latest health care news

01.03.17

Mackey hails ‘tremendous’ effort as trusts slash £1bn off agency staff bill

Major agency controls across the health service have so far succeeded in saving £1bn since they were introduced in October 2015, latest NHS Improvement (NHSI) figures show – but spending for locums remains excessively high, with the five most expensive locums costing over the NHS over £5m.

The regulator argued the latest figures are a testament to the “outstanding efforts” of trusts to reduce their agency expenditure, which had been steadily growing at 25% a year prior to controls being rolled out.

This picture has now largely changed, with almost 80% of trusts having been able to cut down on their agency spend since last year. Over half of them (95 trusts, or 40% of the total) have slashed this spending by more than a quarter.

Sample data also shows 18% reduction in nursing agency prices and a 13% drop in medical locum staff prices from October 2015 until now.

The latest figures build on similarly successful findings in NHSI’s report from October last year, at which point £600m had been saved since the same month in 2015. At the time, 37% of all trusts had reduced spending by more than a quarter, while 73% of them had reduced agency spending overall.

The regulator’s chief executive, Jim Mackey, hailed trusts’ “tremendous efforts” to save money and was pleased to announce that the extra £1bn saved would be “pumped back into improving services for patients”.

But despite today’s good news, NHSI argued once again that “there still much to do in this area”. Overall spend on medical locums is still expected to be around £1.1bn each year, and evidence shows there are “still very high prices paid in places for these locums”.

The top five paid locums cost the NHS over £5m, and £300m could be saved per year if all medical locums charged rates within the set price cap.

“We expect these new measures to take another big chunk out of excessive agency costs; there are far too many agency staff making the most out of the lower tax rates paid via personal service companies and limited liability partnerships. This is a key part of the problem of so many staff choosing to work as agency staff instead of NHS staff,” added Mackey.

“These new rules will make sure most agency staff get paid and taxed in the same way as their NHS staff colleagues. This will make it fairer and more attractive for people to become permanent NHS staff, which is great news for hospitals and patients.”

Although health secretary Jeremy Hunt has promised the NHS is “turning the tide” on agency spend, this issue has long been perceived as one of the major cash leaks in the health service. Early in 2016, NHS England boss Simon Stevens had revealed the NHS was on track to hit a massive £4bn temporary staff bill that financial year.

But despite the desire to cut down on expensive agency staff, some influential think tanks have argued that they are nevertheless necessary given the significant mismatches between funding and staffing levels in the health service.

Comments

There are no comments. Why not be the first?

Add your comment

 

national health executive tv

more videos >

featured articles

View all News

last word

Hard to be optimistic

Hard to be optimistic

Rachel Power, chief executive of the Patients Association, warns that we must be realistic about the very real effects of continued underfunding across the health service. It’s now beyond more > more last word articles >

health service focus

View all News

comment

Staying curious with the Shadow Board Programme

20/03/2019Staying curious with the Shadow Board Programme

Kirstie Stott, director of The Inspiring Leaders Network, discusses organis... more >
Fiction as Therapy

20/03/2019Fiction as Therapy

Elaine Bousfield of ZunTold Publishing – a press specialising in fict... more >

interviews

How can winter pressures be dealt with? Introduce a National Social Care Service, RCP president suggests

24/10/2018How can winter pressures be dealt with? Introduce a National Social Care Service, RCP president suggests

A dedicated national social care service could be a potential solution to s... more >

the scalpel's daily blog

Personal Health Budgets: empowering individuals

20/03/2019Personal Health Budgets: empowering individuals

Jon Baker, PHBChoices director at NHS Shared Business Services (NHS SBS) believes that the extension of Personal Health Budgets (PHBs) is a great opportunity for clinical comm... more >
read more blog posts from 'the scalpel' >

healthcare events

events calendar

back

March 2019

forward
mon tue wed thu fri sat sun
25 26 27 28 1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
18 19 20 21 22 23 24
25 26 27 28 29 30 31
1 2 3 4 5 6 7

editor's comment

25/09/2017A hotbed of innovation

This edition of NHE comes hot on the heels of this year’s NHS Expo which, once again, proved to be a huge success at Manchester Central. A number of announcements were made during the event, with the health secretary naming the second wave of NHS digital pioneers, or ‘fast followers’, which follow the initial global digital exemplars who were revealed at the same show 12 months earlier.  Jeremy Hunt also stated that by the end of 2018 – the 70th birthday... read more >