the nhs employers organisation's submission to the doctors .../media/employers/documents/pay...

September 2013

The NHS Employers organisation's submission

to the Doctors' and Dentists' Review Body

2014/2015

2

The NHS Employers organisation's submission to the Doctors' and Dentists' Review Body 2014/15

Page

1. The employer view on medical and dental pay 6

2. Service priorities 15

3. Contract reform 22

4. Motivation and experience 26

5. Numbers and earnings 34

6. The financial challenge 48

7. Pensions and Total Reward 57

Annexes 70

Contents

Contents

3


The imperative for NHS organisations for 2014/15 will be to continue to meet the

growing demand for high quality, compassionate patient services. The Francis

report, the Government’s initial response and the subsequent review by the NHS

England medical director all highlight the scale of the quality and organisational

challenges facing the NHS. If patients are at the heart of all the NHS does then

any changes to national pay and conditions have to be seen in this context.

Reform of national pay and conditions arrangements for doctors is needed to

support the delivery of seven day patient services and to provide financial

sustainability for the future.

There is a desire for more flexibility around terms and conditions of service.

The NHS reward package remains highly competitive and is a valuable

recruitment and retention tool. Some terms and conditions can seem generous

compared to other professions where career advancement often depends on

performance, competence and the established need for work at a higher level

rather than purely serving time in a grade.

NHS Employers and the British Medical Association (BMA) have agreed draft

heads of terms which set out a framework for a possible negotiation on new

contracts for doctors in training and a renegotiation of the contract for

consultants working in England.

To start the process of reforming the national pay system and changing the

culture in the NHS, local employers have expressed the need for a clearer link

between consultant pay progression and performance. Local employers continue

to work to ensure that performance management and appraisal arrangements

are robust to enable such changes. This link to performance now exists for other

NHS staff groups.

NHS organisations are facing an unprecedented financial and efficiency challenge

with demand for healthcare growing at a rate that current funding will struggle

Key messages to the Doctors' and Dentists' Review Body

Key messages to the NHS Pay Review Body (NHSPRB)

4


to match. Restraining the pay bill is essential to ensure the continued delivery of

high quality patient services and to minimise job losses.

Even with no increase in pay scales, the pay bill is expected to increase due to the

costs of incremental pay and other drift during 2014/15.

There is no evidence on grounds of the recruitment, retention or motivation

from employers to support any increase in the national pay scales. Recruitment

and retention is generally stable. Where there are known recruitment challenges

in the medical workforce, these are not related to the national pay scales and

need wider labour market supply solutions. Local employers already have the pay

flexibilities needed to address local labour market challenges that arise.

There is no evidence to support differential awards for different specialties either

locally or nationally. NHS pay rates for doctors and dentists remain competitive.

Employers report, and the NHS Staff Survey demonstrates, that morale is holding

up during a period of major transition for the NHS.

Staff satisfaction measures, shown by the most recent NHS Staff Survey, remain

generally good and, for doctors, better than other NHS staff.

We recognise that continued pay restraint will have a continued impact on

individual medical staff, many of whom will have had to meet the cost of higher

pension contributions. However, the majority will continue to enjoy pay

progression as they move through training and up incremental steps. On

average, these increments result in an individual salary increase for eligible

doctors of between 3 and 8 per cent per year.

Work is continuing to develop the new NHS Pension Scheme arrangements

which will be introduced in 2015. This is expected to impose additional costs for

employers. Employers are also concerned about the additional cost pressures on

NHS organisations from the introduction of a single tier state pension in 2016.

The current national pay and conditions arrangements are increasingly not

affordable for employers in the NHS, who are faced with the task of meeting

growing demand and sustaining the quality of patient care while achieving

unprecedented efficiency savings of at least £20 billion by March 2015.

NHS organisations are facing a growing and changing demand for care, at a time

of tough financial pressures. Our priority is that available resources should be

used to support improvements to the delivery of patient services and the

necessity of retaining key staff. For this reason we would ask the Doctors and

Dentists Review Body (DDRB) to decide to recommend that pay scales remain

unchanged for 2014/15.

5


In the event that the DDRB does make recommendations on pay these should be

used to help the introduction of new and reformed terms and conditions

contracts.

6


Introduction

1.1 The NHS Employers organisation welcomes the opportunity to submit our

evidence for 2014/15. We value the continuing role of independent pay

review through the DDRB, in bringing an independent and expert view on

remuneration issues in relation to the NHS medical and dental workforce.

1.2 The evidence relates to doctors and dentists employed on the national terms

and conditions of service by NHS organisations in England. It focuses on the

recruitment, retention and experience of doctors and dentists and how those

are affected by the pay system.

1.3 Since 1 April 2013, responsibility for the commissioning of primary care

services has transferred from Primary Care Trusts (PCTs) to NHS England. As a

result, evidence in relation to doctors and dentists commissioned to provide

services to the NHS – i.e. general practitioners and general dental

practitioners – will be submitted by NHS England.

1.4 We believe it would be inequitable and unaffordable if primary care

contractors were to receive a higher uplift than salaried employees. Such a

situation could jeopardise other service provision.

1.5 In previous years the NHS Employers organisation has also given detailed

evidence on education, training and workforce planning. The advent of HEE

has provided an opportunity for that organisation to submit their own

evidence to the review body on the issues for which they now are

responsible.

1. The employer view on medical and dental pay

7


Remit

1.6 Our evidence seeks to address the DDRB remit from the perspective of

healthcare employers in England.

1.7 2014/15 will be the second year after the Government’s two year pay freeze

for public sector workforces. In the 2011 Autumn Statement, the

Government announced that the public sector pay awards should average 1

per cent for two years following the pay freeze. The Chief Secretary to the

Treasury has written to the DDRB setting out the Government’s advice on the

need for continued public sector pay restraint and other matters.1

1.8 In the Budget statement, the Chancellor announced a continuation of pay

restraint in the public sector with increases of no more than 1 per cent in

2014/15 and 2015/16. He also announced that the public sector was

expected to make additional savings by reducing the cost of incremental pay

systems. This is clear in the generic remit letters given to the pay review

bodies and in the specific remit given to the DDRB in the health minister's

letter of 3 September 2013.

1.9 The Minister asks the DDRB to make a recommendation on basic pay that is

consistent with the Government's public sector pay policy. He emphasises

that affordability and incremental progression should be critical elements as

the DDRB determines whether any award is justified.

Service priorities (more in Section 2)

1.10 The reports of Robert Francis QC, the Government's initial response and the

subsequent review by the Medical Director of NHS England, Sir Bruce Keogh

highlight the scale of the quality and organisational challenges facing NHS

organisations. The priority has to be to ensure that any changes to the

national pay and terms and conditions support the delivery of high quality,

compassionate care in the context of significant financial and employment

relations challenges.

1 Office for Manpower Economics, DDRB reports and current remit letters,

http://www.ome.uk.com/DDRB_Reports.aspx

http://www.ome.uk.com/DDRB_Reports.aspx

8


1.11 The focus throughout the Francis report is on the delivery of high quality and

compassionate care by everyone involved in its provision and commissioning.

The report calls for cultural change to improve the quality of services for

patients. He clearly links patient care with staff experience. Employers must

consider all aspects of their employment practice, from recruitment and

appraisal to management and leadership. Staff must be supported to deliver

the type of care that is expected. Where standards are not met there must be

an effective and open performance management system to protect patients.

1.12 There is a clear national aspiration to ensure the NHS offers a much more

patient-focused service, delivering high-quality care seven days a week.

Employers have told us that the current national conditions of service for

doctors and dentists presents barriers to this necessary development of

service provision. The priority must be to change national terms and

conditions to enable the delivery of seven day services affordably and

sustainably.

Reforming national terms and conditions (more in Section 3)

1.13 The cases for reform of the Consultant Contract 2003 and the “new deal”

contract for doctors in approved postgraduate programmes of training are

compelling. Clearer links between pay progression and performance are

needed as a start to the process of reforming the national pay system and

changing culture in the NHS. Employers in the NHS are working locally to

apply performance management and appraisal arrangements to help

strengthen links between pay progression and performance including

adherence to the values of compassion indentified by Francis. Each local

employer must decide how they want to make links to their organisational

priorities and values. This requires effective staff engagement and partnership

working.

1.14 Reform of national pay and conditions is needed to make them more

supportive of the delivery of seven day patient care and to make them

financially sustainable for the future. We must remove barriers to developing

more service provision during evenings and weekends. Junior doctors must be

more effectively supported in their training and development during evenings

and weekends. In the Health Service Journal (HSJ) and NHS Employers

Barometer survey, 92 per cent of respondents said that more changes were

9


needed to national pay and conditions. There is a desire for more flexibility

around conditions of service and progression, which are often seen as more

generous than those for other professions.

The financial challenge (more in Section 6)

1.15 The NHS faces an unprecedented financial dilemma - funding is struggling to

meet the growing demand for healthcare. At the same time, the NHS has to

deliver at least 4 per cent efficiency savings every year until 2015. The 2013

Spending Review has confirmed that financial pressures will increase in the

years beyond 2015/16.

1.16 These changes are indicative of the need for significant innovation in the NHS

to improve services for patients while meeting the continuing need for cash

releasing efficiencies of an unprecedented level. The NHS strives to make

efficiency savings of £20 billion, including a 45 per cent reduction in

management costs by 2015.

1.17 Continuing restraint of earnings growth is essential to ensure continued

delivery of high quality patient services and minimise the loss of key frontline

staff. Even with no increase to pay scales, the pay bill is expected to increase

in 2014/15 due to the costs of incremental pay and other drift factors – see

Annex G1.

Changes to the structure of the NHS

1.18 The main changes set out in the Health and Social Care Act 2012 came into

force on 1 April 2013. A new organisational structure was introduced.

Clinical commissioning groups (CCGs) are now responsible for using

resources to secure high-quality services. They are free to commission services

from any service provider which meets NHS standards and costs. Providers

could be NHS, social enterprises, voluntary organisations or private sector

providers. NHS commissioners will be supported by NHS England who will

authorise CCGs, allocate resources and commission certain services such as

primary care.

1.19 Health Education England (HEE) and Local Education and Training Boards

(LETBs) were established on 1 April 2013 to ensure that education, training,

and workforce development drives the highest quality public health and

10


patient outcomes and achieves good value for money. HEE is responsible for

providing national leadership and oversight on strategic planning and

development of the health and public health workforce. It allocates an

education and training budget of around £5 billion per annum through its

employer led LETBs. The advent of HEE means it will submit its own evidence

to the pay review body on the issues for which it is responsible.2

1.20 The NHS Employers organisation has always argued for employers to be

involved in workforce planning and education. It is critical that education

commissioning is employer led and locally managed if the workforce is to be

sufficiently equipped to manage and deliver services in the future.

1.21 Employers will have a greater say in developing the healthcare workforce as

the new system brings more emphasis on local knowledge. HEE will support

healthcare providers and clinicians to take greater responsibility for planning

and commissioning education and training through the development of

LETBs. These are statutory committees of HEE. Planning should be more

efficient and more effective at a time when the NHS needs to make the very

best use of every pound spent. Employers will make the most of the new

system to help them tailor the future NHS workforce and skills to the needs

of patients.

1.22 The Department of Health issued its first mandate to NHS England setting out

the objectives for the NHS in England for the next two years. This set out the

Government's priorities on health and social care. High level priorities include:

helping people live longer

managing ongoing physical and mental health conditions

helping people recover from episodes of ill health or following injury

making sure people experience better care

providing safe care.

2 A Mandate from the government to Health Education England

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/203332/29257_2900971_Delivering_Accessible.pdf



11


Employer engagement

1.23 NHS Employers evidence was gathered through a continuing programme of

employer engagement with the full range of NHS organisations on their

priorities for national pay and conditions of service. We have held discussions

at meetings of regional human resources directors, the NHS Confederation

and other employer networks throughout the year. We have held one-to-one

meetings with NHS chief executives. There has also been substantive

discussion with the NHS Employers policy board, its medical workforce forum

and the employer representatives on the joint negotiating committees on

doctors and dentists terms and conditions.

1.24 To complement these broader qualitative employer engagement activities,

during May 2013, we collected views of HR directors through the first Health

Service Journal (HSJ) and NHS Employers Barometer survey.3 We also

gathered employers views from a subsequent online survey, which sought

feedback on recruitment and retention, workforce supply, and NHS pension

issues. Responses to these surveys have reinforced and confirmed the key

messages in this submission.

Employer views

1.25 Employers support the reforms being discussed in relation to consultant

doctors and junior doctors contracts. They believe there are compelling

arguments for such reform based on the needs of patients; the need to make

consultant pay progression better aligned to performance; and to remove

barriers to seven day working. They believe that the DDRB should take

account of the need to reform the contracts when considering their

recommendations on the national scales. Employers believe that any DDRB

recommendations should contribute to the necessary contract reforms and

not add to the base line national scales.

3 Health Service Journal, HR Directors Barometer: Workforce chiefs seek further cuts to pay, terms

and conditions http://www.hsj.co.uk/news/hr-directors-barometer-workforce-chiefs-seek-further-cuts-to-pay-terms-and-conditions/5059147.article?blocktitle=NHS-Employers-News&contentID=1778

http://www.hsj.co.uk/news/hr-directors-barometer-workforce-chiefs-seek-further-cuts-to-pay-terms-and-conditions/5059147.article?blocktitle=NHS-Employers-News&contentID=1778

http://www.hsj.co.uk/news/hr-directors-barometer-workforce-chiefs-seek-further-cuts-to-pay-terms-and-conditions/5059147.article?blocktitle=NHS-Employers-News&contentID=1778

12


1.26 Employers tell us that the morale and motivation of doctors remains

satisfactory and has not been unacceptably affected by the period of pay

restraint and other changes, such as those to pension provisions in the NHS.

This view is consistent with the latest available NHS Staff Survey results

described in section 4.

1.27 Employers agree that there remains a strong case for continued pay restraint.

In terms of recruitment and retention they are able to confirm that there are

no compelling labour market issues for doctors and dentists that can be

addressed by higher national pay scales from April 2014. They believe that

continued restraint of pay will help sustain the current national pay system by

helping its affordability; support the quality of healthcare in the service; and

help to protect jobs.

1.28 The continuing good staff satisfaction measures from the latest available NHS

Staff Survey, suggest that morale and motivation remains positive.

1.29 Where recruitment and retention issues have been specifically referred to by

employers these are locality and specialty specific or are part of known labour

supply problems. These types of difficulty cannot be solved by raising national

pay scales. For example, in relation to emergency medicine physicians, actions

are being taken at a national level by NHS England and Health Education

England in relation to service demand, service configurations, better training

programmes, clearer careers guidance, and a planned growth in the numbers

of specialty training opportunities. It is possible for employers to use

recruitment and retention premia at local level where this helps.

1.30 Employers have also told us that they feel that increased pay costs would be

unaffordable. The majority of them do not favour differential increases in pay

between staff groups or within medical staff groups, or regional variations in

pay awards.

1.31 In summary, our extensive programme of employer engagement tells us that:

the DDRB recommendations should be used to support necessary

contract reforms, to link pay progression better to individual and

organisational performance and remove the barriers to seven day

working, rather than increase national pay scales

13


sustaining effective, high-quality services while delivering the financial

challenges facing the service must be the priority

employer efforts are directed at ensuring sustainable workforce costs –

increasing national pay scales would undermine those efforts

there are no national pay related recruitment and retention difficulties

that can be addressed by increased national pay scales

the level of progression pay should be considered

there is no compelling evidence for differential awards to change national

pay scales more for some staff groups, specialties or geographical areas

than for others

national pay scales should not be increased from April 2014.

Conclusion

1.32 There remains a compelling case for contract reform for junior doctors and

for consultants. Those contract reforms must improve service delivery and be

achieved without increasing costs.

1.33 There is no pressing recruitment and retention issue which can be solved by

increasing national pay scales – although there are some that need wider

labour market supply changes and changes to service configurations.

1.34 The morale and motivation of doctors remains satisfactory; higher than other

health occupations and higher than that prevailing in the economy at large

(see paragraph 4.3).

1.35 The earnings of individual doctors have again grown by more than the

increase in the national pay scales and numbers of doctors have also grown.

Largely this growth of income and numbers has been made possible by

reductions elsewhere in the workforce and increasing the risk of service

quality issues being compromised. Such a process cannot go on indefinitely.

The ratio of hospital and community health services (HCHS) doctors to HCHS

14


non-medical staff has increased from the previous year4. Many individual

doctors have again enjoyed incremental progression.

1.36 The service continues to be working under increasing financial pressures and

the usual range of contingent uncertainties, such as flu pandemics – for

which provision must be made.

1.37 Known cost pressures also arise from:

changes planned to the public sector pension assumptions from 2015

and National Insurance contributions from 2016

the continuing efficiency savings assumptions

the introduction of a single tier state pension

providing the service seven days a week, as being discussed by NHS

England may add additional costs.

1.38 So, employers of doctors tell us that the national pay scales should not be

increased from April 2014 and that if any recommendations are made, they

should be used to help facilitate necessary contract changes.

4 Health and Social Care Information Centre, NHS Workforce, Summary of staff in the NHS: Results

from September 2012 census, http://www.hscic.gov.uk/catalogue/PUB10392/nhs-staf-2002-2012-over-tab.xlsx – The number of FTE doctors per 100 non-medical staff was 9.8 in 2012 compared with 7.6 in 2002.

http://www.hscic.gov.uk/catalogue/PUB10392/nhs-staf-2002-2012-over-tab.xlsx

http://www.hscic.gov.uk/catalogue/PUB10392/nhs-staf-2002-2012-over-tab.xlsx

15


NHS services, seven days a week

2.1 Patients need the NHS every day. Evidence shows that the limited availability

of some hospital services at weekends can have a detrimental impact on

outcomes for patients, including raising the risk of mortality.5 NHS England

has said it is committed to offering a much more patient-focused service. Part

of this commitment will be met by more often providing routine NHS services

seven days a week.

2.2 In its planning guidance to clinical commissioning groups, 'Everyone Counts:

Planning for Patients 2013/14'6, NHS England identified their initial step

toward better access to services seven days a week. Professor Sir Bruce

Keogh, NHS England's Medical Director, set up a seven day services forum.7

The goals and objectives of the forum are to identify how there might be

better access to routine services seven days a week. Its initial focus is on

improving diagnostics and urgent and emergency care.

