Jeremy Hunt has suggested the government would be willing to drop its call for a freeze on incremental pay progression if unions will agree other measures that “achieve the same level of savings”, in a letter to unions and NHS Employers seen by HSJ.

In the letter, sent to NHS staff council representatives but not made public, the health secretary reveals a clear government desire for wider reform of contracts covering both the non-medical workforce under the Agenda for Change framework and doctors.

The government has publicly offered unions the chance of a permanent pay rise in exchange for a freeze on incremental pay for Agenda for Change staff in 2015-16, after it rejected recommendations from the NHS Pay Review Bodies last week.

But the health secretary’s letter goes further, saying the government “would be prepared to agree other measures that would achieve the same level of savings to protect frontline staff numbers and which would reinforce the principle of progression for performance and support the development of seven day services”.

This could allow employers to open up talks on other areas including unsocial hours premia, overtime pay, sick pay or weekend working.

Mr Hunt said his “door was open” to unions agreeing alternative savings but added he wanted a reply by 9 April stating “whether both sides feel it will be possible to reach an agreement”.

He said any agreement on pay, terms and conditions would need to include the British Medical Association which has traditionally negotiated terms for doctors separately to Agenda for Change unions.

“It is incumbent on staff and employer representatives to leave no stone unturned in finding a way forward in the interests of patients,” he wrote, adding that talks could consider “our proposal for an increment swap alongside any other options for delivering the savings needed.”

Earlier this month the Government rejected a 1 per cent cost of living pay rise for all staff in 2014-15. Only those at the top of their pay band will receive the increase and it will be non-consolidated, meaning it is not permanent or pensionable.

Employees eligible for incremental pay increases will receive their increment but will not get the 1 per cent cost of living rise. Ministers claim the deal, which will be repeated in 2015-16, will save £200m each year and protect frontline jobs.

In his letter, Mr Hunt said the imposed deal built on the Agenda for Change agreement made by unions in 2013 which linked incremental pay rises more closely to performance. This would allow time for NHS organisations to develop performance standards, he said, and build “a base for further reform of national contracts.”

“I would like to hear back in three weeks by 9 April whether both sides feel it will be possible to reach an agreement that makes the same savings as the decision I announced last week but that will enable all staff to receive a 1 per cent consolidated pay rise over each of the next two years,” he wrote.

Negotiations are already underway on both junior doctor and medical consultant contracts but Agenda for Change unions reacted angrily to the pay deal last week with Unison, Unite and the GMB unions saying they would consult members.

Christina McAnea, staff side chair of the NHS Staff Council, has previously said unions would not negotiate “while a gun is held to our head for a paltry 1 per cent pay rise.”