Agenda for Change: NHS Pay Restraint

Rupa Huq Excerpts

Monday 30th January 2017 Westminster Hall

[Catherine McKinnell]

The hon. Gentleman makes another valid point. I hope that the Minister is listening, because although we are focusing specifically today on pay restraint for Agenda for Change staff, there is a much wider issue for the Government to take on board. A variety of factors is affecting recruitment and retention of NHS staff. The axing of bursaries is just one significant factor that the Government should seriously examine, and reverse.

What has the pay restraint for Agenda for Change staff meant to individual nurses, midwives, paramedics, cleaners and other healthcare professionals since 2011? Depending on the measure of inflation used, it has resulted in a drop in real-terms earnings of up to 14%. To put that in context, the trade union Unison has calculated that it is equivalent to annual pay cuts of £2,288 for a cleaner, £4,846 for a nurse, £6,134 for a midwife and £8,364 for a clinical psychologist. Indeed, ahead of the 2017-18 NHS pay review process, Unison surveyed its members working in the NHS and received the following responses, which are a matter of deep concern: nearly two thirds felt worse off than they did 12 months ago; 49% had asked for financial support from family or a friend; 13% had used a debt advice service; 11% had pawned possessions; 11% had used a payday loan company; 15% had moved to a less expensive home or remortgaged their house; and just under one fifth took on paid work in addition to their main NHS job, 64% of whom did so because their NHS salary was not enough to meet their basic living costs. More than 80% said they had considered leaving the NHS in the past year.

[Dr Rupa Huq (Ealing Central and Acton) (Lab)]

My hon. Friend is making a powerful speech. Does she share the concerns of the London nurses at the lunchtime lobby today, who said that punitive London housing costs are making the situation even more acute? They feel that they are being forced out of the capital, which needs nurses, and that what is happening is almost social cleansing by the back door, pricing nurses out of our city.

[Catherine McKinnell]

Yes, I share those concerns, particularly about the significant shortage of nurses in London. The issue affects places throughout the country, but I fully appreciate the acuteness of the situation in London.

The findings that I have set out are mirrored in the most recent Royal College of Nursing employment survey of its members. It found that 30% had struggled to pay gas and electricity Bills, 14% had missed meals because of financial difficulties, 53% had been compelled to work extra hours to increase earnings, and 32% were working extra night and weekend shifts to help pay bills and meet everyday living expenses. The RCN stated:

“This corresponds with our year on year increase of 30%, over the past five years, on the number of our members seeking specialist money advice from our RCN Welfare Service. This contact from our members focuses predominantly on dealing with unmanageable consumer debt.”

It is shocking and depressing stuff. It is bad enough that the Government continually expect NHS staff, many of whom are at breaking point, to do more with less and treat more patients with fewer resources in what are usually physically and psychologically demanding roles, but to expect them to do so while they face such anxiety and stress over their own financial situation is completely unacceptable.

We do not need to take Unison or the RCN’s word for what is happening. I have received emails containing powerful testimony from NHS staff in my constituency. One explained:

“I have been qualified as a children’s staff nurse for 12 years and I reached the top of my pay scale four years ago. I have not had a pay rise since. 4-5 years ago I was in a comfortable position, I could afford the basics and if I wanted extras like holidays or treats I would just do overtime or extra shifts to afford these luxuries. However, due to the fact my pay against my cost of living has reduced by 14%, I now struggle to afford the basics and am having to do extra shifts just to be able to provide food and pay my bills… I am missing out on valuable time with my family as I have to work nearly every weekend in order to be able to get a wage that can cover our costs. It is now becoming such a stretch each month that I may have to leave nursing and find a job that pays me better... Working as a children’s nurse in a busy A&E unit is amazing and worthwhile, but it is very stressful. On a daily basis we deal with and see things that are devastating and can be difficult to switch off from. Our pay should reflect this.”

Another constituent challenged the claim made in the Government’s response to the e-petition:

“Average earnings for qualified nurses were £31,214 in the 12 months to June 2016”.

She described herself as an average nurse in her 40s with a partner and a child:

“I have been qualified and working in the NHS for 11 years. I don’t earn £31,214. The top of my band (band 5) is £28,464. So, I am paid about £14.50 an hour to clean up faeces, vomit, blood and other bodily fluids. To hold the hands of patients who are dying. To comfort the relatives of patients who are dying. To maintain complicated machinery/equipment that is keeping a person alive whilst watching the newly-qualified staff nurse who doesn’t feel confident and make sure they don’t do anything dangerous.”

Another constituent painted a very concerning picture about her financial situation. She recently qualified as a nurse—a year and four months ago. She is a single parent of three children, and commented:

“After studying hard for 3 years mixing university, placements and guided learning, I gained my degree only to find myself in more dire financial circumstances than I was as a student.