2.3 The forum has considered the consequences of some clinical services not

being available every day of the week. It is also exploring proposals for

improvements and examining the key issues which affect delivery of a seven

day service. It is clear to employers that the current consultant contract

5 http://www.england.nhs.uk/ourwork/qual-clin-lead/7ds/

6 Everyone Counts, NHS England, December 2012 http://www.england.nhs.uk/everyonecounts/

7 http://www.england.nhs.uk/ourwork/qual-clin-lead/7ds/

2. Service priorities

http://www.england.nhs.uk/everyonecounts/


http://www.england.nhs.uk/ourwork/qual-clin-lead/7ds/


http://www.england.nhs.uk/ourwork/qual-clin-lead/7ds/

16


presents barriers to this necessary development of the service. Key to NHS

England delivering its ambition for patients is the reform of the consultant

contract (see Section 3) to make the terms and conditions more responsive to

local needs, affordable and sustainable.

2.4 The forum is organised into five work streams:

clinical standards

commissioning levers

finance and costing

workforce

provider models.

2.5 The forum is gathering evidence on how the NHS could move towards

offering patients better, safer and high quality healthcare every day of the

week.

2.6 The five work streams established by the forum are investigating the benefits

of providing seven day services across the country, as well as collating

information on the challenges that such a transformation would inevitably

bring. Finance and workforce issues are being examined very closely, as these

are key to helping commissioners and providers work together to improve

outcomes for patients.

2.7 Sir Bruce Keogh, NHS England’s Medical Director outlined the enormity of the

task the forum has taken on, saying:

“NHS England is the only healthcare system in the world that is trying to sort

out the issue of 7 Day services. Individual hospitals have done some work on

it, but never a national health service.

“The NHS is owned by the people, so it must serve the people and serve

them when they need it. With ill-health, that has to be across the entire

week.

“I believe there are compelling arguments for introducing 7 Day services, not

least of all when we consider the mortality rates at weekends compared with

the number of deaths during the working week.

17


“If we can make 7 Day services work, we owe it to our patients to ensure it

happens.”

2.8 Some trusts are already developing their own local solutions to problems

caused by the five day service model, with seven day services increasingly

being recognised as part of a wider solution to improve efficiency.

2.9 The forum is due to report its findings later in 2013. This will include the

consequences of the non-availability of clinical services every day of the week

and provide proposals for improvements.

2.10 One of the key enablers to delivering the necessary changes is to reform the

consultant contract. It is particularly important to:

remove the right of consultants to refuse non-emergency out of

hours.8 Employers tell us consistently that this stands in the way of plans

for extending services into evenings and weekends

ensure that the contract supports the Academy of Medical Royal

Colleges' (AoMRC) standards9 for consultant present care seven days a

week. These say there should be active care and consultant review of

patients at least every 24 hours every day

ensure that the extension of services later into evenings and into

weekends is affordable. This will require fewer working hours attracting

premium pay rates

ensure junior doctors are adequately supervised and supported in their

clinical work and in their training and development. Junior doctors can

feel unsupported in evenings, overnight and at weekends and this can

damage patient services, patient experience and the quality and

experience of training for the next generation of doctors.

8 Paragraph 6 of schedule 3 of the 2003 consultant contract states that “non-emergency work after

7pm and before 7am during weekdays or at weekends will only be scheduled by mutual agreement between the consultant and his or her clinical manager. Consultants will have the right to refuse non-emergency work at such times. Should they do so there will be no detriment in relation to pay progression or any other matter”. 9 http://www.aomrc.org.uk/publications/reports-a-guidance/doc_details/9532-seven-day-consultant-

present-care.html

http://www.aomrc.org.uk/publications/reports-a-guidance/doc_details/9532-seven-day-consultant-present-care.html

http://www.aomrc.org.uk/publications/reports-a-guidance/doc_details/9532-seven-day-consultant-present-care.html

18


The Francis report

2.11 The Francis report was published in February 2013. NHS Employers held six

listening workshops with employers, the workshops provided the content of

NHS Employers' response on specific recommendations. This was summarised

in a letter to the Department of Health.10

2.12 Throughout the Francis report he focuses on the delivery of high-quality and

compassionate care by everyone involved in its provision and commissioning.

The report highlights the need for cultural change in order to improve the

quality of services for patients. The report makes clear the links between

patient care and staff experience. Employers must consider all aspects of their

employment practice, from recruitment and appraisal to management and

leadership. Staff must be supported to deliver the type of care that is

expected. Where standards are not met there must be an effective and open

performance management system in place to protect patients.

2.13 This call for cultural change is at a time when the NHS is facing significant

financial and employment relation challenges. It is coupled with a system that

is changing and which needs providers to build new relationships with

commissioners of both services and education.

2.14 A significant number of the report’s 290 recommendations relate to

workforce issues and have major implications for all levels of the health

service in England. Following the publication of the final report and the initial

Government response, the NHS Staff Council agreed that consideration be

given to the workforce related issues, in relation to the council's future work

programme.

2.15 The key areas for consideration are:

staffing levels and skill mix

raising concerns and duty of candour

incentivising/rewarding high quality care, values and behaviours

treating staff well

10

http://www.nhsemployers.org/The-Francis-Inquiry/Documents/NHSE%20letter%20re%20Francis%20to%20GL%20DH%20150313.pdf



19


changing the culture

staff engagement and partnership.

2.16 The Francis report stressed the importance of the NHS recruiting staff for their

values as well as their competence. This is reflected in the mandate of Health

Education England (HEE) referred to at paragraph 1.19. We will soon start

joint work with HEE on how values based recruitment can be supported. This

work will cover recruitment to education programmes as well as

employment. The values must affect all aspects of employment practice not

just recruitment. Compassion in Practice, our organisational development

programme, and staff engagement work referred to in section 4, aim to do

this.

The Keogh report

2.17 The report by the Medical Director of NHS England, Sir Bruce Keogh on

hospital mortality rates11 in 14 NHS trusts was published on 16 July 2013. It

signals the importance of monitoring mortality statistics to highlight any

underlying issues around patient care and safety. It is equally important to

identify those trusts where outcomes are much better than expected, so that

learning and experiences can be shared.

2.18 Sir Bruce identified some common challenges facing the wider NHS. He set

out a number of 'ambitions' for improvement which seek to tackle some of

the underlying causes of poor care. He wants to make some significant

progress towards achieving these ambitions within two years.

2.19 The report makes a number of recommendations for the NHS as a whole,

including some specific workforce issues:

nurse staffing levels and skill mix will appropriately reflect the caseload

and the severity of illness of the patients they are caring for and be

transparently reported by trust boards

as set out in 'Compassion in Practice'12, directors of nursing in NHS

organisations should use evidence based tools to determine appropriate

11

http://www.nhs.uk/NHSEngland/bruce-keogh-review/Documents/outcomes/keogh-review-final-report.pdf 12

http://www.england.nhs.uk/wp-content/uploads/2012/12/compassion-in-practice.pdf

http://www.nhs.uk/NHSEngland/bruce-keogh-review/Documents/outcomes/keogh-review-final-report.pdf


http://www.england.nhs.uk/wp-content/uploads/2012/12/compassion-in-practice.pdf

20


staffing levels at least every six months, providing assurance about the

impact of quality of care and patient experience

all NHS organisations will understand the positive impact that happy and

engaged staff have on patient outcomes including mortality rates, and

will be making this a key part of their quality improvement strategy. All

NHS organisations need to be thinking about innovative ways of

engaging their staff.

2.20 Sir Bruce Keogh also makes a number of other comments relating to

workforce matters. He raises concerns that the initial analysis of the available

data indicated that there were various workforce related issues, including

high rates of sickness absence and heavy reliance on agency staff to cover

vacant posts. Statistical analysis showed a positive correlation between

inpatient to staff ratio and a high hospital standardised mortality ratio (HSMR)

score.

2.21 The report also finds that a number of trusts have been undergoing mergers,

restructures or applications for foundation trust status and many have needed

to make significant cost savings. These issues may have diverted management

time and attention from focusing on quality. This was a key factor raised in

the inquiry into problems at Mid Staffordshire Hospital. While he did not

consistently find this level of distraction in all of the 14 trusts, it has been

important that this review has forced quality of care at the top of NHS

England’s agenda. At each of the trusts the report found that processes were

in place to ensure cost improvement programmes were not adversely

affecting quality, but there was more for all the trusts to do to ensure these

are applied consistently and monitored continuously.

The Berwick review

2.22 Professor Don Berwick, a leading expert in patient safety, looked at what

needs to be done to make zero harm a reality in the NHS. He led a National

Patient Safety Advisory Group consisting of leading UK and international

experts. The report, 'A promise to learn – a commitment to act' identified

some important elements for organisations and leaders to consider.

"The most important single change in the NHS in response to this report

would be for it to become, more than ever before, a system devoted to

21


continual learning and improvement of patient care, top to bottom end to

end.”

Conclusion

2.23 Taken together these important reports on service needs are reliant on

contract reform if they are to deliver for patients. There are particular

challenges related to the continued growth in doctor numbers and in their

earnings which we report on in section 5.

22


Consultants

3.1 The current contract was implemented in 2003 (2004 in Northern Ireland).

3.2 The vast majority of consultants (98 per cent13) are now on the 2003

contract. It applies to all new consultants. It has eight pay thresholds ranging

from £75,249 to £101,451. The remaining 2 per cent (down from 3 per cent

in 2012) of consultants are on the old pre-2003 contract (a five point

incremental scale rising to £80,988).

3.3 Following publication of the DDRB’s ‘Review of compensation levels,

incentives and the Clinical Excellence and Distinction Award schemes for NHS

consultants’14 in December 2012, an event for key stakeholders was held,

with representatives from NHS employing organisations, the British Medical

Association (BMA), the British Dental Association (BDA), the Academy of

Medical Royal Colleges (AoMRC), Health Education England (HEE), the

Medical Schools Council and representatives from the four health

departments, to discuss the implications for the consultants contract.

3.4 Exploratory discussions between the BMA and employers were then held on

the possible reform of the consultant contract. These discussions have

considered the substantial changes recommended by the DDRB to the Clinical

13

NHS Employers calculations, based on an ESR data warehouse staff in post query of staff with recorded consultant grades in September 2012. 14

http://www.ome.uk.com/Article/Detail.aspx?ArticleUid=12dd11ab-b6fa-469b-bbc0-84e2a7f9b5bd

3. Contract reform

http://www.ome.uk.com/Article/Detail.aspx?ArticleUid=12dd11ab-b6fa-469b-bbc0-84e2a7f9b5bd

23


Excellence Awards (CEA) scheme and to link pay progression more closely to

performance rather than time served. The current debate on the provision of

seven day services referred to in section 2 has led to consideration of how the

consultant contract could facilitate better patient services and care every day

of the week, whilst still remaining fair to consultants.

3.5 On 31 July 2013 NHS Employers and the BMA published jointly agreed draft

heads of terms (HoT).15 They set out a framework for future detailed

negotiations on amendments to the 2003 consultant contract in England and

Northern Ireland and the CEA scheme. Such negotiations would focus on the

following key areas:

Seven day services

facilitating seven day services within current contractual provisions

timings and rates of pay for plain and premium time working.

Clinical Excellence Awards

the encouragement of sustained excellence at all stages of a consultant

career

whether there should be separate arrangements for national and local

CEA schemes.

Pay progression

which structure would best reward the acquisition of new skills, the

development of new techniques, taking on leadership roles, teaching and

mentorship, innovation and research

how thresholds for pay progression could fairly and objectively be judged

by taking into account objective measures of job-based criteria.

3.6 Both parties have considered the draft heads of terms over the summer and

sought the necessary agreement of the BMAs Consultants’ Committee and

the England and Northern Ireland health departments, in order to proceed to

formal negotiations.

3.7 We are planning for negotiations to start during October 2013.

15

http://www.nhsemployers.org/SiteCollectionDocuments/HoT_final_for_website_ap290713.pdf

http://www.nhsemployers.org/SiteCollectionDocuments/HoT_final_for_website_ap290713.pdf

24


Doctors in training

3.8 The current contract for doctors in training was implemented in 2000. It had

a specific remit to reduce doctors’ (in training) hours and enforce minimum

rest breaks and working conditions. This contract applies to doctors in the

training grades below consultant level, including both years of foundation

training and all the subsequent years of specialty registrar training.

3.9 The four health departments of the UK commissioned NHS Employers to

conduct a scoping study to consider the viability of the current terms and

conditions for doctors in training. The report took into account the views of a

wide range of employers in the NHS as well as the British Medical Association

(BMA) and the British Dental Association (BDA). The commission for the

report arose from a suggestion from the DDRB, following evidence from the

BMA that they believed the current contract is not fit for purpose.

3.10 The scoping report made a compelling case for change. As a result the four

health departments of the UK commissioned NHS Employers to undertake

heads of terms talks. This process began in January 2013 with a major

stakeholder event for both junior doctor contract reform and consultant

contract reform as referred to at paragraph 3.3.

3.11 There were then specific exploratory discussions with the BMA (also

representing the BDA) and representatives of the General Practice Committee

(GPC) in relation to junior doctors. These led to jointly agreed heads of terms

(HOT).16 These set out a framework for negotiation and a joint vision for what

a new contract may feature. The HoT states the contract must:

promote safe care for patients and safety for doctors in training and be

fair for doctors in training, employers and other NHS staff

be affordable for employers now and in the foreseeable future

facilitate high quality NHS patient care through sustainable service

provision, delivered by suitably trained doctors and dentists, working in

an approved training environment

16

www.nhsemployers.org/SiteCollectionDocuments/HoT%20final%20draft%20with%20explanatory%20notes.pdf

http://www.nhsemployers.org/SiteCollectionDocuments/HoT%20final%20draft%20with%20explanatory%20notes.pdf




25


deliver both safe working patterns and safe total hours or work

address the current dissonance between New Deal and the European

Working Time Directive (EWTD)

seek to make it easier for employers to offer longer contracts of

employment than the present contracts allow.

3.12 Both parties have considered the draft HoT over the summer and sought the

necessary agreement of the Junior Doctors Committee (JDC) and the four

health departments in the UK, in order to proceed to formal negotiations in

the autumn.

3.13 We have planned for negotiations to begin during October 2013.

Specialty and associate specialist doctors (SAS) doctors

3.14 Employers find the contractual arrangements introduced in 2008 satisfactory

for their purposes. However, if other contractual changes are agreed it is

possible that there will be consequential changes to the speciality and

associate specialist doctors (SAS) contract to ensure the family of contracts

remain congruent.

Salaried dentists

3.15 Employers find the contractual arrangements for salaried dentists working in

primary care dental services remain satisfactory.

Salaried general practitioners

3.16 Employers in the NHS find the published salary ranges and model contracts

remain fit for purpose.

General Practitioner Registrar (GPR) supplements

3.17 Employers want a reformed contract for all doctors in approved postgraduate

training programmes and therefore this should incorporate the position of

General Practitioners Registrars (GPRs). As noted in paragraph 5.2 of this

submission there has been a noticeable increase in GPR numbers of 10.3 per

cent suggesting that the supplement should not be increased.

26


Motivation

4.1 In its 41st report, the DDRB remarked on the question of motivation and

stated its intention to give this further consideration. The DDRB noted NHS

Employers' view that the staff satisfaction measures, shown by the most

recent NHS Staff Survey in 2012, remained generally good and, for doctors,

better than other NHS staff. However, the DDRB felt the results were out of

date. They noted that the evidence from the British Medical Association

(BMA) and the British Dental Association (BDA) suggested emerging signs of

reducing morale among doctors and dentists.

4.2 The most recent NHS Staff Survey has subsequently reported. This again

suggests that staff satisfaction measures among doctors did indeed remain

generally good and not as suggested by the BMA and BDA surveys. The NHS

Staff Survey provides the most robust and reliable available evidence and

should have more weight than other samples and surveys. We report some of

the more detailed results from the latest survey for 2012 (reported in March

2013) later in this section.

4.3 NHS satisfaction rates and engagement measures can be seen to be

comparable to the UK economy more widely from the Workplace

Employment Relations Study (WERS) 2011 first findings.17 The WERS series

commenced in 1980. This sixth WERS has been conducted in an exceptional

period for the British economy. Its findings offer an important opportunity to

understand the operation of workplaces in a time of substantial economic

and social uncertainty. It says:

17

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/210103/13-1010-WERS-first-findings-report-third-edition-may-2013.pdf

4. Motivation and experience



27


"Pay is likely to be one of the key factors affecting how employees feel

about their jobs.”

The WERS finds that high earners – defined as those earnings £521 per week

or more, (approximately £27,000 per year) – were most likely to be satisfied

or very satisfied with their pay. The NHS Staff Survey data on a similar

question suggests that the percentage of doctors and dentists being satisfied

or very satisfied with their pay compares well to these economy wide findings

(55 per cent of high earners were satisfied). Consultant doctors (at 63 per

cent were satisfied or very satisfied with their pay in the NHS Staff Survey)

appear to be noticeably more satisfied with their pay.

4.4 Since 2009 the NHS Employers organisation has been involved in a strategy of

fostering more and better staff engagement.

4.5 The primary responsibility for engagement of NHS staff lies with the hundreds

of individual employers in the service. The Department of Health developed

the underpinning framework through the NHS Staff Pledges18 and the

Operating Framework.19

4.6 NHS Employers supports staff engagement activity by providing regular

guidance and resources to the NHS, posting timely information on our

website, including case studies and podcasts and by holding webinars and

practical workshops to enable the exchange of knowledge and sharing of

good practice.

4.7 The key drivers affecting staff engagement at organisational level are known

from research to be:

great management and leadership – well led organisations appear to

have higher staff engagement scores relating to whether staff feel the

organisation has clear goals, sets objectives and manages performance

well and is able to explain and communicate its aims

18

http://www.nhsemployers.org/employmentpolicyandpractice/staff-engagement/nhs_values/pages/staff-pledges-responsibilities.aspx 19

https://www.gov.uk/government/publications/the-operating-framework-for-the-nhs-in-england-2012-13

http://www.nhsemployers.org/employmentpolicyandpractice/staff-engagement/nhs_values/pages/staff-pledges-responsibilities.aspx

http://www.nhsemployers.org/employmentpolicyandpractice/staff-engagement/nhs_values/pages/staff-pledges-responsibilities.aspx



28


a healthy and safe working environment – staff will not be successfully

engaged in unsafe or unhealthy environments. Conversely, staff

engagement appears to have a positive effect on absence levels and

overall health and well being is closely associated with good staff

engagement levels

involving staff in decision making – involvement contributes to overall

staff engagement through ensuring employee voice is heard and also

that employee ideas can contribute to the success of the organisation

making sure every role counts – job satisfaction is fundamental to staff

engagement. Well designed rewarding jobs with a clear link to overall

success of the organisation appear to contribute greatly to staff

engagement

personal development – job skills development, formal education and

training or opportunities to develop in their job role can also contribute

to staff engagement.

