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Chiefs declare support for increment freeze

The first NHS chief executives to publicly support a freeze on pay increments have spelt out why they believe the move is vital to protect services.

Twelve NHS chiefs have signed a letter to HSJ supporting NHS Employer’s proposal to freeze increments and guarantee not to issue compulsory redundancies to those on Agenda for Change bands 1 to 6 for two years from 1 April.

As revealed by HSJ last September, many trusts have been privately lobbying for the change, but until now few have been prepared to speak openly (September 23, p4-5).

The letter says the deal is “not only desirable as a way of dealing with financial pressures, it is essential in order to be able to protect employment and staffing levels”.

One of the signatories, Worcestershire Acute Hospitals Trust chief executive John Rostill, said increments were “a significant factor in cost pressures.” Next year’s 1.5 per cent tariff cut meant trusts needed to do “anything to reflect those pressures to continue providing a high level of care.”

Wrightington, Wigan and Leigh Foundation Trust chief executive Andrew Foster warned that failure to broker a deal could result in cuts in posts exceeding the figure of 35,000 being mooted within the NHS as the likely consequence of not restraining pay.

However, he told HSJ the deal appeared “fragile” because unions were reluctant to sign up, fearing employers could later abandon the guarantee on job security.

Mr Foster said the terms were “very carefully constructed to offer an absolute guarantee to those on bands 1 to 6.”

Those in higher pay bands would not receive any guarantee regarding compulsory redundancies but trusts would make “best endeavours” to maintain jobs. Mr Foster said there was a need to “flesh out” what this meant in practice.

NHS Employers believes a national framework agreement would save £1.9bn a year. It would come on top of the freeze on cost-of-living pay rises for all public sector staff earning more than £21,000.

Unions are due to meet on 20 January to decide whether to proceed.

But Unite’s lead officer for nursing Barrie Brown told HSJ: “From the feedback we’ve had so far there’s clearly no appetite for entering into any decisions over the proposals that have come forward.”

One of the main sticking points for unions is the fact that staff in bands 7 to 9 will not necessarily benefit from the freeze.

However, NHS Employers director Dean Royles said controlling pay would “also enable more certainty of employment for other bands” because trusts would be in a healthier financial position.

He added that the agreement would be “binding” as employees would be able to seek an injunction to prevent compulsorily redundancies. Alternatively, they could potentially sue for wrongful or unfair dismissal.

“The reality is employers would be determined to make it work. It isn’t something they would enter into lightly,” he said.

 

The letter:

To the Editor

Dear Sir,

You have reported on the NHS Employers proposals to the staff side of the NHS Staff Council, for a national framework agreement involving a freeze in incremental progression that NHS organisations can use where there is agreement locally.

In summary, each organisation adopting the framework would freeze pay increments for all staff for a two year period, and guarantee not to make compulsory redundancies for staff earning at or below the equivalent of the maximum of Agenda for Change band 6 during the same period.

We, the undersigned, support the need to make such a proposal and believe that the proposal is one we are very willing to work with. This letter aims to make clear the reasons why trusts see this proposal as a win for them and a win for staff. Although the NHS has been offered significant protection of funding in the most recent spending round, rising costs and increasing demand for patient care make the next two years a huge challenge and we expect to have to make efficiency savings of well over 5 per cent per year. We are looking at all areas of expenditure to find savings, but salaries represent 60 to 70 per cent of our costs so we need to explore measures to contain the pay bill. NHS Employers’ proposal represents a practical way forward, which maintains the integrity of the nationally agreed pay systems.

Each of our organisations has plans to improve quality and productivity over the period of the spending review, but these will take time to deliver benefits. In the meantime, we want to maximise employment security for our staff and retain their skills in the NHS. We know from local feedback and surveys that trade unions have undertaken, that job security is a key concern for staff. We will be having a very open dialogue with our staff locally, so that the benefit of these ideas can be explored with them.

In summary, we believe that this is a fair deal and one that can be delivered. It is not only desirable as a way of dealing with financial pressures, it is essential in order to be able to protect employment and staffing levels,

Yours sincerely

Maggie Boyle, Chief Executive, Leeds Teaching Hospitals NHS Trust

Sir Robert Naylor, Chief Executive, University College Hospital NHS Foundation Trust

Jo Cubbon, Chief Executive, Taunton and Somerset NHS Foundation Trust

Peter Cubbon, Chief Executive, West London Mental Health NHS Trust

David Dalton, Chief Executive, Salford Royal NHS Foundation Trust

Stephen Eames, Chief Executive, County Durham and Darlington NHS Foundation Trust

Mike Farrar, Chief Executive, North West Strategic Health Authority

Andrew Foster, Chief Executive, Wrightington, Wigan and Leigh NHS Foundation Trust

Julian Hartley, Chief Executive, University Hospital of South Manchester NHS Foundation Trust

Simon Pleydell, Chief Executive, South Tees Hospitals NHS Foundation Trust

John Rostill, Chief Executive, Worcestershire Acute Hospitals Trust

Chris Sharratt, Chief Executive, Sheffield Children’s NHS Foundation Trust

Readers' comments (59)

  • Well they would given that they are off the top of the payscale so dont get any increments anyway. The problem with this proposal is that it makes everyone entitled to an increment suffer, and reduce their pension, but only offer some reward to this for some staff.

