and 1976, and explain the reasons for increasing attention being given to resource allocation in the early 1970s. It illustrates these points with the particular case of the Sheffield RHB, long recognised as a resource-poor region. The chapter argues that while concerns about resource allocation were expressed periodically from 1940 onwards, the early 1970s marked an important stepchange in this debate, reflecting a changed political and intellectual climate.

Before 1948: the inherited pattern of resources Although not a major issue, the inequalities inherent in the resources inherited from the pre-1948 period have been recognised. Some of the earliest commentators on the NHS made passing reference to the issue of resource allocation and the experience of individual regions. Harry Eckstein, for example, an American observer writing in 1959, noted the uneven geographical distribution of services before 1948, and argued that despite improvements in the distribution of general practitioners, ‘an appointment in Manchester or Sheffield is still tantamount to self-imposed exile for all too many budding consultants’.8 Similar points were made in 1962 by Sir John and Sylvia Jewkes, who noted that there had been little change in the number and distribution of hospitals and in the distribution of dentists and doctors, thus many of the pre-war weaknesses were still evident.9 The health economists M. H. Cooper and A. J. Culyer, writing in 1972, observed that the NHS embodied the principle of equal access and there was an assumption that resources would inevitably become more equitably distributed than if they had been left in the private sector. They suggested that detailed and systematic evidence on the uneven geographical distribution of manpower and capital was lacking in 1948, but that ‘the stock was taken over much as it stood and the evidence is that it remains very unequal to this day’.10 Nevertheless, it is fair to say that much of the early secondary literature on the NHS made little reference to geographical variations in provision or to the issue of resource allocation in general. More recent (post-RAWP) commentators

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have paid more attention to the resources NHS regions inherited in 1948. Alan Maynard and Anne Ludbrook have observed, for instance, that the NHS inherited a hospital stock characterised by lack of co-ordination and large geographical differences in the distribution of beds. The broad pattern was one of relative under-provision in the North of England and over-provision in the South, with greater variations below regional level.11 Judy Allsop has argued that the NHS came into existence with a geographical maldistribution of resources in relation to population distribution that was itself a legacy of ‘a combination of market forces, past philanthropy and civic pride’.12 The South was better off than the North, the town than the countryside, and areas with higher socio-economic groups than those with a predominantly working-class population. Charles Webster, the official historian, has observed that impoverishment of resources was ‘an inherited pattern, closely reflecting the long-term problems of the economy in the areas worst affected by the depression’.13 Webster has claimed that the NHS ‘tended to mirror and perpetuate the accumulated idiosyncrasies and inequalities in health-care provision contained in the inherited system’.14 There has been growing interest in the resources inherited from the pre-1948 era, and the assessments of hospital services before the NHS offered by the surveys sponsored by the Nuffield Provincial Hospitals Trust (1945) give a useful view of hospital distribution by the late 1930s.15 The survey of Sheffield and the East Midlands, for example, which was one of the most comprehensive, reported that this region was rhomboid in shape, and was one of the largest in England and Wales, covering some 5,688 square miles. It included Leicestershire, Nottinghamshire, and parts of Derbyshire, Lincolnshire, Rutland and the West Riding of Yorkshire. Geographically it was diverse, ranging from the sparsely populated areas of north-west Derbyshire, to the rich agricultural fenland of south-east Lincolnshire. John Mohan has drawn attention to the importance of the socio-economic landscape against which policies are implemented in order to understand policy development, and notes that social policies may have been designed to appeal to socio-economic groups in particular regions.16 In the Sheffield region, the main industries were coal-mining, agriculture, textiles, the manufacture of boots and shoes, and heavy industry, and the total population was 3.9 million. If there were particular health needs, it appears these were unmet by existing institutions. It was calculated that overall there were 20,385 hospital beds but that 32,521 were needed, especially in County areas, where shortages were more severe than in County Boroughs.17 Institutions included voluntary, local authority and chronic hospitals. The survey found twenty voluntary hospitals with 4,634 beds, ranging from the Leicester Royal Infirmary with some 500 beds, to the Newark and District hospital with only sixty-six. In the most highly developed hospitals the honorary staff held higher qualifications and practised only as consultants, but many were staffed by general practitioners. Moreover, there was a tendency to overdevelopment and lavish expenditure on equipment, especially in cottage hospitals, which often had operating theatres and X-ray equipment.18 This expensive equipment was rarely used. The local authority hospitals, on the other hand,

224 John Welshman catered for both acute and chronic cases. Some had developed acute services such as midwifery and orthopaedics. Here the Boroughs generally had better provision than the Councils, and there were other problems of co-ordination owing to administrative boundaries. Hospitals for infectious disease, for example, varied greatly, especially with regard to nursing – in one, the caretaker, an untrained woman, was the only nurse. The degree of co-operation between voluntary and municipal hospitals was also variable – although some transferred cases and shared consultant staffs, in others the co-operation envisaged in the 1929 Local Government Act was infrequent and ineffective.19 On hospital building and design, very few large hospitals had been rebuilt on modern lines and most were dark, overcrowded and badly-equipped. The tables that accompanied the wartime hospital surveys were based on a standard questionnaire, and do permit comparative analysis of the situation within each region. The Sheffield survey gives a striking sense of the variable quality and uneven spatial distribution of the institutions which the Sheffield region was to inherit from the pre-NHS era. In fact, similar issues were highlighted in the survey that covered much of the neighbouring future Oxford region. It comprised Oxfordshire and Northamptonshire, with parts of Berkshire, Buckinghamshire, Gloucestershire and Wiltshire, an area that had a population of 867,140 in 1938, seventy-five hospitals and 5,711 beds. Again, there were perceived shortages of both hospital beds and medical personnel, particularly consultants. Public Assistance Institutions were singled out as being especially bad, and there were areas of special need, as at Aylesbury. Even Oxford and the Radcliffe Infirmary were seen as being unable to meet demands, while smaller centres like Slough and Windsor had no, or inadequate, hospitals.20 Thus other regions had similar problems with the institutions that they took over. Nevertheless, the contrasting experiences of the neighbouring Sheffield and Oxford RHBs were to provide striking illustrations of inequalities in resource allocation into the 1970s.

1948–62: Limited attention to resource allocation Secondary commentators have pointed out that while the legacy of inherited resources was seen as important, there was little discussion of regional resource inequality in the 1950s. A. E. Bennett and Walter Holland (themselves members of RAWP) have argued that the methods used to distribute financial resources to the NHS at this time ‘tended to augment the historical element in the supply of real resources (for example, facilities and manpower); and by responding only slowly and slightly to changes in population and morbidity they have perpetuated inequalities’.21 Maynard and Ludbrook have argued that perception of regional resource inequality as a policy problem remained muted, and the main concern of policymakers was ‘containing the size of the NHS budget’. They characterised the division of the budget as ‘what you got last year, plus an allowance for growth, plus an allowance for scandals’. In their view, incremental increases in resources

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went to the ‘noisiest rather than the neediest’.22 With such a system it was hardly surprising that the regional inequalities inherited in 1948 went virtually untouched, to be ‘discovered’ in the 1960s. Maynard and Ludbrook have pointed out, interestingly, that there was also little evidence on social class inequalities – the recognition that conditions of access were different for different sections of the population. There was a lack of data on the utilisation of services by the different social classes – what evidence there was tended to be qualitative or speculative – and they argue the lack of attention given to social class inequalities was reflected in the introduction of charges. This was even though social class variations in health status were well documented in official statistics, such as on occupational mortality. In general, Maynard and Ludbrook argued there had been more interest in geographical inequalities than in social class differences.23 Rudolf Klein has pointed out that the inherited inequalities in the geographical distribution of hospital beds remained virtually undisturbed between 1950 and 1960. In effect, under the pressure of financial crisis and in the absence of information needed to make judgements about local services and needs, the Ministry of Health settled for control over the inherited budgets instead of devising an appropriate financial allocation from first principles. In Klein’s words, preference was given ‘to the issue of control, to the neglect of the issue of distribution’.24 In surveying the background to RAWP, Mays and Bevan have also argued that in the 1950s there was little interest in access to services. They suggest it was only in the 1960s, with the Hospital Plan (1962), that the notion of normative planning to provide desirable provision for the population gained ground, to be replaced in the 1970s by a policy of rationing in response to financial stringency.25 They argue that before 1962 the concern of the financial policy-makers in the Ministry of Health was to contain the increasing cost of the NHS. Thus planning and funding of capital and revenue were incremental and ad hoc, and the regional resource inequalities inherited in 1948 were not perceived as an important policy problem. The result was that there was no explicit public policy to reduce inequalities in resource distribution, and these remained little changed in the period up to 1962. Indeed, in many respects they were reinforced.26 On the capital side, there was a lack of co-ordination given the poor condition of hospitals, and the low level of capital investment in hospitals meant there were no new hospitals before 1962. A large proportion of new investment went on the teaching hospitals, and the distribution of major capital remained unchanged geographically. The only redistribution formula concerned the distribution of general practitioners. From 1948 the Medical Practices Committee had the power to exclude practitioners from ‘over-doctored’ areas, and 1952 saw the introduction of ‘restricted’ and ‘designated’ areas.27 In the official history of the NHS, Charles Webster has argued that during the first decade of the NHS relatively little attention was given to resource allocation, although he concedes there was an undercurrent of concern. Those regions that were better provided for retained their advantages. The most deprived regions in 1947 were East Anglia, Sheffield and Wales, and deprivation tended

226 John Welshman to be located in the North and West. Moreover, Webster has pointed out that the league table of the resource-rich and resource-poor RHBs remained essentially unchanged between 1948 and 1974. In terms of such indicators as the ratio of staff to beds, and the number of consultants, areas like East Anglia, Sheffield and Newcastle remained at the bottom, while Oxford, the Metropolitan RHBs and the South-west were consistently at the top. Sheffield’s share of capital and revenue allocations, for example, did not reflect its large population, and it was also under-provided with consultants, despite having a high percentage of the total beds. The percentage of national awards to consultants showed similar trends. The Sheffield region was short of junior doctors, and reliant on migrant doctors from India and Pakistan.28 Webster has noted that because the NHS could only apply basic mechanisms of financial control, often taken from pre-NHS bodies, ‘the new health service therefore ossified many of the inherited inequalities in health care, and there was no mechanism for preventing the perpetuation of such evils’.29 Webster makes the point that social scientists such as Richard Titmuss (Professor of Social Administration at the London School of Economics, 1951–72) and his colleague Jerry Morris (of the London School of Hygiene and Tropical Medicine) were not overly concerned with the resource allocation issue, their interest in geographical inequalities in health notwithstanding. Moreover, at a time of limited capital investment the opportunities for redistribution were limited. The metropolitan regions attracted a higher share of resources partly due to distribution of hospital beds, but also on account of the more expensive character of the London hospital system.30 The result was that in the first ten years of the NHS, despite the principle of regionalism, the position of the poorer regions had only ‘marginally improved’.31 In evaluating resource allocation, it is important to understand the systems for revenue and capital expenditure under which the RHBs operated. Publications by the Acton Society Trust provide helpful evidence. By 1959, when the Trust reported, allocations for revenue expenditure were composed of two elements, a ‘static’ or ‘inherited pattern’ element, based on an estimate of requirements for keeping the service running at its existing level, and a ‘developmental’ element, to cover the cost of new developments and extensions. The Ministry used its ‘developmental’ element to effect some levelling up in favour of the more needy regions. By the late 1950s, there were six RHBs that qualified for ‘levelling up’ through revenue distribution – Newcastle, Sheffield, Birmingham, Manchester, Liverpool and Wales. Between 1950–51 and 1958–59, the percentage share of revenue allocations of the six neediest RHBs increased from 39.11 per cent to 42.22 per cent of the total allocation to RHBs. For the same period, the percentage share of the four Metropolitan RHBs decreased from 41.72 per cent to 38.30 per cent. The share of the remaining group (Leeds, East Anglia, Oxford and South-western) was stable. Given that the total allocation for RHBs in England and Wales was £306.5m for 1958–59, the four Metropolitan regions got £10.37m less.32 Capital allocations were also divided into two – a basic allocation to be spent on purposes freely chosen by the RHBs and calculated mainly according to

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population served, but with small additions for certain Boards, and an allocation for specific purposes chosen by the Ministry. As with revenue expenditure, there was the same tendency to work towards ‘levelling up’ those Boards which started with standards of equipment and expenditure below average. The share of the six neediest Boards in total capital expenditure for the period 1948–49 to 1956–57 was 46.57 per cent, while their share of expenditure for 1956–57, 1957–58, and 1958–59 was over 50 per cent. The share of the total of the four Metropolitan Boards for the nine-year period was 33.11 per cent, while from 1956–57 it was 30 per cent. The remaining four Boards had a share for the nineyear period of 20.33 per cent.33 Work on social policy of the 1950s and early 1960s has tended to explore the extent of consensus on the health service, arguing that this was more an illusion than a reality, with expenditure cuts, for instance, offering a test of Conservative support for the principles of the NHS.34 In the 1950s, under the Conservatives, there was more concern with costs than in improving funding mechanisms, but enquiries did offer opportunities to explore the issue of resource allocation. The Guillebaud Committee on the Cost of the NHS (1956), for example, considered a formula for funding allocations, but argued there was such a wide range of variables that it was not practicable at that time. It noted capital allocations were calculated on a population basis with a 5 per cent rating in favour of the regions deemed to need special help. Therefore the Committee felt that ‘something’ was already being done to ‘level up’ service provision, and it concluded that ‘the present system, though it has certain weaknesses, is probably the best that can be devised in present circumstances’.35 The Guillebaud Committee was unable to recommend a resource allocation formula. It compared spending between hospital types, but paid little attention to regional distribution.36 More interestingly, the Select Committee on Estimates in 1956–57 admitted that hospital spending was linked to an ‘inherited pattern’, and while a check was kept on growth, inefficiency or lack of proper economy might go unchecked and variations in costs between regions could become entrenched. While the Ministry had tried to reduce variations, they were still too wide. The Committee argued that ‘it should be the object of the Minister to break away from this inherited pattern, and to find some method of taking efficiency into account when making his annual allocations’.37 In evidence to the Select Committee, Treasury officials had conceded they were faced ‘with an inherited pattern in which the teaching hospitals generally had a much higher standard before the appointed day, and with the limited juggling you can do in allocating money each year it is not very easy to bring about a closer alignment’.38 They argued that they were not unconcerned, and the Treasury did not consider it an ‘immutable inheritance’.39 However, others were more philosophical. In their evidence, Ministry of Health officials observed that there would always be variations according to the conditions in regions, and the types of buildings and hospitals. They claimed that in making allocations they took ‘into account those regions which have been running at a lower rate than others, and give them some benefit for that, so that we are all the time trying to keep a fair balancing