4.8 The NHS Pension Scheme (NHSPS) and conditions of service continue to play

a valuable role in staff perception of their overall reward package. The DDRB

noted last year that the BMA had surveyed their members about the changes

to the NHS Pension Scheme and feared that many of their members would

consider leaving the service as a result. Paragraph 5.16 shows that the age

distribution of pension scheme members remains largely unchanged,

suggesting that, even if consideration was indeed given, their members have

not chosen to retire in disproportionate numbers.

4.9 Employers place great emphasis on staff engagement and are increasingly

focused on its benefits. Most employers have taken some action around staff

engagement in the past year ranging from full-scale staff engagement

interventions such as 'Listening into Action' or 'Big Conversations' to

development of local values and involvement methods.

4.10 In most cases employers will address staff engagement within their overall

workforce strategy rather than have a separate staff engagement strategy.

Staff engagement is often linked to partnership working and is increasingly

seen as part of productivity and efficiency initiatives. There is a focus on the

need for better communication and involvement of staff and a growing use

of social media.

29


4.11 NHS organisations have been taking a range of action on staff engagement in

relation to the Staff Pledges in the NHS Constitution. Some case study

examples can be found on the Social Partnership Forum's website.20

4.12 These drivers of staff engagement are reflected in the NHS Staff Pledges and

they are measured within the NHS Staff Survey.

4.13 The latest available data from the NHS Staff Survey, which is the

comprehensive and methodologically reliable indicator of staff engagement,

indicates that on all key measures staff engagement rose in 2012 compared

with 2011. This is a reflection of the concerted efforts of employers.

4.14 The overall composite Staff Engagement Index for the NHS rose from 3.61 to

3.6821 (engagement is measured on a five point scale). Of particular note

were:

motivation rose from 3.80 to 3.82

staff job satisfaction rose slightly from 3.49 to 3.58.

The Staff Engagement Index for medical and dental staff as reported in the

2012 Staff Survey was 3.75, better than that of the NHS as a whole.

4.15 The perceived ability of staff to contribute towards improvements at work

rose from 62 per cent to 68 per cent though this still remains below what we

would wish to see and varies between organisations. Other involvement

indicators also rose but are still at relatively low levels.

4.16 The chief indicator of staff advocacy the willingness of staff to recommend

the services in which they work rose from 3.49 to 3.57, driven primarily by an

increased willingness to recommend their workplace as a place to work.

4.17 There is a complex relationship between staff engagement and pay levels. Pay

itself does not seem to directly drive engagement in the NHS. This does not

20

www.socialpartnershipforum.org/PartnershipInAction/Staffmoraleandengagement/Pages/Staffmoraleandengagement.aspx 21

National NHS Staff Survey Co-ordination Centre, Briefing Note: Issues Highlighted by the 2012 NHS Staff Survey In England www.nhsstaffsurveys.com/Caches/Files/NHS%20staff%20survey%202012_nationalbriefing_final.pdf

http://www.socialpartnershipforum.org/PartnershipInAction/Staffmoraleandengagement/Pages/Staffmoraleandengagement.aspx

http://www.socialpartnershipforum.org/PartnershipInAction/Staffmoraleandengagement/Pages/Staffmoraleandengagement.aspx

http://www.nhsstaffsurveys.com/Caches/Files/NHS%20staff%20survey%202012_nationalbriefing_final.pdf

30


mean that pay is unimportant, for example if pay levels are seen as unfair on

a long-term basis this could contribute to a decline in morale and motivation.

4.18 Staff have become more likely to recommend the NHS as a place to work in

recent years perhaps also due to staff engagement and also the impact of the

total reward package.

NHS Staff Survey results, 2008–2012

4.19 The 2012 NHS Staff Survey involved 259 NHS organisations in England.

Around 203,000 NHS staff were invited to participate using a self-completion

postal questionnaire. Responses were received from 101,169 NHS staff, a

response rate of 50 per cent (54 per cent in 2011). All full-time and part-time

staff who were directly employed by an NHS organisation on 1 September

2012 were eligible.22 Tables of detailed figures from the survey are given at

Annex A, while selected highlights are given below.23

1. Engagement and job satisfaction

The percentage of medical and dental staff who are satisfied or very

satisfied with their pay exceeded that of all NHS staff for each year

between 2008 and 2012, although the percentage for medical staff fell

by 1 per cent between 2011 and 2012.

Doctors’ and dentists’ job satisfaction scores in all grades continued to

improve over time and still exceeded the average job satisfaction score of

the NHS at the time of the 2012 survey.

Doctors’ motivation scores have exceeded those of all NHS staff.

In 2012, doctors and dentists were at least as satisfied with the quality of

work and patient care they are able to deliver as the NHS as a whole

22

NHS Staff Surveys, Briefing Note: Issues Highlighted By the 2012 NHS Staff Survey In England, http://www.nhsstaffsurveys.com/Caches/Files/NHS%20staff%20survey%202012_nationalbriefing_final.pdf 23

The key finding relating to staff's intention to leave (Table B in NHS Employers' replies to DDRB supplementary questions for 2013/14) was dropped for the 2012 survey. The questions relating to trust and immediate manager's support of staff's work-life balance (Tables F and G in NHS Employers' replies to DDRB supplementary questions for 2013/14) were dropped for the 2012 survey.



31


(apart from consultants, where the rounded percentage was the same as

the NHS.) This score increased by four percentage points for all medical

and dental staff (similar to the rest of the NHS) and by five percentage

points for consultants.

Ninety-four per cent of medical and dental staff agreed that their role

makes a difference to patients in each year of the staff survey. Between

2011 and 2012, this percentage increased by one percentage point,

whilst the equivalent statistic for the NHS staff as a whole decreased by

one percentage point.

The majority of medical and dental staff (72 per cent) agreed that there

were frequent opportunities for them to show initiative in their role,

compared to 69 per cent of the NHS as a whole. The percentages for

doctors in training and other medical/dental staff increased by 12 and 11

per cent respectively from 2011, compared to an increase of 8 per cent

for the NHS as a whole.

2. Patient care and safety

In light of the Francis inquiry, nearly half of doctors and dentists (44 per

cent) in 2012 witnessed potentially harmful errors, near misses or

incidents in the month prior to the NHS Staff Survey, compared to 32 per

cent of NHS staff as a whole.

Medical and dental staff were slightly more likely to agree than the NHS

as a whole that incident reporting procedures were fair and effective.

3. Workload

Medical and dental staff are more likely to work extra hours than the

NHS as a whole.

4. Appraisals

Appraisal rates over the previous 12 months increased by six percentage

points for medical and dental staff in 2012 to 88 per cent, in contrast to

a three point increase for NHS staff as a whole to 83 per cent. It is

expected that appraisal rates will increase in future years in order to meet

the criteria required by the revalidation process.

There was an increase in the percentage of medical and dental staff

saying that their appraisal was well-structured. The percentage of doctors

32


in training who stated that their appraisal was well-structured increased

by nearly four percentage points to 41 per cent in 2012.

Appraisal is at the heart of the revalidation process whereby doctors are

re-licensed with the General Medical Council (GMC) every five years. We

expect that this will increase the quantity and quality of appraisal. This

may provide opportunities to improve clinical governance and outcomes

and provide better links to the pay system and its processes.

4.20 It is recognised that there are specific challenges in the engagement of

medical staff. Although medical staff continue to have high levels of job

satisfaction there are issues around involvement. Medical staff

disengagement appears to have a wider range of causes and in particular is

connected to the perception of lack of medical involvement in key decisions.

There is a range of work to improve development of medical leadership in the

NHS led by the Faculty of Leadership and Management. In addition, many

trusts have implemented changes that sought to improve medical

involvement in leadership roles as a way of promoting engagement, for

example Northumbria Healthcare and the adoption of models such as Service

Line Management. The Francis and Keogh reviews highlighted the

importance of medical involvement and leadership for quality care.

Summary of the 2012 patient survey and staff survey correlations

4.21 Although there is evidence24 that shows that increased staff morale is linked

to better patient experience, the research did not explicitly examine staff

satisfaction with their level of pay with scores from the patient survey. NHS

Employers has calculated rank correlations between the explanatory variables

from the 2012 NHS Staff Survey25 and the 2012 patient survey26 scores from

24

Jeremy Dawson Institute for Health Services Effectiveness, Aston Business School, Does the experience of staff working in the NHS link to the patient experience of care? An analysis of links between the 2007 acute trust inpatient and NHS staff surveys, http://collections.europarchive.org/tna/20100509080731/http:/www.dh.gov.uk/prod_consum_dh/groups/dh_digitalassets/@dh/@en/@ps/documents/digitalasset/dh_111827.pdf Last accessed 14 August 2013 25

National NHS Staff Survey Co-ordination Centre, 2012 Results, http://www.nhsstaffsurveys.com/Page/1006/Latest-Results/2012-Results/ Last accessed 19 August 2013. 26

As taken from CQC source material

http://collections.europarchive.org/tna/20100509080731/http:/www.dh.gov.uk/prod_consum_dh/groups/dh_digitalassets/@dh/@en/@ps/documents/digitalasset/dh_111827.pdf

http://collections.europarchive.org/tna/20100509080731/http:/www.dh.gov.uk/prod_consum_dh/groups/dh_digitalassets/@dh/@en/@ps/documents/digitalasset/dh_111827.pdf

http://www.nhsstaffsurveys.com/Page/1006/Latest-Results/2012-Results/

33


acute trusts only that were entered into the Aston Business School regression

analysis.27

4.22 The NHS Staff Survey question variables were selected as potential

explanatory variables on the basis that they were not intuitively dependent

variables (for example, experience of bullying from patients); were thought to

be related to patient care; and had at least one correlation coefficient of

magnitude 0.50 or greater (0.45 for composite scores). In addition, the

unweighted28 percentage of staff who agreed or strongly agreed that they

were satisfied with their level of pay was added as a staff survey variable.

Annex B provides a table which shows that there are positive correlations

between satisfaction with pay and various patient experience scores, such as:

Did you have confidence and trust in the nurses treating you?

Were you involved as much as you wanted to be in decisions about your

care and treatment?

Before the operation or procedure, did the anaesthetist or another

member of staff explain how he or she would put you to sleep or control

your pain in a way you could understand?

4.23 However, satisfaction with pay is significantly correlated with other NHS Staff

Survey measures such as:

staff who said yes to the question – Does your organisation act fairly with

regard to career progression / promotion, regardless of ethnic

background, gender, religion, sexual orientation, disability or age?

staff who said yes to experiencing discrimination from patients / service

users, their relatives or other members of the public in the last 12 months

percentage of staff saying hand washing materials are always available.

4.24 It suggests that staff satisfaction with the level of pay is one of many factors

contributing to the patient experience.

27

Not all variables in the 2007 surveys were still present in the 2012 surveys. Where a explanatory variable was not available, the nearest equivalent was used where possible.) 28

The percentage of staff who are agreed or who strongly agreed that they were satisfied with their level of pay is only available at trust level and is based on the survey responses from that trust. Therefore, the actual average level of satisfaction with pay from each trust (based on all staff) may differ significantly from the observed measure. Note that satisfaction with level of pay is a component of the composite score of job satisfaction.

34


Doctor numbers

5.1 There are now more than 140,000 hospital and community health services

(HCHS) doctors and GPs. Figure 129 shows the growth in the HCHS medical

full-time equivalent workforce since 2002. A table of staff numbers (both

headcount and full-time equivalent) can be found in Annex C.

Figure 1. Hospital and community health services medical workforce by grade 2002 to 2012

29

Health and Social Care Information Centre, NHS Staff 2002 - 2012 (Medical and Dental): Bulletin tables, www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2002-2012-medi-dent-tab.xlsx

5. Numbers and earnings

http://www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2002-2012-medi-dent-tab.xlsx

35


5.2 The latest annual census figures for England confirm that the NHS medical

and dental workforce has increased in 2012 to the highest ever recorded,

reaching over 100,000 full-time equivalents for the first time.30 Figure 1

shows that medical numbers in nearly all of the staff groups continued to

grow during the year to 30 September 2012, in particular:

the numbers of hospital, public health medicine and community health

service medical and dental staff increased by 1,531 (headcount) or 1.4

per cent and 1,505 full- time equivalents (FTE) or 1.5 per cent

consultant numbers increased by 1,306 (headcount) or 3.3 per cent and

1,232 (FTE) or 3.3 per cent

the number of specialty doctors, staff grades and associate specialists

increased by 71 (headcount) or 0.7 per cent and increased by 88 (FTE) or

1.0 per cent

the numbers of doctors in training and equivalents increased by 447

(headcount) or 0.8 per cent and 269 (FTE) or 0.5 per cent

GP numbers – excluding GP retainers and GP registrars – decreased by 19

(headcount) or 0.1 per cent, and increased by 187 (FTE) or 0.6 per cent;

GP registrars increased by 413 (headcount) or 10.3 per cent and 354

(FTE) or 9.3 per cent.

5.3 Figure 2 shows the composition of the medical workforce based on the most

recently available census figures.

30

Health and Social Care Information Centre, NHS Staff 2002 - 2012 (Medical and Dental): Bulletin tables. www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2012-medi-dent-detl-tab.xls Last referenced 24 July 2013.

http://www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2012-medi-dent-detl-tab.xls

36


Figure 2. Composition of the medical workforce

Turnover

5.4 Figure 3 shows the hospital and community health service (HCHS) doctors

turnover statistics31 (both leaving and joining rates) for all HCHS doctors

(excluding locums and trainees) in England, dating from the September to

December 2009 quarter to the December 2012 to March 2013 quarter.

Joining rates have consistently exceeded leaving rates over the period.32 This

shows that NHS overall recruitment and retention has not only been sufficient

to maintain workforce numbers, but also sufficient to expand the medical

workforce by 5.2 per cent between September 2009 and September 2012.33

31

Health and Social Care Information Centre. Monthly NHS Hospital and Community Health Service (HCHS) Workforce Statistics in England – April 2013, Provisional Statistics - Quarterly Tables Turnover, www.hscic.gov.uk/catalogue/PUB11118/month-hchs-work-stat-eng-apr-2013-quar-tur.xlsx. 32

Health and Social Care Information Centre. Monthly NHS Hospital and Community Health Service (HCHS) Workforce Statistics in England – April 2013, Provisional Statistics - National Tables www.hscic.gov.uk/catalogue/PUB11118/month-hchs-work-stat-eng-apr-2013-nat-tab.xls. 33

Health and Social Care Information Centre, NHS Staff 2002 - 2012 (Medical and Dental): Bulletin tables, www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2002-2012-medi-dent-tab.xlsx

http://www.hscic.gov.uk/catalogue/PUB11118/month-hchs-work-stat-eng-apr-2013-quar-tur.xlsx

http://www.hscic.gov.uk/catalogue/PUB11118/month-hchs-work-stat-eng-apr-2013-nat-tab.xls

http://www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2002-2012-medi-dent-tab.xlsx

37


Figure 3. Turnover for HCHS doctors in England

Applications to study pre-clinical medicine and pre-clinical dentistry

5.5 Medical and dental degrees continue to be attractive options for students.

Data on entry to UK pre-clinical medical and dentistry courses is available in

Tables 1–4 in Annex D.

5.6 For 2012 entry, average UCAS tariff points held by home domiciled accepted

applicants to pre-clinical medical and dentistry courses were 417 and 392

respectively, compared to 406 and 361 in 2011 (see Tables 1 and 2 of Annex

D). It is pleasing to note that medicine and dentistry remain very attractive

careers and continue to attract high-quality candidates with average tariff

points considerably higher than the average for all subjects.

5.7 In 2012, there was an average of 2.3 (2.4 in 2011) and 2.2 (2.4 in 2011)

home domiciled34 applicants for every successful applicant to medicine and

34

Note: the 2011 average numbers of applications per accepted applicants as stated in the 2013/14 supplementary questions (2.8 for pre-clinical medicine, 2.7 for pre-clinical dentistry) were based on an

38


dentistry respectively. Tables 1 and 2 show that despite the introduction of

tuition fees, the number of applicants per successful applicant remains

broadly the same as in previous years.

5.8 Of the successful home domiciled applicants, 55 per cent for dentistry courses

and 54 per cent for medical courses were female applicants. The percentage

of female applicants applying for dentistry courses increased by 4 per cent

whilst the percentage of female applicants applying for medical courses

stayed broadly the same compared with 2011.

5.9 As women account for more than 50 per cent of accepted applicants to

medical schools, this needs to be considered as part of any future workforce

planning, especially for specialties that attract more female candidates.

Doctors' earnings

5.10 The NHS Information Centre produces a quarterly publication of NHS staff

earnings estimates which show medical workforce earnings by staff group,

taken from the Electronic Staff Record (ESR). The ESR covers every English

NHS organisation, apart from two foundation trusts who have opted not to

use the system (as of March 2013).

5.11 Changes in the average earnings by staff group arise from actual increases in

individuals’ pay due to pay awards, back pay and incremental progression or

changes in the composition of the workforce due to pay reforms and/or the

impact of new organisations.

