Action on mental health could help save London up to £26billion a year

22 January 2014

The scale of mental ill health in London is costing the capital around £26 billion a year, a new report commissioned by the Mayor Boris Johnson has revealed today.

In any given year, an estimated one in four Londoners will experience a diagnosable mental health condition. A third of these will experience two or more conditions at once.

According to a Department of Health report, the impact of mental ill health is greater than cancer and cardiovascular disease. It represents around 22.8% of the total, compared to 15.9% and 16.2% respectivel.

Close to £7.5 billion is spent each year to address mental ill health in London. This includes spending on health and social care to treat illness, benefits to support people living with mental ill health, and costs to education services and the criminal justice system. However, these costs are only part of the total £26 billion lost to London each year through such issues as reduced quality of life and productivity.

The Greater London Authority report provides a range of data, highlighting the direct and indirect costs of mental ill health to the city's economy. For example, at least one in 10 children is thought to have a clinically significant mental health problem, and the impact of childhood psychiatric disorders is estimated to cost the capital's education system approximately £200 million per year. In social care costs alone, London boroughs spend around £550 million a year treating mental disorder, and another £960 million is spent each year on benefits to support people with mental ill health.

The report shows how London's businesses are also affected - it is estimated that a staggering £10.4 billion is lost each year, including £7.2 billion due to increased worklessness. £920 million alone is lost annually to sickness absence, and a further £1.9 billion is lost to reduced productivity.

The Mayor of London Boris Johnson said: 'This report is a rallying cry to increase yet further our response to this very pressing and pervasive issue. There are still many misconceptions about what mental ill health is, how it happens and what can be done about it. The result is that those struggling with mental ill health often go unnoticed and unsupported. It affects our relationships with others, limits educational achievement and increases sickness absence and worklessness. Indeed, the effects of mental ill health impact upon each and every aspect of our lives.'

Launching the new report London Mental Health – The Invisible Costs of Mental Ill Health, Deputy Mayor Victoria Borwick said: 'This timely report reveals how far-reaching the effects of mental ill health are, not just on individuals and their loved ones, but on wider society and indeed the economy. It shows that this is not just an issue for health and social care professionals, but also for politicians and business leaders. It is vital that we work together to support people living with mental ill health and to mitigate the wider impacts which are so costly to London's economy.'

Professor Martin Knapp, Professor of Social Policy, London School of Economics, who was on the report's working group, said: 'The fact that mental health problems have enormous consequences is well known, but the findings in this report illustrate just what a pervasive impact they have on the capital’s population. £26 billion a year is far too high a price to the city, and much of it is because we are not addressing individual and social needs properly. Those costs will continue to rise if we do nothing. I want the findings of this report to spur the wider London community to help meet those needs.'

Mental ill health is one of the priority areas identified by the London health Board, and the Mayor is keen that it is an issue that will be considered through the London Health Commission led by Lord Ari Darzi. The Deputy Mayor Victoria Borwick will also advocate for the issue, including representing the Mayor at the Pan-London Dementia Action Alliance and by acting as a mental health champion as part of the Local Authority Mental Health Challenge.

Mental health will also be integrated better into the well-being activities being coordinated through the Mayor's Healthy Schools London programme. Mental health is also one of the issues tackled by the Mayor's Workplace Health Charter, which was set up to encourage and support employers that create a health enhancing workplace.

The report is available to download from – www.london.gov.uk/mentalhealth.