228 John Welshman up’.40 Overall, the Select Committee was less concerned with reallocating resources to the benefit of the poorer regions than with arriving at means of rewarding the most efficient authorities. It was not particularly aware of deficiencies of services in the poorer regions.41 Independent organisations did show concern over resource allocation. The Acton Society Trust, for example, was a non-profit-making Trust set up to promote economic, political and social research, and deriving its income mainly from the Joseph Rowntree Social Service Trust. Its investigation of hospital organisation was conducted by T. E. Chester, later Professor of Social Administration at Manchester University. In the late 1950s, the Trust noted that Treasury officials had admitted to the Select Committee on Estimates that the amounts available for hospital building had been inadequate, and the calibre of individual Ministers could have a decisive effect on the demands to finance the ‘developmental’ aspect of the budget. It noted there was some levelling up for regions with below average resources, and some evidence in the 1950s that poorer regions had increased their percentage share of the total revenue and capital allocations. The question the Trust posed was whether this ‘levelling up’ had gone far enough, and if it had been done fairly. Nevertheless, inequalities in resource allocation were not a major source of concern. The Trust argued that the Ministry had acted ‘sensibly and fairly’ on the basis of the empirical evidence available and, while certain hospitals and RHBs had been favoured, attempts to have applied more egalitarian policies would have been ‘very dangerous’.42 Again, it seemed more concerned about hospital efficiency than resource allocation. It is clear that the 1950s were marked by shortages of building materials and by severe restrictions on capital expenditure. John Mohan’s work suggests that relationships between the Ministry of Health and Treasury were also crucial, with the Treasury regarding expenditure on health as consumption rather than investment, and with the Ministry being sceptical of the planning abilities of individual RHBs. In this context, funds tended to flow to the ‘well-organised and vociferous’.43 Many aspects of the resource allocation question were determined outside regions, in the revenue and capital expenditure systems operated in Whitehall by the Ministry of Health and Treasury. Periodic concern was expressed by the Guillebaud Committee, the Select Committee on Estimates, and the Acton Society Trust. However, regions such as Sheffield remained at the bottom of the league table of RHBs partly because of their personnel and officers. Sheffield had a very complex committee structure, its Senior Administrative Medical Officers were not of the highest calibre, and most of the key posts were occupied by the same personnel from the creation of the RHB until the early 1960s. In the 1950s the Sheffield region was not ready with suitable schemes when money did become available, and neither the region’s Chairman nor Senior Administrative Medical Officers seemed able to exploit the sense of drift at the national level regarding resource allocation. This was in marked contrast to the Oxford region, where Dame Janet Vaughan and Dr J. O. F. Davies were the key players.44 Thus personalities also played a part at the regional level, and could make a difference.

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1962–72: Greater attention to resource allocation In surveying the period between 1962 and 1970, Mays and Bevan argue that the 1962 Hospital Plan marked the first attempt to link planning to resource allocation and to remove disparities. The 1968 and 1970 White Papers did mention resource allocation, and the period saw the introduction of the Crossman formula. There was much interest among health economists and others in the relationship between resources, services and needs, and in resource allocation itself. However, there were also reasons why more direct action on resource allocation was not taken in this period. They argue that the Hospital Plan aimed at equalisation through capital planning rather than direct revenue redistribution. Methods of allocation based on historical patterns of funding left little scope for redistribution, and NHS planning remained weak in face of vested interests represented by the consultants and the teaching hospitals. Levelling up would have been expensive, and there was little conception of what was a desirable level of health services or need. There were doubts about the administrative feasibility of redistribution. And what was missing before 1974, in addition to uncommitted resources for redistribution, was the political will to introduce a more explicit resource allocation formula.45 One of the key questions in relation to inequalities in resource allocation is the extent to which the RHBs might be able to make up their capital deficits through a hospital building programme. The Hospital Plan (1962) held out the promise of correcting pre-existing inequalities in resource distribution through a programme of capital investment in hospital infrastructure. David Allen suggests that its development was very similar to that of the NHS – consensus allied to greater affluence and government expenditure produced it – and the only pressure group activity was by the British Medical Association (BMA). This consensus was seized upon by three key individuals – Enoch Powell, the Minister for Health, Sir Bruce Fraser, Permanent Secretary at the Ministry of Health, and Sir George Godber, the Chief Medical Officer.46 Chris Ham has argued that the Hospital Plan marked the end of an era of ‘make do and mend’ and, while it was over-ambitious, provided a framework of development for the next decade and beyond.47 The Hospital Plan aimed for 90 new hospitals, 134 substantially modernised hospitals and 356 other big schemes. It envisaged capital expenditure on hospitals would rise steadily to reach £50m a year by 1964, and create a network of District General Hospitals (DGHs). For the first time since 1914, new hospital facilities were part of the investment landscape. How successful was the Plan as a mechanism for resource redistribution? Charles Webster’s judgement is critical. He claims that the Plan was vague, underestimating needs and overestimating the potential for economies. Even by 1964 it was realised that it would be more expensive than was originally thought, and Webster argues that the Hospital Plan also fell well short of its objectives. By 1979 only a third of the 250 DGHs had been built, and many were obsolete by the time they opened. Overall, Webster has concluded that ‘even upon the most lenient interpretation . . . the Hospital Plan was little short of a disaster, the full ramifications of which are still largely unchronicled’.48

230 John Welshman John Mohan’s work represents an attempt to chronicle the ramifications of the Hospital Plan in the Newcastle region. Unlike Allen, he relates the origins of the Plan more to wider policy on economic planning, including the Plowden Report (1961).49 This represented a shift to long-term public expenditure planning, including the Public Expenditure Survey and Control (PESC) system. Mohan argues that the Hospital Plan represented a positive attempt to maximise resources and respond to changing circumstances. It was at least a starting point in trying to steer resources towards areas of greatest need, and the 1960s did see a steady rise in hospital capital expenditure. However, Mohan also argues that it rested on insecure foundations and had technical weaknesses, so that a ‘plan’ became a ‘building programme’. The process of planning faced obstacles and external constraints on modernisation, and as officials began to acknowledge these there was less emphasis on planning and more on building. In this respect, the Hospital Plan was both a ‘milestone and a millstone’.50 Although there is evidence that the Plan illustrated new British interest in international developments in health care, notably in the USA, this seems too optimistic an interpretation. Certainly, it was not until the late 1960s that resource allocation became more prominent on the policy agenda. In the Sheffield region, the 1962 Hospital Plan was the first major attempt to link planning to resource allocation and to remove disparities. The Plan observed, for example, that in many places diagnostic facilities were out of date and in many rural areas hospitals were too small – ‘the region has fewer beds in relation to population than any other. Many are in old buildings which no longer serve the purposes of modern hospitals.’51 It also noted variations between local authority community care services in hospital regions. Nationally, however, the Plan aimed for equalisation through capital planning rather than direct revenue redistribution, and was mainly concerned with making estimates of the numbers of beds required per 1,000 population by 1975. Hospital revenue was then distributed to meet the cost of new hospital building, although this did not favour the less well-provided RHBs.52 This was because the new emphasis on hospital building did not necessarily imply a commitment to reducing inequalities in resources for annual expenditure. The other main planning document of the early 1960s was the Health and Welfare White Paper (1963). The publication of the Hospital Plan had highlighted the need to plan the long-term development of the local authority health and welfare services, notably with regard to care in the community. Thus all local authorities in England and Wales were invited to prepare plans for the development of services in the ten-year period 1962–63 to 1971–72. Nevertheless, the document was a poor exercise in planning, essentially amalgamating the ten-year plans of all the local authorities. As the Ministry of Health itself conceded in a telling illustration of its relaxed approach to relationships with local government, ‘no attempt was made either to indicate common standards to which the plans should conform or to suggest modifications before publication’.53 While Health and Welfare revealed large regional variations in existing services, for example in referrals and the number of people receiving services,

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the norms it used were not mandatory and costings were rudimentary.54 Thus, viewed in terms of the resource allocation issue, Health and Welfare was if anything even less successful than the Hospital Plan. In explaining growing emphasis on resource allocation up to 1972, the role of individual personalities was clearly important. Despite his work on the Hospital Plan, Enoch Powell made no mention of resource allocation in his reflections on his period as Minister of Health, 1960–63, published in 1966.55 As Secretary of State for Social Services at the newly-formed Department of Health and Social Security between 1968 and 1970, Richard Crossman was much more aware of the issue, and there was pressure from RHBs (including Sheffield) to adopt a fairer formula.56 A distribution mechanism was needed, and added impetus was given to this by the hospital scandals of the early 1970s, such as that at the Ely Hospital, Cardiff. In order to speed up redistribution, starting in 1971–72, a plan was devised to equalise revenue spending in the English regions over a ten-year period. Under the Crossman formula, half of the allocation was based on the population served, a quarter on the number of beds provided and a quarter on the number of cases treated. The new formula therefore reduced the previous emphasis on bed and case data, and increased that on demographic and epidemiological criteria, where age–sex and occupancy data were used to provide a proxy for morbidity. This was extended to community services after 1974. The new formula was criticised at the time by health economists. It was seen as using data from past performance to assess current needs, but ignored the past costs of the performance in assessing the required current allocations. It was only partially based on the objective needs of the region through adjusted population. Thus while it made much of the allocation process explicit, it failed in its attempts to be a comprehensive method for resource equalisation.57 Mays and Bevan have put forward a range of criticisms, and Webster has concluded that the Crossman formula had only limited success.58 A further factor highlighted by Mays and Bevan is the rise of the social indicator movement associated with Bleddyn Davies. He and others produced important academic studies of the relationship between services, resources and needs in the personal social services, and showed the importance of being able to quantify the extent to which redistribution could improve access. Davies’ work employed the concept of ‘territorial justice’ to describe the most appropriate relationship between uses of resources, provision of services and relative needs. Davies argued that what determined who received services was more likely to be the judgements of those who allocated services, the criteria used to assess relative needs, the availability of services (including charges), and how much the general public knew about them. What this pointed to was that a greater degree of control over local authority policies and resources would be likely to achieve appropriate allocation. Davies was critical of the organisation and ideology of the Ministry of Health, suggesting that ‘its attempts to tackle the problems of territorial justice and rising standards seemed to the observer to be too tactful to be highly effective’.59 More generally, Davies noted that differences in standards of local authority provision had been influenced by ideas

232 John Welshman about central–local relations and the need for central planning of the economy. The ten-year plans established by local authorities did not appear to result in a greater correlation between services and needs. Davies concluded that the raison d’être of local authorities was to provide services – ‘increasingly, this assessment is being made on the basis of national and not local experience, and efficiency of services is coming to be judged according to the costs and benefits to the nation as a whole’.60 What is clear is that there was increasing interest in the early 1970s regarding the issue of regional variation in Britain. For example, the geographers B. E. Coates and Professor E. M. Rawstron published Regional Variations in Britain (1971). Coates and Rawstron made comparisons between the Oxford, Sheffield, Newcastle, Liverpool and Wales regions on such indices as costs of inpatients, admissions, merit awards to consultants, hospital beds in use and reliance on overseas doctors. They concluded that geographical discrepancies were ‘gross’, and the distribution of medical and dental manpower and facilities was ‘irrational’.61 This came within the broader context of Julian Tudor Hart’s arguments about the ‘inverse care law’. For health economists, too, resource allocation was of increasing interest by the early 1970s. In 1972, M. H. Cooper and A. J. Culyer found from thirty-one official indices that in almost every instance the Sheffield region remained less well-endowed than the neighbouring Oxford region, and since 1962 relative inequalities seemed to have been increasing. Sheffield scored poorly on such indices as population per consultant, expenditure in hospitals per capita per annum, anaesthetists per million population and consultants treating mental illness per million population.62 Cooper and Culyer’s chapter appeared in a collection edited by Mark Hauser, who, like them, was a health economist based in the Department of Economics at the University of York.63 Hauser observed there were serious doubts about the capability of the NHS to make more efficient use of medical resources and achieve a more equitable distribution of services between different regions.64 More generally, this highlights an issue underplayed by Mays and Bevan – that of the influence of the York health economics policy nexus. With figures such as Professor Alan T. Peacock and Jack Wiseman, along with the Department of Economics and the University’s Institute of Social and Economic Research, York appears to have played an influential – and as yet unrecognised – role in the background to RAWP.65 Certainly, the way that health economics (and indeed social scientists in general) influenced policy development deserves more study than it has received hitherto.