5.12 Figures 4 and 6 show mean annual basic pay and mean annual total earnings

for HCHS medical and dental staff over time, while Figures 5 and 7 show the

changes in mean annual basic pay and mean annual total earnings per staff

member35 based on the new staff earnings methodology.36

assumption that selecting the UK option in UCAS’ statistical enquiry tool (now now longer available) referred to home domiciled applicants. When deriving the updated information for all years for the 2014/15 evidence, it was apparent that selecting UK in the tool referred to all applications. Only Tables 3 and 4 are affected. 35

Health and Social Care Information Centre, NHS Staff Earnings estimates to March 2013, Provisional, -Experimental statistics – Tables.xlsx, www.hscic.gov.uk/catalogue/PUB11006/nhs-staf-earn-est-to-mar-13-tab.xlsx. 36

Health and Social Care Information Centre, NHS Staff Earnings estimates to March 2013, Provisional, Experimental statistics, https://catalogue.ic.nhs.uk/publications/workforce/earnings/nhs-

http://www.hscic.gov.uk/catalogue/PUB11006/nhs-staf-earn-est-to-mar-13-tab.xlsx

http://www.hscic.gov.uk/catalogue/PUB11006/nhs-staf-earn-est-to-mar-13-tab.xlsx

https://catalogue.ic.nhs.uk/publications/workforce/earnings/nhs-staff-earn-mar-2013/nhs-staf-earn-est-to-Mar-2013.pdf

39


Basic pay

5.13 Figures 4 and 5 show that despite the pay freeze, average basic pay per full-

time equivalent increased for all grades except other medical and dental staff.

The average pay increase in basic pay between 2011/12 and 2012/13 was 1.1

per cent, up from the previous increase between 2010/11 and 2011/12 of 0.8

per cent. The 2012/13 mean annual basic pay per full-time equivalent HCHS

doctor is £58,555.

Figure 4. Basic pay

Staff group Mean annual basic pay per full-time equivalent during 12 month period ending in March (£)

2009 2010 2011 2012 2013

All HCHS doctors

(non locum) 55,451 56,663 57,475 57,916 58,555

Consultants

(including directors

of public health)

85,337 86,975 87,089 87,150 87,211

Hospital

practitioners &

clinical assistants

61,102 63,265 64,488 65,256 66,384

Other doctors in

training 25,870 25,789 25,943 25,917 25,997

Other medical and

dental staff 56,845 59,144 61,568 62,426 62,835

Registrars 36,034 36,545 36,979 37,059 37,146

staff-earn-mar-2013/nhs-staf-earn-est-to-Mar-2013.pdf. Mean earnings have been estimated using twelve months of data to improve accuracy. The tables and charts below are therefore based on twelve month periods ending in March 2009 to March 2013. Under the new methodology, basic pay is shown per full-time equivalent, whereas total earnings are shown per person using the new methodology, as some payments (such as temporary benefit allowances) are based on a flat rate regardless of whether the recipient is full-time or part-time.

https://catalogue.ic.nhs.uk/publications/workforce/earnings/nhs-staff-earn-mar-2013/nhs-staf-earn-est-to-Mar-2013.pdf

40


Figure 5. Change in mean basic pay per full-time equivalent by grade since 2008/09

Total earnings37

5.14 Figures 6 and 7 show that the increase in total earnings per person has

increased for all grades except consultants. The average pay increase between

2011/12 and 2012/13 was 0.9 per cent, in contrast to the previous decrease

37

Total Earnings per person = Basic Pay per person + Additional Earnings per person. Additional Earnings are made up of: Payments for additional activity; Band supplements; Medical awards; Geographic allowances; Local payments; On call payments; Overtime payments; recruitment and retention premia; Shift work payments; Other payments. Where earnings have reduced, one of the contributory factors is likely to be the better management of rotas and additional programmed activities.

41


between 2010/11 and 2011/12 (0.4 per cent). The 2012/13 mean annual

total earnings of an HCHS doctor is £73,694.

Figure 6. Total earnings

Staff group Mean total earnings per person during 12 month period ending in

March (£)

2009 2010 2011 2012 2013

All HCHS doctors

(non locum) 72,182 73,520 73,315 73,008 73,694

Consultants (including

directors of public

health)

111,222 113,394 111,592 109,962 109,676

Hospital practitioners &

clinical assistants 15,685 15,954 15,726 15,752 16,405

Other doctors in training 36,924 36,329 36,047 35,793 36,685

Other medical and

dental staff 58,790 61,064 62,123 62,296 63,099

Registrars 54,751 54,372 53,638 53,045 53,173

42


Figure 7. Change in mean annual total earnings per person by grade since 2008/09

Consultants

5.15 Consultant numbers increased by 1,306 (headcount) or 3.3 per cent and by

1,232 (FTE) or 3.3 per cent during the year to 30 September 2012. The

number of consultants (FTE) at 30 September 2012 was 38,197, the highest

ever recorded. The FTE number of consultants has increased by 13,440 or 54

percent from 2002. There are questions for employers about whether the

growth in consultant numbers is sustainable and affordable in the long term

without contract reform. We refer to the cost pressures caused by

incremental progression in the long term at paragraphs 6.21 to 6.29 and in

Annexes G and H.

5.16 The mean basic pay of consultants is estimated at £87,211 per full-time

equivalent and £82,302 per person. Additional earnings, including Clinical

Excellence Awards, constitute £27,374 (33 per cent) per consultant

43


(headcount). Mean total earnings decreased by 0.3 per cent per person

between 2011/12 and 2012/13, whilst mean basic pay has increased by 0.1

per cent per full-time equivalent compared to the same period. More than 50

per cent of consultants (headcount) earn £83,500 or more in basic pay.38

5.17 The September 2012 workforce census39 indicated that 38 per cent of the

consultant headcount of 40,394 working in the NHS in England were aged

50 or over, and 8 per cent were aged 60 or over. These proportions are

around the same as those in September 2010 and 2011. The latest

information on consultant retirements is in Annex E.

5.18 The overwhelming majority of consultants (98 per cent) are now on the 2003

consultant contract,40 which applies to all new consultants and has eight pay

thresholds ranging from £75,249 to £101,451.41 The remaining 2 per cent of

consultants are on the old pre-2003 contract (a five point incremental scale

rising to £80,988).

5.19 Some consultants also receive recruitment and retention premia. Annex F

provides a summary of these which indicates that they remain useful for

employers, though sparingly used.

Specialty and associate specialist doctors (SAS)

5.20 The total number of associate specialists, specialty doctors and staff grade

doctors increased by 71 (headcount) or 0.7 per cent and by 88 (FTE) or 1.0

per cent during the year to 30 September 2012. The number of doctors (FTE)

in this group at 30 September 2012 was 8,964, the highest ever recorded.

5.21 In the year to September 2012, the numbers of associate specialists

decreased42 by 201 (headcount), or 5.4 per cent and by 162 (FTE) or 4.9 per

38

Health and Social Care Information Centre, NHS Staff Earnings Estimates to March 2013 – Provisional, Experimental statistics – Basic Pay.xlsm, www.hscic.gov.uk/catalogue/PUB11006/prov-exp-bas-pay-grap-jun-13.xlsm 39

Health and Social Care Information Centre, NHS Staff 2002 - 2012 (Medical and Dental): Detailed Results tables, www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2012-medi-dent-detl-tab.xls 40

NHSE calculations, based on a staff in post ESR data warehouse extract from September 2012. 41

NHS Employers Pay Circular (M&D) 1/2013, www.nhsemployers.org/Aboutus/Publications/PayCirculars/Documents/Pay-Circular-MD-1-2013.pdf 42

Associate specialist (old grade) and staff grades were closed to new entrants following the introduction of the 2008 contract for associate specialists and specialty doctors.

http://www.hscic.gov.uk/catalogue/PUB11006/prov-exp-bas-pay-grap-jun-13.xlsm


http://www.hscic.gov.uk/catalogue/PUB10394/nhs-staf-2012-medi-dent-detl-tab.xls

http://www.nhsemployers.org/Aboutus/Publications/PayCirculars/Documents/Pay-Circular-MD-1-2013.pdf

44


cent. The number of specialty doctors increased by 508 (headcount) or 8.7

per cent and by 460 (FTE) or 9.4 per cent, whilst the number of staff grade

doctors (also a closed grade) decreased by 236 (headcount) or 28 per cent

and by 210 (FTE) or 30 per cent.

5.22 Associate specialists, staff grade and specialty doctors are grouped together

in the new earnings census and fall into the staff group category of other

medical and dental staff. Other medical and dental staff have a mean basic

pay of £62,835 per full-time equivalent and £52,332 per person. This shows

that additional earnings add £10,767 (21 per cent) to mean basic pay per

person. Their average basic pay has increased by 0.7 per cent per full-time

equivalent since the previous year whilst total earnings have increased by

1.3 per cent per person.

5.23 Associate specialists earned an approximate mean basic pay43 of £67,400 per

person and approximate mean total earnings44 of £81,100 per person. This

figure shows that approximate additional mean earnings add £13,700 (20 per

cent) to basic pay. The median is very much higher than the mean total for

basic earnings (median = £72,400) but not total earnings (median =

£81,900).

5.24 Staff grades earn an approximate mean basic pay of £45,400 per person and

earn an additional £13,200 (29 per cent) in approximate mean additional pay

per person. Their approximate mean total annual earnings are £58,600.

Median earnings are greater than the mean earnings, both in terms of basic

pay (median = £48,800) and total earnings (median = £62,900).

5.25 Specialty doctors earn an approximate mean basic pay of £48,300 and an

additional £11,300 (23 per cent) in additional pay. Therefore, their

approximate mean total annual earnings are £59,600. Median earnings are

43

Health and Social Care Information Centre, NHS Staff Earnings Estimates to March 2013 - Provisional, Experimental statistics – Basic Pay.xlsm, www.hscic.gov.uk/catalogue/PUB11006/prov-exp-bas-pay-grap-jun-13.xlsm All approximate basic pay statistics have been derived from this graphing tool based on all SHAs in England and are not meant to be definitive mean earnings. 44

Health and Social Care Information Centre, NHS Staff Earnings Estimates to March 2013 – Provisional, Experimental statistics – Total Earnings.xlsm, https://catalogue.ic.nhs.uk/publications/workforce/earnings/nhs-staff-earn-mar-2013/prov-exp-tot-earn-grap-jun-13.xlsm All approximate total earnings statistics have been derived by NHSE from this graphing tool based on all SHAs in England and are not meant to be definitive mean earnings.



https://catalogue.ic.nhs.uk/publications/workforce/earnings/nhs-staff-earn-mar-2013/prov-exp-tot-earn-grap-jun-13.xlsm


45


greater than the mean earnings, both in terms of basic pay (median =

£52,800) and total earnings (median = £62,100).

Doctors in training

5.26 At the September 2012 census, the number of doctors in training in England

was 53,319 – an increase of 447 (0.8 per cent) on the number recorded in

the September 2011 census. The FTE figure increased by 0.5 per cent in the

year to 2012 (from 51,993 to 52,262) and by 18,330 or 54 per cent from

2002.

5.27 In the year to September 2012, the numbers of doctors in foundation year

one (including house officers) increased by 1 (headcount), or 0.0 per cent and

decreased by 5 (FTE) or 0.1 per cent. The number of doctors in foundation

year two (including senior house officers) decreased by 85 (headcount) or 1.1

per cent and by 79 (FTE) or 1.0 per cent. The number of registrars increased

by 513 (headcount) or 1.3 per cent to 39,404 and by 355 (FTE) or 0.9 per

cent to 38,489.

5.28 Doctors in foundation year one (including house officers) received an

approximate mean basic pay45 of £22,500 and their approximate mean total

earnings46 are £28,200. These figures show a mean enhancement equivalent

to £5,800 or approximately 26 per cent of basic pay. Median earnings are

similar to mean earnings, both in terms of basic pay (median = £22,600) and

total earnings (median = £28,800).

5.29 Doctors in foundation year two (including senior house officers) received an

approximate mean basic pay of £32,300 and mean total earnings of £47,900.

These figures equate to a mean enhancement of £15,600 or 48 per cent of

basic pay. Median earnings are smaller than mean earnings, both in terms of

basic pay (median = £31,700) and total earnings (median = £47,200).

45

Health and Social Care Information Centre, NHS Staff Earnings Estimates to March 2013 – Provisional, Experimental statistics – Basic Pay.xlsm, www.hscic.gov.uk/catalogue/PUB11006/prov-exp-bas-pay-grap-jun-13.xlsm All approximate basic pay statistics have been derived by NHSE from the graphing tool based on all SHAs in England and are not meant to be definitive mean earnings. 46

Health and Social Care Information Centre, NHS Staff Earnings Estimates to March 2013 – Provisional, Experimental statistics – Total Earnings.xlsm, https://catalogue.ic.nhs.uk/publications/workforce/earnings/nhs-staff-earn-mar-2013/prov-exp-tot-earn-grap-jun-13.xlsm All approximate total earnings statistics have been derived from this graphing tool based on all SHAs in England and are not meant to be definitive mean earnings.





46


5.30 Registrars receive an estimated basic pay of £37,146 per full-time equivalent

and £35,757 per person and total pay of £53,173 per person. These figures

equate to a mean enhancement of £17,416 or 49 per cent of basic pay.

Mean total earnings increased by 0.2 per cent per person between 2011/12

and 2012/13 and mean basic pay has also increased by 0.2 per cent per full-

time equivalent compared to the same period.

Graduate starting earnings comparisons with other professions

5.31 The most recent Graduate Recruitment Survey from the Association of

Graduate Recruiters (AGR) continues to show that total earnings for medical

graduates47 entering their first post remain very competitive when compared

to other posts. This can be seen when comparing medical salaries to those of

graduates in other sectors measured through the AGR Survey48 and illustrated

in Figure 8, especially when the number of posts is taken into account.

Uniquely amongst undergraduates of any discipline, medical graduates are

fortunate in the high proportion of graduates that are immediately able to

enter their chosen career.

47

Health and Social Care Information Centre, NHS Staff Earnings Estimates to March 2013 – Provisional, Experimental statistics – Total Earnings.xlsm, https://catalogue.ic.nhs.uk/publications/workforce/earnings/nhs-staff-earn-mar-2013/prov-exp-tot-earn-grap-jun-13.xlsm 48

Association of Graduate Recruiters, The AGR Graduate Recruitment Survey 2013Summer Review, www.agr.org.uk/Surveys



http://www.agr.org.uk/Surveys

47


Figure 8. Graduate starting salaries

5.32 The same survey showed that graduate vacancies are predicted to decrease

by 3.9 per cent in 2012/13, in contrast to the actual decrease of 8.2 per cent

predicted for 2011/12. However, the survey did point out that the same

numbers of graduates are being recruited as in the period before the credit

crunch. Survey respondents estimated that the average starting salary would

remain at £26,500.

5.33 AGR employers stated that at the time of the survey, they had received an

average of 85.3 applications per vacancy, a marked increase from the

2011/12 average (73.2.) This represents an increase of approximately 17.0

per cent.

48


6.1 The NHS faces an unprecedented financial challenge.49 Funding is insufficient

to meet the growing demands on the service, this will require among other

things, significant reform of service configurations, ways of working, patterns

of working and patient pathways. Such necessary reforms will require reform

of pay and the terms and conditions of contracts as discussed in sections 2

and 3. At the same time, the NHS has to deliver 4 per cent efficiency savings

every year until 2015. The 2013 Spending Review has confirmed that

financial pressures will increase in the years beyond 2015/16.

6.2 An NHS Confederation Members' Survey, published in June 2013, indicates

that financial pressures continue to be a real and significant challenge for the

NHS. In some cases these are damaging the quality of services.

6.3 Key messages from the survey were:

22 per cent of respondents stated that the financial pressures currently

facing their organisation were the worst they had ever seen

a further 40 per cent stated the financial pressures were very serious, but

not the worst they have ever experienced

83 per cent of respondents expected that the financial pressure would

increase over the next 12 months

50 per cent of respondents said that waiting times and access had been

detrimentally affected by financial pressures

70 per cent of respondents suggested that waiting times will be the area

of care most damaged by financial pressures over the next 12 months.

49

http://www.nhsconfed.org/Publications/Documents/Tough-times-overview-finances.pdf

6. The financial challenge

http://www.nhsconfed.org/Publications/Documents/Tough-times-overview-finances.pdf

49


The second and third most often chosen aspect of care being damaged

were patient experience (64 per cent) and availability of certain

treatments or drugs (27 per cent).

The 2013 Spending Review

6.4 It is clear that the financial challenge will continue beyond 2015. Public

spending plans for 2015/1650 were set out by the Government in June 2013.

While it was confirmed that overall NHS spending will continue to be

protected at £110 billion in 2015/16 (a real terms growth of 0.1 per cent) the

annual pledge to social care from the NHS budget will be increased from

£1 billion to £3 billion in 2015/16. This amount, as well as an extra

£0.8 billion, will be placed into a pooled shared budget between the NHS and

local authorities. There is to be an additional 10 per cent real terms reduction

in the NHS administration budget. This will include cuts to backroom staff

across various organisations, including the Department of Health, clinical

commissioning groups (CCGs), Public Health England and NHS England.

There are also assumptions of up to £1 billion savings from an overhaul of

NHS procurement.

6.5 In responding to the Government's plans, NHS Confederation Chief

Executive, Mike Farrar said:51

"This settlement means NHS organisations will have less money available for

front line services, so the need to change services is more pressing than ever.

We must maintain focus on improving patient care and ensuring staff job

security – both depend on sustainable pay bills and a focus on performance."

6.6 The National Audit Office (NAO) has published its annual report into the

financial sustainability of the NHS.52 This report consolidates the financial

accounts of the NHS trusts and foundation trusts up to the end of 2012/13.

Analysis in the report highlights significant financial challenges for some

health providers, despite the NHS reporting a combined surplus of £2.1 billion

last year.

50

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/209036/spending-round-2013-complete.pdf 51

http://www.nhsconfed.org/PressReleases/Archive/2013/Pages/confed-employers-comment-spending-review-2013.aspx 52

http://www.nao.org.uk/wp-content/uploads/2013/07/10220-001_Indicators-of-financial-sustainability-in-the-NHS.pdf

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/209036/spending-round-2013-complete.pdf

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/209036/spending-round-2013-complete.pdf

http://www.nhsconfed.org/PressReleases/Archive/2013/Pages/confed-employers-comment-spending-review-2013.aspx

http://www.nhsconfed.org/PressReleases/Archive/2013/Pages/confed-employers-comment-spending-review-2013.aspx



50


6.7 The NAO reports that this is the seventh year running that a surplus has been

recorded across the NHS. By sector, they find that the foundation trust sector

had an overall surplus of £492 million, the primary care trust (PCT) sector had

a surplus of £678 million and NHS trusts had a surplus of £100 million.

