More funding for mental health could help UK break new ground, study says

Spending more money on mental health services will boost economic growth and improve social well-being more than building new roads, according to a study.

A report from the London School of Economics (LSE) says a rethink is needed within Whitehall on how to approach spending decisions, with a focus on how money actually improves people’s lives, particularly -mostly about health.

Researchers have assessed the cost-benefit ratio of policies across sectors in a bid to convince Rachel Reeves that she should drop expensive road projects such as the Lower Thames Crossing in order to invest more in health. , education and skills to grow the economy. .

The chancellor is due to publish the budget and full spending review next month, which sets out the government’s spending priorities for the next five years.

Reeves is expected to announce severe cuts to Whitehall spending to stay within the budget restrictions carried over from the previous Conservative administration. Other key road projects have been scrapped, including a proposed tunnel near Stonehenge on the A303.

LSE researchers assessed the benefits made by individual consumption decisions in relation to their incomes in terms of savings and welfare benefits in terms of their income equivalent.

They hypothesized that targeted use of mental health and addiction services would not only help those affected, but also reduce the overall cost of health and welfare services when they are returning money to the exchequer when people go back to work.

They also found that a psychiatric service for addiction and job support for moderate mental illness will pay for itself within two to three years.

Although some policies were found to increase overall government spending, they were found to deliver the highest benefits per pound, for example, the commitment to ensure that everyone has and the right to an apprenticeship was judged to provide benefits worth 14 times more than what they consume.

Similarly, they found that more police officers would produce benefits in reduced crime worth more than 10 times their impact on human well-being.

On the other hand, a review of the road projects concluded that the overall project produced benefits equal to three times the costs when the proposed Lower Thames Crossing, linking north Kent and south Essex, was proposed. that it provides benefits equal to only 1.5 costs.

Richard Layard, one of the authors of the report, said the savings from people with fewer health problems, returning to work earlier and claiming fewer benefits, should be put to good use. first because it reduces the overall cost to the government.

Lord Layard, distinguished professor of economics at the LSE and a former government adviser, said its report – called Value for Money – was inspired by Keir Starmer’s pledge, which he made when he was leader of opposition, that “for every pound spent on your behalf, we can expect the Treasury to weigh not only its effect on the national currency but also its effect on the lives of beauty”.

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after the news release

The report will be launched on Tuesday at the offices of the Government Think Tank in central London with the support of former head of the civil service Gus O’Donnell, and Amanda Rowlatt, former chief inspector at the Department for Transport.

Layard said the method used by the LSE team mimics the cost-benefit analysis used by the National Institute for Health and Care Excellence (Nice), which assesses the value for money that new drugs and treatments provide. about it on the NHS.

He added: “We now have the skills to estimate cost-benefit ratios for many policies, and these should be the basis for the next cost-benefit analysis.”

O’Donnell said: “This is an exceptionally important report. It should lead to significant improvements in the way government spends our money to improve lives. ”

The Treasury declined to comment.