A key government initiative to reduce NHS management costs is heading for failure, HSJ research suggests

Applications to the mutually agreed resignation scheme closed last Friday with what appears to be very few takers.

Under the voluntary scheme, staff with continuous service of 24 years or more will receive a year’s pay. Those with one to six years’ service will receive three months’ pay, increasing along a scale to the 12 month maximum.

However, the agreement is worth only half that offered under Agenda for Change redundancy terms. Commentators warned this would limit the attraction.

PCT responses to enquiries by HSJ suggest uptake has been low and has failed to attract more than a handful of applicants in many places.

For example, NHS Leicestershire County and Rutland, which has more than 3,000 staff, received just 23 applications, NHS Sandwell received 34 applications from a workforce of around 1,500, NHS Wolverhampton fewer than 20 from its workforce of around 2,500, and NHS Oxfordshire received 33 from a workforce of 2,600.

NHS Hull chief executive Chris Long said there had been a “very low take-up”.

“They know we’ve got to make these management cost reductions so why would they take the worse deal? Also the job market here is nothing like as good as in London,” he told HSJ.

NHS Lincolnshire chief executive John McIvor said: “We have had a handful showing an interest but we’ve managed vacancies very tightly over the last 12 months.”

The highest number of applications HSJ identified was at NHS Hampshire - one of the country’s largest PCTs - with 181 applicants, although it has provisionally approved only 31.

However, the scheme did prove attractive enough for two West Midlands senior managers - NHS Telford and Wrekin chief executive Simon Conolly, who stepped down on 31 October, and NHS Worcestershire chief executive Paul Bates, who will retire at the end of the year.

Some PCTs, such as NHS North Yorkshire and York and NHS Wakefield, told HSJ they had not offered staff the scheme because they had either started or just completed their own voluntary redundancy schemes. NHS Leeds recently completed its own exercise but said it also planned to apply to the DH to run the mutually agreed resignation scheme in December.

PCT Network director David Stout said people should not be surprised that “there are not floods of applications”.

He said: “It wholly depends on [people’s] personal circumstances.”

Mr Stout added savings needed to be off set against the cost of replacing staff in posts that were not redundant.

He said: “For chief execs there is all the more need for it to be planned. Replacing them on an agency basis would cost twice as much and would be a silly move.”

Managers in Partnership chief executive Jon Restell said: “We don’t expect a huge uptake for the scheme.

“Some applications have been refused because they are seen as too expensive.”

Applications are awaiting approval from the DH, which is expected to be granted later this month.

A DH Spokeswoman said:  “The national MAR scheme was designed to run until the end of October but SHAs also have the flexibility to extend it where appropriate. We understand that some SHAs have extended the deadline to early November.

“As some schemes are still running it is too early to say how many applications will be approved but we should have a better idea towards the end of November.”