• NHS organisations overspent on bank staff by almost £1bn in 2017-18
  • Trusts saw a 3.3 per cent growth in pay bill costs driven by “intense operational pressures”
  • Nursing workforce vacancies remain at 10 per cent, equivalent to 35,794 nursing posts

Operational pressures have forced NHS organisations to overspend on pay costs for the third year running with almost £1bn overspent on bank staff alone.

NHS Improvement’s quarterly performance report revealed most of the overspending was concentrated in frontline staffing roles linked to the delivery of patient related care, with 86 per cent of spending linked to medical and nursing staff.

The report said: ”The bulk of the overspending took place in the acute sector and is attributable to intense operational pressure.”

The significant growth in bank staff pay follows a shift in the use of higher cost agency staff in 2017-18 which came in £93m, or 3.7 per cent, less than originally planned for the year.

Overall temporary staff costs, including both bank and agency, showed a decrease of £67 million, or 1.2 per cent, on the same period in 2016-17.

Controlling agency spend has been a national priority for NHS Improvement since 2015 when it introduced a nationwide cap on all agency spending, including nursing and medical workers, in November 2015.

The latest NHS Improvement data shows the NHS spent over £52 billion on staff pay in 2017-18 due to operational pressures in the acute sector. This represents a 3.3 per cent growth in employee expenses compared to the previous year.

Total pay costs for the year were £1.5 billion higher than the “optimistic” plan set at the start of the year.

NHSI’s report revealed that out of the overall pay overspend, £1.3 billion was concentrated in acute trusts and funding for frontline staff. Only 13 per cent of the overspend, or £210m, was from community, mental health and ambulance trusts.

In 2016-17 overspend on pay was £811 million higher than the plan and in 2015-16 it was approximately £1 billion higher.

The Q4 data shows the overall workforce vacancy rate has improved slightly to 8 per cent by the year end from 9 per cent in Q1. The medical worforce has seen the same improvement but still had 9,982 vacancies at year end.

But within the nursing workforce the vacancy level has remained at 10 per cent having peaked at more than 11 per cent in Q2. Overall there were 35,794 nurse vacancies by the end of the year.

Other staff roles have seen the largest decrease in vacancies – between quarter three and quarter four it fell by over 5,000 vacancies. This includes all staff excluding registered nurses and doctors. In total the NHS had 92,694 vacancies at the end of March.

Chris Hopson, chief executive of NHS Providers, said: “Spending on agency staff fell by more than £500 million compared with the previous year, and trusts delivered cost improvements equivalent to £3.2 billion (3.7 per cent of trust turnover) – £110 million more than 2016-17.”

He added: “Looking ahead to 2018-19, financial and workforce pressures are increasing.”

Janet Davies, chief executive of the Royal College of Nursing, said: “The number of nurses missing from England’s NHS remains stubbornly high – hospitals cannot afford to recruit and inadequate numbers are being trained too.”

NHSI said there has been a “notable reduction” in agency staffing and a related increase in bank staff but said there is “an ambition to see this consequently move to a more sustainable staffing model in the future”.

Financial performance: Best and worst of 2017-18