By Paul Goodman
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The NHS bill damaged David Cameron's NHS strategy

Screen shot 2012-10-03 at 09.52.27Ed Miliband's speech at Manchester this week had the opposite aim to one given in Westminster by George Osborne last year.  Mr Miliband's aim is to get voters to take a second look at him; Mr Osborne's is to get them to give a second term to David Cameron.  But the Labour leader's public address to his party conference and the Chancellor's private one to Conservative MPs agreed on one point: over the years since it was formed, Labour has established political ownership of the NHS.  This is why Mr Miliband used the health service to sign off his speech and why, during his,  Mr Osborne told his audience that one of Team Cameron's two main aims in opposition was – since it couldn't win on the issue – to neutralise the NHS issue as a problem to the Tory brand.

A year or so on from the Chancellor's speech and a couple of days after Mr Miliband's, that issue remains resolutely unneutralised, for all the NHYes campaigning in opposition, the denunication of  "Gordon Brown's NHS cuts", Mr Cameron's enthusiastic reception by junior doctors and public understanding of his own family use of the NHS.  Whatever one's view of its original content and eventual shape, the deployment of a radical health bill in the Government's shop window was inconsistent with a strategy of tidying health policy away on a backroom shelf.  The pause in the midst of the bill's passage was an acknowledgement of defeat.  The risk of further reputational damage now follows, for two reasons.

The service is now faces a funding crisis and is in the hands of a vulnerable Minister

First, NHS funding is to rise at a slower rate than at any time since the service was created.  True, it is to rise above inflation – a settlement that other departments yearn for – but by a bare minimum: 0.1% for each year until 2015.  Second, the service is now in the hands of a man who arrives with a dented reputation.  Jeremy Hunt has had a dire time since I suggested in February that he be moved to health to lull the storm over the bill.  In the months between then and now, he has lost a special adviser over the BSkyB bid and Labour – sensing weakness – moved in for the kill.  They did not succeed, and Mr Cameron sending Mr Hunt to health was a sign of confidence in him.  None the less, the new Health Secretary arrived at his new department battered.

The nightmare for the Government generally – and Mr Hunt specifically – must be that between now and 2015 a good – or rather bad – old-fashioned "NHS crisis" erupts, as the service fails to meet the squeeze on its spending by achieving the "Nicholson challenge" of saving £20 billion by 2015.  In political terms, such a crisis means the return of the familiar shroud-waving circus, complete with hospitals closing wards, A & E units keeping patients waiting in ambulances, patients unable to obtain appointments and Trojan Women chorus of outraged doctors and nurses.  The Health Secretary holding the parcel when the music stops will duly first be baled out by Mr Osborne and later sacked by Mr Cameron.  This was to be Mr Lansley.  Now it is Mr Hunt.

Hunt is relying on the Lansley reforms working to stave off a crisis…

The King's Fund said recently that the Nicholson challenge is unlikely to be met.  The Institute for Fiscal Studies declared that the coming years will be the toughest since the NHS was formed.  And the Health Secretary recognises in an interview in this week's Spectator that funding may tighten further after 2015.  So how does he plan to stop the music stopping on his watch?  Friends of Mr Hunt recognise that the service is "bruised" after the health bill experience – they could scarcely not – and that funding is "flat": all this suggests that the Prime Minister has sent the new Health Secretary in to calm things down, deploying the presentational and personal skills that served him well until the BSkyB contretemps.

But more than charm will be needed to avert a crisis. A key to avoiding one remains meeting the Nicholson target, and this in turn means treating patients earlier and thus keeping them out of hospital.  Mr Hunt is apparently more optimistic than his department that this can be done – again, it would be surprising were this not the case – claiming that a quarter of the savings are already banked, and that the Lansley reforms are working their way through the system, as the new commissioning groups of GPs roll up their sleeves and down get to work.  In Newcastle, doctors have apparently reduced admissions by 9% in Corby, scene of that forthcoming by-election, the figure is 25%.

…And wants everyone to have access to their medical records online

The new Health Secretary is also setting store in the rolling-out of I.T to speed the system up.  This may give a clue to a difference between his approach and his predecessor's.  Mr Lansley understood the system from top to bottom, but was never quite able snappily to summarise his reforms.  Indeed, he once told nurses that "I am sorry if my policy has failed to communicate itself to you" – a curious choice of words, since it falls to politicians to communicate their policies: the policies cannot do so themselves.  We can expect Mr Hunt to be snappier about what he is trying to do.  One of his aims is to personalise the service: he wants each user of the service to have online access to their medical records.

This project was begun by Mr Lansley, but the new Health Secretary wants to speed it up.  He has been known to compare his predecessor and himself in turn to Lord King, the man who revived British Airways, and Lord Marshall, the firm's Chief Executive – who implemented much of the change that King inspired.  It is unusual for a politician to present himself as playing second fiddle, but Mr Hunt clearly believes that he can best get his way by consensus: he has told friends, quoting Ronald Reagan, that "there is no limit to what you can accomplish if you don't care who gets the credit".  The great former President was another optimist.  But with funding this tight and the service as it is, Mr Hunt is going to need all the optimisim he can get.