However, without additional funding these figures drop to an overall PCT

surplus of £614 million and an overall NHS trusts deficit of £102 million. One

PCT reported a deficit of £12 million, 20 foundation trusts reported deficits

that total £159 million and five NHS trusts reported deficits that total £139

million. Without additional funding, this changes to 13 PCTs with a total

deficit of £146 million and 23 NHS trusts with a total deficit of £320 million.

6.8 The NHS therefore continues to show a wide gap between the biggest

deficits and surpluses. The financial shortfall for some trusts is significant and

the NAO notes that there are reported deficits exceeding £30 million a year.

This is particularly concerning for NHS trusts, which are required to report a

balanced budget, and should still, in the main, be on a path towards

becoming a foundation trust. It is highlighted that this will be a difficult

challenge with the average balance, without additional funding, being a

deficit of £1 million and some trusts with deficits in excess of £40 million

without support. The total financial support to the NHS trust sector last year

was £203 million, compared with only £123 million last year. There were 15

NHS trusts receiving financial support year-on-year.

6.9 According to Monitor there were 16 foundation trusts in deficit by the end of

2012/13, one more than last year.53 The total deficit for this sector was £143

million, an increase from the 2011/12 total deficit of £105 million. Five trusts,

all outside London, account for the majority of the deficit (approximately

£111 million). The report also shows that the earnings before interest, tax

and depreciation and amortisation (EBITDA) margins of organisations across

the NHS have declined over the last five years because of the financial

pressure on the foundation trust sector. EBITDA margins indicate the

underlying financial sustainability of an organisation and can act as a good

proxy for operating efficiency. EBITDA margins were marginally ahead of plan

but fractionally below those of 2011/12. Margins remained depressed

partially due to a shortfall in delivered cost improvement plans of £14.8

million. The foundation trust sector has seen the average EBITDA margin drop

53

Monitor, Performance of the Foundation Trust sector Year ended 31 March 2013, www.monitor.gov.uk/sites/all/modules/fckeditor/plugins/ktbrowser/_openTKFile.php?id=37674

http://www.monitor.gov.uk/sites/all/modules/fckeditor/plugins/ktbrowser/_openTKFile.php?id=37674

http://www.monitor.gov.uk/sites/all/modules/fckeditor/plugins/ktbrowser/_openTKFile.php?id=37674

51


from 6.1 per cent in 2011/12 to 6.0 per cent last year. Monitor would usually

expect trusts to have a margin above 5 per cent of income to be licensed as a

foundation trust.

6.10 Monitor has reviewed the annual plans of the 145 NHS foundation trusts

authorised prior to 31 April 2013. The report based on the 2013/14 Annual

Plans was published in July.54 At the end of 2012/13 NHS foundation trusts

had accumulated £4.5 billion in cash and the report shows that trusts plan to

invest almost £1 billion of it this year. Total planned capital expenditure of

£2.6 billion is 50 per cent higher than the actual spend in 2012/13 as the

sector looks to build capacity, undertake strategic development and invest in

improving and modernising the estate.

6.11 Monitor said: "This year, foundation trusts report that opportunities for

traditional Cost Improvement Plans (CIPs) are increasingly depleted. This is

reflected both in the disappointing under-delivery against plan in 2012/13

(21 per cent lower than expected) and in lower levels of planned CIPs over

the next three years. There is little evidence at this stage to suggest that

delivery of CIPs might be expected to improve over the period. This could

mean that actual delivered CIPs are at or below 3 per cent in 2015/16."

6.12 Monitor's report forecasted that CIPs for 2013/14 are 3.9 per cent (compared

to plan of 4.3 per cent and delivery of 3.4 per cent in 2012/13). However,

there are likely to be further pressures for investment in clinical staff to

address capacity issues, for example, A&E and emerging quality and patient

care issues as a result of the Francis55 and Keogh56 reports.

6.13 Monitor's Annual Plan Review reports that "ongoing efficiencies are

becoming harder to deliver as one-off savings such as cuts in management

costs start to slow." There is a widespread recognition that fundamental

change is needed to address financial pressures in the coming years. This will

require employers to devise ways of driving productivity and quality

improvements through service transformation and development of new

patient pathways.

54

Available from Monitor’s Board papers here: www.monitor.gov.uk/about-monitor/what-we-do/publication-scheme-guide-the-information-we-publish/monitor-board-papers/bo-18 55

http://www.midstaffspublicinquiry.com/report 56

www.nhs.uk/NHSEngland/bruce-keogh-review/Documents/outcomes/keogh-review-final-report.pdf www.nhs.uk/NHSEngland/bruce-keogh-review/Pages/published-reports.aspx

http://www.monitor.gov.uk/about-monitor/what-we-do/publication-scheme-guide-the-information-we-publish/monitor-board-papers/bo-18

http://www.monitor.gov.uk/about-monitor/what-we-do/publication-scheme-guide-the-information-we-publish/monitor-board-papers/bo-18

http://www.midstaffspublicinquiry.com/report



http://www.nhs.uk/NHSEngland/bruce-keogh-review/Pages/published-reports.aspx

52


6.14 A sign that part of the NHS is struggling under financial pressures was the

announcement in August that under pressure A&E departments will receive

an additional £500 million over the next two years to ensure they are

adequately prepared for winter pressures.

6.15 The NHS Confederation acknowledged that this additional resource would be

useful to the service but Chief Executive, Mike Farrar, said:

"We need the system working together to tackle the challenges we are

facing if we are to get a longer-term solution. This money must be used to

help divert work away from hospitals as well as to compensate trusts fairly for

the extra work they are undertaking."

Draft plans to recalculate the value of public sector pensions

6.16 The HM Treasury's recently circulated consultation paper on draft directions

to recalculate the value of public sector pensions raises a new and very

significant financial pressure for the NHS. The NHS Employers organisation

appreciates that these are draft directions but, if unchanged, independent

actuaries have calculated it would result in additional costs of around £1.7

billion from 2015. It is clear that this would be unaffordable for the NHS.57

6.17 A contribution increase for employers of this magnitude could destabilise the

national arrangements that have only recently been agreed to take forward

the Hutton proposals on public sector pensions. If these draft valuation

directions are not amended, the contribution increases which will be

implemented from 1 April 2015 will severely influence the running of the

NHS and will significantly damage the quality and quantity of patient care.

6.18 This is on top of the additional cost pressures facing NHS organisations as a

result of the changes to state pensions58 that will now be introduced in 2016.

This is likely to result in a significant cost pressure.

6.19 NHS organisations have consistently reported that the financial situation

facing their organisations is very serious. Most expect pressures to increase

over the next three years. The NHS needs to make tough choices to

57

www.nhsemployers.org/SiteCollectionDocuments/Consultation%20response%20on%20valuation%20directions%20FINAL.pdf 58

www.nhsemployers.org/PayAndContracts/NHSPensionSchemeReview/LatestNews/Pages/State-pension-reform-announcement.aspx

http://www.nhsemployers.org/SiteCollectionDocuments/Consultation%20response%20on%20valuation%20directions%20FINAL.pdf


http://www.nhsemployers.org/PayAndContracts/NHSPensionSchemeReview/LatestNews/Pages/State-pension-reform-announcement.aspx

http://www.nhsemployers.org/PayAndContracts/NHSPensionSchemeReview/LatestNews/Pages/State-pension-reform-announcement.aspx

53


guarantee the delivery of safe, effective and sustainable health services in the

years to come.

6.20 These choices can only be made by being open and honest about NHS

finance and involving patients, the public, government and politicians in the

national debate about the tough choices ahead.

Pay bill

6.21 The Department of Health's pay bill metrics show that the aggregate pay bill

for all HCHS doctors (excluding locums) increased by 2.6 per cent in 2012/13.

6.22 The revised 'headline pay bill growth drivers' (see Annex G1) shared by the

Department of Health provides sufficient detail to identify the pay elements

which contribute to the change. NHS Employers welcomes the increased

detail available in the revised metrics. This makes it possible to better

understand the drivers of pay drift.

6.23 It is important to have an understanding of the component drivers of pay drift

as well as the net position. The net position may give false confidence, if the

temporary factors mitigating pay bill growth in the short term do not

continue in the future.

6.24 The metrics show that the 2.6 per cent growth in pay bill was in large part

(2.0 percentage points) due to a growth of this workforce. The remaining 0.6

percentage points represent pay drift – an increase in the cost per unit of

staff. This is partially due to a shift in the staff group mix (0.4 per cent)

towards a more senior/ experienced workforce.

Incremental drift

6.25 In its 41st report, the DDRB commented that the effect of incremental

progression was more than offset by the combined effects of other factors

such as staff turnover and changes of the mix in medical grades, though the

effects of these individual changes could not be separately identified.

6.26 The revised metrics show that 0.4 percentage points of the pay bill growth in

2012/13 is due to basic pay drift.59 Basic pay drift includes the effect of

59

Basic Pay per FTE drift (Excluding the staff group mix impact). In 2012/13 the staff group mix impact was estimated to be 0%. Department of Health, Estimated Headline Pay bill Growth Drivers – Total HCHS non-medical staff, July 2013.

54


incremental progression, and the changing distribution of staff across pay

points and grades on the average basic pay per full-time equivalent (FTE).

6.27 Employers believe the most significant driver of this pay bill growth is

incremental pay progression. Although at present the Department of Health

(DH) metrics do not isolate the precise cost of incremental progression, a DH

supplementary analysis estimates the specific cost pressure associated with

incremental progression is around 2 per cent per year for both the

non-medical and medical workforce.60

6.28 The full impact of incremental progression is not evident in the basic pay per

FTE metric as it is offset by negative pressures such as the changing

distribution of staff across pay points.

6.29 As the full costs of incremental progression are not visible in the bottom line,

it is easy to underestimate their contribution to the ever increasing pay bill.

Employers feel that the increased investment in the pay bill to fund

incremental progression is not commensurate with improved performance or

productivity. Employers would prefer a pay system where increasing

investment in the pay bill was used to incentivise these improvements.

6.30 There is an opportunity cost for each pound spent on incremental progression

to be spent in an alternative way which improves value for money for the

taxpayer and/or improves the care that patients receive. For example, money

could be invested in contract reforms to support service delivery reforms.

Equilibrium between incremental progression and turnover

6.31 It might seem reasonable to suggest that turnover offsets the cost of

incremental progression, as there will be a theoretical point of equilibrium

where the savings from turnover (the most highly paid and experienced

workers being replaced by lesser experienced and lower paid workers as they

retire) perfectly offset the increased pay bill costs due to annual payment of

increments. It is rare for this point of equilibrium to be reached, and if it is, it

is by coincidence rather than design. This is because the medical pay

structures have no mechanism to reach or maintain zero incremental drift.

Keeping the cost of incremental drift close to zero is entirely dependent on

turnover levels and staff distribution. As turnover is currently low, as it often

60

Department of Health, HCHS Pay bill Metrics & Pay bill driver quantifications, July 2013.

55


is in times of economic uncertainty, the cost of increments is outweighing any

savings from turnover.

6.32 Whilst staff reaching the top of their band reduces the cost pressure caused

by incremental progression, the basic pay bill is not likely to reduce unless

turnover significantly increases.

6.33 The current basic pay per FTE drift (excluding the impact of the staff group

mix) of 0.4 per cent shows that at present the medical workforce is not at a

point of equilibrium, and current turnover levels are too low to entirely offset

the increased costs caused by incremental progression.

6.34 Given the present distribution of staff across the pay scales, even if the DDRB

recommends, and government agrees to, no uplift, employers can expect to

see their pay bill increase in 2014/15.

Consultant pay growth

6.35 The Department of Health's pay bill metrics show that the aggregate

consultant pay bill grew by 2.9 per cent in 2012/13. This was primarily down

to a growth in the consultant workforce of 3.3 per cent. With the consultant

pay bill growing at a slower rate than the workforce, the pay bill per FTE has

reduced by 0.4 per cent. Annex G2 (from the DH headline HCHS pay bill

metrics) details the contribution of changes to each of the pay elements to

the reduction in pay bill per FTE.

6.36 NHS Employers has been concerned that historically low pay drift has not

always been an indicator of a pay system in balance, but often a result of

factors temporarily suppressing pending pay bill growth.

6.37 NHS Employers supplementary analysis of consultant pay growth provides an

illustration of the contribution of incremental progression to pay bill costs

which is consistent with the overall magnitude of basic pay bill growth

described in the Department of Health's pay bill metrics. This supplementary

analysis uses the terms described in the DH HCHS pay pressures terminology

guide for consistency.

6.38 The basic pay per FTE drift of 0.0 per cent could give the impression that the

consultant contract is in a steady state. However, the increasing cost of the

pay bill due to the cost of paying incremental progression is entirely offset

56


through savings from replacing workers who leave from the top of the pay

scale, with workers near the bottom of the scale.

6.39 Our analysis (see Annex H) demonstrates that the situation is more complex

than this. At present, turnover levels alone are insufficient to entirely offset

growth to the pay bill due to incremental progression. The other factor which

is temporarily offsetting any increases to basic pay per FTE is growth of the

consultant workforce. Newly qualified consultants joining the workforce at

the bottom of the pay scales, provides a downward pressure on pay drift by

reducing the average basic pay.

6.40 Should the workforce growth not continue, all other things being equal, basic

pay per FTE will increase. Long-term continued growth of the consultant

workforce is financially unsustainable. Without the workforce growth

between September 2011 and September 2012, basic pay per FTE would

have otherwise have increased by 0.3 per cent.

6.41 NHS Employers estimates the component parts of basic pay drift in Figure 9.

Annex H provides additional detail on what each driver includes, and how

these estimates were derived.

Figure 9. Net effect of incremental progression, joiners, leavers and workforce growth

Basic pay drift drivers Impact of driver on

basic pay per FTE

Incremental progression 1.0%

Joiners vs leavers experience balance -0.7%

Workforce growth -0.3%

Total 0.0%

57


Total reward and pensions in the NHS

7.1 The purpose of the reward package in the NHS, as for any employer, is to

ensure the recruitment and retention of the appropriate numbers of staff, the

appropriate skill and knowledge mix among the staff and the correct quality

of application of that skill and knowledge at the correct place and time, to

provide the services required. While economic conditions have effects on the

labour market and on overall affordability, the level of earnings need to

reflect this purpose.

7.2 Staff in the NHS enjoy a range of valuable benefits beyond their current

earnings. Arrangements in the NHS provide one of the most generous

pensions available.

7.3 The NHS reward package remains highly competitive when account is taken

of pay and the employers' 14 per cent of pensionable earnings contribution

to their pension. It is a valuable recruitment and retention package. In

addition doctors and dentists enjoy other valuable employment benefits such

as:

flexible early retirement provision from age 55

life insurance of twice their annual pay and generous death benefits for

widows/widowers and dependents/children

up to 34 days' annual leave compared with 28 day statutory

requirements

7. Pensions and total reward

58


sick pay of up to six months' full pay and six months' half pay, compared

with statutory sick pay of less than £90 per week for up to 28 weeks

redundancy arrangements that pay up to two years' salary with a

maximum of 24 years' reckonable service

maternity pay of eight weeks' full pay, 18 weeks of half of full pay, 13

weeks of statutory maternity pay and an optional 13 weeks' unpaid leave

supporting professional activities (SPA) time for training and development

postgraduate training programmes.

7.4 During periods of pay restraint, it is all the more important that the full value

of the reward package is transparent and clearly explained to staff. This has

led to a renewed interest among employers in the NHS to a total reward

approach.

Total reward strategy

7.5 Up to now, NHS organisations have essentially been administrators of a

national system with pay and terms and conditions of service determined

through national collective bargaining. As a result of this there is the need to

develop capacity and capability at a local level to develop reward strategies

that underpin service delivery and deliver key benefits against the level of

investment.

7.6 As the pressures on financial resources, as described in section 6, continue with a

clear need to maximise the level of return against the pay bill it is clear that a one

size fits all approach has a limited application. By adopting a total reward

approach employers can better communicate the value of the entire employment

package and develop rewards that staff value. The NHS Employers organisation

has identified five areas of work that will enable HR professionals in the NHS

achieve a more strategic approach to reward. These are:

education and training

establishing an employer reward network

developing tools and products

establish a collaborative approach to work across a number of work

streams

gather and share intelligence.

59


7.7 A toolkit of resources is being developed which will enable HR directors to

deliver a more strategic approach to pay and reward. The first part of this

toolkit focuses on how to develop a local reward strategy and will be

published in the autumn of 2013.

Total reward statements

7.8 In the final report of the Independent Public Service Pensions Commission61

(IPSPC) published in March 2011, Lord Hutton made it clear that all members

of public service pension schemes should receive regular benefit statements.

This recommendation has recently been reinforced by the Public Service

Pensions Act 201362 which sets out that the scheme manager is required to

provide benefit information statements to each person in pensionable service.

7.9 NHS Employers has been working with the NHS Business Services Authority

on the introduction of an electronic version of a benefit statement that

extends beyond the basic requirement of providing pension benefit

information and includes details of pay and other reward benefits for all staff

as a total reward statement (TRS). Employer views have been taken into

consideration both in terms of statement design and implementation.

Pilots

7.10 As part of the TRS project, two pilot exercises have been run. The first pilot

involved two NHS organisations and was primarily aimed at seeking feedback

from staff on how they viewed a benefit statement. The second exercise

extended to 15 NHS organisations and covered 85,000 employees and tested

the online technical solution.

7.11 The second pilot has now been fully evaluated and feedback was sought

from employees and employers through a variety of mechanisms including

online surveys, telephone interviews and feedback sessions. This feedback is

largely positive with all employers stating that the statements either met or

exceeded their expectations. The TRS is a key communication tool that can be

used to successfully engage with staff on a range of issues and benefits

considered important by them.

61

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/207720/hutton_final_100311.pdf 62

www.legislation.gov.uk/ukpga/2013/25/contents

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/207720/hutton_final_100311.pdf

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/207720/hutton_final_100311.pdf

http://www.legislation.gov.uk/ukpga/2013/25/contents

60


7.12 The main rollout of the TRS to all eligible staff through a controlled release of

statements will commence in 2014. Employers will have the opportunity to

develop over time additional local benefits which can be communicated

through the TRS.

Developments on NHS Pensions

7.13 A key feature of the NHS reward package is access to the NHS Pension

Scheme (NHSPS). The NHSPS is an occupational scheme backed by the

Exchequer. All eligible members of staff are contractually enrolled into the

scheme at the point of entry into NHS employment. However, membership is

not compulsory and members are free to opt out of the scheme at any time.

