Pay deal could extend waiting list and ‘make day job even harder’, says NHSE

A pay rise of more than the 2.8 per cent budgeted for next year would slow down the NHS’s waiting list recovery, and make “the day-to-day job of NHS staff even harder”, NHS England has claimed.

The national body said the 2025-26 NHS funding envelope was “extremely tight” and any pay rises above 2.8 per cent would mean “further tough re-prioritisation, significantly impacting patient care and in turn making the day-to-day job of NHS staff even harder”.

In evidence to the NHS Pay Review Body panel published on Monday, NHS England said it would have to meet extra costs from its own budget, and every half percentage point above 2.8 per cent would cost around £700m. This was the equivalent of reducing the elective waiting list by at least 300,000, it said.

NHSE’s requests of the PRB chime with the Department of Health and Social Care, which said 2.8 per cent, which is marginally above inflation forecasts for 2025-26, was a “reasonable” pay rise in light of the fiscal context and labour market.

Anything beyond this would mean “stark trade-offs”, the government said.

In its own evidence NHSE made a similar argument. Although NHS funding is likely to grow by around 2 per cent above inflation, much of this will be eaten up by inflation, rising medicines costs and pay, according to the submission.

It says: “In that context, the NHS will not be able to make material investments in new services and meet all its pressures from the uplift available, including the usual growth in capacity that is necessary to meet demand growth.

“It is possible that some services will see real terms cuts in funding and activity after allowing for the pay settlement, depending on its scale.”

It adds: “Based on this, we propose to set allocations for NHS planning on the basis of a 2.8 per cent pay settlement. Every 0.5 per cent increase above that costs around £700m; which is the equivalent to around 2 per cent of elective activity (greater than 300k completed patient pathways).”

The proposed pay rise was met with anger by unions, which warned of further strikes.

Last week Julian Kelly, NHSE’s chief finance officer, said the funding envelope next year would feel like a real terms cut in “activity spending power”.