1972–76: The Resource Allocation Working Party: interim and final reports The final period witnessed a gathering of pace of these earlier issues which together explain the appointment of RAWP in May 1975 by Barbara Castle, Secretary of State for Social Services 1974–76. First, academic research by

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health economists and others was increasingly concerned with resource allocation. The work of Martin Feldstein, then Professor of Economics at Harvard University, on regional inequalities in health and health care suggested that major inequalities in access and utilisation remained. Feldstein was well-known for his work with the World Health Organisation on health sector planning in developing countries – for instance, he applied a resource allocation model to public health planning, providing a case study of tuberculosis control in Korea.66 In the United Kingdom, academic research highlighted that there were inequalities in access and utilisation at the national, regional, and sub-regional levels; inequalities in manpower; geographical variations in mortality; and inequalities in resources between England, Wales, Scotland and Northern Ireland. Moreover, trends in inequalities of resources and needs seemed to be increasing.67 Other researchers concerned with expenditure on community services and correlations with need were based not in universities but in local government. Writing in the Lancet in 1974, J. Noyce, A. H. Snaith and A. J. Trickey (all based in the Derbyshire County Council Health Department) deployed a multiple regression analysis using community health expenditure as the dependent variable. They argued that the distributions of expenditure by health authorities in the three branches of the NHS in 1971–72 showed that dispersion was greater in the hospital than the community sector, and greater among health authorities than local authorities’ expenditure for all purposes. Noyce, Snaith and Trickey suggested a normative model was required for distribution between regions of financial resources for community health services. They found greater variations in expenditure in the hospital sector than by Executive Councils or by individual local authorities – twice as much was spent on hospitals in 1971–72 per 1,000 population in the South-west Metropolitan region as by Sheffield RHB. Overall, they argued that their work demonstrated the extent to which community health expenditure was associated with ‘inappropriate’ factors, and provided further evidence of Tudor Hart’s inverse care law.68 Second, Mays and Bevan also stress the political context of the 1974–76 period. The 1974 White Paper was committed to dealing with geographical inequalities, and this, they argue, provided the main impetus for the setting up of RAWP in 1975. The creation of Area Health Authorities (AHAs) provided an opportunity to improve management functions including resource allocation and planning. With the creation of the DHSS Regional Group (1972), there were joint DHSS–NHS Committees. Mays and Bevan claim the BMA was increasingly resentful of the London teaching hospitals and consultants.69 All this occurred in the broader economic context of the early 1970s following the oil crisis, which implied reductions in expenditure and rationing. Third, the issue of devolution opened up debates about the distribution of resources between different parts of the United Kingdom and between regions.70 Devolution prompted observers to reassess the rationale for the distribution of resources between the parts of Great Britain. It also drew attention to the idiosyncratic nature of existing arrangements, and led to the formulation of more scientific methods.71 Writing of devolution in 1975, George Godber, the former

234 John Welshman Chief Medical Officer, noted the disparity in the amount spent in Scotland and Wales compared to England, though he also argued of the situation in England that the problem was one of a lack of resources rather than one of maldistribution.72 Fourth, and perhaps most importantly, political support for spatial redistribution was now stronger. Richard Crossman was aware of inequalities and had devised the earlier formula, in part because of pressure exerted by RHBs such as Sheffield. Crossman had noted in his diaries on 1 April 1970 of the new formula for ‘reducing the disparity between well-off places, London and the Home Counties, and poorer places like Newcastle, Manchester and Birmingham . . . there was a tremendous struggle to maintain the status quo’.73 In his Maurice Bloch lecture, given at the University of Glasgow in April 1972, Crossman acknowledged that the standards of service available in Sheffield and London were ‘poles apart’.74 He acknowledged that the dominance of London hospitals reflected the concentration of wealthy people in the South-east. Crossman argued that unless the Health Service budget rose steadily, and the percentage of GNP allotted to it was steadily increased, the gap between the richer and poorer regions would remain – that was why there was ‘virtually no change’ in the first twenty-five years of the NHS.75 In addition to Crossman, the Labour Party was active on this issue, Mays and Bevan arguing that this was an attractive egalitarian policy in a period of financial stringency.76 David Owen, Minister of Health 1974–76, was interested in geographical resource allocation, and this was supported by experts including Brian Abel-Smith, Professor of Social Administration at the London School of Economics, 1961–91. Certainly, in her diaries, Barbara Castle recorded that Owen’s work on the issue of resource allocation was one of his ‘. . . most important contributions to the work of the Department . . . David had long argued that the NHS had failed to iron out the wide discrepancies in health care between different parts of the country and was determined to get a new system of allocation related to need’.77 This comes through clearly in Owen’s book In Sickness and in Health (1976), where he regarded inequalities in health care as being ‘totally unacceptable’ and their elimination the ‘central task’ for the NHS over the following five to ten years.78 If Owen was not instrumental in the setting-up of RAWP, his commitment on the resource allocation issue did represent a continuation of the work done earlier by Crossman. Fifth, in the official history of the NHS, Webster tends to link concerns about inequalities with the Priorities exercise which exposed the problem of the disparities in health provision in different parts of the country. He argues that the arrangements for rational distribution of resources between programmes outlined in the Priorities document (1976), a consultative paper on health and the personal social services, required closer reference to the equitable geographical distribution of resources determined by reference to objective demographic and epidemiological factors.79 Similarly, The Way Forward document (1976) showed that the ranking order of the regions had changed little since 1958.80 By 1974 it was clear that earlier attempts at resource redistribution had been too

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limited in their effect, and insufficiently comprehensive in their framework. A more scientific approach was necessary, not excluding any branch of the health service, and taking account of both revenue and capital expenditure. Certainly, the new focus on resource allocation was brought out well in the Priorities document (1976). In the foreword, Barbara Castle wrote that, particularly when the growth of public expenditure was constrained, ‘it is all the more imperative that we should choose the right priorities and plan how they can be realised’. In addition to stressing the role for preventive services, the document noted that there was also a need progressively to remedy the large variations in standards between different regions, areas and districts. How far these variations reflected differences in need was not known for certain, but there were major inequities in the distribution of services which had to be corrected.81 Originally appointed in May 1975, the Resource Allocation Working Party’s terms of reference were ‘to review the arrangements for distributing NHS capital and revenue to Regional Health Authorities (RHAs), AHAs and Districts respectively with a view to establishing a method of securing, as soon as practicable, a pattern of distribution responsive objectively, equitably and efficiently to relative need and to make recommendations’.82 From this it derived the objectives to reduce disparities in access to health care of people at equal risk, and to develop criteria and indicators of need which could be incorporated in methods of allocating resources. The first interim report was published in August 1975. The membership was made up of twelve NHS and nine DHSS members, including Professors Walter Holland and A. E. Bennett, both then of the Department of Clinical Epidemiology and Social Medicine at St Thomas’ Hospital, London. The main interim recommendations of RAWP, on allocations to regions in 1976–77, were that the formula for distributing revenue to regions should be revised and based (for hospital care) on two elements, population and caseload (weighted 3 : 1), and for community care on population alone. The population element in the revised revenue formula was weighted and adjusted, but the main point was that beds were no longer included in the formula. There were constraints that restricted the extent of increases and reductions to 2.5 per cent, and there were separate allowances for medical teaching and research. Capital allocations for 1976–77 were to take account of contractual commitments, forecast population and regional deprivation, for which interim measures were to be established.83 The rather longer full report, published in 1976, had the space to include a more considered historical perspective. It found that the supply of health facilities was variable and very much influenced by history. The methods used to distribute financial resources to the NHS reflected ‘the inertia built into the system by history’ – they had increased the historic basis for the supply of resources, and also perpetuated them through responding slowly to changes in demography and morbidity.84 The stated aim of RAWP was to secure, through resource allocation, equal opportunity of access to health care for people at equal risk. The report sought criteria to establish and quantify the differentials of need in different geographical locations. These included the size and composition of the

236 John Welshman population, patterns of morbidity, the costs of providing care, patient flows across administrative boundaries, medical and dental education, and capital investment. On capital investment, the RAWP report noted of capital stock that ‘there are not only geographical inequalities in the quantity of stock available but also in its age and condition’.85 Regions that were well-provided for in quantitative terms might also have ageing stock, and problems of ‘mislocation’ might all be exacerbated by population movement, demographic change and the redefining of administrative boundaries. The report argued that hitherto these factors had not been directly recognised in the arrangements for allocating capital resources, but could not continue to be ignored.86 One of the main concerns of the report was the lack of relevant information with which to develop criteria for allocation. Measuring relative need was regarded as a start in addressing the major issues of resource allocation that existed. Nevertheless, the report confirmed ‘the existence of large disparities between the way in which resources have traditionally been allocated to different parts of the country’ and noted that ‘disparities of the order demonstrated could not be redressed at a stroke’.87 It set out systems for distributing capital and revenue to RHAs, AHAs and Districts, and for meeting the additional costs that were associated with teaching medical and dental students. The aim was to identify relative need, compare that need with existing provision and suggest a practical plan for progress from existing to new patterns of allocation. The technical details of the formula can only be briefly summarised here. ‘Targets’ were set for revenue allocations in proportion to relative needs measured by population served, weighted and adjusted using Standardised Mortality Ratios as a proxy for morbidity. Progress was to be made ‘as fast as is consistent with practical constraints on the pace of change’.88 Capital was to be distributed to RHAs in accordance with their relative positions as measured by their weighted populations and value of existing stock. The extent to which the new formula recommended by RAWP was able to remedy inequalities in resource allocation is outside the scope of this chapter, though there is evidence that, in the case of Sheffield, the distance from target revenue distributions had been successively reduced by 1981 and 1988.89 On the one hand, RAWP has been seen as an important milestone in correcting the ‘inherited pattern’ of resources. A. E. Bennett and Walter Holland, writing in 1977, argued that RAWP marked a transition in the NHS from ‘muddling through’ to ‘rational planning’, where objectives were established and the best means of achieving them identified.90 Howard Glennerster has argued that RAWP ‘must be counted one of the real technical achievements of the period’.91 In some respects, the RAWP exercise formed the background to the concern with social and class inequalities in health that was to lead to the Black Report (1980).92 On the other hand, RAWP has been judged to have been flawed in important respects, including its reliance on mortality data, and with losers (inner-city London) as well as winners. Judy Allsop concluded in 1984 that the policy had had limited success in terms of overall regional budgets, but had made little

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impact at an Area or District level. She suggested that structured inequalities in needs and provision are reinforced by interest groups which slow down and modify the pace of change, and she concluded that ‘RAWP, though politically and morally important, inevitably remains a crude instrument’.93 John Mohan has argued that the technical weaknesses in the RAWP formula only became important for the Conservatives in the 1980s.94 In his most recent summary of the creation and implementation of RAWP, Charles Webster provides a mixed assessment. Resource constraints limited the speed of movement towards the RAWP targets, and only limited progress had been made by 1981, although the most glaring differences between extremes had been noticeably reduced (including in the Sheffield and Trent regions). Webster has concluded that ‘the more affluent regions and acute specialties were efficient at obstructing any rapid shift of resources according to the criteria of spatial equality or in the interests of the groups dependent on community care’.95 At the same time, RAWP did represent an attempt to solve a problem which had for so long been ignored, and in that respect formed an important building block for further efforts to devise more equitable ways of allocating resources.

Conclusion This chapter has sought to describe and explain the changing position of resource allocation as a policy issue in the 1940–76 period. Identifying turning points is tempting, but difficult. Rather than characterising the Hospital Plan of 1962 as the watershed, it would appear that the step-change in thinking regarding resource allocation in England occurred in the late 1960s and early 1970s. The inequalities in resources that regions inherited from the pre-1948 era were relatively well-known through the wartime hospital surveys, even though systematic evidence was lacking. However, systems of capital and revenue expenditure in the period between 1948 and 1970 were not essentially concerned with reducing inequalities between regions, but with limiting the cost of the NHS. There was periodic concern about resource allocation – as seen in the evidence given to the Guillebaud Committee, the comments of Treasury officials to the Select Committee on Estimates and the observations of the Acton Society Trust. Nevertheless, Mays and Bevan are clearly wrong in suggesting that RAWP was a legacy of the Guillebaud Committee. The best evidence for this contention is that neither the Hospital Plan nor Health and Welfare were particularly troubled about resource allocation. Rather, the factors driving increasing concerns with resource allocation were more apparent in the late 1960s and early 1970s. First, there was academic concern, on the part of geographers and health economists, with correlating the provision of services with needs, and with tracing inequalities in resource allocation, both in England and internationally. Here, the University of York played an important (but as yet unrecognised) role as an emerging centre of excellence in health economics. Second, debates about devolution opened up debates about the distribution of resources between different parts of the United Kingdom and

238 John Welshman between regions. Third, the 1974 health service reorganisation, which finally tackled the classic tripartite structure of the NHS, with the creation of Area Health Authorities, arguably facilitated debates about resource allocation. Fourth, and most importantly, there was an increasing political commitment on the part of the Labour Party, notably Richard Crossman, David Owen and Barbara Castle and their academic expert advisers, to reducing inequalities between regions. Together these factors seem to provide a more convincing explanation of the background to RAWP, building on the concern expressed periodically from the publication of the wartime hospital surveys onwards but also significantly accelerating that concern, so that action was finally taken with the creation of RAWP itself in 1975. Looking backwards from today, when health inequalities are as high as they have ever been on the policy agenda, what is arguably most striking are the continuities in regional variations in access to health care. Perhaps the task now is to appreciate that resource allocation is only the start in tackling socio-economic and ethnic differences in access to health care. In that respect, RAWP seems very much of an era in which there was greater faith in technical solutions to inequalities issues.

