Milburn signals 'understanding' on Agenda pay deal

An 'understanding' has been reached over the main areas of the new NHS pay system and a linked three-year, 10 per cent pay deal, health secretary Alan Milburn was expected to announce today.

But the new system for non-medical staff could leave one in six as 'losers', whose rates are reassessed to lower levels, while phasing could mean 'winners' will not see the full benefits for 'three or four years', HSJ has learned.The date for full implementation has also slipped back six months, to October 2004.

A Department of Health spokesperson refused to discuss the Agenda for Change pay talks, other than to say 'we are still negotiating and discussing with the unions', but HSJ sources earlier this week said talks had been 'telescoped' to allow an announcement.

They speculated that the statement had been driven by the government's need to offset pressure from the firefighters' strike with news that it was successfully controlling pay elsewhere in the public sector.

'The reason he's doing it is because of the firefighters, ' one source said. 'For three-and-a-half years it has gone at a snail's pace and now he's telescoping it all.'

As HSJ went to press, it was unclear how far last-minute talks would go towards a final agreement. Another source said Mr Milburn, expected to make his announcement to Parliament, would not be able to say an agreement had been reached 'because it hasn't and it will not be'.

Instead Mr Milburn was likely to say there was 'an understanding on Agenda for Change, with the major issues resolved and some technical details to be worked through'. But the source added: 'Some issues will not be resolved for months.'

New job profiles are understood to be among the problem areas.

But Unison negotiator Paul Marks said 'negotiations are very close to conclusion', while Royal College of Nursing head of employment relations John Humphreys said: 'We are very close to a final set of proposals.'

Any deal is set to be conditional on a link with pay rises of 3.225 per cent for each of the next three years - 10 per cent over the period, matching the deal rejected by consultants last month.

HSJ understands that around one in six staff whose place in the proposed eight pay grades brings their pay rate down will be dealt with through a combination of pay protection, 'marking time' - with pay rises withheld until the individual's rate matches the grade rate - and 'market supplements' for jobs with recruitment and retention problems.

It is not known how many staff will make significant gains, but with increases phased in at 4.5 per cent a year, 'in some cases people will not get onto their new substantive grade for three or four years' after October 2004. 'The fear is that is not going to be enough to sell it [to staff], ' a source said.

Annual leave will be equalised and hours are set to be standardised at 37.5 a week - a figure which means some groups of staff will gain while others need 'protection for some time'. HSJ understands out-of-hours payments had still to be finalised as had London weighting, though this was believed to be set for a significantly boost.

Unions will take any proposals back to their executives before making recommendations to their memberships. But the firefighters' dispute has raised members' aspirations, while government moves to speed up Agenda for Change and speculation in the national press last week, which sparked a joint union denial, are likely to increase tension.