Nurses and Midwives: Fees

Debate between George Freeman and David Anderson

Monday 23rd March 2015 Westminster Hall

[George Freeman]

The hon. Gentleman makes an interesting point. As the challenges for the NMC’s members and for it as a professional body change, adapt and evolve in the new landscape of greater transparency and accountability in the public interest, one issue for the NMC as a professional body is how it deals with that internally. Members across the House have raised a number of concerns about that, and I will touch on some of those later.

The intention is that in future the PSA will be funded by a fee raised on the nine professional regulators that it, in turn, serves. It is important to note that the fee is raised on the professional regulators—the regulatory bodies—not on registrants. The formula for calculating what contribution each of the nine regulatory bodies should pay was subject to consultation. It has been based on the number of registrants, simply because it was judged that that would most fairly equate the fee to the amount of service that the PSA provides to each regulator.

The NMC has nearly 50% of the total number of registrants so its contribution to the fee equates to nearly 50% of the overall costs of the PSA. However, it is important to remember that the fee per registrant is likely to be in the region of £3, which represents only 2.5% of the NMC’s overall registrant fee of £120 a year.

[Mr Anderson]

I am trying to understand what the Minister is saying. Is it that the regulators have to pay a fee but the registrants will not, and if they do, it will be £3? Where else are the organisations going to get the money from?

[George Freeman]

My point is that it is important to understand that the reforms mean that the PSA is funded by the nine regulatory bodies. How the bodies seek to cover that cost is up to them. In this case, the NMC has decided to apply it equally across all its members.[Official Report, 25 March 2015, Vol. 594, c. 3MC.] A number of hon. Members have raised a number of issues connected to that; the point about part-time nurses and midwives was an interesting one. There are issues with how the NMC chooses to allocate the cost internally. However, I repeat the key point that the fee increase is likely to be in the region of £3 per registrant. That represents 2.5% of the NMC’s overall registrant fee, which covers a whole range of other services.

It may be helpful to the House if I set out some details about the services that the NMC provides. It is the independent regulator for nurses and midwives in the UK. Its primary purpose is to protect patients and the public through effective and proportionate regulation of nurses and midwives. It is accountable to Parliament—not Ministers—through the Privy Council for the way in which it carries out its responsibilities. It sets and promotes standards of education and practice, maintains a register of those who meet those standards and takes action when the fitness to practise of a nurse or midwife is called into question. It also has a role in promoting public confidence in nurses and midwives and in regulation.

Members from all parties would agree that we welcome the growing sophistication of the role of nurses and midwives and the extra responsibilities reflected in salaries and professional standards. That is part of the evolution of the professionalisation of standards that we all welcome.

--- Later in debate ---

[George Freeman]

It is a fair question, which I will come to, but it has nothing to do with the importance of getting this right; it is merely a matter of the regrettable constraints of parliamentary time. One reason why I very much hope my colleagues and I will be returned in May, Mr Hollobone—I was about to call you Mr Havard; I welcome you to the Chair—is that we will be able to get on with that important reform.

For the benefit of the House, let me finish summarising some of the important information about the NMC. The NMC’s total income for 2013-14 was £65 million. Its fee income was £62 million, which is quite a substantial sum. It received a grant of £1.4 million from the Department of Health and investment income of £1 million. Its expenditure totals £70 million, with £24.18 million, or 34%, going on staff. Its permanent headcount has been going up year on year. The average for the year 2014-15 was 496. The NMC had 521 permanent staff on the payroll in March 2014 and 577 in March 2015. The permanent headcount for March 2016 is projected to be 606. I merely point that out to highlight that the NMC faces some important considerations in driving productivity and efficiency internally to deliver the service it is statutorily required to deliver to its members, who fund it through subscription.

Let me turn now to the relationship between the PSA and the regulations we have introduced. The proposed change will be introduced in the Professional Standards Authority for Health and Social Care (Fees) Regulations 2015—or S.I., 2015, No. 400, with which you will be intimately familiar, Mr Hollobone, as an assiduous observer of these things—which have already been laid in Parliament. The NMC’s council meets this week to decide its policy towards them, so this debate is, again, extremely timely.

The NMC has decided to increase its fees for nurses and midwives from £100 to £120. The rise was effected through the Nursing and Midwifery Council (Fees) (Amendment) Rules Order of Council 2014, which came into force on 1 February. Although the NMC is an independent statutory agency, the Government have made it clear that they expect the NMC council to have clear justification for, and to consider nurses’ and midwives’ financial constraints when making, decisions on fees. I will say a little more in a moment about that and about the importance of the Bill to modernise the NMC’s constitution.

