Urgent question (Commons) on NHS Staff Pay - Mar 21

Jonathan Ashworth (Leicester South) (Lab/Co-op) 

(Urgent Question): To ask the Secretary of State for Health and Social Care if he will make a statement on NHS pay.

The Secretary of State for Health and Social Care (Mr Jeremy Hunt) 

The whole House will want to pay tribute to the hard work of NHS staff up and down the country during one of the most difficult winters in living memory. Today’s agreement on a new pay deal reflects public appreciation for just how much they have done and continue to do, but it is much more than that. The agreement that NHS trade unions have recommended to their members today is a something for something deal that brings in profound changes in productivity in exchange for significant rises in pay.

The deal will ensure better value for money from the £36 billion NHS pay bill, with some of the most important changes to working practices in a decade, including a commitment to work together to improve the health and wellbeing of NHS staff to bring sickness absence in line with the best in the public sector. We know that NHS sickness rates are around a third higher than the public sector average, and reducing sickness absence by just 1% in the NHS will save around £280 million. The deal will put appraisal and personal development at the heart of pay progression, with often automatic incremental pay replaced by larger, less frequent pay increases based on the achievement of agreed professional milestones. It includes a significantly higher boost to lower-paid staff, to boost recruitment in a period when we know the NHS needs a significant increase in staffing to deal with the pressures of an ageing population. Pay rises range from 6.5% to 29% over three years, with much higher rises targeted on those on the lowest and starting rates of pay.

As part of the deal, the lowest starting salary in the NHS will increase by more than £2,500, from £15,404 this year to £18,040 in 2020-21, and a newly qualified nurse will receive starting pay 12.6%—nearly £3,000—higher in 2020-21 than this year. But this deal is about retention as well as recruitment. It makes many other changes that NHS staff have been asking for—such as shared parental leave and the ability to buy extra or sell back annual leave—so they can better manage their work and family lives, work flexibly and balance caring commitments.

The additional funding that Chancellor announced in the Budget to cover this deal—an estimated £4.2 billion over three years—cements the Government’s commitment to protecting services for NHS patients, while recognising the work of NHS staff up and down the country. This is only possible because of the balanced approach we are taking—investing in our public services and helping families with the cost of living, while getting our debt falling. Rarely has a pay rise been so well deserved for NHS staff, who have never worked harder.

Jonathan Ashworth 

The Secretary of State has finally given the lowest-paid NHS staff a pay rise. Staff, royal colleges, trade unions and the Labour party have today been vindicated in saying that a pay rise is long overdue. But when we have seen nurses, paramedics and midwives losing thousands of pounds from the value of their pay, heard stories of NHS staff turning to food banks, have 100,000 vacancies across the service, seen more nurses leaving the profession than entering and seen trusts spending billions of pounds on agency staff, this pay cap should have been scrapped years ago.

In the general election, Ministers said that scrapping the pay cap was nonsensical. When a nurse pleaded with the Prime Minister for a pay rise on national television, she was told that there was no magic money tree. Can the Secretary of State tell us how this pay rise will be paid for? Have the Prime Minister’s horticultural skills grown said magic money tree? We have heard that there will be additional money. When will trusts get the allocations, and if the money is additional, will it be paid for by extra borrowing or extra taxation? Public servants deserve reassurances that the Government will not give with one hand and take with the other.

Given the projections for inflation, can the Secretary of State guarantee that staff will not face a real-terms pay cut in any single year of the deal? We note that he has backed down on docking a day’s holiday. Will he commit to not tabling that proposal again? We also note that he will not block the transfer of hospital staff to wholly owned subsidiary companies. Will he at least guarantee that all staff employed by such companies will be covered by “Agenda for Change” terms? Can he tell us when the rest of the public sector will get a pay deal?

NHS pay has been held back for the best part of a decade. Today is a first step, but the NHS remains underfunded and understaffed. We urgently need a plan to give the NHS the funding it needs for the future.