Notes to editors

The London Mental Health report aims to, where possible, quantify the impact of mental ill health in London in order to highlight the scale of the problem. It does this through analysing the wider economic and social impacts of mental ill health. As such the measurement and quantification of the costs of mental ill health go beyond usual measures of economic output, or Gross Value Added (GVA) to consider, amongst other things, so-called 'non-market' impacts, for instance the impact on individuals’ quality of life from mental ill health. The intention is for this to provide for a more ‘all-encompassing’ measure of the economic and social costs of mental ill health to London. The wider impacts of mental ill health result in around £26 billion each year in total economic and social costs to London. The wider impacts of mental ill health affect almost every aspect of a person’s life, from their education and employment to their physical health and the quality of their relationships. Across the population, the net effects of these wider impacts substantially affect London's economy, infrastructure and population. Because of this, mental health is not simply an issue for health and social care. It is an issue for everyone. Unfortunately, mental ill health remains one of the least understood of all health problems, and stigma stops people from addressing it. It is time we faced up to mental ill health and the effects it has on our community. To that end, this report seeks to shed some light on the scope and scale of mental ill health in London. 

Mental health is important to London In any given year, an estimated 1 in 4 individuals will experience a diagnosable mental health condition. A third of these will experience two or more conditions at once. The impact of mental ill health is greater than cancer and cardiovascular disease and the costs extend well beyond health and social care. Close to £7.5 billion is spent each year to address mental ill health in the London community. This includes spending on health and social care to treat illness, benefits to support people living with mental ill health, and costs to education services and the criminal justice system. However, these costs are only a part of the total £26 billion lost to London each year through such issues as reduced productivity and reduced quality of life. 

It is costing government Mental ill health impacts the most vulnerable the most, and many of the related costs fall to the public sector. At least 1 in 10 children is thought to have a clinically significant mental health problem, meaning 111,000 young people in London. The impacts of childhood psychiatric disorders cost London’s education system approximately £200 million per year. It also costs to social care. Forty five per cent of looked after children aged 5 to 17 experience a mental health disorder, and 65,000 older Londoners experience dementia (a figure that is expected to almost double over the next 30 years). In social care costs alone, London boroughs spend around £550 million a year treating mental disorder, and another £960 million is spent each year on benefits to support people with mental ill health. These costs do not even tackle the problem. Informal and unpaid carers are left to contribute £1.2 billion worth of support each year to people with mental disorders.

It hinders the economy Though diagnosis rates lag significantly behind most physical illnesses, an estimated 914,300 adults of working age in London are affected by a common mental disorder such as anxiety and depression. Many more are affected by a severe and enduring mental ill health. Mental ill health hampers London businesses each year by limiting employee productivity and reducing the potential workforce. £920 million alone is lost annually to sickness absences in the city, and a further £1.9 billion is lost to reduced productivity. The costs extend more widely, though, to amount to a staggering sum total of £10.4 billion lost each year to London business and industry. 

It raises the costs of crime Individuals with mental ill health are more likely to be the victims of crime than the perpetrators, but the costs to the criminal justice system are significant. The London criminal justice system spends approximately £220 million per year on services related to mental ill health, and other losses such as property damage, loss of stolen goods and the lost output of victims cost London another £870 million each year. 

The current solutions are not sustainable As stated earlier, roughly £7.5 billion is spent each year in London to combat mental ill health. Health costs for treating mental disorder amount to £2.8 billion per year, and another £550 million is spent on social care. These costs are already too high, and treatment costs are expected to grow over the next two decades. Mental health issues also prevent physical health conditions from being addressed properly. Roughly £1 in every £8 spent on long-term health conditions can be linked to poor mental health, which translates to an additional £2.6 billion in treatment costs each year in London. Despite these substantial costs, diagnosis and treatment rates for mental disorders are poorer than most physical health conditions, meaning that even with these large costs we are not sufficiently addressing the problem of mental ill health in our community. The costs are being felt elsewhere, in schools and businesses, crime and families. 

Mental health is more than mental ill health It is not all about mental disorder. London also has the UK’s highest proportion of the population with high levels of anxiety. Nearly half of Londoners are anxious, and almost a third report low levels of happiness. Life satisfaction and feelings of worth are lower than the national average. If we can begin to address these very basic and too-often ignored problems in our city, we can begin to unburden ourselves of both the moral and economic costs of mental ill health.