Acknowledgements I would like to thank Martin Gorsky, John Mohan, Sally Sheard and Charles Webster, and those present at conferences in Verona and Birmingham, where my earlier work on the Sheffield RHB was presented as papers. Much of this work was funded by the Wellcome Trust.

Notes 1 See, for example, S. Cherry, ‘Before the National Health Service: financing the voluntary hospitals, 1900–1939’, Economic History Review, L(2), 1997, 305–26; M. Gorsky, J. Mohan and M. Powell, ‘The financial health of voluntary hospitals in interwar Britain’, Economic History Review, LV(3), 2002, 533–57; C. Webster, ‘Investigating inequalities in health before Black’, Contemporary British History, 16(3), 2002, 81–103. 2 N. Mays and G. Bevan, Resource Allocation in the Health Service: a review of the methods of the Resource Allocation Working Party (RAWP), London, Bedford Square Press/NCVO, 1987, p. 30. 3 Ibid., p. 160. 4 Ibid. 5 D. E. Allen, Hospital Planning: the development of the 1962 Hospital Plan; a case study in decision making, London, Pitman Medical Publishing, 1979; C. Ham, Policymaking in the National Health Service: a case study of the Leeds Regional Hospital Board, London, Macmillan, 1981; C. Webster, The National Health Service: a political history, Oxford, Oxford University Press, 1998 (2nd edn 2002), Table 2.2; J. Mohan, Planning, Markets and Hospitals, London, Routledge, 2002. 6 J. Mohan, ‘Uneven development, territorial politics and the British health care reforms’, Political Studies, LXVI, 1998, 309–27. 7 The main files in the National Archives are in BS 6, MH 149/1939 and MH 166/1143–7 (1975–79).

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8 H. Eckstein, The English Health Service: its origins, structure and achievements, Cambridge, MA, Harvard University Press, 1959, pp. 41–3, 233–5. 9 J. Jewkes and S. Jewkes, The Genesis of the British National Health Service, Oxford, Blackwell, 1962, pp. 11–18, 19–23. 10 M. H. Cooper and A. J. Culyer, ‘Equality in the National Health Service: intentions, performance and problems in evaluation’, in M. M. Hauser (ed.), The Economics of Health Care, London, Allen & Unwin, 1972, p. 47. 11 A. Maynard and A. Ludbrook, ‘Inequality, the National Health Service and health policy’, Journal of Social Policy, 2, 1982, 101–4. 12 J. Allsop, Health Policy and the National Health Service, Harlow, Longman, 1984, pp. 39–40. 13 C. Webster, The Health Services Since the War, Vol. 1, Problems of Health Care: the National Health Service before 1957, London, HMSO, 1988, p. 292. 14 Webster, The National Health Service, p. 57. 15 M. Powell, ‘A Tale of Two Cities: a critical evaluation of the geographical provision of health care before the NHS’, Public Administration, 70, 1992, 67–80; M. Powell, ‘Hospital provision before the NHS: territorial justice or inverse care law?’, Journal of Social Policy, 21, 1992, 145–63; M. Powell, ‘Hospital provision before the National Health Service: a geographical study of the 1945 hospital surveys’, Social History of Medicine, 5, 1992, 483–502. 16 Mohan, Planning, Markets and Hospitals, p. 16. 17 L. Parsons, S. C. Fryers and G. Godber, Hospital Survey: the hospital services of the Sheffield and East Midlands area, London, HMSO, 1945, pp. 2–4, 16. Interview between Sir George Godber and the author, Cambridge, 13 February 1998. 18 Ministry of Health, Hospital Survey, pp. 13–17. 19 Ibid., pp. 6–8. 20 E. C. Bevers, G. E. Cask and R. H. Parry, Hospital Survey: the hospital services of Berkshire, Buckinghamshire, and Oxfordshire, London, HMSO, 1945, pp. 1–49. 21 A. E. Bennett and W. W. Holland, ‘Rational planning or muddling through? Resource allocation in the NHS’, Lancet, 1, 1977, 464. 22 A. Maynard and A. Ludbrook, ‘Budget allocation in the National Health Service’, Journal of Social Policy, 9, 1980, 290–312. 23 Maynard and Ludbrook, ‘Inequality, the National Health Service and health policy’, pp. 111–14. 24 R. Klein, The Politics of the National Health Service, London, Longman, 1983 (2nd edn 1989), p. 52. 25 Mays and Bevan, Resource Allocation in the Health Service, p. 4. 26 Ibid., p. 6. 27 Ibid., pp. 6–8. 28 Webster, The Health Services Since the War, Vol. 1, pp. 293–5, Table V. 29 Webster, The National Health Service, pp. 57–9. 30 C. Webster, The Health Services Since the War, Vol. 2, Government and Health Care: The British National Health Service 1958–1979, London, TSO, 1996, pp. 22–5. 31 Ibid., p. 26. 32 Acton Society Trust, Hospitals and the State: 6: Creative Leadership in a State Service, London, Acton Society Trust, 1959, pp. 5–6. 33 Ibid., pp. 10–11. 34 See, for example, H. Jones, ‘New tricks for an old dog? The Conservatives and social policy, 1951–5’, in A. Gorst, L. Johnman and W. S. Lucas (eds), Contemporary British History 1931–1961: politics and the limits of policy, London, Pinter, 1991, pp. 33–43; C. Webster, ‘Conservatives and consensus: the politics of the National Health Service, 1951–64’, in A. Oakley and S. A. Williams (eds), The Politics of the Welfare State, London, UCL Press, 1994, pp. 54–73. 35 PP 1955–56, XX, Cmd. 9663, Report of the Committee of Enquiry into the Cost of the

240 John Welshman

36 37 38 39 40 41 42 43 44

45 46 47 48 49 50 51 52 53

54 55 56 57 58 59 60 61 62 63

National Health Service, p. 104, paras 282–3. This Committee was appointed in May 1953, chaired by the Cambridge economist Claude Guillebaud, to ‘review the present and prospective cost of the National Health Service; to suggest means, whether by modifications in organisation or otherwise, of ensuring the most effective control and efficient use of such Exchequer funds as may be made available; to advise how, in view of the burdens on the Exchequer, a rising charge upon it can be avoided while providing for the maintenance of an adequate Service; and to make recommendations’. Mays and Bevan, Resource Allocation in the Health Service, pp. 6–8; Webster, The Health Services Since the War, Vol. 1, pp. 295–6. PP 1956–57, VI, Sixth Report of the Select Committee on Estimates, p. x. Ibid., p. 54, q. 529. Ibid., p. 54, q. 530. Ibid., p. 334, q. 2686. Webster, The Health Services since the War, Vol. 1, pp. 395–6. Acton Society Trust, Hospitals and the State: 6, pp. 6–7. Mohan, Planning, Markets and Hospitals, pp. 12, 87–110. On the potential role of personalities see J. Welshman, ‘Hospital provision, resource allocation, and the early National Health Service: The Sheffield Regional Hospital Board, 1947–74’, in M. Pelling and S. Mandlebrote (eds), The Practice of Reforming Health Medicine and Science 1500–2000: essays for Charles Webster, Aldershot, Ashgate, 2005, pp. 279–301. Mays and Bevan, Resource Allocation and the Health Service, pp. 8–10, 21. Allen, Hospital Planning: The Development of the 1962 Hospital Plan, pp. 169–80. Ham, Policy-Making in the National Health Service, p. 25. Webster, The Health Services Since the War, Vol. 2, pp. 92–109; Webster, The National Health Service: A Political History, pp. 45, 121–4. Mohan, Planning, Markets and Hospitals, pp. 114–20. Ibid., pp. 129–31, 155. PP 1961–62, XXXI, Cmnd 1604, A Hospital Plan for England and Wales, p. 59. Mays and Bevan, Resource Allocation in the Health Service, pp. 8–10. PP 1962–63, XXXI, Cmnd 1973, Health and Welfare: The Development of Community Care. Plans for the Health and Welfare Services of the Local Authorities in England and Wales, p. 2, para. 4. On the Ministry of Health, see also J. A. G. Griffith, Central Departments and Local Authorities, London, Allen and Unwin, 1966. For contrasting views on the White Paper, see Ham, Policy-Making in the National Health Service, p. 166; Webster, The Health Services Since the War, Vol. 2, p. 126. J. E. Powell, A New Look at Medicine and Politics, London, Pitman Medical Publishing, 1966. Mays and Bevan, Resource Allocation in the Health Service, pp. 8–10. P. A. West, ‘Allocation and equity in the public sector: the hospital revenue allocation formula’, Applied Economics, 5, 1973, 164–5. Mays and Bevan, Resource Allocation in the Health Service, pp. 10–14; Webster, The National Health Service, p. 85. B. Davies, Social Needs and Resources in Local Services: a study of variation in standards of provision of personal social services between local authority areas, London, Michael Joseph, 1968, p. 295. Ibid., p. 289. On the Ministry of Health, see also Griffith, Central Departments and Local Authorities. B. E. Coates and E. M. Rawstron, Regional Variations in Britain, London, B. T. Batsford, 1971, p. 222. Cooper and Culyer, ‘Equality in the National Health Service’, pp. 51–3, 55–7. See, for example, M. M. Hauser and P. Burrows, The Economics of Unemployment Insurance, London, Allen & Unwin, 1969.

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64 M. M. Hauser, ‘Summary of main points raised in discussion’, in M. M. Hauser (ed.), The Economics of Health Care, pp. 322–30. 65 See, for example, A. T. Peacock and J. Wiseman, The Growth of Public Expenditure in the United Kingdom, London, 1961 (2nd edn 1967); West, ‘Allocation and equity in the public sector’, pp. 153–66. 66 M. S. Feldstein, M. A. Piot and T. K. Sundaresan, Resource Allocation Model for Public Health Planning: a case study of tuberculosis control, Geneva, World Health Organisation, 1973. 67 Mays and Bevan, Resource Allocation in the Health Service, pp. 14–21. 68 J. Noyce, A. H. Snaith and A. J. Trickey, ‘Regional variations in the allocation of financial resources to the community health services’, Lancet, 1974, 1, pp. 554–7. 69 Mays and Bevan, Resource Allocation in the Health Service, pp. 23–9. 70 Webster, The Health Services Since the War, Vol. 2, p. 757. 71 Ibid. 72 G. Godber, The Health Service: Past, Present and Future, London, Athlone, 1975, pp. 47, 59, 78, 84; G. Godber, ‘Regional devolution and the National Health Service’, in E. Crafen (ed.), Regional Devolution and Social Policy, London, Macmillan, 1975, pp. 71–2. 73 R. Crossman, The Diaries of a Cabinet Minister, Vol. 3, Secretary of State for Social Services 1968–70, London, Hamish Hamilton and Jonathan Cape, 1977, p. 876. 74 R. H. S. Crossman, A Politician’s View of Health Service Planning, Glasgow: University of Glasgow, 1972, p. 12. 75 Ibid., p. 13. 76 Mays and Bevan, Resource Allocation in the Health Service, pp. 23–9. See also Maynard and Ludbrook, ‘Budget allocation in the National Health Service’, pp. 293–4. 77 B. Castle, The Castle Diaries 1974–76, London, Weidenfeld and Nicolson, 1980, p. 519, footnote. Abel-Smith (1926–96) was senior policy adviser to the Secretaries of State for Social Services, 1968–70, 1974–78 (Crossman, Castle, and Ennals). 78 D. Owen, In Sickness and in Health: the politics of medicine, London, Quartet Books, 1976, pp. 48, 60. 79 DHSS, Priorities for Health and Personal Social Services in England: a consultative document, London, HMSO, 1976, foreword. 80 Webster, The Health Services Since the War, Vol. 2, pp. 609–13. 81 Priorities, pp. 8–9, para 1.5. 82 DHSS, First Interim Report of the Resource Allocation Working Party: allocations to regions in 1976–77, London, DHSS, 1975, p. 1, para. 1. 83 Ibid., pp. 12–13, para. 41. 84 DHSS, Sharing Resources for Health in England: report of the Resource Allocation Working Party, London, DHSS, 1976, p. 7, para. 1.2. 85 Ibid., p. 10, paras 1.13–1.14. 86 Ibid. 87 Ibid., p. 12, para. 1.17. 88 Ibid., p. 73, para. 6.2.2. 89 Webster, The National Health Service, p. 86, Table 2.2. 90 Bennett and Holland, ‘Rational planning or muddling through?, pp. 464–6. 91 H. Glennerster, British Social Policy Since 1945, Oxford, Blackwell, 1995, pp. 132–3. 92 Webster, ‘Investigating inequalities in health before Black’. 93 Allsop, Health Policy and the National Health Service, pp. 98–9. 94 Mohan, ‘Uneven development’, p. 310. 95 Webster, The National Health Service, pp. 86–7. See also Webster, The Health Services Since the War, Vol. 2, pp. 609–13.

