So Britain has taken the hard decision on taxation to fund the spending on the pandemic — the first among more to come no doubt. It had to, just as about every country will have to now that the financial cost of the pandemic is beginning to sink in following the human cost.

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The British model announced has been by Prime Minister Boris Johnson in Parliament on Tuesday envisages what he called a “1.25 percent health and social care levy on earned income” — politicians do not like to use the expression “tax rise” unless in opposition. This levy, he clarified will go “straight to the frontline” of medical care.

The state-funded National Health Service in Britain has been under heavy strain from the cost of the pandemic. Other than dealing with Covid cases, the NHS now faces a heavy backlog of dealing with other medical cases delayed through the pandemic.

“It will be wrong for me to say that we can pay for this recovery without taking the difficult but responsible decisions on how we finance it,” Boris Johnson said. It would be “irresponsible to meet the cost from higher borrowing and from higher debt.”

Through the pandemic, the government has borrowed and borrowed. That only added to the national debt that grew to 2.224 trillion pounds (3 trillion dollars) by March of this year, amounting to 106 percent of the gross domestic product. That borrowing had to stop somewhere, and medical services need to be paid for immediately.

The tax rise, call it the new levy, takes effect from April of next year. The levy will be shared between individuals and businesses, it’s not just an income tax rise for individuals. Those who earn more will be asked to pay more; the top 14 percent earners will share half the cost. Dividend tax rates will also go up.

“This will raise 36 billion pounds over the next three years with money from the levy going directly to health and social care,” Johnson said. “It will go straight to the frontline at a time when we need to get more into our health and social care system than ever before.”

The money will be spent, he said on “radical innovation to improve the speed and quality of care.” Specific improvements include better screening equipment to diagnose serious diseases and faster GP access to specialists so that patients “do not wait months to see someone in the hospital to see if something is wrong.” Such delays have been the undoing of a health service that is otherwise considered among the world’s best.

India

Some of the new steps planned can mean a good deal of potential business partnership with Indian firms. One of the new priorities Boris Johnson outlined is the introduction of substantially greater digital technology “so that doctors can monitor patients remotely in their homes.”

Input into such digital services has been a strong area for Indian IT companies to push into. Increased cooperation between Britain and India in the medical field, particularly following Covid, was a declared aim in the areas of cooperation between India and Britain announced by prime ministers of the two countries through the course of a virtual summit held in May.

In a parallel move to an extent, India has announced government support to 75 start-up companies in telemedicine and digital health. The measure marks a sign of government support for financing digital health.

The peak of Covid offered some illustration of India and the UK acting together. A team of doctors from the British Association of Physicians of Indian Origin (BAPIO) teamed up with hospitals in Nagpur and Delhi to provide backup services to doctors in India. They stepped in with reporting and analysis of tests to support Indian doctors — without trying to substitute the primary role of Indian doctors.

A number of Indian companies already set up in Britain are already undertaking services in digital healthcare.

The new UK budget coupled with new agreements being explored under an enhanced UK-India trade deal are expected to throw up several new opportunities for digital medical cooperation now between Britain and India. One way or another both countries are now preparing to spend on healthcare in digital-friendly ways.

— London Eye is a weekly column by CNBC-TV18’s Sanjay Suri, which gives a peek at business-as-unusual from London and around.

Read his other columns

(Edited by : Ajay Vaishnav)