Government proposes agency staffing ban to aid ‘desperate’ hospitals

Government is proposing to ban the use of agency staff in band 2 and 3 roles, and to restrict movement directly from substantive to temporary work.

The Department of Health and Social Care and NHS England have announced NHSE will soon consult on the moves in a bid to further drive down the service’s agency staffing bill.

The announcement referenced the NHS’s £3bn agency bill for 2024-25 and that some agencies were charging the service up to £2,000 for some nursing shifts.

It added the proposed policy would “form part of government efforts to reform and improve efficiency in the NHS”. Health and social care secretary Wes Streeting is expected to announce further moves in his speech at the NHS Providers conference on Wednesday.

The use of agency staff to fill admin and estates posts has been banned since 2019. The proposed ban on agency workers to cover bands 2 and 3 roles would mainly impact healthcare assistants and domestic support workers.

The DHSC also said it would “stop NHS staff resigning and then immediately offering their services back to the health service through a recruitment agency”. 

The Recruitment and Employment Confederation, which represents several agencies who work with NHS, has written to Mr Streeting to claim the proposed move would be “short-sighted and ill-informed”.

REC deputy chief executive Kate Shoesmith said: “Banning agency workers represents a fundamental misunderstanding of where the flaws in the NHS staffing lie, given contingent workers play a valuable role in maintaining NHS staffing levels and people the choice they want to work in a more balanced, flexible way.”

She said it would “save pennies in the short term but would lead to an overall increase in staffing costs in the long run”, and “many agency staff would not move into permanent roles, they would just leave the sector”.

Ms Shoesmith also suggested more attention be paid to the amount spent on bank staff (see below).

NHSE has told trusts agency spending should account for no more than 3.2 per cent of the total pay bill during 2024-25. Local spending crackdowns this year have often also involved tight controls on the use of agency staff.

Ministers have long sought to eliminate “off-framework” agency spending,  pressing trusts to use the NHSE-approved list, but inflation, cost-of-living pressures and industrial action have made this difficult to enforce.

The health secretary said in the announcement: “For too long, desperate hospitals have been forced to pay eye-watering sums of money on temporary staff, costing the taxpayer billions and pulling experienced staff out of the NHS.”

NHSE chief finance officer Julian Kelly said: “While agency spend is at a record low, with trusts on track to save £1bn over two years, we want to go further still.”

Bank staffing a ‘runaway budget line’

Ms Shoesmith told HSJ  the growing crackdown on agency staffing meant high spending via other routes, such as on bank workers, went unnoticed.

She claimed some trusts were spending more on bank staff rates, and said this may be exacerbated as winter drives up demand, and added: “As you head towards winter, there is just this real concern that could be a runaway budget line.

“It’s not just about the hourly pay rate, it’s about all the other costs that are coming via the bank which are, when you add them up, line-by-line and look at them side-by-side, they cost more than the agency would. For the same shift, for the same person.

“That scrutiny is just not there.”

An NHSE spokeswoman said the health service has reduced its spending on agency staff, both in absolute terms and as a proportion of spending, over the past two financial years “despite ongoing pressures such as industrial action”.

A statement added: “There is increased oversight and scrutiny of agency use as part of NHSE’s agency rules and through actions taken locally, and the NHS will continue to reduce its reliance on agency staff as part of our focus to bring this spend down.”