Hospice Funding and the NHS Pay Award

Debate between Liz McInnes and Melanie Onn

Wednesday 31st October 2018 Westminster Hall

[Liz McInnes]

There is a theme developing on recruitment and retention. We have shortages of particular groups of staff, and a two-tier pay arrangement for different NHS providers will only exacerbate those problems.

[Melanie Onn (Great Grimsby) (Lab)]

The points that colleagues have made seem to reflect the situation around the country. The hospice in my constituency, St Andrew’s, provides end of life and respite care for adults and children. The chief executive spoke to me when I went to the opening of its new garden, and expressed exactly the same concerns and fears about future staffing arrangements. The hospice has an incredibly dedicated team of staff, but fears losing them if they can get better pay elsewhere in the NHS.

[Liz McInnes]

My hon. Friend highlights the problems that hospices up and down the country are experiencing with the recruitment and retention of staff. I will explore those issues further in my speech.

--- Later in debate ---

[Melanie Onn]

The chief executive of a social enterprise that provides social care in my constituency under the Care Plus Group TUPE-ed out several staff in order to continue to provide those services. Those staff are on Agenda for Change contracts, but they will not receive the Government uplift in pay, because as the chief executive says:

“The plan is to fund only NHS trusts and foundation trusts, to pay the uplift directly to them.”

The issue goes much wider in the healthcare sector than hospices. It will affect providers of health and social care in our communities, as well as those staff contracted out from the NHS, including porters, orderlies and caterers. I know that Unison is campaigning for those staff who have been privatised within the NHS. Does my hon. Friend think that all those staff are integral to providing healthcare for all of us, and should be included in the uplift?

[Liz McInnes]

My hon. Friend is absolutely right: this goes wider than hospices. It applies to non-statutory, non-NHS organisations that provide essential services to the NHS. Staff being TUPE-ed out is difficult, and I hope the Minister will consider it in her remarks. The pay award has to be funded from somewhere, and it is extremely unfair if NHS staff are TUPE-ed out to a non-NHS provider and lose out on the pay award as a result.

The chief executive of Springhill talked to me about the role of the clinical commissioning group, saying she hoped that

“the CCG will recognise this significant additional burden when agreeing our annual contract”,

and that it will

“not be expecting us to reduce our costs this next financial year.”

I know, and the interventions I have taken show, that the problems experienced by Springhill Hospice are replicated up and down the country, and I am grateful to hon. Members for sharing their experiences from their own communities.

Hospice UK estimates that, over the course of the three-year NHS pay deal, charitable hospices will face an additional bill of between £60 million and £100 million. It says that the Department of Health and Social Care’s criteria for non-NHS providers to access the additional funding set aside to support the implementation of the NHS pay award exclude the majority of the country’s charitable hospices from that essential support. The Department itself has acknowledged that most charitable hospices do not employ staff on NHS terms and conditions, as the staff working in hospices are not NHS employees. However, as hospices recruit their staff from the same local pool as the NHS, they have little option but to mirror the pay award made to NHS staff in order to recruit and retain the staff they need. As a consequence, hospices face a difficult choice: they must either ask their local communities to donate more to fund the pay award or look at options to reduce services proportionately to cover the cost. Neither is a palatable option for the hospices or for the communities that they serve.

The Department maintains that hospices should look to their clinical commissioning groups for additional support, yet research by Hospice UK shows that in recent years two thirds of hospices in England have seen their NHS funding cut or frozen—in many instances, for several consecutive years. In the absence of tariffs reflecting the costs of care, the NHS currently makes a contribution towards the costs of providing hospice care. It is on average just 30% of the costs of providing adult hospice care services and just 15% for children’s hospice services, although that funding varies widely around the country.

Hospice UK has suggested a solution to the problem, which is to follow the precedent set in 2004, when the employer contribution to the NHS pension scheme was doubled from 7% to 14%. At the time, the Labour Government acknowledged that charitable hospices would face an additional cost that they could not recover from elsewhere, so they set aside a national pot of funding to be distributed centrally to mitigate the impact. That worked very well and is a model that would work well in relation to the NHS pay increase by recognising the unintended consequences for charitable hospices while maintaining the integrity of the deal negotiated and agreed with the NHS trade unions.

Additionally, I have been contacted by my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard), who tells me that he has secured an agreement for 3,000 healthcare workers in his constituency who work for a social enterprise to receive Government funding to finance the pay rise, so clearly a precedent has already been set. I would be interested to hear the Minister’s comments on that.

The pay deal that has been agreed is a pay deal for NHS staff and is welcomed. Since this debate was announced, I have also been contacted by the Chartered Society of Physiotherapy.

[Melanie Onn]

It has taken me a little while to catch up, but did my hon. Friend just say that a colleague has managed to secure an independent agreement that the pay deal will be honoured for some workers in a hospice setting? If so, how is it possible that one person can get such an agreement from Government but everyone in this Chamber who is raising issues cannot?

[Liz McInnes]

I thank my hon. Friend: that is exactly the point that I wanted to make. A deal has been done in Plymouth for a social enterprise provider that is not a hospice but a provider of mental health services. Obviously, smaller deals are being done. My hon. Friend the Member for Plymouth, Sutton and Devonport is not able to be with us today, but I was very interested in the evidence that he sent me. The Department of Health and Social Care needs to look at the smaller deals that have been done and ask itself what on earth is going on.

To return to the issue of physiotherapists, they are clinical staff whose role in hospice care is sometimes forgotten. The CSP told me that its members overwhelmingly backed the pay changes when consulted earlier this year. It pointed out to me the importance of the physiotherapist’s role in enabling people with a terminal illness to stay active as long as possible—a really important role—and went on to say that with the current shortage of physiotherapists, it is relatively easy for staff to change roles if they wish to do so, and that employers who cannot broadly match NHS pay rates will find it increasingly difficult to recruit staff.

There is clearly real concern that the NHS pay award will have an unforeseen but damaging impact on charitable hospices and other organisations that are already at a significant disadvantage compared with other non-NHS providers in not receiving reimbursement for the costs of the care that they provide to NHS patients. A sustainable hospice movement is an essential component of delivering the improvements in end of life care that the Government have rightly sought. The Government must look again at the conditions imposed on non-NHS providers and consider how funding may be made available to prevent a diminution of the end of life care service.