7.14 Employer contributions into the NHSPS are currently set at 14 per cent of

pensionable pay. This rate is determined as part of a funding methodology

applied by the scheme actuaries. The pensionable payroll for the financial

year 2012/13 was £39.38 billion. Using this figure the employer contributions

into the NHSPS for 2012/13 amounted to approximately £5.51 billion.

7.15 The pension scheme is highly valued by NHS employees. However, research

indicates that consideration of pension benefits does not feature largely in

retirement decisions63 in part explaining why the age distribution of doctors

has not changed (as referred to at paragraph 5.16). Employers also recognise

the value of the NHSPS in respect of recruitment and retention. Total scheme

membership is currently running at approximately 85 per cent of the NHS

workforce.

7.16 A small number of NHS staff are not eligible to join the NHSPS. This is

primarily due to the fact that they are already in receipt of benefits from the

scheme or have reached retirement age with preserved benefits. Access to an

alternative scheme is now provided through the automatic enrolment

provisions introduced by the Pensions Act 2008 and 2011.

7.17 The NHSPS is currently subject to a major reform programme, details of which

are outlined below. However, it will continue to be a defined benefit scheme

with contributions made by both the individual and the employer.

63

NHS Working Longer Review – Audit of existing research, University of Bath 2013.

61


NHS Pension Scheme reform agenda

7.18 Following the publication of the recommendations from the Independent

Public Service Pensions Commission (IPSPC) in March 2011 a full review of

public service pensions has been carried out. For the NHS this review has

resulted in:

a three year programme of increased employee contributions, resulting in

an average employee contribution rate of 9.8 per cent by 2014/15,

representing an increase of 3.2 percentage points

a revised scheme design to be introduced in April 2015 based on career

average earnings

the linking of normal pension age to state pension age applicable to both

active and deferred members with a minimum normal retirement age of

65

new governance arrangements to support the NHSPS

a revised employer cost cap set at 2 percentage points above and below

the employer contribution rates calculated through a full actuarial

valuation

a shift away from Retail Price Index (RPI) to Consumer Price Index (CPI) for

the purpose of indexation

further changes to the pensions tax relief provisions.

Increased employee contributions

7.19 In April 2014 employee contributions to the NHSPS will increase for the third

year. The proposal setting out the level of these increases is set out Annex E

of the proposed final agreement64 for the NHSPS and are summarised in

Figure 10.

64

Reforming the NHS Pension Scheme for England and Wales – proposed final agreement, 9 March 2012.

https://www.gov.uk/government/publications/reforming-the-nhs-pension-scheme-for-england-and-wales-proposed-final-agreement

62


Figure 10. Proposed contribution rates65

Full-time Pensionable pay

2010/11 contribution rate (gross)



Proposed 2014/15 contribution rate (gross)

Up to £15,000

5.0% 5.0% 5.0% 5.0%

£15,000–£21,175

5.0% 5.0% 5.3% 5.6%

£21,176–£26,557

6.5% 6.5% 6.8% 7.1%

£26,558– £48,982

6.5% 8.0% 9.0% 9.3%

£48,983– £69,931

6.5% 8.9% 11.3% 12.5%

£69,932– £110,273

7.5% 9.9% 12.3% 13.5%

Over £110,273

8.5% 10.9% 13.3% 14.5%

Introduction of new scheme 2015

7.20 The new NHS Pension Scheme will be implemented with effect from 1 April

2015. This new scheme will replace the current 1995 and 2008 sections

except where protection applies.

7.21 The key features for the new scheme post 2015 are outlined in the

'Reforming the NHS Pension Scheme for England and Wales – proposed final

agreement' published on 9 March 2012.66 They include:

a pension scheme design based on career average earnings

65

Figure 10 notes: 1. The full time pensionable pay figures have not been uplifted for pay awards during this period 2. All contributions are shown gross and therefore will be subject to tax relief. For 2014/15 the contribution changes range from zero to 1.2 percentage points of pensionable earnings, contributing to an overall increase of up to 6.0 percentage points over three year. From 2015 the average contribution rate for employees will continue to be 9.8%. 66

Reforming the NHS Pension Scheme for England and Wales - proposed final agreement https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/216219/dh_133003.pdf

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/216219/dh_133003.pdf

63


an accrual rate of 1/54th of pensionable earnings each year with no limit

to pensionable service

protection of the accrued rights of current NHSPS members

additional protection of future benefits for those members within ten

years of their current normal pension age (as at 1 April 2012). Further

limited protection with linear tapering is available to members in the

1995 section of the scheme who are within a further three years and five

months of their current normal pension age, up to 13 years and five

months from their current normal pension age

revaluation of active members' benefits in line with CPI plus 1.5 per cent

per annum

a normal pension age (NPA) equal to state pension age (SPA), which

applies to both active and deferred members (new scheme service only)

pensions in payment to increase in line with CPI

benefits to increase in any period of deferment in line with CPI

member contributions on a tiered basis to produce a total yield of 9.8 per

cent of total pensionable pay in the NHSPS

the current flexibilities within the 2008 section of the scheme relating to

early/late retirement factors, draw down of pension on partial retirement

and return to the NHSPS to be retained in the 2015 scheme.

7.22 The comparison of the benefits in the new scheme with those in the 1995

and 2008 sections of the existing scheme is set out in Figure 11.

64


Figure 11. Comparison of scheme benefits

Benefit Officers

Section/ scheme

1995 2008 2015

Benefits at retirement

Final salary

Based on the best of the last three years of pensionable pay

Final salary

Based on the average of the best three consecutive years pensionable pay in the last 10 years (reckonable pay)

Career average re-valued earnings. (CARE) Re-valued by CPI +1.5%

Retirement lump sum

3 x pension plus option for further commutation up to HMRC limit

Optional 12:1 commutation up to HMRC limit

Accrual rate 1/80th 1/60th 1/54th

Normal pension age

60 (55 for special classes)

65 SPA

Death in service

2 x pensionable pay or average annual earning

2 x reckonable pay or average annual earnings

7.23 To help illustrate the impact of these scheme changes we have published a

series of examples67 for both the 1995 and 2008 sections of the current

scheme (see Figure 11).

7.24 Scheme rules are being developed in partnership by trade unions, NHS

Employers and the Department of Health to support the implementation of

the new scheme.

Valuation directions

7.25 In June 2013 HM Treasury launched an informal consultation on 'The Public

Service Pensions (Valuations and Employer Cost Cap) Directions 2013'. These

directions have two specific purposes:

to determine the employer contribution rate

67

Pension Scheme proposed changes Illustrative examples of the effect on scheme members’ benefits www.nhsemployers.org/SiteCollectionDocuments/NHS%20Pension%20Scheme%20change%20illustrations%20FINAL.pdf

http://www.nhsemployers.org/SiteCollectionDocuments/NHS%20Pension%20Scheme%20change%20illustrations%20FINAL.pdf



65


to specify the operation of the employer cost cap mechanism.

7.26 NHS Employers, in responding68 to these draft directions, identified the

potential financial impact on NHS organisations should they be implemented.

Based on the draft valuation directions we estimate that contributions to

remove the past service deficit alone could result in an increase of employers

contributions of approximately 4 percentage points.

7.27 Since each 1 percentage point of employer contributions represents

approximately £400 million per year across the entire pay bill, the increased

cost pressure across the NHS will be approximately £1.7 billion.

7.28 The impact of a 4 per cent increase in pension contributions on forecasted

employer contributions for the whole NHS is shown in Figure 12 and for four

example NHS organisations in Figure 13.

Figure 12. The impact of a 4 per cent increase in employer contributions

NHS Pension Scheme receipts – Employers contributions (£billion)

Outturn Forecasts

2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2016/18

Employers

contribution

14%

5.5 5.5 5.6 5.7 5.8 6.0 6.2

18% from

2015/16 5.5 5.5 5.6 5.7 7.5 7.7 8.0

Total

(£billion) - - - - 1.7 1.7 1.7

68

NHS Employers Response to Her Majesty's Treasury’s (“HMT”) consultation on draft directions

www.nhsemployers.org/SiteCollectionDocuments/Consultation%20response%20on%20valuation%

20directions%20FINAL.pdf



66


Figure 13. The impact of a 4 per cent increase in employer contributions on individual NHS organisations

Organisation

type

Annual

turnover (£M)

No of

employees

Paybill (£m/%

of turnover)

Value of

potential

increase in

employers

pension

contributions

(£m)

Large foundation

trust £970 13,000 £570 / 60% £15

This increase represents a recurring cost pressure of 1.55%

Large/medium

NHS trust £425 6,000 £270 / 63.5% £7.2


Mental health

foundation trust £220 3,600 £129 / 58.6% £4.2


Ambulance trust £205 3800 £145 / 70.7% £4.0


7.29 Such an increase would come at a time when NHS organisations are facing

significant financial challenges arising from:

ongoing efficiency requirements

the impact of the tariff deflator

increasing costs of new technologies, therapies and drugs

increased requirements and expectations of patients, carers and the

public

more people living longer with multiple health dependencies requiring

complex care packages.

67


7.30 The increase arising from these draft directions, if implemented from 1 April

2015, will severely influence the running of the NHS and have a significant

impact on service delivery.

The Working Longer Review

7.31 A key feature of the proposed final agreement referred to at paragraph 7.21

is the link between normal pension age and state pension age. The 2008

scheme increased the NPA to 65 years old. It is too soon to know the impact

of this. The proportions of the consultant workforce by age range remain

roughly the same as we noted at paragraph 5.16.

7.32 A tripartite review, by Department of Health, NHS Employers and trade

unions, is considering the impact on service delivery and on employees of

working beyond 60 years of age becoming more common. The review has:

established base data from a variety of sources including NHS Pensions

and the NHS Information Centre

audited existing academic research69 (through the University of Bath)

issued a call for evidence inviting interested parties to submit evidence

relating to employment practice, particularly in relation to:

o what happens in organisations that makes it easier for people to stay

longer in work

o what makes working longer more difficult and why

o issues that affect particular groups of staff

o what could be changed to support people working longer.

7.33 The call for evidence closed on the 5 September 2013 and initial

recommendations from the review will be submitted to the Department of

Health later in 2013.

69

NHS Working Longer Review Audit of existing research www.nhsemployers.org/SiteCollectionDocuments/NHS%20WLR%20-%20Audit%20of%20existing%20research.pdf June 2013.

http://www.nhsemployers.org/SiteCollectionDocuments/NHS%20WLR%20-%20Audit%20of%20existing%20research.pdf

http://www.nhsemployers.org/SiteCollectionDocuments/NHS%20WLR%20-%20Audit%20of%20existing%20research.pdf

68


Access review

7.34 Membership of the NHSPS has long being considered a barrier to

competition for service contracts in the NHS as staff are reluctant to move

out of NHS employment and lose their membership of the scheme and access

to ongoing pension benefits.

7.35 Under the terms of the proposed final agreement there has been a review into the

access to the scheme. Recommendations have been made that, if accepted and

implemented, would see eligibility for membership to the NHSPS extended to private

sector organisations who are providing NHS services under the standard NHS

contract. These recommendations are awaiting Ministerial approval.

Scheme membership

7.36 The membership statistics for the NHSPS are published in the scheme

resource accounts.70 Figure 14 summarises current active membership and

in-year movements.

Figure 14. NHS Pension Scheme membership selected statistics

Active members as at 1 April 2012 1,303,714

New entrants 107,797

Deferred members who rejoin in the year 51,004

Re-employed pensioners 78

Retirements (29,820)

Leavers with deferred pension rights (89,753)

Members who op-out with deferred pension rights (18,792)

Deaths (798)

Active members as at 31 March 2013 1,323,430

The impact of automatic enrolment

7.37 The Pensions Acts of 2008 and 2011 places new duties on employers to

automatically enrol eligible job holders into a qualifying pension scheme. This

forms a key part of the Government's strategy to encourage individuals to

make greater financial provision for their retirement. The process of

automatic enrolment commenced for the largest NHS trusts in March 2013

and will largely be concluded by the end of September.

70

NHS Pension Scheme (Incorporating the NHS Compensation for Premature Retirement Scheme)

Accounts 2012–13

69


7.38 Following consultation with trade unions and NHS employers it was agreed

that as the NHSPS is classified as a qualifying scheme for the purposes of

automatic enrolment it should be used to enrol all eligible workers from the

staging date onwards. NHS trusts have a responsibility to administer a second

scheme to enrol any individual who is not eligible to join the NHSPS.

7.39 The level of membership varies significantly across the NHS. Whilst in principle

the NHS Employers organisation supports this direction of travel, it increases

financial pressure on employers. The current estimate from the Government

Actuary's Department is that it adds approximately £140 million of costs

across the NHS. Failure to comply with the requirements of automatic

enrolment can give rise to significant financial penalties amounting to

£10,000 per day.

7.40 Since March 2013 scheme membership has increased and the level of opt

outs has decreased.

Introduction of a single tier state pension 2016

7.41 The introduction of a single tier state pension with effect from 2016 was

confirmed in the 2013 Budget. This will replace the state second pension and

the contracting out provisions. These provisions extend to members of the

NHSPS on the basis that they are giving up an element of entitlement in

return for the provision of a broadly similar defined benefit occupational

pension. As a consequence National Insurance contributions will be

standardised.

7.42 The end of contracting out will have both cost and administrative implications

for employers. From April 2016 employers will pay the standard rate of

National Insurance contributions which will result in an increase of 3.4

percentage points for each contracted-out employee. Current estimates set

this figure at £800 million. The Department for Work and Pensions considers

that many employers will be able to offset these additional costs by reducing

future pension benefits or by increasing employee contribution rates.71 This is

clearly not the case for NHS organisations. Individual employers have limited

ability to influence the design of the NHSPS. For the NHS the only financially

neutral option is to reduce employer contributions through having fewer staff

or the same number of staff being paid less pa

71

Department for Work and Pensions, The single-tier pension: a simple foundation for saving January 2013.

70

The NHS Employers organisation’s submission to the Doctors’ and Dentists’ Review Body 2014/15

Annex A. 2012 NHS Staff Survey results

1. Engagement and job satisfaction

Table 1a Percentage of staff who are satisfied or very satisfied with

their pay

Change

(since

2011)

2008 2009 2010 2011 2012

All NHS staff (inc.

medics) 34

w 38

w 40

w 38

w 38

w 0

Medical / dental staff in

all trusts 51 53 59 57 56 -1

Medical / dental (in

training) in all trusts 43 40 50 53 52 -1

Medical / dental

(consultants) in all trusts 63 63 68 63 63 0

Medical / dental (other)

in all trusts 35 33 46 43 44 1

Annexes

Annexes

71


Table 1b Staff job satisfaction Change

(since

2011)

2008 2009 2010 2011 2012

All NHS staff (inc.

medics) 3.51

3.50

w 3.51

w 3.49

w 3.58

w 0.09

Medical / dental staff

in all trusts 3.55 3.56 3.59 3.64 3.67 0.03

Medical / dental (in

training) in all trusts 3.52 3.57 3.62 3.64 3.69 0.05

Medical / dental

(consultants) in all

trusts

3.59 3.59 3.63 3.64 3.67 0.03

Medical / dental

(other) in all trusts 3.51 3.54 3.51 3.58 3.62 0.04

Table 1c Staff Motivation Change (since 2011)

2008n

2009 2010 2011 2012

All NHS Staff (inc. medics)

3.84w

3.81w

3.80w

3.82w

0.02

Medical / dental staff in all trusts

3.97 3.94 3.94 3.95 0.01

Medical / dental (in training) in all trusts

3.93 3.89 3.95 3.92 -0.03

Medical / dental (consultants) in all trusts

4.00 3.97 3.97 3.96 -0.00

Medical / dental (other) in all trusts

4.00 3.94 3.91 3.97 0.06

72


Table 1d Percentage of staff feeling satisfied with the quality of work and patient care they are able to deliver

Change (since 2011)

2008 2009 2010 2011 2012


60 74w

74w

74w

78w

4


73 79 77 77 81 4


74 83 81 81 85 4


68 75 74 73 78 5


79 89 82 84 87 4

Table 1e Percentage of staff agreeing that their role makes a difference to patients

Change (since 2011)

2008 2009 2010 2011 2012


90w

90w

90w

90w

89w

-1


94 96 94 93 94 1


90 100 92 91 93 2


95 100 95 95 95 0


93 100 94 93 94 1

73


Table 1f Percentage of staff agreeing that there are frequent opportunities for them to show initiative in their role

Change (since 2011)

2008 2009 2010 2011 2012


63w

63w

63w

61w

69w

8


64 62 64 66 72 6


63 59 62 63 75 12


72 69 70 69 73 4


55 54 53 55 65 11

2. Patient care and safety

Table 2a Percentage of staff witnessing potentially harmful errors, near misses or incidents in last month

Change (since 2011)

2008 2009 2010 2011 2012


35w 33

w 32

w 32

w 32

w 0


41 41 39 39 44 5


49 50 47 47 48 2


47 50 44 44 50 6


29 26 31 26 29 4

74


Table 2b Fairness and effectiveness of procedures for reporting errors, near misses and incidents

Change (since 2011)

2008 2009 2010 2011 2012


3.41 3.41w 3.44

w 3.45

w 3.50

w 0.05


3.41 3.42 3.46 3.48 3.53 0.05


3.30 3.33 3.41 3.41 3.49 0.08


3.46 3.45 3.50 3.51 3.53 0.02


3.37 3.41 3.42 3.43 3.52 0.10

3. Workload

Table 3 Percentage of staff working extra hours Change (since 2011)

2008 2009 2010 2011 2012


66w

65w

65w

65w

70w

5


75 79 77 79 83 4


78 83 77 77 81 5


83 90 85 87 89 2


64 67 64 67 70 3

75


4. Appraisals

Table 4a Percentage of staff appraised in last 12 months Change

(since

2011)

2008 2009 2010 2011 2012


64w 69

w 77

w 80

w 83

w 3


74 80 79 81 88 6


74 85 75 77 81 4


81 84 82 86 91 5


64 73 76 73 80 6

Table 4b Percentage having well structured appraisals in last 12 months

Change (since 2011)

2008 2009 2010 2011 2012


27w 31

w 34

w 35

w 36

w 1


29 31 34 35 37 2


32 33 36 38 41 4


30 27 33 34 36 1


28 33 34 35 37 2

76


Source: 2012 NHS Staff Surveys Co-ordination Centre, 2012 Results, http://www.nhsstaffsurveys.com/Page/1006/Latest-Results/2012-Results/.

