Published by The i paper (6th August, 2025)
Labour is floundering with an unpopular Prime Minister, daunting public finances and rising electoral fears over the Government’s competence after little more than one year in office. The benefits bill is growing, the health service struggling despite another multibillion pound injection of funds, and a substantial boost for defence looks more essential each day given the gathering storm clouds over Europe.
So the beleaguered Chancellor Rachel Reeves must spend her summer contemplating how to winkle out more cash from a disgruntled, debt-laden nation amid concerns over the cost of living and at a time when the Government is menaced by populists on both flanks. It is not the ideal backdrop for a relaxing break over the recess.
To make matters worse, Lord Kinnock has popped up with another of his unhelpful suggestions that sound so simple while enthusing the left. Last month the former Labour leader proposed that Reeves should soak the rich a bit more by imposing a wealth tax, despite plentiful evidence from abroad of the failure of such taxes. Now he is calling for the Government to drive up the cost of going to see a dentist or optician.
He does not put it like that, of course. Kinnock has suggested to The i Paper that following imposition of VAT on private school fees, the Government should follow suit by removing its exemption on private healthcare. He argues this would provide “vital funding” for the national health service – an estimated £2bn a year, according to the Good Growth Foundation – while commanding widespread public support.
This is, sadly, populist nonsense – and I say that as someone who has campaigned against the horribly-corrosive impact of private equity and badly-regulated private providers being allowed to run rampant in mental health services and social care.
For a start, analysts say private healthcare must include a wide range of services from opticians through to osteopaths if that £2bn sum is to be obtained. And as tax expert Dan Neidle – a Labour supporter – has pointed out on social media, much of the spending on private medicine comes from businesses, which could reclaim these costs. Additionally, the move would allow private insurers such as Bupa to recover their own VAT costs, so ending the exemption might end up losing money.
Many patients are turning to private providers in their despair or pain due to NHS failures. So what if the experts are wrong and Kinnock’s policy idea worked? Then the cost of private healthcare would rise. The basic laws of economics suggest this would drive more people into using the NHS instead of paying for their consultations, scans and surgeries. So this would end up increasing the pressures on both budgets and staff for overloaded state-funded services.
The 83-year-old former leader seems trapped in the past. He is playing still to the gallery from an era before reality intruded so painfully on Britain’s delusions, when the NHS was hailed as envy of the world and private medicine seen as a diabolical intruder. Such illusions have been shredded by the long waiting lists, patient safety scandals and comparatively poor treatment outcomes. A YouGov poll of 6,642 people in response to this daft idea found fewer than one-third of voters in favour.
No doubt Kinnock expected loud applause, especially from a party long suspicious about private medicine. After all, five years ago Sir Keir Starmer won the leadership with a promise to “end outsourcing in our NHS”. Before last year’s general election, he posed as someone so firmly opposed to the concept that he would not even use private healthcare for a “loved one” trapped in pain on a long waiting list for surgery.
Yet earlier this year Starmer heralded a new partnership with the private sector to “make the spaces, the facilities and resources of private hospitals more readily available to the NHS” in his desperate effort to slash waiting lists, adding to raised eyebrows that he was “not interested in putting ideology before patients”.
Europe shows that well-run public and properly-regulated private services can work effectively together, delivering higher quality care than the creaking NHS. Kinnock’s intervention simply reminds us again that he was the Labour leader who lost two general elections, handing Sir John Major the largest popular vote share in British electoral history. His Labour successors would do well to ignore his latest advice.