finance salaries

Published: 06/02/2003, Volume II3, No. 5841 Page 30 31 32 33

If the NHS is improving its pay packages to attract top accountants, why do employers remain reticent about employing people from outside the health sector, argues Andy Robling

It is widely assumed that salaries for NHS finance staff languish far below those of their private sector colleagues.But this view needs to be reassessed in the light of the current harsh economic climate, the attractions of the public sector as an employer - and the associated benefits it can offer.

But if the health sector should hold attractions for those who work in commerce, why are NHS vacancies failing to attract large numbers of private sector applicants? And where an NHS vacancy does attract applicants from commerce, why is the NHS proving reluctant to employ them?

Salaries for NHS finance staff, especially those with postqualification experience, increased by 4-7 per cent last year.And although salary increases have slowed down, they are still rising above inflation and at a rate well above static private sector pay.

The figures, from a survey by Hays Accountancy Personnel based on analysis of salaries from Hays' jobs database and the salaries of registered candidates, are published exclusively in HSJ (see tables).

The largest increases have been medium trusts with deputy director posts rising by 5.2 per cent, while more junior posts are up even more.The best locations are generally London, the south coast and Kent, West Midlands and Thames Valley.

Employers are facing a variety of recruitment challenges as restructuring and reassessment of priorities combine to change skill requirements, increase working pressure and make it more difficult to fill vacancies.This is particularly true of recently qualified accountants.

Although employers are prepared to continue reviewing salaries favourably to get the best individuals, they are in the main reticent about taking on people not already schooled in the ways of the health sector.Why is this?

While salaries for accountants in the private sector have remained relatively static, NHS packages - which may include better final salary pension schemes, more holidays and flexible working hours - do not fully compensate for the loss of cars, car allowances, bonuses and performance-related pay.These latter benefits are typically only available at director of finance level within the NHS.

The appearance of primary care trusts and shared services has resulted in a feeling of insecurity among employees and increased pressure on employers to reduce management and administrative costs.A recent survey carried out by Hays for the Healthcare Financial Management Association into motivation among finance managers in health underlined the problems many have experienced during the implementation of the NHS plan.Half of respondents stated they were demoralised by frequent changes and policies in the sector, as well as unclear organisational goals.

This is no surprise considering the major changes imposed on finance departments in an extremely short space of time.Many NHS employers have described fatigue and insecurity within finance departments trying to get to grips with the organisational changes.Many departments are tackling the issues by introducing a positive agenda for training and development, as well as stressing the importance of more acknowledgement and understanding from central government of the financial pressures facing organisations.

Many finance managers have been overwhelmed by greatly increased workloads, while the number of accountants rising through the ranks in the health service is far below what is required to support the changes.As a result, pressure on trusts and, to a lesser degree, strategic health authorities to recruit from external sources has been stepped up.

Despite these mounting pressures, the health sector has been, and still seems to be, generally reluctant to inject the fresh commercial blood it professes to seek.There has been a significant increase in the number of private sector accountants exploring career options in the public sector, but many of these individuals tell me that doors are blocked. It is too often the case that candidates from a health background, assuming they meet base job criteria, are favoured over private sector ones.

Where employers prefer finance professionals with experience of the health sector as opposed to those coming directly from commerce, this can create an obstacle to successful modernisation.

The NHS is, and increasingly will be, dependent on talent with broader experience in order to achieve exacting financial and service delivery targets.Bringing in private sector professionals does not mean that existing staff will be laid off; in fact, it could encourage employees with diverse backgrounds to aim towards common goals and inevitably enrich the finance departments in which they work.

Staff with a non-NHS background can introduce the expertise needed to stay within budget and can bring added value to the sector.The mixture of private and public experience is also valuable for bringing in report, presentation and communication skills, as employers expect finance staff to adapt to medical terminology, the sensitivities of patient care and increased contact with clinical colleagues.

This is in line with what eight in 10 health finance managers stated in our survey for the HFMA - namely, that 'the more points of view, the better'- indicating a genuine enthusiasm for bringing commercial accountants on board. In other words, though managers value private sector experience in theory, this is not yet reflected in practice.

It is essential that those devising HR strategies within the health sector begin to regard private sector candidates as an asset and rid themselves of negative preconceptions.Private sector accountants do not see a career in the public sector as a refuge from the cut-throat environment of commerce.Many are attracted by professional challenges as well as the benefits and salary packages the health sector can offer and see a career in health as more in line with their own aims and beliefs.

At careers forums and jobs open days, I have met high-calibre accountants - many of whom have trained in the 'big four' accounting firms or blue-chip companies - who wish to add another string to their bow in the public sector.For them, working in health is a proactive, career-enhancing choice.

But many health organisations are still reluctant to employ accountants directly from the private sector.They see the crosstraining as too big an investment and would rather have the complete package - in the form of an accountant with either a track record or training in health.