14 Financing health care in Britain since 19391 Rodney Lowe

Introduction In January 2000, two decades of relative resource constraint on the National Health Service were ended by the commitment to raise UK health expenditure to the European average. The 2002 Budget funded a real increase of 43 per cent in NHS spending by 2007/08, thereby raising health expenditure from 6.8 per cent to 9.4 per cent of gross domestic product. Two ambitious reform plans, The NHS Plan (2000) and the Wanless Reports (2001–02), established the framework in which these increases would be implemented.2 Key features have been greater private sector involvement, notably in hospital building under the Private Finance Initiative, and administrative restructuring, such as the removal of hospitals from ministerial control to become ‘foundation trusts’. However, despite these far-reaching and often highly controversial changes government has continued to have an expressed preference for the UK’s unique tax-based system for financing the service. As the interim Wanless Report asserted, for example:3 There is no evidence that any alternative financing method to the UK’s would deliver a given quality of healthcare at a lower cost to the economy. Indeed other systems seem likely to prove more costly. . . . The current method by which healthcare is financed through general taxation if both a fair and efficient one. Indeed, the major budgetary increase of 2002 was achieved by raising national insurance contributions (NICs). This chapter will consider why it was that despite the ‘continuous revolution’ which the NHS has experienced since the Thatcher era, the Bevanite funding mechanism established on its foundation in 1948 remains intact.4 The chapter begins by asking why the UK’s unique system of tax-funding was initially adopted. This is followed by an analysis of why the new approach was not reversed in the 1950s when Conservative governments, in anticipation of Mrs Thatcher (or in what might be termed its proto-Thatcherite period), sought to roll back the state and consequently to reintroduce an insurance-based

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system.5 Their failure to do so and their subsequent ten-year modernisation programme (the 1962 Hospital Plan, launched by the economic liberal, Enoch Powell) ironically entrenched the tax-funded system still further. The third section considers whether policy has become, in Paul Pierson’s phrase, path dependent – with the 1940s and 1950s marking the ‘critical juncture’.6 In other words, since that time have the likely costs of any fundamental change to the financing of the NHS patently outweighed any possible advantage? This was the apparent conclusion drawn by the Thatcher government in 1982 and 1988 when it contemplated, but ultimately rejected, radical change. Is the time now any more right – as in the 1940s – for a paradigm shift? The chapter will conclude with several policy suggestions that follow from this analysis.

Caveats All discussions of the NHS come with appropriate health warnings. In this context, there are six which the reader should bear in mind. First, the NHS does not stand for a national hospital service. A fixation on aspects of hospital care such as waiting lists (a major obsession of the first New Labour government between 1997 and 2001) distorts analysis. Second, the NHS is not synonymous with health care. Health outcomes can typically be better improved by expenditure on other services such as the personal social services and housing, whose provision raises different financial issues. This was duly recognized by a third Wanless Report issued in 2004, Securing Good Health for the Whole Population.7 Third, health systems throughout the world are ‘in crisis’, and comparative analysis affirms that there is no perfect system. The French social-insurance based health service, adjudged by WHO in 2000 as the world’s best system, is increasingly switching to tax-funding.8 Fourth, the manner in which money is spent is more important for health outcomes than how it is raised. However, it is important to note in this context that support for social insurance is based not just on the argument that it does not crowd out private health expenditure, but that it also creates a more responsive administration. In other words, how money is raised can affect the way in which it is administered and spent. Finally, from its inception, and whatever its actual delivery record, the NHS has enjoyed exceptional popularity. The most recent opinion poll recorded that 80 per cent of those polled regarded the NHS to be critical to British society and that 75 per cent opposed the creation of a two-tier system.9

Why was a unique funding system adopted in 1948? All health systems have a mix of financing mechanisms which are, in the terminology of Derek Wanless (the banker appointed by the Treasury to report on future levels of funding for the NHS), social insurance, private insurance, outof-pocket payments (charges, patent medicine etc.) and taxation. In the 1930s, the UK had a conventional mix. For example, 90 per cent of the workforce had social insurance, covering the general practitioner service and sick pay. The

244 Rodney Lowe other 10 per cent and all dependants either had private insurance or made full out-of-pocket payments. Hospital costs were paid by a similar mix. Many had private insurance, including the 10 million covered under the workers’ contributory schemes, discussed elsewhere in this volume, whilst the rest paid either full out-of pocket payments or means-tested charges. Local taxes (increasingly supplemented by a block grant from Whitehall financed by national taxation) funded public health and both hospitals and specialist clinics run by local authorities. The change to a unique, predominantly tax-based mix for the NHS was adopted for a combination of pragmatism and principle. This change had popular support and, equally importantly, met with little resistance from vested interests. The Beveridge Report in 1942 recommended a service that was universal (covering all people) and comprehensive (covering all needs). Beveridge, rather like New Labour, regarded it as the duty of the individual and government to prevent ill-health. This was to minimise outgoings in benefit and to forestall the creation of a culture of dependency.10 Equally, it was to boost productivity (and hence economic growth and general well-being). He personally favoured social insurance to underpin responsible individual behaviour, asserting in the Report that ‘previous contribution is the ideal’, and believed the British people thought likewise.11 For example, his reading of the inter-war experience of the hospital contributory funds was that they demonstrated that people were ‘clearly willing and able to pay contributions for institutional treatment’.12 In his universal plans, however, the proceeds of flat-rate insurance were swallowed up by other insurance needs, and especially pensions. For pragmatic reasons, therefore, more than two-thirds of the service (expected to be run by local government) had to be paid by national and local taxes. A £40 million ‘health contribution’ would be made from National Insurance, however, to provide government with a similar income to that received under the old social insurance scheme. This amounted to 23.5 per cent of the anticipated gross cost of the NHS. He also favoured hospital ‘hotel charges’, which would oblige patients to meet the cost of their maintenance, as opposed to their treatment, and charges for appliances, which he felt would operate ‘as an incentive for careful use’.13 As is well known, Aneurin Bevan, Minister of Health in the Labour government, nationalised the hospital system in 1948. Since local government was no longer to co-ordinate the NHS or to run its own hospitals or clinics, national rather than local taxes came to fund the service largely by default. Bevan also favoured this in principle for three reasons.14 The first was that national taxation was more redistributive, and the second was that he regarded free access to health care to be a citizen’s right and not something conditional on the payment of contributions. Finally, there was the question of how, politically and administratively, the non-insured could be turned away from a universal service. He favoured a fully tax-financed system so strongly that he strove to disassociate the NHS from the other welfare services launched on 5 July 1948, ‘the appointed day’ and conventional birthday of the welfare state. Nevertheless, the NI contribution continued and Bevan wavered between supporting charges as a

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means of checking abuse (in 1949) and rejecting them (in 1951). It should be noted that the rational and humane care of the frail elderly, pejoratively called ‘bed-blockers’ by hospital staff by the 1960s, was greatly complicated by the related battle over whether they should be cared for in free geriatric NHS wards or in local authority homes, for which a means-tested charge could be made.15 A predominantly tax-based system was favoured popularly at all levels. Manual workers regarded the inter-war system as inequitable; and the growth of voluntary contributory schemes did not make hospitals more responsive. The better-off favoured risk-pooling as longevity and the cost of more technically advanced health care increased. Doctors were frustrated by the lack of buoyant revenue, which restricted their clinical freedom. Approved societies (responsible for the competing social insurance schemes) were likewise frustrated by the tight Treasury grip over their freedom of action.16 Unlike on the continent, therefore, there was little demand for the continuation – and, equally important, little resistance to the dismantling – of the inter-war, social-insurance based system.

Why did proto-Thatcherism fail in the 1950s? In the mid-1950s, the Conservatives questioned the desirability of a tax-funded NHS on ideological and economic grounds. Increased affluence, they felt, meant most people could, and arguably should, provide directly for their own health care. Taxation could thereby be reduced; and this, in an ‘opportunity’ as opposed to a ‘welfare’ state, would increase individual initiative, economic growth and thereby individual welfare. They therefore introduced three policy proposals designed to make patients pay more. These were the privatisation of supplementary services such as dentistry and ophthalmology; increased charges; and making the NHS fully (or more fully) contributory. The principle of a fully contributory NHS was discussed in Cabinet in 1957 and in great detail within Whitehall in 1959–60.17 The Treasury wished to cap NHS expenditure and sought a clear agreement over which, or how far, individual services should be financed by tax, contributions or charges. It also wanted an equally clear understanding that as costs rose, so automatically would contributions and charges. Contributions would be in the form of a hypothecated tax either within or outside the NI system, but administered centrally and not by competing social insurance funds. A subtext was that, whilst acute care should be paid more directly by patients, chronic care – especially ‘intermediate care’ for the frail elderly – should be tax-financed and thereby ‘free’ at the point of access. In the meantime, the NI contribution was raised three times between 1957 and 1961. This option was most favoured because it proved to be an uncontroversial way to raise revenue. In the words of Selwyn Lloyd, Chancellor of the Exchequer (1960–62), it was an ‘easy way of raising money outside normal fiscal channels’. Unlike on the continent, it was heavily weighted on the employee rather than the employer, and in this period contributions from the employer rose from a weekly payment of 1.5d to 7.5d (old pennies), and that

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from employees from 8.5d to 32.5d. As a percentage of NHS costs, the combined contributions rose from a low of 6.4 per cent to 17.2 per cent, though this still fell short of Beveridge’s figure. Together with income from increased charges, non-tax finance reached an all-time high of 22.7 per cent in 1962.18 Despite all this, the move to a full (or more fully) contributory system failed. There were contingent reasons, such as a greater need to introduce a graduated pensions scheme, which made it difficult simultaneously to raise health insurance contributions. However, the failure was mainly due to issues of principle very similar to those expressed by Bevan (and indeed by the 2002 Treasury Select Committee). Within Cabinet, the NI health contribution was condemned as a regressive poll tax, levied on a limited class of people to pay for a service which was universally available.19 Moreover, without an overt statement that tax was being withdrawn from the NHS to better fund other services, such as care for the frail elderly, the presentational problem arose that the extra money raised from NI contributions far exceeded any increase in expenditure on the NHS. As Macleod wrote: it was ‘a bad tax because it hurts poorer families only. The figures for the NHS [estimates] increase clearly do not justify it.’ Lack of transparency also wasted hours of time on interdepartmental disputes (between, for example the Treasury, the Ministry of Pensions and National Insurance, and the Ministry of Health over how ‘their’ revenue from increased NICs should be allocated) and consequently impeded good government. NI contributions, it was duly acknowledged throughout Whitehall, were simply another tax and not part of an insurance system actuarially based on an estimate of risk: the fiction was just maintained to help ease of collection. Nevertheless, there were endless debates over the expediency of raising the NI health contribution since any rise in contributions might lead to the public expectation that all insurance benefits should be raised.

The Conservatives’ ten-year plan: 1962–72 The drive to make the NHS fully (or more fully) contributory was halted in 1962 by Enoch Powell’s appointment as Minister of Health. It is not a little ironic that Powell, remembered now as an economic liberal, revelled at the time in the launching of his alternative policy prescription, the Hospital Plan. This he described as ‘an opportunity to plan the hospital system on a scale which is not possible anywhere else certainly on this side of the Iron Curtain’.20 ‘Command and control policy’ now came into its own, as the focus turned on how the money should be spent rather than raised. The objective behind the Plan was not simply to remedy a decade of neglect but also to contain future rises in current expenditure by long-term capital investment.21 Over ten years, £570 million was to be spent to provide a national network of District General Hospitals (DGHs) throughout the UK. However, although a triumph of spin, the Plan was a failure in practice. The average of £57m per annum committed to capital expenditure was actually less than the extra £65m raised in increased charges/contributions. Moreover, annual capital

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expenditure had already reached about £50m by 1961. The Plan did not therefore entail, as presented, a major new initiative in hospital construction. Its one advantage was that it represented a public long-term commitment to such a level of expenditure and thereby facilitated rational planning. The ‘spin’ of the original Plan was compounded by that of progress reports in 1963 and 1964 which, by failing to report building delays and cost inflation, were justifiably condemned at the time as ‘misleading to the point of dishonesty’.22 The Plan was also overhasty, being an amalgamation of plans drawn up in four months by Regional Hospital Boards with little experience of or skills in long-term planning. Another difficulty was that it was not evidence-based. For example, there were no estimates of future need, demographic change or optimal location of DGHs, and there was no scientific justification for bed norms or ‘the ideal’ of a DGH. It also seriously underestimated costs, which were to be driven up substantially by a shortage of architects and builders. The critical assumption that capital expenditure would reduce future current costs was also dismissed by the Treasury as ‘guff’.23 By 1964, the projected cost had escalated to £2,000m over twenty-six years. The Plan, as was said of bed norms at the time, was like ‘giving a blind man a stick – it might help but it would not improve his sight’.24

Thatcherism and path dependency in the 1980s During the Heath government of 1970–74, alternative means of funding were not seriously reconsidered despite the presence of Keith Joseph, the leading advocate of economic liberalism, at the Department of Health and Social Security (DHSS). The issue was tentatively raised in opposition between 1974 and 1979, but advisers from the private sector lacked the experience and expertise to make viable suggestions. Consequently, it was not until the 1980s that further attempts were made to alter the financial basis of the NHS. Both failed and resulted, ironically, in the explicit re-endorsement of the tax-based system. An alternative strategy of structural reform was adopted instead. In short, and in line with Pierson’s theory of path dependency, the administrative and political costs were adjudged to outweigh the advantages of change, however ideologically desirable. The first attempt at financial reform was made in 1981–82 when a DHSS working party re-interred, without acknowledgement and apparent awareness of them, most of the suggestions from 1957–61. It was immediately dismissed, following a Cabinet reshuffle, by the new Secretary of State. This was, in his words, because it promised no major savings, envisaged a continuing major role for taxation in financing the needs of those not in the workforce and was ‘frankly political madness’.25 A report by the Central Policy Review Staff a year later, recommending inter alia private health insurance and increased charges, sparked ‘the nearest thing to a Cabinet riot’ and led to the promise at the 1983 Party conference that ‘the NHS is safe with us’.26 The Griffiths enquiry, which radicalized NHS management, swiftly followed. By 1987, the NHS was near bankruptcy because its income from government