Sources: 2008–2011

Weighted Results: CQC - Archives, NHS staff surveys, http://archive.cqc.org.uk/aboutcqc/howwedoit/engagingwithproviders/nhsstaffsurveys.cfm

Unweighted Results: NHS Staff Surveys Co-ordination Centre, Historical Staff Survey Results, http://www.nhsstaffsurveys.com/Page/1021/Past-Results/Historical-Staff-Survey-Results/

Notes Figures for each medical and dental staff group are response rates to the survey, and are not weighted according to the response rates of each organisation. This means that the true scores for medical and dental staff groups may be slightly different. Similarly, the figures are compared to the unbiased NHS estimates (where available) rather than estimates of the figures for the rest of the NHS (i.e., non-medical staff), as any estimate for the latter would be biased.

n – not available in 2008.

w denotes NHS figures that have been weighted to reflect the varying response rates between organisations so that they reflect unbiased estimates of all NHS staff in England.

http://www.nhsstaffsurveys.com/Page/1006/Latest-Results/2012-Results/

http://archive.cqc.org.uk/aboutcqc/howwedoit/engagingwithproviders/nhsstaffsurveys.cfm

http://www.nhsstaffsurveys.com/Page/1021/Past-Results/Historical-Staff-Survey-Results/

77


Annex B. Summary of 2012 patient survey and staff survey correlations

Staff Survey Questions Patient Survey Questions

Q23 Q24 Q25 Q26 Q27 Q28 Q29 Q30 Q32 Q33 Q35 Q36 Q37 Q40 Q47 Q49 Q56 Q57 Q59 Q61 Q68 Q70 LP

Respect and value at work

Staff who agreed that - I have clear, planned goals and objectives for my job

-0.06 0.12 0.13 -0.10 -0.18 -0.15 -0.17 0.18 0.08 0.19 -0.11 0.25 0.05 0.03 -0.09 -0.03 0.19 0.25 0.09 0.20 0.06 0.24 0.14

Staff who agreed that - There are enough staff at this organisation for me to do my job properly 0.22 0.29 0.39 0.17 0.15 0.24 0.15 0.43 0.34 0.42 0.26 0.33 0.28 0.38 0.06 0.37 0.45 0.48 0.37 0.44 0.39 0.24 0.29

Job satisfaction

Staff who were satisfied or very satisfied with their Level of pay

0.30 0.04 0.12 0.18 0.25 0.33 0.16 0.05 0.21 0.14 0.25 0.10 0.16 0.24 0.22 0.18 0.17 0.12 0.20 0.11 0.19 0.08 1.00

Your managers and organisation

Staff who agreed that the care of patients / service users is my organisation's top priority

0.14 0.31 0.41 0.08 0.03 0.13 0.09 0.42 0.29 0.39 0.21 0.35 0.21 0.28 -0.01 0.23 0.40 0.42 0.33 0.41 0.39 0.30 0.16

Violence, bullying and harassment

Staff who said yes to "Does your organisation act fairly with regard to career progression / promotion, regardless of ethnic background, gender, religion, sexual orientation, disability or age?" 0.28 0.16 0.23 0.22 0.23 0.30 0.26 0.18 0.27 0.23 0.24 0.21 0.22 0.24 0.17 0.23 0.24 0.17 0.25 0.21 0.27 0.11 0.54

Staff who said that they had experienced discrimination from patients / service users, their relatives or other members of the public -0.47 -0.21 -0.25 -0.47 -0.52 -0.54 -0.47 -0.10 -0.37 -0.25 -0.43 -0.07 -0.31 -0.35 -0.33 -0.38 -0.33 -0.16 -0.29 -0.16 -0.35 -0.12 -0.46

Staff who said that they had experienced discrimination from patients / service users, their relatives or other members of the public because of their ethnic background

-0.46 -0.10 -0.16 -0.45 -0.49 -0.53 -0.46 -0.05 -0.27 -0.17 -0.39 -0.03 -0.27 -0.36 -0.38 -0.36 -0.23 -0.07 -0.26 -0.13 -0.30 -0.06 -0.44

Staff who said they had personally experienced physical violence at work from patients / service users, their relatives or other members of the public at least once in the previous 12 months -0.11 -0.26 -0.27 -0.10 0.01 0.02 -0.01 -0.17 -0.18 -0.26 -0.06 -0.15 -0.10 -0.24 -0.06 -0.15 -0.31 -0.29 -0.25 -0.27 -0.15 -0.18 -0.07

Staff who said they had personally experienced harassment, bullying or abuse at work from patients / service users, their relatives or other members of the public at least once in the previous 12 months -0.42 -0.31 -0.41 -0.43 -0.35 -0.44 -0.38 -0.27 -0.40 -0.34 -0.41 -0.16 -0.24 -0.39 -0.26 -0.39 -0.52 -0.32 -0.51 -0.36 -0.42 -0.34 -0.41

Key on page 81 Continued on next page

78


Staff Survey Questions

Patient Survey Questions

Q23 Q24 Q25 Q26 Q27 Q28 Q29 Q30 Q32 Q33 Q35 Q36 Q37 Q40 Q47 Q49 Q56 Q57 Q59 Q61 Q68 Q70 LP

Key findings

KF3. Work pressure felt by staff -0.20 -0.29 -0.38 -0.16 -0.16 -0.25 -0.16 -0.40 -0.34 -0.42 -0.25 -0.33 -0.26 -0.38 -0.09 -0.35 -0.46 -0.46 -0.41 -0.42 -0.40 -0.26 -0.34

KF10. % receiving health and safety training in last 12 months 0.13 0.07 -0.01 0.22 0.17 0.08 0.19 0.02 0.13 0.07 0.07 0.13 0.06 0.13 -0.02 0.11 0.06 0.03 0.16 0.01 0.12 0.12 0.09

KF12. % saying hand washing materials are always available 0.32 0.04 0.13 0.34 0.35 0.44 0.39 0.06 0.25 0.08 0.30 0.11 0.21 0.26 0.36 0.32 0.19 0.02 0.23 0.08 0.25 0.17 0.42

KF15. Fairness and effectiveness of incident reporting procedures 0.09 0.28 0.30 0.14 0.04 0.15 0.05 0.24 0.27 0.36 0.15 0.22 0.15 0.21 0.10 0.25 0.36 0.26 0.32 0.29 0.30 0.21 0.31

KF17. % experiencing physical violence from staff in last 12 months -0.32 -0.15 -0.22 -0.15 -0.19 -0.19 -0.18 -0.16 -0.21 -0.21 -0.19 -0.20 -0.14 -0.21 -0.27 -0.19 -0.22 -0.22 -0.22 -0.24 -0.20 -0.14 -0.22

KF23. Staff job satisfaction -0.19 -0.26 -0.30 -0.14 -0.11 -0.17 -0.14 -0.38 -0.30 -0.34 -0.17 -0.33 -0.22 -0.25 -0.13 -0.24 -0.36 -0.35 -0.32 -0.37 -0.30 -0.28 -0.38

79


Key

Rank correlation is assumed to be significantly non-zero at the 5 per cent level.

Q23 Did you get enough help from staff to eat your meals?

Q24 When you had important questions to ask a doctor, did you get answers

that you could understand?

Q25 Did you have confidence and trust in the doctors treating you?

Q26 Did doctors talk in front of you as if you weren’t there?

Q27 When you had important questions to ask a nurse, did you get answers

that you could understand?

Q28 Did you have confidence and trust in the nurses treating you?

Q29 Did nurses talk in front of you as if you weren’t there?

Q30 In your opinion, were there enough nurses on duty to care for you in

hospital?

Q32 Were you involved as much as you wanted to be in decisions about your

care and treatment?

Q33 How much information about your condition or treatment was given to

you?

Q35 Do you feel you got enough emotional support from hospital staff during

your stay?

Q36 Were you given enough privacy when discussing your condition or

treatment?

Q37 Were you given enough privacy when being examined or treated?

Q40 How many minutes after you used the call button did it usually take

before you got the help you needed?

0.22

80


Q47 Before the operation or procedure, did the anaesthetist or another

member of staff explain how he or she would put you to sleep or control

your pain in a way you could understand?

Q49 Did you feel you were involved in decisions about your discharge from

hospital?

Q56 Did a member of staff tell you about medication side effects to watch for

when you went home?

Q57 Were you told how to take your medication in a way you could

understand?

Q59 Did a member of staff tell you about any danger signals you should

watch for after you went home?

Q61 Did the doctors or nurses give your family or someone close to you all

the information they needed to help care for you?

Q68 Overall, how would you rate the care you received?

Q70 Did you see, or were you given, any information explaining how to

complain to the hospital about the care you received?

LP Percentage of staff who were satisfied or very satisfied with their level

of pay.

81


Annex C

Hospital and community health services medical and dental staff, England, at 30 September, 2002–201272

Grade 2002 2003 2004 2005 2006 2007

HC FTE HC FTE HC FTE HC FTE HC FTE HC FTE

England 1 - Total 77,031 68,260 80,851 72,260 86,996 78,462 90,630 82,568 93,320 85,975 94,638 87,533

Consultant (including Directors of Public Health) 27,070 24,756 28,750 26,341 30,650 28,141 31,993 29,613 32,874 30,619 33,674 31,430

Associate specialists 2

1,780 1,578 2,001 1,780 2,294 2,029 2,554 2,260 2,830 2,495 3,048 2,650

Specialty doctors . . . . . . . . . . . .

Staff grades 5,255 4,799 5,255 4,828 5,467 4,948 5,527 4,966 5,937 5,325 6,055 5,438

Doctors in training and equivalents 3, 4

34,915 33,932 37,320 36,402 41,697 40,654 44,311 43,295 46,269 45,422 46,783 46,051 Registrar group 13,770 13,031 14,619 13,989 16,823 16,112 18,006 17,313 18,808 18,180 30,759 30,175

Foundation Year 2 . . . . . . . . 3,693 3,690 4,830 4,823

Senior House Officer 17,135 16,912 18,698 18,419 20,601 20,283 21,642 21,337 18,863 18,662 5,954 5,849

Foundation Year 1 4,010 3,989 4,003 3,994 4,273 4,259 4,663 4,645 4,905 4,890 5,240 5,203

Other Doctors in Training 5

. . . . . . . . . . . .

Hospital practitioners/Clinical assistants 5,417 1,497 4,984 1,290 4,524 1,164 4,064 1,009 3,522 848 3,272 738 Other staff 2,594 1,698 2,541 1,620 2,364 1,524 2,181 1,426 1,888 1,266 1,806 1,226

Grade 2008 2009 2010 2011 2012

HC FTE HC FTE HC FTE HC FTE HC FTE

England 1 - Total 98,703 91,586 102,961 96,598 103,912 97,636 105,711 99,394 107,242 100,899

Consultant (including Directors of Public Health) 34,910 32,679 36,950 34,654 37,752 35,781 39,088 36,965 40,394 38,197

Associate specialists 2

3,212 2,803 3,536 3,135 3,810 3,343 3,741 3,286 3,540 3,123 Specialty doctors 445 361 3,213 2,691 4,998 4,162 5,850 4,889 6,358 5,349 Staff grades 5,929 5,292 3,309 2,915 1,432 1,213 859 702 623 491

Doctors in training and equivalents 3, 4

49,178 48,298 51,502 51,216 52,147 51,397 52,872 51,993 53,319 52,262 Registrar group 35,042 34,272 37,108 36,700 38,158 37,527 38,891 38,134 39,404 38,489 Foundation Year 2 5,509 5,497 6,015 6,055 6,101 6,080 6,181 6,161 6,200 6,178 Senior House Officer 2,577 2,504 2,015 1,994 1,566 1,520 1,463 1,417 1,359 1,322 Foundation Year 1 6,050 6,025 6,364 6,467 6,240 6,207 6,274 6,234 6,275 6,229 Other Doctors in Training

5 . . . . 139 63 124 48 130 45

Hospital practitioners/Clinical assistants 3,259 938 2,741 803 2,464 561 2,058 448 1,785 388

Other staff 1,770 1,215 1,710 1,185 1,816 1,179 1,699 1,112 1,673 1,089

72 Health and Social Care Information Centre. NHS Staff 2002 - 2012 (Medical and Dental) Bulletin Tables, https://catalogue.ic.nhs.uk/publications/workforce/numbers/nhs-staf-2002-2012-medi-dent/nhs-staf-2002-2012-medi-dent-tab.xlsx.

https://catalogue.ic.nhs.uk/publications/workforce/numbers/nhs-staf-2002-2012-medi-dent/nhs-staf-2002-2012-medi-dent-tab.xlsx

https://catalogue.ic.nhs.uk/publications/workforce/numbers/nhs-staf-2002-2012-medi-dent/nhs-staf-2002-2012-medi-dent-tab.xlsx

82


1 The new headcount methodology is not fully comparable with data for years prior to 2010, due to improvements that make it a more stringent count of absolute staff numbers. Further information on the headcount methodology is available in the Census publication. Headcount totals are unlikely to equal the sum of components.

2 Negotiations between NHS Employers and The British Medical Association’s Staff and Associate Specialist Committee resulted in the creation of the new specialty doctor grade from 1 April 2008.

3 The Modernising Medical Careers (MMC) programme saw the introduction of new training grades, changes in categorisation and re-organisation of training staff.

Evidence of these changes was first reflected in 2007, within the component staff of the doctors in training and equivalents group (particularly Registrar Group and Senior House Officers).

4 Doctors in training and equivalents refers to the registrar group, senior house officer, foundation year 2, house officer & foundation programme year 1, other doctors in training and other staff at these

grades that do not hold an educationally approved training post.

5 Other doctors in training refers to those doctors with an unknown grade or pay scale but with a recognised occupation code indicating they are a doctor in training.

Copyright © 2013, Health and Social Care Information Centre. All rights reserved

Data prior to 2005 reused with the permission of the Department of Health

83


Annex D

Accepted Applications to study Pre-Clinical Medicine and Pre-Clinical Dentistry

Table 1. Accepted Applications to study Pre-Clinical Medicines by UCAS Tariff Score and Year

Year of Entry 2004 2005 2006 2007 2008 2009 2010 2011 2012

Applicants accepted through UCAS 7262 7106 7176 7017 7144 7063 7031 6932 7007

Total Band Distribution for accepted applicants

% % % % % % % % %

Tariff Scores

540 plus 22% 24% 22% 26% 25% 28% 34% 35% 36%

480 to 539 22% 21% 20% 20% 20% 20% 18% 17% 18%

420 to 479 22% 22% 20% 19% 19% 18% 15% 15% 15%

360 to 419 18% 16% 12% 9% 9% 8% 8% 7% 7%

300 to 359 7% 6% 3% 1% 1% 1% 1% 1% 1%

240 to 299 4% 4% 1% 1% 1% 1% 0% 0% 0%

180 to 239 1% 1% 1% 0% 1% 0% 0% 0% 0%

120 to 179 1% 1% 1% 1% 1% 1% 1% 1% 1%

080 to 119 0% 0% 0% 0% 0% 0% 0% 0% 0%

001 to 079 0% 0% 1% 1% 1% 1% 1% 1% 1%

Non-tariff courses/unknown 3% 4% 21% 21% 21% 22% 21% 22% 20%

Grand total 100

% 100

% 100

% 100

% 100

% 100

% 100

% 100

% 100

%

Average Tariff Score of Applicants accepted through UCAS - Pre-clinical Medicine

375 382 382 387 406 406 417

Average Tariff Score of all Applicants accepted through UCAS

n

223 214 202 207 216 222 259

84


Table 2. Accepted applications to study pre-clinical dentistrys by UCAS tariff score and year

Year of entry 2004 2005 2006 2007 2008 2009 2010 2011 2012 Applicants accepted through UCAS

917 1114 1042 1135 1141 1150 1190 1113 1122

Total Band Distribution for accepted applicants

% % % % % % % % %

Tariff scores

540 plus 15% 15% 12% 17% 16% 19% 22% 24% 26%

480 to 539 19% 19% 20% 18% 20% 19% 18% 18% 18%

420 to 479 26% 26% 27% 23% 23% 22% 21% 19% 22%

360 to 419 26% 25% 21% 15% 16% 14% 14% 8% 11%

300 to 359 8% 6% 5% 1% 2% 1% 1% 1% 1%

240 to 299 3% 3% 1% 1% 0% 0% 0% 1% 1%

180 to 239 1% 1% 0% 1% 0% 0% 0% 0% 0%

120 to 179 1% 1% 0% 1% 1% 1% 1% 1% 0%

080 to 119 0% 0% 0% 1% 0% 1% 1% 1% 0%

001 to 079 0% 0% 0% 1% 1% 1% 0% 0% 0%

Non-tariff courses/unknown 2% 3% 12% 21% 21% 21% 22% 27% 21%

Grand total 100% 100% 100% 100% 100% 100% 100% 100% 100%

Average tariff score of applicants accepted through UCAS- pre-clinical dentistry

396 362 366 371 377 361 392

Average tariff score of all applicants accepted through UCAS

n

223 214 202 207 216 222 259

85


Notes for Tables 1 and 2 UK Home domiciled applicants only.

Sources: Universities and Colleges Admissions Service (UCAS), Data Resources - quals tables, http://www.ucas.com/sites/default/files/annual-data.zip

Tariff (UK home domiciled applicants only): Average tariff by subject: UCAS, Applicant and accepted applicant by tariff band, http://www.ucas.com/data-analysis/data-resources/data-tables/tariff

Accepted applicants by subject: UCAS, Tariff - Accepted applicants – average Tariff scores by subject, http://www.ucas.com/data-analysis/data-resources/data-tables/he-subject

n UK average score calculated by NHS Employers, using an average tariff score by subject weighted by the number of accepted applicants in each grouped subject.

Average Tariff Score of all Applicants accepted through UCAS.

Tariff (2002 entry onwards).