Yet the health sector boasts high standards of training programmes, increasingly well designed to adapt and merge the commercial skills of private sector professionals with the skills demanded in the health sector.To put it another way: there is no point sitting on the sideline and waiting for the expertise when the sector can easily create it itself.

A number of trusts have realised the value of recruiting directly from the private sector and tailored recruitment campaigns to widen the net beyond the NHS.The salary gap between commercial and not-for-profit organisations has diminished over the past couple of years as pay levels in the private sector have remained largely static due to fluctuating economic conditions.

Public sector benefits packages are in a different league altogether, with lucrative final salary pensions and flexible working hours.The NHS is also renowned for offering study support and leave.

However, on many occasions health employers with vacancies have failed to attract the attention of suitably qualified candidates.This is often the result of the public sector's unwillingness to trade in its old ideas about recruitment and advertising procedures, focusing on what it requires from candidates, as opposed to what can be offered to exceptional individuals.Bolder and more cutting-edge campaigns with an emphasis on career paths, continuous professional development, benefits and generous holiday entitlements would attract attention from high-calibre candidates and kick-start the health sector's attempt to reach out to a new generation of commercially trained accountants.

The use of the internet to attract new recruits is essential.

Increased use of online media is ultimately reaching a larger group of high-standard candidates and reduces the number of applications from irrelevant job seekers.

The health sector has a reputation for friendly work environments and satisfying job roles - and this is still the case after restructuring.With private sector knowledge merging with the existing expertise, the health sector should be an even more rewarding career option in the years to come - and enable employers to attract the skills they need to push through ambitious goals.

Full survey results will be available on www. hayspersonnel. com/salarysurveys

A question of perception: why the case against the public sector doesn't add up

Although salaries in the health sector are improving, they still cannot match those of FTSE 100 companies and other employers in industry.

Remuneration packages in the health sector are closer in real terms to those offered in industry than might be thought; salaries in the private sector have been more or less static for the last year.

In addition, highly publicised bonuses have been slashed for all but those at the very top.

Can public sector benefits compensate for the gap in salaries?

Benefits such as share options are not as valuable as they used to be and many private sector companies are no longer offering final-salary pension schemes to new employees - while the NHS scheme is still highly lucrative.Benefits which those in the public sector tend to take for granted, such as more generous holiday allowances, are extremely attractive to private sector employees.

Public sector employers promote work/life balance and family-friendly policies, but will these appeal to high-flying finance professionals? are not they only attractive to those who are not really committed to their job?

With increasing pressures throughout the workforce, more and more people are demanding benefits that allow them to enjoy a life outside work - and employers are recognising the benefits of happy, refreshed workers.Evidence indicates that having the option of occasionally leaving work an hour or so early, or being able to spend time with family, does not impact negatively on the workplace.

I would like to employ people who can bring a commercial, business-like approach to my finance department.But if they have not had exposure to health issues, it is going to take a while for them to adjust - and I do not have time to help them.

Qualified accountants may have years of experience behind them, especially those from practice who are used to going into new environments and quickly getting up to speed.Surveys show that accountants already in the health service are open to those coming from the outside. It can be assumed that accountants from commerce and industry are likely to be given the help and support they need.Also, training in the health sector is renowned for its excellence.

Posts with the most: 'turnover is not too bad'

Simon Scott, deputy finance director, South West London and St George's Mental Health trust: Mr Scott says that although the last couple of years have not been 'easy', there is currently only one senior post to fill. In general, finance managers are not abandoning the trust: 'Turnover is not too bad - most vacancies are related to expansion, not because people are leaving.'

He is not particularly keen to look outside the health service to fill senior vacancies.He would prefer people with health service experience, although suitable non-NHS candidates would not be rejected without interview.Non-NHS candidates are, however, welcomed for junior posts.

Nick Dawe, finance director, South Warwickshire General Hospitals trust: 'It has always been difficult to recruit for senior positions, ' says Mr Dawe, who has two or three senior positions to fill.He believes that candidates from outside the health service bring valuable knowledge, especially IT expertise.For him, problems lie in the training overheads and the extra support they need.He recognises that the huge organisational change in the NHS may alienate long-standing NHS managers, but he does not find constant upheaval unsettling: 'I do not have a negative feeling at all... the situation is not any worse than it has been in the last few years.'

Interviews by Eleanor Turpin

Key points

Post-qualification salaries have increased by 4-7 per cent, a slowdown on last year's figures when increases were often more than 10 per cent.

The highest increases this year tended to be in medium-sized trusts where newly qualified accountants' salaries rose 8.2 per cent.

Directors of finance in large trusts earn about 20 per cent more than in medium trusts and about 40 per cent more than in small ones.

Newly qualified accountants in large trusts earn 5 per cent more than in medium-sized trusts and 13 per cent more than in small ones.

The survey is based on an analysis of salaries from Hays' jobs database, and salaries of registered candidates.

Andy Robling is director, Hays Accountancy Personnel.