Reducing health spending: The role of financial incentives

Though the Treasury may use tax concessions for political ends, it has always been reluctant to regard taxes themselves as anything other than revenue‐raising devices. Also, British administrators, in implementing policy, have traditionally gone for regulatory measures rather than fiscal or pricing solutions. Taken together, this has meant there has been no effective lobby within the Civil Service for the policy‐oriented use of financial incentives. But what might happen if the Department of Health & Social Security was empowered to levy and receive the proceeds of its own taxes?