NHS frontline to get £2 billion extra per year

The Chancellor has said the government's spending plan has got public finances "under control" now - and that is what will pay for the extra £2 billion a year set to be ploughed into the NHS.

George Osborne told ITV News that money being paid by banks in fines would also go into the health service, and would be invested in GP services in the community.

The head of the Institute for Fiscal Studies, Paul Johnson, said the government would fund the £2 billion extra for the NHS by making a number of cuts to other areas of public spending such as local authorities already been hit by austerity.

In an interview with Political Correspondent Libby Wiener he said the spending cuts and austerity measures were by no means over - in fact only half had been implemented - and there was an element of "robbing Peter to pay Paul" in today's announcement.

Mr Johnson said the government's plans to curtail welfare spending had not gone very well so far, as rents have went up whilst wages have went down.

NHS England chief Simon Stevens has welcomed the extra cash injection announced by the government, and their commitment to the radical changes outlined in his report on how the NHS can best cope with the increasing demands of an aging, fattening and growing population.

Read: NHS 'needs radical shake-up and extra cash'

Mr Osborne has announced an extra £2bn annual funding for the NHS, along with a new fund to improve GP services, paid for out of fines levied on the banks.

But Labour called the announcement "crisis funding" and said they had a "long-term plan to save the NHS".

Mr Osborne will give more details on Wednesday during his Autumn Statement, but the extra funding for the health service may mean cuts in other government departments.

ITV News Correspondent Rags Martel reports.

Health Secretary Jeremy Hunt says Labour's only plan to provide extra funding for the NHS is a "homes tax" on properties worth over £2 million.

His choice of words is notably different to Labour's own characterisation of the policy as a "Mansions Tax" aimed at the very rich.

Read: Andy Burnham: Extra NHS money 'nowhere near enough'

The extra £2bn NHS funding announced by George Osborne is "nowhere near enough" to deal with the "crisis" in the health service, according to the Shadow Health Secretary.

Andy Burnham told Sky News' Murnaghan programme:

Mr Burnham said Labour had plans including a tax on tobacco companies and a levy on high-value homes which would provide extra NHS funding.

Read: NHS funding boost 'extremely welcome vote of confidence'

The head of NHS England has welcomed the announcement of an extra £2bn funding, saying it is an "extremely welcome vote of confidence" in his long-term plan for the health service.

Simon Stevens said he had been making the case to government that sustaining a high-quality NHS called for "both challenging new efficiencies and genuine new investment."

Read: NHS England: 'Radical shake-up and extra cash needed'

The Government will use fines paid by financial institutions to support a "permanent improvement in GP services".

The fines from the Forex rate-rigging scandal will contribute £1.1bn to the health service.

The Chancellor told the BBC's Andrew Marr Show the payments were a "downpayment on the NHS' own long-term plan".

The Chancellor has announced an extra £2bn for the NHS' annual budget, which he says is possible because of the UK's improved economic performance.

Read: George Osborne to announce extra £2 billion NHS funding

Extra funding for the NHS announced by George Osborne is "crisis money", according to Shadow Chancellor Ed Balls, who accused the Conservatives of "putting the NHS in danger".

The Chancellor is set to announce £2 billion extra for frontline NHS services, which he says is only possible because of the UK's improved economic outlook.

Speaking to the BBC's Andrew Marr Show, Mr Balls hit out at his opposite number, saying:

"This is a typical Tory pattern - a winter crisis and then crisis money coming after it. The question is, is this a one-off, or is it going to be an actual, long-term investment in the nurses and doctors we need?"

He said Labour would tax high-value properties to provide an extra £2.5bn funding for the health service.

Read: Osborne: I will support nurses, doctors and NHS staff