248 Rodney Lowe was so restricted. Even bodies such as the King’s Fund were starting to consider additional, alternative sources of finance.27 They were also considered within government in the NHS Review chaired by Mrs Thatcher. A proposed hypothecated health tax, from which people might opt out into private health insurance, was dismissed on the grounds that it would have left the NHS with a heavily reduced income and all the bad risks. Increased charges were rejected as politically unacceptable. Increased tax incentives for private insurance, as proposed by Mrs Thatcher herself, were rejected by the Treasury as costly, complicating the tax system and unfairly advantageous to the private sector. Indeed, the Treasury’s survey of international practice concluded that a tax-financed system offered the best means of containing costs.28 The subsequent White Paper in 1989, Working for Patients (Cm 555), contained a foreword by Mrs Thatcher which promised: ‘the NHS will continue to be available to all . . . and to be financed mainly out of general taxation’. The alternative solution to the problems of the NHS, as proposed by the White Paper, was the introduction of internal markets. Given that tax-funding appeared to be inevitable, their objective was to optimise expenditure (and thereby limit potential tax rises) by injecting an element of competition into the provision of health care. The NHS budget was increasingly allocated to ‘fundholding’ general practitioners and District Health Authorities, who were then empowered to purchase the most cost-effective services, be they from the public or private sector or from within or outside their health district. The reintroduction of such commercial principles, albeit by a mimicking of the market, was naturally attacked by Labour in opposition. This did not prevent New Labour in government from making the reform permanent in 2002, in the shape of Primary Care Trusts.29

Implications for current policy History cannot be prescriptive. However, debates over certain suggestions for or initiatives in current policy can be deepened by an injection of historical perspective. The financing of the NHS is a case in point. First, in relation to tax-funding, the conclusion of both the NHS Plan and interim Wanless Report that the NHS should remain predominantly tax-financed appears historically justified.30 The UK, unlike France and Germany, does not have a tradition of strong social insurance funds. They capitulated quietly in the 1940s and there were no plans to revive them in the later 1950s. The rejection by the Conservatives of alternative methods between 1957 and 1961, and again in 1982 and 1988, suggests that policy has become ‘path dependent’. Immense dislocation, which would increase immediate costs without improving health outcomes, would attend any major change. New Labour explicitly accepted this in 2002 when the Health Secretary advanced the view that a shift to a different mode of funding would mean ‘years of turbulence and instability’.31 Second, the role of National Insurance Contributions is suggestive. NICS have long been acknowledged within government to be an uncontroversial

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method of raising taxation – not least when increases to the NI health contribution were raised three times between 1957 and 1961 as an explicit hypothecated health tax. It is also the case that the NHS has always enjoyed immense public support at all levels of society. These two considerations indicate that public debate on taxation could be enriched, and willing compliance to increased taxation enhanced, by a hypothecated health tax. Such a tax might be ring-fenced to fund an explicit programme of reform, however much this might offend conventional Treasury accounting principles. Furthermore, the arguments used by Beveridge, which stress that health expenditure advantages everyone through increased social solidarity and improved productivity, might provide cross-party justification for increased taxation. In addition, the financing of the NHS from NICs could be made more progressive. Employers, in comparison with continental Europe and the USA, have paid relatively little. The upper earnings limit within NI (partially modified in the 2002 budget) is also an anomaly arising from the historic fiction that NI is an insurance scheme rather than – as covertly admitted since the mid-1950s – simply another form of taxation. It is here that ‘one nation’ arguments concerning productivity and increased social solidarity, evolved under the Conservatives between 1957 and 1964 and latterly revived by Tony Blair, become particularly pertinent.32 Two final considerations may be advanced. First, the Wanless Report appears historically justified in insisting that the terms of reference for all future reviews of the NHS should include social care.33 Conservative plans in the 1950s to make the NHS insurance-based were designed to release resources for the taxfunded support for the frail elderly (now termed ‘intermediate care’). The frail elderly were particularly disadvantaged by the 1948 settlement, and this historical legacy remains. Indeed, it has arguably worsened, as under-funding since the 1980s, coupled with the pressures on hospital trust managers to balance budgets, has tempted NHS general hospitals to relinquish responsibility for long-term care, either to the private sector or to local authority community services.34 Finally, the fate of the 1962 Hospital Plan serves as a warning against any ambitious modernisation plan that is not evidence-based and honestly monitored. Increased revenue can be raised with least difficulty when there is the perception that value for money is assured. It was, after all, just such a perception by the middle class in the 1940s and 1950s that led the predominant inter-war mix of private and social insurance being so conclusively rejected in favour of a tax-funded NHS.35

Notes 1 This is a revised and updated version of an earlier paper which first appeared on the ‘History and Policy’ website (online at: www.historyandpolicy.org/archive/ policypaper-08.html). The editors are most grateful to its moderators, Simon Szreter and Alastair Reid, for permitting its publication here. The author is also grateful for the editorial advice of Martin Gorsky, who nevertheless denies responsibility for any errors.

250 Rodney Lowe 2 The NHS Plan (Cm 4818-1, 2000), online at: www.nhs.uk/nhsplan/; the Wanless Interim (2001) and Final (2001) Report, online at: www.hm-treasury.gov.uk/consultations_and_legislation/wanless/ 3 Interim Wanless Report (2001), paras 2.21 and 2.24. PFI and foundation hospitals led to government defeats at successive Labour party conferences, and legislation for the latter in 2003 provoked a backbench rebellion which reduced the government’s parliamentary majority from 167 to thirty-five. Foundation hospitals, and the degree of public choice they will permit, have also been a major source of friction between Tony Blair and Gordon Brown. 4 C. Webster, The National Health Service: a political history, Oxford, Oxford University Press, 2002 edn, Ch. 3. 5 For an analysis of Conservative policy during this phase, see R. Lowe, ‘Modernizing Britain’s welfare state: the influence of affluence’, in L. Black and H. Pemberton (eds), An Affluent Society? Aldershot, Ashgate, 2004, pp. 35–51. 6 P. Pierson, ‘Increasing returns, path dependence and the study of politics’, American Political Science Review, 94, 2000, 263. 7 www.hm-treasury.gov.uk 8 See the Independent, 20 June 2000 and 2 January 2004. The latter cites a report by an official committee, the Haut Conseil Pour L’Avenir de L’Assurance-maladie, that the French health system faces imminent bankruptcy because of an absence of control over both the demand for and supply of medical care. 9 Interim Wanless Report (2001), para. 2.4. For a full review of popular attitudes towards the NHS, see S. Leatherman and K. Sutherland, The Quest for Quality in the NHS, London, TSO, 2003, pp. 133–53. 10 Social Insurance and Allied Services (Cmd 6404, 1942), paras 426–7. For a full exposition of Beveridge’s philosophy and its later fate, see J. Harris, William Beveridge, Oxford, Clarendon Press, 1997, Chs 16–19, and R. Lowe, ‘A prophet dishonoured in his own country?’, in J. Hills, J. Ditch and H. Glennerster (eds), Beveridge and Social Security, Oxford, Clarendon Press, 1994, Ch. 8. 11 Social Insurance and Allied Services, para. 433. 12 Ibid., para. 432. 13 Ibid., paras 434, 436. For the financial calculations, see the Government Actuary’s report on p. 201. 14 The best (albeit retrospective) statement of Bevan’s views, including a critique of NICs, was his House of Commons speech in 1958 celebrating the tenth anniversary of the NHS. It is reproduced in C. Webster, Aneurin Bevan and the National Health Service, Oxford, Wellcome Unit for the History of Medicine, 1991, Ch. 23. See also A. Bevan, In Place of Fear, London, MacGibbon and Kee, 1952, Ch. 5. On his diffidence in 1948, see T. Wildy, ‘Propaganda and social policy in Britain, 1945–1951’, unpublished PhD thesis, University of Leeds, 1985, Ch. 3; and on charges see C. Webster, The Health Services Since the War, Vol. 1, London, HMSO, 1988, pp. 143–7. 15 P. Bridgen and J. Lewis, Elderly People and the Boundary between Health and Social Care, 1946–91: who cares? London, Nuffield Trust, 1999, pp. 17–24. 16 See successively J. Harris, ‘Did British workers want the welfare state?’, in J. Winter (ed.), The Working Class in Modern British History, Cambridge, Cambridge University Press, 1983; J. Mohan and M. Gorsky, Don’t Look Back, London, OHE and ACCA, 2001, p. 34; P. Baldwin, The Politics of Social Solidarity, Cambridge, Cambridge University Press, 1990, Ch. 1 for a middle-class and comparative perspective; and N. Whiteside, ‘Private agencies for public purposes’, Journal of Social Policy, 12, 1983, 165–94. 17 For the wide range of documentary evidence on which the succeeding analysis is based, see P. Bridgen and R. Lowe, Welfare Policy under the Conservatives, 1951–1964, London, PRO Publications, 1998, pp. 50–8, and Webster, The Health Services, Vol. 2, Ch. 3.3.

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18 See A. Leathard, Health Care Provision, London: Chapman and Hall, 1990, p. 38. 19 The full range of objections is summarized in Webster, The Health Services, Vol. 2, pp. 80–9. Macleod’s objection is noted on p. 81. 20 The Times, 24 January 1962. Simon Heffer’s panegyric on Powell as an economic liberal, Like a Roman (London, Weidenfeld and Nicolson, 1998), might have benefited from some consideration of the following criticisms. 21 The following account is based above all on the excellent J. Mohan, Planning, Markets and Hospitals, London, Routledge, 2002, Chs 6–7, as well as Webster, The Health Services, Vol. 2, Ch. 2.4, and R. Lowe, The Welfare State in Britain Since 1945, Basingstoke, Palgrave, 2004, pp. 192–5. 22 Kenneth Robinson, the shadow Labour Health Minister, quoted in Webster, The Health Services, Vol. 2, p. 108. His judgement was not contradicted by the government when given the opportunity to do so. 23 The National Archive: Public Record Office, T227/1321. 24 Ibid., MH123/278. 25 Norman Fowler, quoted in N. Timmins, The Five Giants, London, HarperCollins, 2001, p. 388. 26 Ibid., pp. 390–91. 27 This paragraph is based on Timmins, The Five Giants, pp. 451–62 and Lowe, Welfare State, pp. 353–8. The accounts of the two major protagonists may be found in M. Thatcher, The Downing Street Years, London, HarperCollins, 1993, pp. 606–18, and N. Lawson, The View from No 10, London, Bantam, 1992, Ch. 49. Real expenditure on health care doubled under the Conservatives (1978/79 – 1996/97) from £23.5 million to £45 million, or from 4.6 per cent to 5.3 per cent of gross domestic product. This rise, however, was extremely uneven, and did not match increasing demand from, in particular, an ageing population. 28 Lawson, The View from No 10, p. 616. 29 For a rather pessimistic assessment of the experiment, see J. Le Grand, N. Mays and J. A. Mulligan, Learning from the NHS Internal Market, London, King’s Fund, 1998; for a later, more optimistic version (as befits Tony Blair’s special adviser on health care), see J. Le Grand, Motivation, Agency and Public Policy: Of Knights and Knaves, Pawns and Queens, Oxford, Oxford University Press, 2003. 30 NHS Plan (2000), Ch. 3; interim Wanless report (2001), Ch. 4. 31 Alan Milburn MP, ‘Redefining the National Health Service’, speech to the New Health Network, 14 January 2002. 32 See, for instance, Tony Blair’s speech on welfare reform, Guardian, 12 October 2004. 33 Wanless Report (2002), para. 5.60 and p. 120. The third Wanless Report in 2004 (see footnote 7) was therefore much to be welcomed, although its authors felt unable to make many detailed policy recommendations. 34 A masterly historical account of these issues can be found in Bridgen and Lewis, Elderly People and the Boundary between Health and Social Care, 1946–1991. The public finance of personal care in homes, as practised in Scotland, is arguably a poor alternative to the public finance of more domiciliary care (such as home helps and district nurses), as practised in England, to enable those in need to remain longer in their own homes. 35 There have been many critical accounts of the practice as well as the principle of PFI. Amongst the most powerful are the Institute of Public Policy Research, Building Better Partnerships, London, 2001 and A. Pollock, NHS Plc: the privatisation of our healthcare, London, Verso, 2004.

