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NHS pay rise may be capped below 1% for next few years

BMJ 2010; 340 doi: https://doi.org/10.1136/bmj.c459 (Published 22 January 2010) Cite this as: BMJ 2010;340:c459
  1. Adrian O’Dowd
  1. 1London

    NHS staff will be lucky to receive a maximum 1% pay rise in the coming years, MPs have been told by the head of the NHS.

    Staff members have to face the sober reality of a financially frugal next few years to help the NHS play its part in tackling the current economic recession, said the NHS chief executive, David Nicholson.

    Mr Nicholson, giving evidence to the parliamentary health select committee as part of its one-off evidence session for an inquiry into public expenditure on health and social services, said that savings had to be made.

    Last year Mr Nicholson warned that the NHS would have to find productivity and efficiency savings of between £15bn (€17bn; $24bn) and £20bn over the three years from 2011-12 to 2013-14. This would help deal with what he anticipated was an NHS budget that would stand still after a 5% or more rise this financial year and the next.

    MPs asked whether he expected job losses as part of efforts to meet necessary efficiencies, to which Mr Nicholson replied, “We are working through the planning at the moment, and trusts are doing that work, and I wouldn’t like to say what the implication of that is.

    “The issue for us is a very clear one, which is that there is essentially a trade-off between pay and numbers of jobs in a cash limited system. That is the big unknown for us, and that is what we need to talk through with the trade unions and the staff organisations—about what that trade-off actually is. We will be starting those discussions relatively soon.”

    The committee’s chairman, Kevin Barron, Labour MP for Rother Valley, asked what the effect had been of the announcement by the chancellor of the exchequer, Alistair Darling, in his pre-Budget report last month, that there had to be a 1% pay rise cap for the public sector for two years from 2011.

    Mr Nicholson said, “That is a pay cap. It is not meant to be what the settlement is. Clearly, we will be negotiating and discussing hard with the trade unions to see what we can get for the NHS as a whole. We see that as a pay cap, not as a right for everybody.”

    He insisted that a tight budget would not mean a return to long waiting lists for NHS treatment, saying, “Letting the waiting lists go up is the way the NHS dealt with problems in the mid-1990s. That is absolutely not what we want to do.”

    MPs asked whether there would be enough posts for the growing numbers of medical graduates, given that the NHS had to make efficiency savings, and what would be the effect of imminent retirements.

    Mr Nicholson said, “We are not expecting lots of UK graduate unemployment. We think within the total amount of UK graduates that we can be in a position of getting a good balance between our ability to deliver jobs for them at the end of it, in line with the efficiency gains we have set.”

    The Department of Health was expecting around 10 000 new GPs to qualify over the next five years and between 3500 and 4000 GPs to retire. Over the next 10 years there would be about 24 000 new GPs and about 10 000 retirements.

    Notes

    Cite this as: BMJ 2010;340:c459

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