Mr Hunt 

If the hon. Gentleman wants a plan to give the NHS the funding it needs, can he explain why Labour in Wales has deprived the NHS of £1 billion of funding that it would have had if funding had increased at the same rate as in England? Far from Labour being vindicated, the House will remember that the pay restraint in the NHS for the past eight years was caused by the worst financial recession since the second world war, caused by a catastrophic loss of control of public finances.

The hon. Gentleman asks for some details. Today’s pay deal means that someone starting work in the NHS as a healthcare assistant will see their rate of pay over the next three years go up by 26%, nearly £4,000. A nurse with three years’ experience will see a 25% increase, which is more than £6,000 over three years. A band 6 paramedic with four years’ experience will see a £4,000 rise. On top of that, we are putting in a huge number of things that NHS staff will welcome, including, for example, statutory child bereavement leave and shared parental leave. Yes, we are asking for important productivity changes in return, but this is about the modernisation of NHS staff terms and conditions, which is good for them and good for taxpayers.

The hon. Gentleman asks where the money is coming from: it is additional funding from the Treasury for the NHS. It is not coming from extra borrowing. If he had been listening to the autumn statement, he would have heard that debt as a proportion of GDP is starting to fall this year for the first time. That is possible because we have taken very difficult decisions over the past eight years—they were opposed by the Labour party—that have meant 3 million more jobs and have transformed our economy out of recession into growth. None of that would have been possible if we did what his party is now advocating, which is to lose control of public finances by increasing borrowing by £350 billion. Let us just remind ourselves that countries that lose control of their finances do not put more money into their health services—they put less. In Portugal, the amount is down 17%, and in Greece, it is down 39%. The reason that we can announce today’s deal is very simple: this country is led by a Government who know that only a strong economy gives us a strong NHS.

Dr Sarah Wollaston (Totnes) (Con) 

I warmly welcome today’s announcement of a well-deserved pay rise for NHS staff and, in particular, that this will be additional funding of £4.2 billion over three years, rather than it coming out of existing resources. I particularly welcome the focus on staff health and wellbeing, which was raised by the recent Health Committee inquiry into the nursing workforce. In particular, I ask the Secretary of State to go further and talk about what will be done on continuing professional development for NHS staff, because this was identified as a key factor in retention. He referred to it partially in his comments, but I wonder whether he could go further.

Mr Hunt 

I thank my hon. Friend for her comments. Underneath this agreement, there is a very important new partnership between NHS employers and the unions to improve the health and wellbeing of staff through mental health provision and the implementation of the Stevenson-Farmer review, taking on board a number of points raised by the Health Committee, and through improved support for people with musculoskeletal conditions, because a lot of NHS work is very physical. However, she is absolutely right: professional development is also very important. By reforming the increments system that we have been using for many years, we will give staff the chance to see their pay go up in a way that is linked to their skills going up as well. That is something that many staff will welcome.

David Linden (Glasgow East) (SNP) 

May I associate myself with the comments made by the Secretary of State in paying tribute to our NHS staff? It is good to have not just warm words today, but substantive action. He has referred to devolved nations elsewhere in the UK, and I hope that he will acknowledge that the Scottish Government were the first Government in the UK to lift the public sector pay cap.

Although this announcement is welcome, we have committed to using any additional funds that come to Scotland through consequentials to go into the Scottish pay agreement. However, the Office for Budget Responsibility has projected that average earnings will go up by 7.7% in the next three years, while the retail prices index goes up by over 9%. Has the Secretary of State taken that into account, or are the Government ignoring the OBR on average earnings? Committing to a three-year deal could stagnate wages and lower the standard of living, and none of us in this House wants that to happen.

Mr Hunt 

The majority of NHS staff will see that their pay is protected against the cost of living, but many NHS staff, including the lowest-paid, will see increases that are substantially higher than inflation rates, because, first, that is the kind of society that we believe in. Conservative Members want everyone to be given decent rates of pay, and there are many parts of the country where the cost of living is very high and this will make a very big difference. We also recognise that there will be 1 million more over-75s in 10 years’ time, so we need to expand the number of staff in the NHS and its capacity to deal with those pressures. We therefore need to attract more people into working for the NHS and social care systems.