Index

11+ examination 209–11 Abel-Smith, Brian 29, 59, 207, 214, 234 Accident Hospital, Birmingham 44 accommodation, voluntary hospitals 65–6 accounts, voluntary hospitals 52, 64 Acton Society Trust 226, 228, 237 actuarial risk 155–6 Addenbrookes Hospital Cambridge 63, 69 Addison, Dr Christopher 137, 138–40, 141 admission arrangements: isolation hospitals 116; voluntary hospitals 29–35, 52–3, 136; workhouse infirmaries 103–4; see also letters of recommendation affiliated hospitals 52 affiliated orders 147–8 age restrictions, NHI scheme 182 Aikin, J. 29, 34 Allen, David 229 Allsop, Judy 223, 236–7 amenity beds, NHS 212, 213 Ancient Order of Foresters (AOF) 147–8, 156–7, 159 Annual Representative Meeting (ARM), BMA 171 Area Health Authorities (AHAs) 233, 234, 238 Artisans’ General Medical Charity Fund 48, 49 assigned revenues 99–100 associated charity 25 Association of Hospital Contributors, Sheffield 66 Associations of Insurance Committees 192 asylums 104 Baker’s Row workhouse, London 98, 103, 104 Barnett, Henrietta 105 Barnsley Beckett Hospital 63–4, 68, 69, 70, 71 Bart’s Hospital, London see St Bartholomew’s Hospital ‘Battle of the Clubs’, Cork (1894) 168, 169–70 bed capacity 62 bed rationing 34–5, 53 ‘bed-blockers’ 245 beds, expenditure related to 79–85 benefactions 24–7

benefactors: objectives 28; role in admissions 30–2 Bennett, A. E. 224, 235, 236 Berkshire 81, 149, 224 Bethnal Green Union 103 Bevan, Aneurin 77, 208, 244–5, 246 Bevan, Gwyn 221, 225, 229, 231, 232, 233, 234 Beveridge, William 147, 205, 244, 249 Birmingham voluntary hospitals 40–1, 71; encouragement of donations 49–51; fundraising 45–7; scientific medicine/charity 51–5; subscribers 41–4; working-class subscriptions 48–9 Black Report (1980) 221, 236 Border counties 183 boycott scheme, contract practice 166, 167, 171–2, 176–8 Boyd-Carpenter, John 208 Brackenbury, Henry 189 Bradford 121, 130–41, 188–9 Bradford British Medical Association 138–9 Bradford Children’s Hospital 131 Bradford City Council 130, 131–2 Bradford Fever Hospital 117 Bradford Municipal Hospital 130–1 Bradford Royal Infirmary (BRI) 131–2, 136–7, 141 Bradford Rules (1905), BMA 171, 172, 175 Bridgen, P. 205–6, 207, 212, 213 Bristol 71, 152, 156 British Hospitals Association 59, 69, 72 British Lying-in Hospital, London 34 British Medical Association (BMA) 118, 157, 183, 229; Bradford 138–9; Insurance Committees 167; Medical Planning Committee 135; see also contract practice British Medical Journal 15, 139, 168, 171, 172, 176, 177 Brushfield, Thomas 105 Buchan, George 134–5 Buchan, John 130, 132–3, 134–7, 138, 140, 141 Buckinghamshire 224 budget deficits, voluntary hospitals 78 Burdett, H. C. 61 Burdett’s Hospitals and Charities 79

Index Burnett, Sir Napier 139 Butler, R. A. 205, 213 Cancer Act (1939) 140 capital expenditure/funding: municipal hospitals 116–27; NHS 214–15, 225, 226–7, 230, 236; voluntary hospitals 67–8; workhouse infirmaries 97–100 case-mix 85, 89 Castle, Barbara 232, 234, 235, 238 Central Ethical Committee (CEC), BMA 171, 177 charitable donations 24–6, 86–7 Charity Organisation Society (COS) 102 Cherry, Steven 40, 41, 59–72, 78, 79, 89 Cheshire 152, 186 Chester, T.E. 228 Chesterfield Royal Infirmary 63–4, 69, 70 Chibber-Want, Dr H. R. 185 children: contributions from 50; exclusion from voluntary hospitals 30 Children’s Brick League, Birmingham 50 Children’s Hospital, Birmingham 40, 44, 49, 50, 51, 52–4 Children’s Hospital, Sheffield 65, 71 church collections 46–7 Churchill, Winston 208 City General, Sheffield 71 City Hospital, Bradford 131 City of London Lying-in Hospital 28 class-consciousness 168–9 clergy, subscriptions from 47 clinical examinations 193 Coates, B. E. 232 commercialisation of medicine 184–5 complaints, against panel doctors 194 ‘consent’ agreements 97 Conservative Party 90, 99, 133, 134, 139, 209–11, 212, 213–14, 215, 216, 221, 222, 226, 237, 242–3, 245–8, 249 contract practice 183 Contract Practice Sub-Committee (CPSC), BMA 171, 176 contract practice, BMA’s campaign: boycott 176–7; doctor’s complaints 168–70; investigation 172–6; organising against 170–2; overview 165–8 contracting out of services 104 contributory funding, NHS 245–7 contributory schemes, voluntary hospitals 63, 66–72 convalescent homes 55, 69 Cooper, M. H. 222 Corn Law repeal package (1846) 98 Cornwall 150 cottage hospitals 69, 70, 223 county councils, provision of municipal hospitals 118–19 Cox, Alfred 171, 172 Craven, Thomas 105 Crookshank, Harry 208 Crossman, Richard 229, 231, 234, 238

253

Croxson, Bronwyn 23–36 Culyer, A. J. 222, 232 Cumbria 193 current expenditure, NHS 214–15 Cutler, A. 89–90, 201–16 Dahrendorf, Ralf 90 Davies, Bleddyn 231–2 Davies, Dr J. O. F. 228 Dawson Report (1920) 131, 141 Dawson, R. W. 137, 139 Deakin, N. 77 Dean, D. 211 debt collection 173, 190 demographic change 159 demographic pressure 211 Dental Estimates Board 216 dental services 212–14, 215, 216, 245 Department of Health and Social Security 231, 233, 247 Derbyshire 149, 150 devolution 233–4 Devon 121, 152, 158, 184 Digby, Anne 182–95 discharge procedure 33–4 Disease Prevention (Metropolis) Act Disease (Notification) Act (1883) 117 dispensaries 173, 175, 176, 193 Disqualification Act (1879) 100–1 District General Hospitals (DGHs) 229, 246–7 District Health Authorities 248 District Medical Officers 193 diversification, Poor Law unions 101–7 doctor–population ratios 150, 186–7 doctors see general practitioners, medical staff Dorset 149 earnings limit, NHI scheme 182 East Anglia 62–5, 67, 68–9, 70, 71, 72, 79, 85–6, 88, 225–6 Ebbw Vale Workmens’ Medical Association 177 Eccles, David 210–11 Eckstein, Harry 222 Economic Conditions of Contract Practice in the United Kingdom (1905), BMA 172–6, 178 economic growth 148–50 economic significance of NHI scheme: doctors 183–90; overview 182–3; patients 190–4 Eden, F.M. 150 Edgar Allen outpatient orthopaedic facility, Sheffield 65 Education Act (1944) 209 education expenditure 209–11 elderly, care for 245, 246 Ely Hospital Cardiff 231 Ethical Committee, BMA 171 ethical rules, BMA 167, 170–1 expenditure: education 209–11; NHS 205–9; voluntary hospitals 51, 79–85 Eye Hospital, Birmingham 40, 43, 44, 47, 52 Eyler, J. 114

254 Index facilities, voluntary hospitals 65, 66 Fazakerley Hospital, Liverpool 124 fees: GPs 154–5, 165–79; voluntary hospitals 54–5; Feldstein, Martin 233 Fifth Valuation of Approved Societies (1943) 212–13 Foundation Trusts 90 France 115, 243, 248 Fraser, Derek 55 Fraser, Sir Bruce 229 Friendly and Benefit Building Societies’ Commission 151, 152 Friendly Societies Association 169 Friendly Societies Commission (1874) 158 friendly societies: Birmingham 44; club practice in 157–9; doctors employed by 152–7, 165–79; emergence of 148–51; growth and extent of medical care 152; membership 157–9; overview 147–8 Fullerton Denaby Main Colliery hospital 70 fund-holding, NHS 248 funding crisis, Sheffield 65–7 fundraising: NHS 90; voluntary hospitals 25–6, 45–7, 67–71 Gallup polls 211–12 Gemmill, P. 211–12 General Certificate of Education (GCE) examination 210–11 General Courts, voluntary hospitals 24 General Hospital, Birmingham 40, 41, 43, 44, 45, 46, 47, 49, 51–2 general hospitals (voluntary), expenditure 81–2, 83 General Medical Council 166, 176 general practitioners (GPs): contract practice 152–7, 165–79; fund-holding 248; medical work, value of 178; panel scheme 183–90; referrals 60–1 geographical variations: NHS provision 221–38; voluntary hospital finances 77–90 Germany 115, 135, 182, 184, 248 Gladstone, William 102 Glasgow 71, 72, 82, 186 Glasgow Royal Infirmary 60 Gloucestershire 72, 116, 224 Godber, Sir George 229, 233–4 Gorsky, Martin 1–15, 78, 147–60 Goschen minute (1869) 102, 106 government funding, voluntary hospitals 62 Grafton Street Hospital, Toxteth 123 grammar schools 209–11 grants-in-aid, Poor Law unions 98–9 Gray, A. M. 78 Great Ormond Street Hospital, London 90 Green, D. G. 148, 156, 158 Griffiths enquiry 247 guardians, Poor Law unions 104–7, 117 Guillebaud Committee (1956) 221, 227, 228, 237 Guy’s Hospital London 24, 25, 27, 29, 86, 90

Hall-Edwards, John 52 Ham, Chris 229 Hampshire 157 Hardy, A. 117 Harlow Wood Hospital, Mansfield 88 Hauser, Mark 232 Health and Welfare White Paper (1964) 230–1, 237 health care, debates about funding since 1939 242–9 health economists 232 health insurance, friendly societies: club practice 157–9; doctors 152–7; emergence 148–51; growth and extent of medical care 152; overview 147–8 health promotion campaigns 191 Hertfordshire 210 Heslop, Thomas 51 Holland, Walter 224, 235, 236 Hollen Lees, L. 102 Hollingsworth, E. and J. R. 85 Holroyd Slater, Benjamin 138 Hope, Dr Edward William 124 Hospital Plan (1962) 221, 225, 229–31, 237, 243, 246–7, 249 Hospital Saturday/Sunday 40, 46–7, 48–9, 60, 64 Hospital Savings Association 62, 86 hospital size 81–2 Hospital, The 89 Hospitals Yearbook, The 79 house visitors, voluntary hospitals 33 In Sickness and in Health (1976) 234 income sources, regional variations 85–9 incomes, doctors 186–90 incurable patients 29 Independent Order of Oddfellows Manchester Unity 147–8, 151, 156 indoor relief 98–9, 104 inequalities (regional), NHS 221–38 Infectious Disease (Notification) Act (1889) 118, 126 infectious diseases: exclusion from voluntary hospitals 30; isolation hospitals 115–19; isolation principle 113–15; mortality rates 125 insurance crisis (1911–12) 167 internal markets, NHS 248 investments, voluntary hospitals 45–6 Irremovable Poor Act (1861) 97 Isle of Wight 81 isolation hospitals 115–16 Isolation Hospitals Act: (1893) 118, 126; (1901) 119 isolation principle 113–15 Jessop Hospital for Women, Sheffield 65, 71 Jewkes, Sir John and Sylvia 222 Johnson, P. 157–8 Johnson, Samuel 27 Joint Consultative and Advisory Hospitals Council, Sheffield 65–6

Index Joint Hospital Boards 118 Joseph, Keith 247 Jowett, Fred 133 King’s Fund 248 Klein, Rudolf 225 Kyrle Society 51 labour market: changes 149–51; insecurity 159; medical 154 Labour Party 209, 210, 213, 216, 221, 234, 238, 243, 244, 248; Bradford 130, 132–4, 139, 140 Lancashire 71, 72, 86, 116, 121, 150, 158, 186–7, 188, 191; see also Liverpool; Manchester Lancet, The 106, 154, 156, 233 Larking, Dr A. E. 169 Law XIII, voluntary hospitals 45 Leach, William 133, 134 legacies 24–7, 41, 45–6, 86–9, 136 Leicester Royal Infirmary 223 Leicestershire 81, 116 letters of recommendation 30–2, 36 Levy, H. 193 Liberal Party 99, 133, 134 Liverpool 112–13, 122–5, 226 Liverpool Medical Institution 123 Liverpool Sanatory Act (1846) 122 Lloyd George, David 167, 178, 182, 191, 192 Lloyd, Geoffrey 210 Lloyd, Selwyn 145 loans: county councils 118–19, 121–2; Poor Law unions 97–8, 105 local authorities: construction of municipal hospitals 116–25; hospitals 223–4 Local Government Act (1888) 99 Local Government Act (1929) 113, 140, 224 Local Government Board (LGB) 101, 105, 108; creation of 114–16; grants 98–9; and municipal hospitals 112, 116–27; Order (1906) 65 Local Government Board Act (1871) 114 Local Loans Act (1875) 121 Local Taxation Returns 119–22 Lock Hospital, London 24 London 226, 233, 234; isolation hospitals 117, 120; voluntary hospitals 23–36, 62, 67, 71, 78–9, 80, 81, 82, 84, 85, 86–9; see also Whitechapel Union London and Provincial Medical Directory 155 London County Council (LCC) 96–7, 99, 107 London Hospital, East End docks 31, 104 lotteries, admissions places 35 Lowe, Rodney 205–6, 207, 212, 213, 242–9 Loyal Order of Ancient Shepherds 147–8 Lucas, Keith 105 Ludbrook, Anne 223, 224–5 lunatics: exclusion from voluntary hospitals 30; treatment under Poor Law unions 104, 105 lying-in hospitals 24, 28, 34–5 McIntosh, T. S. 140–1

