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The Tories’ NHS pledge puts them on a Brexit bus to nowhere

Boris Johnson Brexit Battle Bus
Boris Johnson during the Brexit Battle Bus tour. Photograph: Christopher Furlong/Getty Images

As Theresa May would say: let me be clear. There is no “Brexit dividend”. There is no glorious golden handshake to look forward to when we leave the European Union. If there is to be £600m extra a week in cash terms for the NHS within six years, it will not be found in the goody bag when we leave the Brussels party.

As Paul Johnson, director of the Institute for Fiscal Studies, told the Financial Times: “Payments to the EU will fall [after Brexit], but tax revenues will fall more as a result of Brexit.” That, as Johnson said, “is the official position of the government, which has accepted the Office for Budget Responsibility’s forecast that the public finances are likely to be weakened to the tune of £15bn a year as a result of the referendum vote.”

Given that there is absolutely, categorically, definitely, no Brexit bonanza in prospect, it is natural to ask why ministers keep pretending that there is. And the reason is big and red and monstrous.

In the game of politics, it is commonplace to speculate about what might happen if someone were knocked down by a hypothetical bus. Well, the Conservative government was knocked down by a real one two years ago, and specifically by the pledge emblazoned on its side that leaving the EU would yield £350m a week for the health service.

Since the victory of the leave campaign, this particular promise – as fiscally ridiculous as it was emotionally cunning – has bedevilled the Tories like political herpes. How to deliver the undeliverable?

The answer, it transpires, is to promise a quite distinct increase in NHS spending, and cheekily slap an entirely misleading “Brought to You By Brexit!” sticker on the side. The prime minister also hopes that the renewed association between our departure from the EU and extra money for the health service will make it harder for MPs to sabotage the withdrawal process between now and the end of March. I doubt that this ruse will work, but desperate times call for desperate measures.

This, in other words, is political triage before it is public policy. Which is a shame; because there are few more pressing issues confronting our society than the future funding and structure of the NHS in an age of greater longevity, pioneering medical technologies and a growing recognition that mental health deserves the parity it has so long been denied. Credit to Jeremy Hunt, the longest serving health secretary in the 70-year history of the service, who has secured this spending increase through a combination of stamina, political guile and sheer persistence. It may not be as much as the NHS needs, and is certainly not as much as it wants. But the cash boost is substantial, and it is churlish to pretend otherwise.

It also marks the beginning of a huge political debate that is long overdue. Correctly framed, the government’s recognition that more money is needed, and must be found, might have put Labour on the back foot, forcing Jeremy Corbyn on to the terrain of fiscal precision, the detail of tax-and-spend, and the practicalities of turning social ideals into clinical reality.

The problem for the PM is that this terrain is no less awkward for the Tories, some of whom regarded even David Cameron’s ringfencing of the NHS budget as an ideological affront. Let us assume, though, that May and Hunt are able to convince their party that it cannot possibly face the voters in another general election until it has explicitly acknowledged the problem of NHS underfunding and (no less explicitly) done something about it. We have established that the “Brexit dividend” should be categorised with leprechauns, the Easter bunny and fairies at the bottom of the garden. Where, then, will the money come from?

Herein lies the true strategic significance of the PM’s announcement. For eight years the Conservatives have made deficit reduction a core objective: combining fiscal conservatism with monetary activism. Though Philip Hammond has introduced greater flexibility to the plans he inherited, he remains committed, as was George Osborne, to wiping out the deficit as soon as politically feasible. The question, then, is whether the chancellor will now allow the NHS to edge ahead of the deficit as a priority – and borrow accordingly. To do so would send a sharp signal to Westminster and the markets, and the fact that this matter has clearly not yet been resolved is eloquent.

Whatever he decides, the impact of austerity will be felt for years to come. But Hammond’s decision on borrowing will be one of the most important he faces in office. If, on the other hand, he chooses to fund the new NHS spending from taxation, he will infuriate those Tories who are ideologically opposed to all tax rises, and alarm those who, more narrowly, believe that social justice is best served by lifting as many people out of taxation altogether by continuing to raise the personal allowance.

I am as confident as I can be that the NHS funding conundrum will not be properly addressed until one or other of the main parties proposes a wealth tax (in fact, Osborne was inclining towards a mansion tax as a first step in this direction, only to be stopped in his tracks by Cameron). But a mature debate on the subject will be very hard as long as the question is entangled with fatuous claims about shimmering Brexit gold.

Labour, it is true, still languishes in the shade of the magical money tree. But the Tories will be in no position to mock as long as they stay on board the big red bus of magical thinking, hurtling toward the unknown.

• Matthew d’Ancona is a Guardian columnist