Mr Iain Duncan Smith (Chingford and Woodford Green) (Con) 

I congratulate my right hon. Friend; I know of his huge personal commitment to the NHS and how he has battled for it over the years—I have seen that personally. I unashamedly, absolutely agree that this is a very good deal, and I congratulate nurses and others on this pay rise, which they deserve and for which they have worked very hard. Is it not also right to recognise and remember that back in 2008-09, Labour’s great depression plunged the economy into the biggest and most difficult economic trench that it has faced? As a result of our stewardship and our support of the NHS through that period, unlike many other countries that cut their health spending, we secured 200,000 jobs in the NHS, and now we can start rewarding staff for their hard work.

Mr Hunt 

I thank my right hon. Friend and commend him on his courage in putting through some incredibly challenging and important reforms to our welfare state, when many people said that it was nigh on impossible. He is right: the biggest and most misleading thing that we hear is the charge that in austerity Britain, the NHS budget has been cut. In fact, the countries that cut their health budgets were Portugal and Greece—countries that are following precisely the policies that are advocated by the Opposition. In this country—so-called austerity Britain—NHS spending has gone up by 9%.

Sir Vince Cable (Twickenham) (LD) 

On the vexed question of how to pay for the NHS, has the Secretary of State been in any way influenced by the testimony of the recently retired permanent secretary to the Treasury, who at last acknowledged that the only way to do it was to have some form of earmarked taxation?

Mr Hunt 

The former permanent secretary to the Treasury is an extremely wise and experienced public servant, and I always listen to what he says with a great deal of interest.

Rebecca Pow (Taunton Deane) (Con) 

I have met many nurses from Taunton Deane to press their case for a rise in salary, and I have passed that on not just to the Department of Health and Social Care, but to the Chancellor. I welcome today’s pay rise; I think these hard-working nurses all deserve it, and we congratulate them. Does my right hon. Friend agree that today’s £4 billion commitment demonstrates that this is a listening Government who are taking investment in the health service extremely seriously?

Mr Hunt 

I very much enjoyed meeting nurses and staff at Musgrove Park Hospital when my hon. Friend invited me there recently. I know that they will welcome today’s deal and they would welcome even more investment in their operating theatres, which she is campaigning for assiduously.

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op) 

We have lost over 5,000 nurses working in mental health since 2010. As a result of this announcement on pay, when does the Secretary of State expect the number of mental health nurses to return to 2010 levels?

Mr Hunt 

We would have more nurses in mental health if we had not had to deal with the crisis at Mid Staffs and pronounced short staffing in our acute hospitals. Since I have been Health Secretary, we have 15,000 more nurses in the NHS and we are also finding more money to go into mental health. It is time that the hon. Lady recognised that, rather than trying to paint the opposite picture.

Mr Philip Dunne (Ludlow) (Con) 

I add my voice to those congratulating the Secretary of State and his ministerial team on a tremendous achievement in discussions with the Treasury to secure this additional funding. I invite him to comment on the work that has been done by the health unions and the Royal College of Nursing, in particular, in helping to deliver this agreement and particularly to give many of the people on starting salaries a significant uplift, which he referred to earlier. This will make it easier to attract people to the vital starting roles for future generations.

Mr Hunt 

I would like to pay tribute to my hon. Friend because, when he was working in my Department, he laid a lot of foundations for this deal. He chaired some very important meetings. In particular, one of the most important areas of consensus that has emerged, which he should take enormous credit for, is that we are saying today that the minimum salary for anyone working in the NHS will go up by £2,000. That is going to make a huge difference—100,000 people will benefit from that important change—and he should be very proud of that.

Bambos Charalambous (Enfield, Southgate) (Lab) 

NHS trusts are spending £3 billion a year on agency staff to plug gaps in the workforce. Has the pay cap not been totally self-defeating and led to huge amounts of public money going to private staffing agencies?

Mr Hunt 

What led to the mushrooming agency fee was the realisation, post Mid Staffs, that we needed a lot more nurses. Nursing staff numbers were going down until the Francis report was published, but the report created huge demand among hospitals, which realised they needed to improve patient safety by recruiting more staff. The hon. Gentleman will be please to know, however, that we are bringing down the agency bill, and I expect it to be significantly lower this year.