The NMC has consulted its registrants on the proposed fee rise, but I am aware of the strong body of opinion among those who opposed it, and that has been expressed in the debate and in the number of people who have signed the petition. The NMC says that it has not taken its decision lightly and that it has considered the responses to the consultation in detail and carefully listened to the issues raised, and I have no reason to doubt that. However, I remind hon. Members that the NMC’s first duty must be to deliver its core regulatory functions and to fulfil its statutory duties to ensure public protection, and the fee rise must be justified against its core duty.

Let me touch now on the Government grant, which is important. I appreciate that, since the NMC was established in April 2002, there have been a number of increases in its annual registration fee, and I appreciate the impact that that has had on dedicated nurses and midwives working long hours in difficult roles to provide excellent care. That is why, in February 2013—more than 10 years after the increases started in 2002—the Government awarded the NMC a substantial, £20 million grant to ease the pressure.

One purpose of that grant was to allow the NMC to protect nurses and midwives—particularly lower-paid nurses and midwives—from the full impact of a proposed annual registration fee rise. The grant meant that, in 2013, the NMC was able to raise its fee from £76 to £100 and not to £120, as originally intended. With a week before Parliament dissolves, the Government have no plans to give the NMC a further grant to subsidise the 2015 registration fee increase. Given that we continue to have to make tough decisions to put the economy back on track, and that we have given the NMC £20 million, it now needs to work out internally how best to allocate the fee increase, which I should remind hon. Members is equivalent to £3 per member if it is spread equally among them.

I am pleased to say that, as part of the broader package of measures the Government are putting in place to support the lowest-paid workers in the NHS, all the major NHS trade unions accepted the Government’s pay offer on 9 March. It will be implemented from 1 April, giving more than 1 million NHS staff, including most nurses and midwives, a 1% pay rise, without risking front-line jobs or costing the taxpayer more money. That means our lowest paid staff will receive the biggest rise.

I want to update hon. Members on the changes, because they are an important wider consideration against which to view the impact of the fees. For the lowest- paid, the 1% rise will mean an increase of up to 5.6%, or an extra £800 in their pay packets. I have looked at the salary figures, and the average, ending March 2014, for nurses, midwives and health visitors—the people we are talking about—is £31,000. They will get the 1% rise, which is an extra £800.[Official Report, 25 March 2015, Vol. 594, c. 3MC.] Importantly, staff earning between £15,000 and £17,000 will get an extra £200, which is equivalent to 2.3%. Nursing staff earning up to £40,558 who are not at the top of their pay band are still eligible to receive an incremental increase.

Let me take issue with the point that the Government are not looking after the lowest-paid. The pay offer specifically makes sure that the increases the system can afford are targeted at the lowest-paid. Those earning more than £56,000 are more able to cope with the challenges of pay restraint. We are supporting the poorest in the system most, and we are making the highest-paid bear more of the burden. Finally, the bottom pay point will be abolished, seeing the lowest pay rise from £14,300 to £15,000, with about 45,000 on the lowest two pay points benefiting.

[Mr Anderson]

I am interested in the average figure the Minister cites. Obviously, if he could give us his figures now, I would be happy to look at them, but could he also put them in the Library? The average he gave seems very high, when we are talking about the lowest point on the scale being £14,500. The average is more than double that—the scale must be heavily loaded at the top, which is not my experience from working in the public sector.

[George Freeman]

I will happily make those data available to the hon. Gentleman and put them in the Library. They are from the NHS staff earnings survey’s provisional statistics by staff group in England.

It is worth noting that UK taxpayers can claim tax relief via Her Majesty’s Revenue and Customs on professional subscriptions or fees that they must pay to carry out a job. That includes the registration fee paid to the NMC. Nurses and midwives on a salary of £30,000, confronted with a fee increase of £3, can therefore claim tax relief on it. A basic rate taxpayer would be eligible for £24 tax relief on the £120 fee.

[George Freeman]

I note with relish and interest what I assume is official Opposition policy—that they do not support the Chancellor’s announcement about funding for the RAF museum. The point that I am trying to make is that he already set out in the autumn statement a serious pay commitment to the lowest-paid staff in the NHS, which I was summarising.

I am glad that the hon. Member for Easington (Grahame M. Morris) has raised the issue of the Budget. The reporting on it has made it clear that for a pre-election Budget it was, far from making give-aways, surprisingly light on them, and was very much “steady as she goes”, continuing to pare down the deficit with fair tax reform. The truth is that we have cut income tax for 27 million people, and particularly for the lowest-paid nurses and midwives. The impact of that is nearly £900 a year from changes to the personal allowance. That is not fashionable stuff that captures the top line in red-top newspapers, but nurses and midwives do not exist in isolation. They have the NHS pay deal but also the important tax allowance changes introduced by the Chancellor. The Government are taking pressure off the lowest-paid workers in the NHS and elsewhere. Viewed in the round, those changes give us a record that we can be proud of, albeit within a difficult set of funding requirements.

