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New NHS bodies face recruitment challenge, government told

National bodies being set up as part of the government’s NHS reforms risk being unable to attract good enough leaders due to declining pay, terms and conditions, experts have warned.

The fears are highlighted in a report by government advisory group the Senior salaries Review Body and come as details of new pay rules for “very senior managers” (VSMs) in the NHS are emerging.

VSMs include chief executives and the board directors they line manage - other than medical directors - in primary care trusts, strategic health authorities, special health authorities and ambulance trusts.

From next year they are expected to include senior leaders in new arm’s length bodies such as the NHS Commissioning Board, Health Education England and the Trust Development Authority.

The review body’s latest report published last week says VSMs’ average take-home pay has dropped by 12 per cent since 2009-10, from £55,843 to £48,860, due to inflation, tax changes and the pay freeze – which started a year earlier than for the rest of the NHS.

It also highlights declining morale and says that “if it becomes widely perceived that terms and conditions…are persistently declining, then it is very likely that there will be a fall in the quality – and possibly the numbers – of recruits, together with problems in retaining the best people.”

Currently, VSMs fall under a strict pay system that sets chiefs’ salaries according to the population size their organisation covers and ensures directors earn a percentage of their leaders’ salary.

The Department of Health commissioned PricewaterhouseCooopers in March 2010 to devise a job evaluation system for VSMs aimed at addressing fears of a widening boardroom pay gap between PCTs and foundation trusts, which have the freedom to offer more attractive salaries.

The new system is awaiting ministerial sign-off. But, ahead of its publication, the review body states: “We have learned that the DH intends to control closely the pay of the VSMs covered by us and in that respect the framework may remain fairly rigid…Therefore we question whether NHS ALBs will be able to compete with foundation trusts to recruit and retain suitably able and qualified managers.”

Managers in Partnership has been involved in developing the framework. MiP chief executive Jon Restell partly welcomed it but said there were a number of potential pay problems it did not fully tackle. He said: “If we want a level playing field between the commissioning and provider sectors then we have got to level the terms and conditions because that’s the only way we’re going to recruit. I don’t think what we’ve got in the new framework necessarily deals with that.”

He also expressed concern that clinical commissioning groups would not face the same restrictions as other bodies, making it easier for them to recruit.

He said there was a risk that senior jobs in the commissioning board’s 50 local offices would be made unattractive by offering salaries lower than those of former PCT chief executives, on the basis that the jobs were further down the management chain.

However, leaders may welcome the new framework’s expected removal of the blanket rule that high-performing VSMs cannot receive a bonus if their organisation has missed its financial targets.

Readers' comments (7)

  • Local office leaders are simply middle managers, so should be on AFC not VSM

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  • It is about time those in the public sector realised that as a country we can't afford to keep paying the huge salaries that we have been doing. There are plenty of good people around - both from within the NHS and outside - who would happily apply for these jobs with their security, good sickness and holiday benefits and a great pension.

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  • Anon-8:21 Security??

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  • Payscales in AfC are more than enough to incorporate ALL grades in the NHS. Why oh why do we need VSM? We are creating problems where they needn't be. If we want to pay above the top of Band 9, then simple add another 2 bands & increase the top to say £120k MAX (including all clinicians). This is not a small salary and coupled with the following benefits a not unreasonable package:

    - Up to 33 days annual leave
    - 6 months full pay, 6 months half pay sickness scheme
    - NHS Pension
    -up to 2 years pay redundancy scheme

    With regards to bonuses. Why should the people at the top expect them when they are considered unworkable for the rest of the organisation?

    Bonuses like tipping should be consigned to room 101!!!!

    And for those who say we need to pay the top money to attract the best, well I say let them go and find it because the NHS is suppoosed to be paying more than the private sector in any case!!!!!!

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  • Interesting the earlier comment about the "security" of public sector jobs.
    Can't speak for other public sectors, but in the NHS we've been in a very long period of absolutely no security, with people leaving and being made redundant very quickly and with very little explanation to remaining staff. Not sure I'd call that secure.......

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  • Why not permit applicants to be engaged through their own limited companies? This worked a treat in the Students Loans office and is a terrific tax avoidance scheme.

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  • Anon 8.21am, you must be from the Banking sector I presume?

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