Pay rise over 2% risks staff and service cuts, NHSE warns

Pay rises of more than 2 per cent this year risk cuts to staff and activity, unless there is extra government funding, NHS England has warned.

In evidence submitted to the pay review bodies considering uplifts for both doctors and dentists, and Agenda for Change staff, NHSE highlighted existing pressures which in 2023-24 meant “diverting planned spend away from technology budgets, international recruitment and wider capital budgets, which will involve switching capital to resource spending”.

It said pay awards above those already funded – which is for 2 per cent – and not supported by additional government funding “will put further pressure on the NHS budget”.

It added: “This could impact staffing numbers and the ability to deliver planned activity or service improvements.”

NHSE said the service had to deliver annual efficiency savings of at least 2.2 per cent each year, significantly higher than the historical 1 per cent, amid the ongoing impact of high inflation. The overall NHS budget is expected to be close to flat in real terms in 2024-25.

Similar submissions were made to both the NHS pay review body, for Agenda for Change staff (who include nearly all non-medical staff); and to the review body on Doctors’ and Dentists’ Remuneration. Both will make recommendations to government in coming months. Government has already warned in its submission to the PRB that any pay rise above 3 per cent was “extremely constrained” by high inflation and previously unbudgeted pay rises.

Agenda for Change staff received a 5 per cent consolidated pay award, backdated to 1 April 2023, last summer following months of strike action, along with one-off bonus payments.

Consultants recently voted to settle their pay claim and strike action after improved government offers  – amounting to variable pay rises, sometimes well in excess of 6 per cent, which has left some Agenda for Change staff angry over last year’s deal. Junior doctors remain in dispute and threatening further strikes.

NHSE’s PRB evidence acknowledged there was evidence of “a downward trend in pay satisfaction across all workforce groups”, but claimed “a positive shift from quarter 1 2023/24 in engagement scores” in its quarterly “pulse” survey of staff with “a positive trend in how staff describe their mood”, adding: “In addition, the nursing leaver rates have fallen below the pre-pandemic baseline of 6.5% in February 2020.”