[Mr Anderson]

Will the Minister give way on that point?

[George Freeman]

I really need to make progress.

[Mr Anderson]

We have got an hour and a half.

[George Freeman]

I happily give way.

[Mr Anderson]

The Minister made a point about tax, and that is welcome, but does he deny the fact that overall, people, including those we are talking about, are worse off under the present Government as a result of VAT rises and other rises across the economy? People are worse off than when they came to power.

[George Freeman]

I am glad, again, that the hon. Gentleman raises that, because fortunately the Chancellor was able to confirm that the Office for Budget Responsibility has confirmed that finally people in this country are better off, after a very difficult period. I am not going to pretend that it has not been difficult. The reason was that we inherited a chronic legacy of debt, deficit and structural deficit, which was tackled by the previous Government nowhere less than in health care. That created a situation in which, despite a growing economy, we face a huge structural challenge, exacerbated by demographics.

This year there are 1 million more pensioners in the system—1 million more people needing and generating high health demand. I do not hold the Opposition responsible for that. However, the lack of reform and the structural issues at the heart of the health service, which mean that the health structural deficit is growing faster than the general economy, have left us with a challenge. We need to tackle that.

As the hon. Member for Blaydon pointed out, the NMC has stated that there has been a significant rise in its costs, because of fitness-to-practise referrals, which are up more than 100% since 2008-09. Since 2008-09 it has raised its fee by only 63%, making up the bulk of the difference in cost through a programme of efficiencies. Without those it would have had to scale back its fitness-to-practise activity, or generate additional costs earlier. The NMC has provided assurances that it is committed to continuous improvement in carrying out its regulatory functions and will continue to deliver more efficient ways of working to maximise the value of registration fees and to keep them at the lowest level possible while enabling it to fulfil its statutory duty. The NMC is a £70 million-a-year organisation with substantial opportunities to put efficiencies in place, to reduce the cost of the £3 extra cost on its members.

As to the need to update the NMC constitution, the Government have worked with it to make changes to its legislation. We have made good progress with legislative change to reform the way it operates. On 11 December 2014 an order made under section 60 of the Health Act 1999, amending the Nursing and Midwifery Order 2001, came into force. Those changes to the NMC’s governing legislation will enable it to introduce more effective fitness-to-practise processes, while not lessening the public protection it provides.

A key amendment to the NMC’s governing legislation enables it, through its rules, to delegate the decision-making functions currently exercised by its investigating committee to its officers known as case examiners. The intended effect is to speed up and therefore reduce the cost of early-stage fitness-to-practise proceedings, as it will not be necessary to convene the full investigating committee to consider every allegation of impairment of fitness to practise. That should result in financial savings to the NMC as well as greater consistency in decision making. I think we would all welcome that. The rules that bring those changes into effect come into force on 9 March.

The section 60 order has helped the NMC by providing a degree of modernisation of its legislation. However, there is still much to do and that is why we asked the Law Commission in 2011 to review the whole framework of legislation underpinning professional regulation. The report was published last year and we published the Government response in January. I am aware that the decision not to progress a professional regulation Bill to take forward the thinking in the report in the current parliamentary Session was a disappointment to the NMC, as it was to us. We want to move on, but parliamentary time, as you know, Mr Hollobone, is an eternal constraint on Government’s ability to implement. However, that decision provided an opportunity to invest time in getting that important legislative change right, for the benefit of those who will be affected by it. Of course, it will not restrict the NMC’s ability to implement its own internal modernisation and efficiency programme, or to decide how to deal with the internal allocation of its fee obligations to the PSA. It is free to do that.

Oral Answers to Questions

Debate between George Freeman and David Anderson

Tuesday 24th February 2015 Commons Chamber

[Mr David Anderson (Blaydon) (Lab)]

Despite assurance from the Prime Minister, it is now clear that the drug Translarna will not be available until after NHS England has concluded its internal consultations. The Secretary of State and others have told me repeatedly that they have no control over the issue, but can the Minister give the House any idea when the drug will be available for young boys suffering from Duchenne muscular dystrophy in this country, in the same way as it is across Europe? The drug is saving young boys from going into wheelchairs earlier. Does the Minister have any idea when it will be available?

[George Freeman]

I have had a number of meetings with patient groups, campaigners and charities over recent months, and the hon. Gentleman will appreciate that due process is important. NHS England is looking at whether to make an interim ruling on the drug in advance of a decision by the National Institute for Health and Care Excellence, and I have worked with NICE to ensure that its process is accelerated. We should get a decision from NICE this summer, and I hope that NHS England will make a rapid decision based on that judgment.