255

McKinnon, M. 100 McKnee, Dr Ballie 168–9 Macmillan, Harold 205, 208, 210 McMillan, Margaret 133 maintenance expenditure 79–84 Manchester 71, 115, 121, 183, 184, 188–9, 226, 234 Manchester Medical Guild 171 Marquand, Hilary 208 Maynard, Alan 223, 224–5 Mays, Nicholas 221, 225, 229, 231, 232, 233, 234 means testing 53–4 measles epidemics 123 Medical Act (1858) 155 Medical Aid Associations 154 Medical Defence Union 166 medical equipment 223 medical labour market 154 Medical Officers of Health 114, 122–3, 125, 126 medical officers, role in admissions 32–3 Medical Practices Committee 225 medical significance of NHI scheme: doctors 183–90; overview 182–3; patients 190–4 medical staff, voluntary hospitals 24; see also general practitioners medicalisation, friendly societies 156–7 Medicine and the Public (1905) 165, 172 Medico-political Committee, BMA 175 Memorandum on Hospital Accommodation (1895) 118 Mendicity Society, Birmingham 54 Metropolitan Asylum(s) Board (MAB) 100, 104, 117 Metropolitan Common Poor Fund (MCPF) 100, 107 Metropolitan Poor Act (1867) 100, 106 Metropolitan Sick Asylums District 104 Middlesex 81 Middlesex Hospital 23–5; admission arrangements 29–35; benefactor’s objectives/hospital organisation 28; income 25–7, 86; overview 23 Midlands 60, 71, 86, 88, 151, 184, 223, 226, 234; see also Birmingham Midwives Act (1936) 140 Mile End workhouse, London 98 military hospitals 137 Mill, John Stuart 77 Miners Association, Barnsley 68 mining communities 63, 67, 150, 183–4 Ministry of Health 131, 137, 139, 186, 188, 215, 227, 228, 230–1; hospital surveys 70, 90, 113; Miscellaneous Provisions Bill 140 mixed economy in provision: Bradford Royal Infirmary 131–2; John Buchan 134–7; municipal socialism 132–4; overview 130–1; St Luke’s Hospital 137–9 Mohan, John 40, 77–90, 215, 222, 223, 228, 230, 237 morbidity rates 159 Morrice, Andrew 165–79, 183

256 Index Morris, Jerry 226 mortality 236–7 Motherwell Fever Hospital 134–5 municipal hospital finance (1870–1914) 112–27 municipal hospital provision: Liverpool 122–5; overview 112–13; variation in 119–21 municipal socialism 132–4 municipalisation, Bradford 130–41 Music Festival, Birmingham 45, 46 National Association of Clerks to Insurance Committees 191 National Health Insurance (NHI) scheme: doctors employed in 183–90; overview 182–3; patient experiences 190–4 National Health Service (NHS) Act (1946) 221 National Health Service (NHS) Amendment Act (1949) 213–14 National Health Service (NHS): charitable fundraising 90; double irony 216; failure and funding 209–11, 221–38; funding and resource allocation 10–13; health care since 1939 242–9; parsimony and competition for resources 201–9; success and parsimony 211–15 National Health Service Bill (1946) 77 National Health Insurance Act (1911) 60–1, 69, 125, 182; medical opposition to 167 National Insurance as funding 243–6 National Insurance Contributions (NICS) 248–9 nationalisation 244 Netherfield Road Hospital, Liverpool 123, 124 Newark and District Hospital 223 Newcastle 71, 226, 230, 234 NHS Plan (2000) 242, 248 non-pauper inmates, workhouse infirmaries 100–1 Norfolk 62–3, 68–9, 70, 71, 156; see also Norwich North East 60, 101, 116, 191; see also Newcastle North West 60 Northamptonshire 81, 224 Northern England 82, 85–6, 88, 120, 150, 223, 226 Northumberland 81 Norwich 62–3, 69, 70, 72, 121, 158 Norwich Hospitals Contributors’ Association 69 Nottinghamshire 121, 150, 193, 194 Noyce, J. 233 Nuffield Provincial Hospitals Trust 59; surveys 113, 223–4 occupational health risks 150–1 Odsall Smallpox Hospital 131 On the Provision of Isolation Hospital Accommodation by Local Authorities (1900) 119 ophthalmic services 212–14, 215, 245 organisation, voluntary hospitals 59–72 Orthopaedic Hospital, Birmingham 40, 41, 43, 44, 47, 52

Osborn, F. M. 66, 68 outdoor relief 98–9, 102–3, 104–5 outpatients, voluntary hospitals 53–4 Owen, David 234, 238 Oxfordshire 72, 81, 224, 226, 232 panel practice 147, 183–90 path dependency 247–8 patient payments: isolation hospitals 117, 125; voluntary hospitals 60–1, 64–5, 86, 88–9 patient records 192 patient transfers, voluntary hospitals 68–70 patients, experiences of NHI scheme 190–4 pauper patients 95–108, 117 pauperisation, stigma of 155 pay beds, NHS 212 Peacock, Alan T. 232 Peake, Osbert 203 penny collecting schemes 63, 69, 70 Perkin, H. 166 perpetual trusts 24–5 pharmaceuticals 214 philanthropy 3–4 Pickstone, J. 114 Pierson, Paul 243, 247 Pinker, R. 78–9 Player, J. E. 50 Plowden Report (1961) 230 Policy for Secondary Education, A (1951) 210 politics of NHS expenditure: double irony 216; failure and funding 209–11; parsimony and competition for resources 201–9; success and parsimony 211–15 poor boxes, voluntary hospitals 26, 27 Poor Law Amendment Act (1834) 95, 96, 101, 105, 153 Poor Law conference movement 107 Poor Law infirmaries 6, 98–9, 102–8, 116, 123, 124, 153; municipalisation of 130, 131, 137–9 Poor Law unions: diversification 101–7; finance 96–101; overview 95–6 poor rate 96–101, 105 Powell, Enoch 229, 231, 243, 246 Powell, M. 83–4, 113 prescriptions 191, 193 Priestly, Sir William 136–7 Priestman, George 136 Primary Care Trusts 248 Priorities (1976) 234–5 Private Finance Initiative, NHS 242 private patients, panel practices 191–2 privatisation 245 Prochaska, F. 40, 78, 88 professional capability 185 professional ostracism 166 professional status 156 Provident Dispensaries 171, 175, 176 Public Assistance Institutions 224 public contracts, voluntary hospitals 88 Public Expenditure Survey and Control (PESC) system 230

Index Public Health Act: (1866) 123; (1875) 114, 116–17, 119, 121–2, 138; (1890) 122 public hospitals: before 1914 4–6; relations with voluntary hospitals 70–1 Public Loans Works Commissioners (PWLC) 122 public opinion polls 210, 211–12, 215, 243 Public Works Loans Board 97–8 Pullan, H. Thornton 133, 134, 139, 141 quacks 155 Quarterly General Courts, voluntary hospitals 34 Queen’s Hospital, Birmingham 40, 43, 44, 45–6, 48, 49, 51–2, 54 Radcliffe Infirmary, Oxford 224 Rawstron, Prof E.M. 232 Rechabites 147–8 reciprocal arrangements, voluntary hospitals 69–71 Redistribution Act (1885) 100–1 referrals, voluntary hospitals 60–1, 68, 70, 71 regional comparators, voluntary hospitals: contributory schemes/fundraising/coordination of services 67–71; East Anglia/South Yorkshire 62–5; overview 59–62; Sheffield 65–7 regional distribution, friendly societies 149 Regional Health Authorities (RHAs) 235 Regional Hospital Boards (RHBs) 222, 228, 229, 230, 231, 233, 234 regional inequalities NHS 221–38 Regional Variations in Britain (1971) 232 regionally based contributory schemes 68–9 registration, friendly societies 157–8 Reinarz, Jonathan 40–55 Report of the Royal Commission on Metropolitan Hospitals (1882) 117 Report on the Use and Influence of Hospitals for Infectious Diseases (1882) 115–16 Resource Allocation Working Party (RAWP) 221–2, 232–7, 238 resource allocation, NHS 10–13, 224–32; resources: competition for 90, 201–5; inherited pattern of 222–4 revenue expenditure, NHS 225, 226–7, 231 Riley, J. C. 148, 156, 159 Rivett, G. 40 Robb-Smith, A. H. T. 206–7 Robert and Agnes Jones Hospital, Oswestry 88 Rotherham Infirmary 63–4, 69, 70, 71 Royal Commission on the Poor Laws (1905–1909) 102, 158, 183 Royal Eye and Ear Hospital, Bradford 131 Royal Hospital, Sheffield 65, 66, 68 Royal Infirmary, Sheffield 65, 66 Royal Institute of Health and Public Hygiene 135 Royal National Hospital for Consumption, Isle of Wight 81 Royal Ophthalmic Hospital 104

257

Royal Sanitary Institute 134 Royal Sea Bathing Hospital, Margate 88 rural authorities, provision of isolation hospitals 118–19 Rural Sanitary Authority, Alcester 116 rural–urban contracts in expenditure 80–1 Sampson, Gamgee 40, 45, 48 Sanitary Act (1866) 113–14 scarlatina epidemics 123 scientific medicine 51–5 Scotland 62, 67, 80–2, 84, 184–5, 188, 192, 193, 234; see also Glasgow screening of patients 32–3 Seamen’s Hospital, Greenwich 100 secondary modern schools 209–11 Select Committees 106, 155, 227–8, 237 services: co-ordination, voluntary hospitals 67–71; contracting out 104; free at point of use/comprehensiveness 212; inequalities in provision 221–38; range in panel practices 193–4 Sheard, Sally 1–15, 112–27 Sheffield 184, 222, 223–4, 225–6, 228, 230, 232, 233, 234, 236; industries 150–1; municipal hospitals 116; voluntary hospitals 64–8, 69, 70–1, 72 Sheffield Hospitals Joint Council 68 Sheffield Municipal and Voluntary Hospitals Joint Committee 71 Sheffield Trades and Labour Council 65–6, 141 Shropshire 113, 149 sickness insurance 6–8 smallpox epidemics 115, 118–19, 123 Smallpox Hospital, London 24 Smith, Adolphe 168 Smith, E. J. 133 Snaith, A. H. 233 social class inequalities 225 social indicator movement 231–2 social status, doctors 155 Society of Medical Officers of Health 134 Society of Miners, Tipton 150 Society of Tradesmen, Tipton 151 South-east England 86, 88, 116, 120, 150, 186, 191, 234 South-west England 82, 88, 120, 150, 186, 226, 233 special hospitals 24, 88 specialist services, co-ordination of 70 Squire Sprigge, S. 165, 171, 172 St Bartholomew’s Hospital, London 24, 27, 90 St George’s Hospital, London 23, 25, 27 St Luke’s Hospital, Bradford 130, 131, 132, 134, 137–9, 140–1 St Thomas’s Hospital, London 24, 86, 90 Staffordshire 81, 149, 150, 151, 152 Standard Mortality Ratios 236 State and the Doctor (1910) 112 Stilliard, James 53 Stopford Taylor, Dr John 123 subscriber note admission system 155

258 Index subscribers: Birmingham 41–9; encouragement of 49–51; recommendations see letters of recommendation; working-class 48–9 subscriptions: Birmingham 41–4; London 25–6 Suffolk 62–3, 70 supplementary services 212–13, 245 surgeries, accommodation 193 surgery visits, length of 191–2 Surrey 81, 84 Sussex 149 tax-funding system 242–5 teaching hospitals: beds 82; new techniques 51–2 technical schools 209, 210, 211 Thane, Pat 97 Thatcher, Margaret 201–2, 242, 247–8 throughput, voluntary hospitals 84–5 Titmuss, Richard 214, 226 trade union, BMA as 166–7 Trickey, A. J. 233 tripartite system of education 209–11 Tudor Hart, Julian 232, 233 two-tier service, assertions of 192–3 typhus epidemics 123 ‘ultra-sanitarians’ 114 unemployed workers 183–4 unethical practices 170–1 Union Assessment Committee Act (1862) 96 Union Chargeability Act (1865) 97 United Order of Free Gardeners 158 universal free treatment, arguments for 117 University College Hospital, London 90 university medical schools 70 urban–rural contrasts in expenditure 80–1 Vallance, William 101, 103, 105, 107 Vaughan, Dame Janet 228 voluntarism 77–8, 88, 132, 137 Voluntary Hospitals Commission 59, 69 voluntary hospitals: benefactor’s objectives 28; contributory schemes 67–71; East Anglia/South Yorkshire 62–5; encouragement of donations 49–51; expenditure 84–5; expenditure variations 79–84; fundraising 45–7, 67–71; income (1745–1800) 25–7; municipalisation 130–2; philanthropy 3–4; scientific medicine and scientific charity

51–5; service co-ordination 67–71; Sheffield 65–7; subscribers 41–4; throughput 84–5; working-class subscriptions 48–9 voluntary labour 85 Waddington, Keir 40, 95–108 waiting lists 70, 243 Wales 80–1, 82, 84–5, 167, 177, 183, 193, 225–6, 231, 234 Wanless Reports (2001–04) 242, 243, 248, 249 Warwickshire 81, 116 Way Forward, The (1976) 234 Webb, Beatrice and Sidney 112 Webster, C. 78, 204, 205–6, 208, 211, 213, 215, 223, 225–6, 229, 234, 237 Weekly Boards, voluntary hospitals 24, 30, 31, 32–5 Welshman, John 221–38 West Suffolk General Hospital 63 Westminster Infirmary 23, 29 Whitechapel Union: diversification 101–7; finance 96–101; overview 95–6 Whyte Watson, G. 140 Willink, Henry 207 Willis, Tim 130–41 Wiltshire 224 Wiseman, Jack 232 women: as doctors 186; qualification for NHI scheme 186, 189 Women’s Hospital, Birmingham 40, 43, 44, 47, 52 worker representation, voluntary hospitals 49 workhouses: care of incurable patients 29; infirmaries in 98–9, 102–8, 116, 123, 125 working conditions, GPs 165–79 Working for Patients (1989), White Paper 248 Working Men’s Committee, Queen’s Hospital, Birmingham 49 working-class subscriptions 48–9, 65–6, 86 workplace: collections 46, 48–9, 60, 65–6; Worksop Victoria Hospital 63–4, 69 World Health Report 2000 1 World War I 60 Wright, Thomas 47 Yorkshire 62–5, 67–8, 69, 70–1, 72, 79, 86, 116, 149, 156, 188–9, 192, 226; see also Bradford; Sheffield Yorkshire Miners’ Welfare Association 68