Chancellor Gordon Brown may well have a 'bulging war chest', acquired through his notoriously prudent monetary and fiscal policy, but there is no sign in the government's submission to the pay review bodies that he anticipates the accumulated riches will trickle down into nurses' and doctors' salaries next year.
Pay for nurses and midwives, doctors and professions allied to medicine must be 'realistic and affordable', says the joint submission from the combined English, Welsh and Scottish health departments, which suggests they want pay to rise at - or not much in excess of - the government's 2.5 per cent inflation target.
After last year's spectacular pay rise for nurses, midwives, health visitors and PAMs - the biggest for 10 years - and what it regards as its positive effect on recruitment, retention and morale, the government says its priority in 2000 is to focus resources on NHS modernisation.
It believes cash should go primarily towards creating posts for nurses, midwives, PAMs and other staff; towards improving conditions of service; and funding modernisation initiatives, including public health measures, NHS Direct and developments in information technology.
'The health department hopes that the recommendations for April 2000 can... be implemented in full - though this depends... on a careful balance of affordability of any pay award against underlying demand pressures and the modernisation programme,' says the submission.
It admits that the NHS found the balance between pay and service delivery 'tight' in 1999-2000 - when NHS growth was 5.1 per cent. In 2000-01 headline growth will be 4.6 per cent, so 'the needs of the NHS and the... economy point to a pay settlement significantly below the headline level of NHS resources growth'.
The NHS Confederation, in its role as the employers' organisation, is more candid on this point in its submission. It says meeting the only partially funded pay award in 1999-2000 directly caused financial problems in trusts and HAs, leading to cuts and 'adverse effects on services and staff alike'.
It states: 'Although the comprehensive review shows an increase in real terms of 4.6 per cent... it is vital that the review body accepts that it does not follow that trusts will have that sum available for pay... In 1999- 2000 there was an even higher growth figure, but trusts were still forced to make cuts to fund the year's pay award.'
It adds: 'Put simply, there are not enough resources available to address the unavoidable costs and pressures, to implement the government's modernisation programme and to give more than a very modest pay award to staff.'
What is a 'modest' award? The Department of Health points out that headline inflation for June 1999 was 1.3 per cent. In addition, Continued from page 9
retail price index inflation is 1.3 per cent, pay settlements are running at 3 per cent on average, and in recent years public sector pay has lagged on average just 0.2 per cent behind the private sector.
According to John Northrop, director of analysts Pay and Workforce Research, the government will be looking for a recommendation within the range of 2.5 to 3 per cent. 'If it goes below that figure it will cause all sorts of problems; it will have to be at the upper end of the range.'
A key area for debate for the pay review body will be the contribution of pay as a factor behind staff morale and commitment.
The health departments and NHS Confederation contend that pay - in all but a few specialist areas - is at the right level and that the crucial issues are workload and quality of working life.
The DoH submission to the doctors' and dentists' review body is most stark on this issue. It claims there is no shortage of people wishing to pursue a career in medicine, and that vacancy rates are negligible. Improvements to junior doctors' hours and living conditions are needed, it says, not a big pay rise.
It says: 'There are no wide-ranging problems which need to be addressed through the general pay settlement. Where specific issues arise, these are being addressed through targeted action which often requires changes to working conditions rather than remuneration.'
The NHS Confederation claims that although recruitment and retention is still a 'major problem' for nurses and midwives, 'pay levels are well positioned and do not need to be significantly improved'.
The main priority, it argues, is to improve working lives: 'The answer to this is more staff, not higher pay.'
In particular, it contends that efficiency savings have gone too far, affecting both staff morale and the quality of patient care. 'The relentless growth in workload in the NHS is causing real problems which, unless addressed, will lead to an exodus of staff and failure to meet the government's output targets.' Naturally, the unions are not easily persuaded by the argument that the choice is between better conditions or higher pay.
'We think there are enough resources to have decent pay and proper staffing levels; staff should not have to choose between pay and a good-quality working life,' says Unison national officer Steve Weeks.
Steven Griffin, director of employment relations at the Royal College of Nursing, argues that while it is vital to increase staff numbers, pay should not be ignored.
'We have very real concerns that experienced nurses may become disillusioned if their heavy responsibilities aren't recognised and rewarded.'
The battle for the hearts and minds of the review body will soon begin in earnest. The RCN, the British Medical Association and Unison will be publishing their submissions over the next few days.