Maria Caulfield (Lewes) (Con) 

It is disappointing to see the lack of welcome from Labour Members for this pay rise for NHS staff in England—one day after the announcement of five new medical schools across the country. Has the Secretary of State had discussions with the Labour Government in Wales to see if they will be replicating this pay rise for NHS staff in Wales?

Mr Hunt 

First, I want to pay tribute to my hon. Friend as one of the practising nurses in the House and someone who always makes sure that the voice of nursing is heard loud and proud in this place. I very much hope that the devolved Governments will follow suit with this deal, although for every additional pound per head we have put into the NHS in England, Labour in Wales has put in only 57p.

Stella Creasy (Walthamstow) (Lab/Co-op) 

Further to the question from my hon. Friend the Member for Enfield, Southgate (Bambos Charalambous), we all know how much agency nurses cost the NHS, and the same goes for private finance initiatives. These companies are making £1 billion in profits, which is money that will not touch any of our hospital budgets, including that of my own, Whipps Cross Hospital, which has a 17% agency rate and tried to deal with its PFI debt by downgrading the pay of nurses to save money. What is the Secretary of State doing to cut the PFI bill for our hospitals and prevent them from balancing their books off the backs of hard-working staff?

Mr Hunt 

The hon. Lady is right to draw attention to that problem. We have certainly stopped doing any new PFI deals of the disastrous kind that lead to the consequences she talks about. We have given some relief to a number of hospitals in that area, but I will look again at her local hospital, because it is clearly totally unacceptable if that is happening.

Will Quince (Colchester) (Con) 

Colchester General Hospital has recently come out of special measures, and the staff there have worked so hard to turn our hospital around, so I welcome wholeheartedly this announcement of extra money, which means that our staff will get a well-deserved pay rise. I will always champion our hospital, however, so will my right hon. Friend commit to continuing to invest in our hospital and its people? In particular, will he look at the accident and emergency department?

Mr Hunt 

I will happily do that. The hon. Gentleman has championed his hospital, which has been on a rollercoaster journey during his time in this House but which has now turned a corner. The staff have worked incredibly hard to improve safety standards for patients, but I know that, like many places, they would like more investment in their A&E, and I will certainly look at it.

Ben Lake (Ceredigion) (PC) 

I, like many others, welcome the fact that NHS workers in England will finally receive a pay rise they deserve. Of course, health is devolved to the Welsh Government, so could the Secretary of State clarify how much of this additional funding is new funding and what the Barnett consequential will be for the Welsh Government?

Mr Hunt 

This constitutes an investment by the Treasury of £4.2 billion, and the normal Barnett consequentials will apply, so it is perfectly possible for the Labour Government in Wales to replicate this deal if they choose to, but we know, of course, that had they replicated the increases in funding to the NHS in England, the NHS in Wales would have had an additional £1 billion spent on it over the past five years.

Dr Andrew Murrison (South West Wiltshire) (Con) 

rose—

Dr Julian Lewis (New Forest East) (Con) 

rose—

Mr Speaker 

I see that two doctors are standing on the Government Back Benches. I am sure that the House will understand if I call the medic rather than the military strategist.

Dr Murrison 

I warmly welcome this announcement and congratulate my right hon. Friend, the trade unions and NHS Employers on reaching this deal. One problem facing our NHS is that of people not returning to work after they have had caring responsibilities. What elements of the deal will encourage more people to consider coming back into the workforce? I am thinking, in particular, of the non-pay elements and the reform of pay structures that he has mentioned.

Mr Hunt 

The most important thing about the deal is that it will discourage people who might be reaching breaking point, because of personal circumstances, from packing it all in and leaving the NHS family. There is a particular proposal to allow much greater flexibility in the buying and selling of annual leave so that people who need to work less because of things that happen at home, and perhaps people who want to work more, find it much easier to do so. This is therefore part of a much bigger shift towards the flexible working that we know everyone wants these days.