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  • A dozen - that's less than 10%.

    That 90% wouldn't/didn't sign shows the extent to which the system recognises that some very difficult decisions are needed as we move forward.

    It is also telling that the letter was sent to HSJ and not the Department. Seems like there's only so far above the parapet people are prepared to stick their heads.

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  • Please can HSJ make the headline a little more indicative of the true content of the story, instead of ,"Chiefs declare support for increment freeze" may I respectfully suggest, "A few chiefs declare support for increment freeze", or perhaps even, "Very few chiefs declare support for increment freeze".

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  • What about ' A minority of chiefs declare support for increment freeze'
    An increment freeze is a breach of contract and is wholly inappropriate.

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  • Assume this means that not only do I have to work with less colleagues, support and capacity to deliver on GP commissioning I should lose my increment too. This should really motivate and inspire me before I get the boot from my PCT employer. Happy new year.

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  • mike batt

    Ridiculous. This will not save enough to prevent redundancies. How about legitimate re-structuring or making real efficienies. Very silly stuff from some people who should know better.

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  • Perhaps they might wish to take a 10% pay drop in support

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  • How about 'chiefs reject calls to freeze increments'

    This shows that 90% of CEOs know redundancies are inevitable.

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  • Most of these comments assume that the other 90% do reject the suggestion. The fact that others have not signed a letter does not mean they don't support it. Perhaps they just didn't think that signing a letter to the HSJ was the right thing to do.

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  • Its lovely to see so many anonymous comments, particularly the one that talks about the 'parapet'. Amongst the many challenges facing the NHS in the economic downturn is a choice between compulsory redundancies and freezing what for most is an automatic increment for no increase in productivity. In opposing this strategy I assume they support compulsory redundancies and if so lets hear the arguments in favour. Perhaps readers should know that only a representative sample of CEO's were canvassed to support the letter.

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  • How many CEOs are there? 300 or so? Therefore, 12 signatures is 4%. If some of the 96% want to sign it then why haven't they? What are they afraid of? Either they want to sign but are afraid of repercussions which means they ought not to be CEOs of our health service because we should have people with grit and independent thinking running the place OR they cannot sign the letter because they know they cannot keep the 'no redundancies' promise.

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  • This is the payroll vote of CEOs desperate for what they see as easy savings from their staff.It is not leadership and this proposal won't save jobs. A better headline would be "Majority of CE's Stay Silent on Plans to to Announce Redundancies". The cap on the no redundancy enabler will focus redundancies on clinical leaders above band 6.Staff won't go for it but it is important to negotiate to flex agreements to maintain UK wide pay and conditions and contribute to productivity gain.

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  • Does anyone seriously think that once increments are suspended, they will EVER get re-instated again? Forget it. Once the two years is up they will always find some excuse not to. And in the meantime, people on the bottom of the scale will suffer the injustice of doing the same job as people further up whilst not having their loyalty rewarded as they should reasonably expect.

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  • Obvious typo in your headline, should read:

    'OVERWHELMING MAJORITY OF CHIEFS FAIL TO SUPPORT INCREMENT FREEZE'.

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  • Jo Cubbon, Chief Executive, Taunton and Somerset NHS Foundation Trust

    Peter Cubbon, Chief Executive, Northwest London Mental Health NHS Trust

    Joint income from NHS ? Do as I say, not as I do!

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  • The offer is unrealistic for many organisations. For those without the surpluses enjoyed by some there needs to be a freeze on increments AND compulsory redundancies. At my Trust this is necessary which is one reason that our Chief Executive couldn't sign such a letter (assuming he was asked, which I doubt).

    PS
    In the era of everyone becoming an FT collective pay bargaining should be a thing of the past in any case.

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  • In March 2009, Naylor made headlines when he was named by the Daily Mail as the best-paid NHS chief executive: "The highest paid chief executive was Robert Naylor at University College Hospital trust in London. His pay soared to £230,000 - a rise of 30 per cent in a year."[1]

    Who needs increments!!!!

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  • Thanks La La.

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  • Hear hear anon 3.19PM. An equitable approach is most definitely required or those at the top of the pay pile will lose any credibility they might have. I think the expression is lead by example.

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  • Marcus Adams

    Increments create inequality in the workplace and do nothing to promote productivity or quality outcomes for patients.

    The fact that we have enjoyed increments and cost of living increases throughout the global financial crisis owes much to the commitment of successive governments, and to a pay system which improved pay and conditions for virtually everyone.
    However, what is the point in perpetuating these cost pressures when they will only cost even more jobs?

    I have friends and family in the private sector who have endured pay freezes, pay cuts and job losses over a period of some time now, and I don't see how we can look these people in the eye in the current global economic climate and argue that we are a special case.

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