From 2002 entry, the UCAS Tariff replaced Main qualification in UCAS data. The UCAS Tariff establishes agreed equivalences between different types of qualifications, and reports achievement for entry to higher education in a numerical format. This allows comparisons between applicants with different types and volumes of achievement. Tariff data are only available for UK applicants. Details of the UCAS tariff can be found at http://www.ucas.com/how-it-all-works/explore-your-options/entry-requirements/ucas-tariff. s - Subject group (JACS).

UCAS subject classification employs the Joint Academic Coding System (JACS). JACS, introduced for 2002 entry, replaces UCAS' Standard Classification of Academic Subjects (SCAS), which was used up to and including 2001 entry. Where applicants apply to more than one subject area, the subject group listed most frequently on the application form is counted (preferred subject). A full list of JACS codes can be found in http://www.hesa.ac.uk/index.php?option=com_studrec&task=show_file&Itemid=233&mnl=07051&href=jacs2.html.

http://www.ucas.com/sites/default/files/annual-data.zip

http://www.ucas.com/data-analysis/data-resources/data-tables/tariff

http://www.ucas.com/data-analysis/data-resources/data-tables/he-subject

http://www.ucas.com/how-it-all-works/explore-your-options/entry-requirements/ucas-tariff

http://www.hesa.ac.uk/index.php?option=com_studrec&task=show_file&Itemid=233&mnl=07051&href=jacs2.html

86


Applications to study pre-clinical medicine and pre-clinical dentistry by gender

Table 3. Applicants and accepted applications to study pre-clinical medicine by gender and year of entry

Year of entry

Applicants Accepted applicants Ratio of applicants to accepted applicants

Female Male Total Female Male Total Female Male Total 2004 8142 6133 14275 4347 2915 7262 1.9 2.1 2.0

2005 8713 6924 15637 4138 2968 7106 2.1 2.3 2.2

2006 8477 6771 15248 4218 2958 7176 2.0 2.3 2.1

2007 8490 6602 15092 3940 3077 7017 2.2 2.1 2.2

2008 8264 6573 14837 4001 3143 7144 2.1 2.1 2.1

2009 8199 6661 14860 3887 3176 7063 2.1 2.1 2.1

2010 8903 7476 16379 3860 3171 7031 2.3 2.4 2.3

2011 9154 7826 16980 3729 3203 6932 2.5 2.4 2.4

2012 8853 7513 16366 3704 3303 7007 2.4 2.3 2.3

87


Table 4. Applicants and accepted applications to study pre-clinical dentistry by gender and year of entry

Year of Entry

Applicants Accepted applicants Ratio of applicants to accepted applicants

Female Male Total Female Male Total Female Male Total

2004 956 883 1839 501 416 917 1.9 2.1 2.0

2005 1139 1117 2256 619 495 1114 1.8 2.3 2.0

2006 1187 1046 2233 591 451 1042 2.0 2.3 2.1

2007 1303 1092 2395 649 486 1135 2.0 2.2 2.1

2008 1249 1107 2356 657 484 1141 1.9 2.3 2.1

2009 1425 1192 2617 668 482 1150 2.1 2.5 2.3

2010 1565 1307 2872 701 489 1190 2.2 2.7 2.4

2011 1451 1273 2724 635 478 1113 2.3 2.7 2.4

2012 1389 1125 2514 673 449 1122 2.1 2.5 2.2

Notes for Tables 3 and 4

Sources: Universities and Colleges Admissions Service (UCAS), Data Resources - quals tables, http://www.ucas.com/sites/default/files/annual-data.zip

Accepted applicants are of home domiciled UK applicants only.

a - Applicants naming medicine/dentistry at least once on an application form. These figures include those graduates who have applied for pre-clinical medical and dentistry degree places through UCAS. These

figures do not include students who have applied directly to higher education institutions.

b - The number of applications submitted per applicant changed over the years. From 1989 to 1993, the maximum was 5 applications. In 1994 it rose to 8 applications and was reduced to 6 applications in

1996, although the recommended number for medicine/dentistry remained at 5. In 2000 medicine/dentistry was reduced to 4. In 2008 the number of applications was reduced to 5, whilst medicine/dentistry remained at 4.

s - UCAS subject classification employs the Joint Academic Coding System (JACS). JACS, introduced for 2002 entry, replaces UCAS' Standard Classification of Academic Subjects (SCAS), which was used up to

and including 2001 entry. Where applicants apply to more than one subject area, the subject group listed most frequently on the application form is counted (preferred subject). A full list of JACS codes can be found in http://www.hesa.ac.uk/index.php?option=com_studrec&task=show_file&Itemid=233&mnl=07051&href=jacs2.html.

http://www.ucas.com/sites/default/files/annual-data.zip

http://www.hesa.ac.uk/index.php?option=com_studrec&task=show_file&Itemid=233&mnl=07051&href=jacs2.html

88


Annex E. Retirement data

These figures include all retirements on grounds of age, ill health, premature retirements following redundancy or interests of efficiency of the service and voluntary early retirement (introduced from 6 March 1995). Where possible data is shown separately for each category.

Figure E1: Consultant Retirements and Reasons for Retirement

NHS Pensions73August 2013 Year end 31 March

Age Ill-health

Deferred Pension Benefits

Redundancy

Agreed Voluntary Early Retirement (AVER)

Voluntary Early Retirement (VER)

Unknown

Total Pension Awards

1997 257 57 63 27 * * 35 439

1998 296 51 56 19 * * 36 458

1999 274 57 45 19 * * 38 433

2000 293 55 61 11 * * 29 449

2001 337 67 57 11 * * 37 509

2002 355 67 47 7 * * 37 513

2003 322 60 52 7 * * 40 481

2004 361 57 65 16 * * 49 548

2005 363 49 58 9 * * 54 533

2006 491 52 63 7 4 44 56 717

2007 605 59 58 6 3 77 52 860

2008 669 61 44 9 6 90 50 929

2009 666 41 27 6 81 63 884

2010 822 7 32 1 98 94 1054

2011 1065 5 16 4 172 98 1360

2012 1074 9 50 7 202 105 1447

2013 670 7 18 17 188 80 980

2014 255 1 57 15 328

TOTAL 9175

761 812 184 13 1009 968 12922

* AVER and VER Data for 1997 – 2005 is not separately captured in this extract.

73 Figure E1: The data in this annex must be interpreted with care.

The current extract may not be consistent with previous DDRB extracts due to a number of factors e.g. on-going programme at NHS Pensions to cleanse member records.

Where possible NHS Pensions has reviewed the current and previous extracts for consistency.

89


A number of issues, highlighted below, should be noted:

1). It has not been possible to establish the number of Agreed Voluntary Early Retirements (AVER) in scheme year ends 1997 – 2005 e.g. it is possible that either no AVER’s took place or some AVER’s did take place but are captured in the unknown category.

2). The category ‘unknown’ - NHS Pensions have reviewed a number of individual pension records held under this ategory to establish the types of retirement captured. This review indicates that whilst this category may include all types of retirement the majority of the cases are likely to be death benefit awards.

Additionally the following caveats must be noted:

NHS Pensions administers the scheme for members in England and Wales. The data table reflects consultant retirements. It has not been possible to disaggregate Welsh data for this exercise.

Retirement data held by NHS Pensions is designed primarily to record Scheme membership to allow the calculation and payment of retirement pensions and support periodic actuarial investigations by the Scheme Actuary; to ensure contribution rates will allow the Scheme to meet its' future liabilities. This means that data can only be routinely extracted by individual members, to calculate benefits, or for actuarial groups for valuation.

The NHS Pensions data recording system manages over 1.3 million active records most of which are subject to regular updates year on year. Retirement data will therefore represent a "snapshot" at a given period, which will be subject to change over time.

NHS Pensions introduced a pension processing system in October 2005. The retirement data provided since September 2006, to assist in supporting evidence/guidance for DDRB, represented an extract from this new pension processing system. This system is designed to assist in the daily processing of pension calculations and will in the future support scheme valuation, however development to utilise the system for valuation has yet to be fully defined and validated. The latest information has been amended to reflect the latest extract over retrospective years, but comparisons across the yearly reports is not possible.

Work has been undertaken this year to define the extraction routine used for employment groups and whilst NHS Pensions is confident that the current data extract displays a trend of retirement in the table, this should only be used for guidance. As indicated, this year’s extract may not be consistent with previous extracts due to an on-going program to cleanse member records.

Important information in relation to Data for year-end 2014

When considering trends/patterns of retirements the figures for 2014 should not be included until further updates have been obtained. It is anticipated that these will increase once there is a full financial year’s data available.

90


Annex F. Recruitment and retention premia (RRP) payments to consultants by specialty as at September 2012

Specialty % RRP

Forensic Psychiatry 8.1%

Public Health Medicine 7.4%

Psychiatry of Learning Disability 2.1%

Psychotherapy 2.0%

Medical Microbiology 1.9%

Occupational Medicine 1.8%

Old Age Psychiatry 1.0%

Accident and Emergency 0.7%

General Psychiatry 0.5%

Notes to Annex F:

1. Based on NHS Employers analysis of the ESR data warehouse.

2. All other specialties have fewer than 1 per cent in receipt of an RRP.

3. Staff receiving an RRP are defined as those with a positive payment recorded in either the general or long term RRP fields of ESR. RRPs may be recorded in other payment fields in ESR, but these are not centrally identifiable.

4. Data cleaning processes are applied to ESR extracts before use.

91


Annex G1

92


Annex G2

93


Annex H – Supplementary analysis of consultants incremental progression

Figure H1. Basic pay per full-time equivalent change for consultants progressing through the pay scale

Notes:

Each red dot on the diagram represents 1 per cent of the workforce sample. n = 29278 FTE as at September 2011. Available data does not detail the distribution of staff across the pay thresholds 5, 6 and 7, which span over five years.

94


Figure H2. The effect of incremental progression on the average basic pay per full-time equivalent progression type and threshold position

Progression type FTE

2011 Basic Pay per FTE

2012 Basic Pay per FTE

% Change to basic pay per FTE

Average Basic Pay per FTE 2011

Average Basic Pay per FTE 2012

% Change to Average Basic Pay per FTE

Threshold Movement

Threshold 1 to Threshold 2 1274 £74,504 £76,837 3.1%

£81,565 £84,919 4.1%







Mid threshold


£88,553 £88,553 0.0% Threshold 6 to Threshold 6 8659 £89,370 £89,370 0.0%


Top of Band Threshold 8 to Threshold 8 2396 £100,446 £100,446 0.0% £100,446 £100,446 0.0%

Total 29278 £87,461 £88,452 1.1%

95


Figure H3. Turnover – the effect of joiners vs leavers experience Balance on the average basic pay per full-time equivalent

96


Figure H4. The effect of workforce growth on the average basic pay per full-time equivalent

97


Figure H5. Component parts of consultant basic pay per full-time equivalent (FTE) drift by progression type and position on pay scale

2011 2012

Progression type Basic pay per FTE

FTE Aggregate Basic Pay

Basic pay per FTE


Change in Aggregate Basic Pay

% Change in Aggregate Basic Pay

Joiners replacing leavers

Threshold 1 £74,504 602 £44,851,380 £74,504 1344 £100,143,109 £55,291,729 0.0%

Threshold 2 £76,837 220 £16,941,783 £76,837 363 £27,897,967 £10,956,184 0.0%

Threshold 3 £79,170 178 £14,062,191 £79,170 260 £20,574,765 £6,512,574 0.0%

Threshold 4 £81,502 166 £13,537,481 £81,502 172 £13,989,836 £452,355 0.0%

Threshold 5 £83,829 447 £37,440,547 £83,829 415 £34,752,968 -£2,687,579 0.0%

Threshold 6 £89,370 448 £40,075,297 £89,370 271 £24,181,824 -£15,893,474 0.0%

Threshold 7 £94,911 330 £31,363,342 £94,911 138 £13,093,922 -£18,269,420 0.0%

Threshold 8 £100,446 911 £91,464,928 £100,445 340 £34,173,530 -£57,291,398 0.0%

Total £87,738 3302 £289,736,950 £81,406 3302 £268,807,922 -£20,929,028 0.0%

Joiners (growth)

Threshold 1 £74,504 692 £51,545,617 £51,545,617 0.0%

Threshold Movement

Threshold 1->Threshold 2 £74,504 1274 £94,892,812 £76,837 1274 £97,864,167 £2,971,355 3.1%







Continued on next page

98


s 2011 2012

Progression type Basic pay per FTE


Basic pay per FTE


Change in Aggregate Basic Pay

% Change in Aggregate Basic Pay

Mid threshold

Threshold 5->Threshold 5 £83,829 6129 £513,771,020 £83,829 6129 £513,771,179 £158 0.0%



Top of Band Threshold 8->Threshold 8 £100,446 2396 £240,658,598 £100,446 2396 £240,658,489 -£109 0.0%

Total progression staff (constant) £87,461 29278 £2,560,658,179 £88,452 29278 £2,589,685,114 £29,026,934 1.1%

Grand Total £87,489 32580 £2,850,395,129 £87,463 33272 £2,910,038,653 £59,643,524 2.1%

Average FTE Growth 2.12%

Average Basic Pay bill Growth 2.09%

Basic pay per FTE drift -0.03%

99


Figure H6. Component parts of consultant basic pay per full-time equivalent (FTE) drift summary

Basic pay drift drivers

Basic Pay per FTE 2011

Basic Pay per FTE 2012

% change in Basic Pay per FTE

Isolated Impact of driver¹

FTE share of whole workforce 2012

Isolated effects of driver, weighted by the groups FTE share of the whole workforce²

Impact of driver on basic pay per FTE (includes effect of interactions between groups)³

Incremental progression

£87,461 £88,452 1.13% 1.10% 88.0% 0.97% 1.01%

Joiners vs Leavers experience balance

£87,738 £81,406 -7.22% -6.95% 9.9% -0.69% -0.72%

Workforce growth

- £74,504 - -14.84% 2.1% -0.31% -0.31%

Total £87,489 £87,463 -0.03% -0.03% 100.00% -0.03% -0.03%

Summary table notes:

The purpose of the analysis is to quantify the contribution of each of the following groups (joiners (growth), turnover (joiners replacing leavers) and staff progressing through the pay system. There are interactions between the effect of each of these groups has on basic pay drift. The combined effect of groups depends on the sequence of changes to the groups occur / the sequence in which the groups are calculated. The sequence of calculation leads to variations in the aggregate basic pay per FTE result. This is because any change within the group simultaneously changes the composition of the workforce overall and average basic pay per FTE. If the individual change in basic pay per FTE is calculated for each group, the parts do not sum with the aggregate change in basic pay per FTE for the whole consultant workforce, due to interactions between the groups.

¹ Isolated effect of the changes within a single group on the aggregate basic pay per FTE for the whole workforce (as if there were no changes anywhere else in the workforce).

² A simplified method (which ignores the effect of interactions between groups) and achieves similar results (to 1 dp) is to weight the isolated effects of each group, weighted by the groups FTE share of the whole workforce.

³ The most complete picture of the contribution of the effect of each of the drivers (including the effects generated by interactions between the drivers) can be calculated by taking the geometric average of each individual change compared to a counterfactual:

1) The change in basic pay per FTE in year 1 solely due to the effect of the subject group (as if there were no workforce composition or pay changes in the rest of the workforce.

2) The change in basic pay per FTE in year 2, as if there were changes to the workforce composition and pay of the rest of the workforce, but not in the subject group.

3) The change in basic pay per FTE in year 1 (weighted by the year 2 workforce distribution) solely due to the effect of the subject group (as if there were no workforce composition or pay changes in the rest of the workforce.

4) The change in basic pay per FTE in year 2 (weighted by the year 2 workforce distribution) as if there were changes to the workforce composition and pay of the rest of the workforce, but not in the subject group.

100


Figure H7. Supplementary analysis methodology

Analysis based on a comparison of two annual snapshots of the ESR (as at September 2011 and September 2012) data detailing the workforce at individual assignment level, in order to determine workforce distribution and pay point progression of individuals.

Based on a sample covering 90 per cent of the workforce on the new consultant contract (excludes locums). Includes those staff who receive a basic salary matching those detailed in the pay circular, and whose pay point movement is recognised as normal pay progression under the rules of the new consultant contract.

Joiners vs Leavers effect combines both the joiners who are replacing leavers, and the joiners who are the 'new additional posts' which are the workforce growth. At aggregate level, new additional posts are indistinguishable from existing posts. New additional posts may be filled by staff at any of the threshold points. Although growth may be achieved through international recruits, return to practice to points at other than Threshold 1, the vast majority of growth is likely to be achieved through new CCT holders joining at Threshold 1.

To estimate the effect of workforce growth on Basic Pay Drift per FTE, the number of joiners to Threshold 1 has been artificially split into Joiners who are replacing leavers, and joiners who are contributing to workforce growth. This assumes all growth is achieved through new CCT holders joining at Threshold 1.

Simplifications

Changes to the participation rate have been classed as turnover and accounted for in the joiners replacing leavers line. This year less than 0.05 per cent of the workforce changed their participation rate, so the impact on basic pay drift is minimal. Refinement to the methodology would allow this affect to be separately identified, which might be useful if there was considerable changes in participation rates in future years.

In the time-frame of the analysis, there was no basic pay settlement, which makes identifying the components leading to changes in basic pay per FTE more straightforward. Method would require refining to account for this in future years.

NHS Employers

The NHS Employers organisation is the voice of employers in the NHS, supporting them to put patients first. Our vision is to be the authoritative voice of workforce leaders, experts in HR, negotiating fairly to get the best deal for patients.

We manage employer negotiations with the NHS trade unions on pay, pensions and terms and conditions. On behalf of primary care trusts, we lead on specific contract negotiations for GPs and dentists and are involved in contract discussions on community pharmacy.

We work with employers in the NHS to reflect their views and act on their behalf in four priority areas:

1. pay and negotiations 2. recruitment and planning the workforce 3. healthy and productive workplaces 4. employment policy and practice.

The NHS Employers organisation is part of the NHS Confederation.

Contact us

For more information on how to become involved in our work, email [email protected] www.nhsemployers.org Email [email protected]

NHS Employers

4th Floor, 50 Broadway 2 Brewery Wharf

London SW1H 0DB Kendell Street, Leeds LS10 1JR

Published September 2013. © NHS Employers 2013.

This document may not be reproduced in whole or in part without permission.

The NHS Confederation (Employers) Company Ltd

Registered in England. Company limited by guarantee: number 5252407

Ref: EINF30001

mailto:[email protected]