Eleanor Smith (Wolverhampton South West) (Lab) 

I absolutely appreciate the Secretary of State’s announcement on pay. As a nurse who has worked for more than 40 years, I know that it is greatly welcomed by everybody across the patch, including porters. I want to ask, however, about wholly owned subsidiary staff. I believe that some of them are not under “Agenda for Change” terms. Will they get the pay rise as well?

Mr Hunt 

First, I thank the hon. Lady for welcoming the deal. I think she is the first Labour Member who has done so, and it is not insignificant that she is a nurse. A wholly owned subsidiary is a legal structure that was made possible by a change in the law introduced in 2006, under her party’s Government, and is actually an alternative to outsourcing. Employees would be far more likely to benefit from “Agenda for Change” pay rates within such a structure than if they were outsourced, which the last Labour Government tried so hard to encourage.

Mr Gary Streeter (South West Devon) (Con) 

When I met Devon’s secretary of the Royal College of Nursing recently to discuss nurses’ pay, she made the obvious point that she was getting a bit fed up with politicians saying that they valued nurses while not actually adding to their pay packets. Does my right hon. Friend agree that from today not only will we be saying that we value nurses, but that that will be reflected in their pay packets? I congratulate him and the RCN on achieving such a good deal.

Mr Hunt 

I thank my hon. Friend for that, and I pay tribute to Janet Davies, the boss of the RCN, who has worked very hard to make this deal happen and in the best interests of her profession.

Ruth Smeeth (Stoke-on-Trent North) (Lab) 

My healthcare economy was held together over the winter solely by the good will of NHS workers, yet they have had a 14% pay cut in real terms since 2010. This announcement is a drop in the ocean. How does the Secretary of State think that it will help retention rates?

Mr Hunt 

I cannot agree that this is a drop in the ocean. If the hon. Lady does not want to hear it from me, let me point out what was said by the Unison head of health, Sara Gorton, who is also the head negotiator for the NHS unions. She said that the deal

“would go a long way towards making dedicated health staff feel more valued, lift flagging morale, and help turn the tide on employers’ staffing problems.”

That is not a drop in the ocean.

Robert Halfon (Harlow) (Con) 

I strongly welcome the measures that my right hon. Friend has announced. He will have heard my question to the Prime Minister earlier, and he will acknowledge that Harlow Hospital is out of special measures and that this pay award is much deserved by staff. In the future, will he look at the particular problem we face—we are just outside London, and a lot of staff work in London, which makes it harder for Harlow Hospital to recruit—and perhaps think again about the pay scales?

Mr Hunt 

I am happy to do that and to congratulate the staff at my right hon. Friend’s hospital, which he has long championed and whose pressures and needs he has highlighted assiduously. To come out of special measures is a huge achievement. I have recorded a video message, but I am happy to say in the House how proud we all are of what the staff have achieved. I also recognise the capital issues at the hospital and the fact that the building is not fit for purpose.

Tim Farron (Westmorland and Lonsdale) (LD) 

The minimum amount that nurses in south Cumbria will have lost since the pay freeze is £4,306. Given that the average house price in my constituency is 10 times the value of the average nurse’s salary, Members will understand the huge impact that there has been on retention and recruitment. The rise is therefore deserved, welcome and overdue, but without a long-term plan for funding health and social care, this announcement will not be trusted, so does the Secretary of State not agree that we need a new deal to refresh Beveridge’s vision for the 21st century, and should we not be prepared to be honest with the British people and say that this will involve a modest but clear increase in taxation?

Mr Hunt 

I disagree that the deal will not be believed—it is a concrete deal. NHS staff still have to vote for it, but the Government have committed to significant rises in pay. I agree, however, that we will need to find the best way of getting more money into the NHS and social care system as we face the pressures of an ageing population.

Dr Julian Lewis 

Will the Secretary of State expand a little on what he briefly said about flexibility of working hours and family bereavement among NHS staff? After this urgent question, will he kindly give a short tutorial to those of us with an interest in defence on his successful techniques for extracting £5 billion from the Treasury for a Department that urgently needs it?