Health Secretary announces cap on NHS staffing agency costs

Nick Elvin

The Government is to cap the amount agencies can charge the NHS for staff, Health Secretary Jeremy Hunt announced this week.

The measures will limit the amount companies can charge per shift for all staff, including doctors and non-clinical personnel. Building on previously announced controls, which introduced mandatory use of frameworks for nursing staff and will bring a cap on nursing spend into force shortly, they are designed to remove £1 billion from agency spending bills over three years.

The cap will be introduced on 23 November, subject to responses from a consultation by Monitor/TDA, and will be ratcheted down over time, allowing staff and trusts time to adjust.

Citing examples of some agencies charging up to £1,800 for a standard shift for a nurse and £3,500 for a weekend shift for a doctor, Jeremy Hunt said: “For too long staffing agencies have been able to rip off the NHS by charging extortionate hourly rates which cost billions of pounds a year and undermine staff working hard to deliver high-quality care.

“The tough new controls on spending that we’re putting in place will help the NHS improve continuity of care for patients and invest in the frontline – while putting an end to the days of unscrupulous companies charging up to £3,500 a shift for a doctor.”

Responding to the the Health Secretary’s comments about “unscrupulous” and “rip-off” agencies, the Recruitment and Employment Confederation’s director of policy Tom Hadley said: “Yet again, the Secretary of State is grossly misrepresenting the role agencies play in supporting the NHS, and scapegoating agencies for years of poor workforce planning by the Government.

“The overwhelming majority of trusts use frameworks to obtain agency staff, where pay rates are negotiated and set by NHS trusts and central government. The Secretary of State is deliberately presenting extreme, outlier, off-framework instances as if they were the norm.

“The average band five nurse earns £20-£25 per hour and an agency A&E doctor earns around £60 per hour. On top of this the agency would charge a fee of between 10-20% to cover the costs of recruiting and vetting the worker. For this fee the agency would also have to commit to any training updates and revalidation checks for the worker. When you take into account the shifts that an agency nurse or doctor would work, their pay often equates with a permanent NHS employee.

“Far from ‘ripping off’ the NHS, recruiters are working all hours to make sure our wards are safely staffed. Even Monitor’s own recent report on NHS trust finances acknowledged that increasing agency spend was due to increasing demand and skills shortages, not escalating or ‘rip off’ rates.”