I live to a tight budget, I drive a car that is 16 years old, I don’t smoke or drink, and I rarely socialise with my friends unless it’s a special occasion. This month I was paid £1,450 after tax—from that £300 is childcare; £400 is rent; leaving £750 for the month covering gas, water, phone, food, insurance etc. I also receive £35 tax credits a week which covers my daughter’s bus fare to college and her lunch money.

I am a qualified professional and yet I would class myself as being on the breadline. I know there are others in greater need than I am; however I feel like I work hard and sacrifice my family time for nothing.”

Finally, a senior sister with 30 years’ experience in an acute trauma unit explained:

“After six years of pay restraint, I now see nurses struggling day to day to make ends meet. Those who have stayed are now planning to leave the NHS early and newly qualified nurses are unable to stay without reasonable remuneration.

I feel like I grieve every day for my profession now. We have an NHS workforce currently willing to work as hard as the service asks them, but this goodwill is now eroding faster than I have ever seen in all my years’ service.

I am retiring within a couple of years. This request comes not for me, but for those who come after me and who will be caring for me and my family in the future.”

It is clear that our NHS is facing a crisis, yet the people the Government entirely rely on to make the NHS work are being badly let down. Nobody would suggest for a minute that those working in the health service do it for the money. However, we have reached a situation in which nurses, midwives and other invaluable NHS staff are struggling to pay their bills or put food on the table, or are pawning their possessions or taking out high-interest loans just to get from one month to the next.

How can we expect people to continue to provide high-quality care to us and our loved ones in what are already increasingly challenging circumstances when they are also facing this level of stress and anxiety at home? I strongly urge the Government to look at this situation again and to take on board the concerns being raised not only by organisations such as Unison, the RCN and the RCM, but by NHS frontline staff who are saying loud and clear that this pay restraint simply cannot continue.

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[Andy Burnham]

It is not only a false economy; it directly damages the quality of patient care. When people arrive on the ward who do not know the team or the environment and have to be told everything, it builds in confusion and delays because staff have to take them through things. It does not make sense to use private staffing agencies to the extent that they are being used in the NHS. The cost is exorbitant—that is No. 1—but it also damages morale, because it leads to staff in the permanent employ of the trust working on the ward alongside people who are being paid significantly more than them for the same shift, despite having just arrived on that ward. That does not build a sense of team on the ward; it builds a sense of resentment.

[Dr Huq]

My right hon. Friend makes a powerful point about the lack of continuity with agency staff coming in. He talks about recruitment and retention. The NHS traditionally has had a large overseas workforce. Does he agree that the £35,000 salary required to settle in the UK has not helped matters? Nurses normally start at £23,000. Our NHS would crumble without overseas workers. We have also heard that in the post-Brexit climate, people from overseas feel less welcomed by this nation. Does he have any comment on that?

[Andy Burnham]

My hon. Friend makes two important points. The first was on the effect that Home Office immigration rules could have had on the nursing profession. I think the former Home Secretary, now the Prime Minister, made some changes in that regard.

My hon. Friend is right that there is a much bigger context here: the post-referendum climate. The Government have been absolutely wrong not to guarantee the status of EU nationals currently working in our national health service. I have an example from my constituency of a Polish community nurse, who every day gets up early to go on her local round delivering insulin to vulnerable patients who are diabetic and housebound. One morning she heard a cry of, “Go home!”, out of one of the bedroom windows opposite. What does that make that nurse feel like, and is she likely to stay when we are in this prolonged period of uncertainty in which this growing hostility is felt to be around? There is a real risk here. We cannot simultaneously refuse to give clarity to those tens of thousands of nurses from other parts of Europe who are currently working in our NHS and run down the good will of nurses who are UK nationals. In the end, something will give, and it will be patient care, if we operate policies of that kind.

Alongside that, there is the attack on nurse training. We have seen cuts to nurse training places over a number of years, so there is a shortage of nurses coming through. Many places are being and have been forced to recruit from overseas. In those circumstances, with everything else that I have described, including the downward pressure on headline pay, how can it possibly make sense to scrap the nursing bursary? Will that not just be another factor that adds to the growing sense of crisis in the profession? Every single piece of support that is there to develop the nursing profession is systematically being stripped away.

We have seen years of that approach and are beginning to see the consequences in the national health service. Labour, of course, did not get everything perfect—I am not saying that—but I can say with some pride that when I was a Minister in the Department of Health, we brought through a major programme of investment in the nursing workforce, through Agenda for Change. It was the subject of hard discussions, but in the end it was agreed between the trade unions and the Government of the day. We did have in the Department of Health a social partnership forum, which brought together NHS Employers, trade unions and the Government to iron out problems relating to the nursing workforce. We did massively increase the numbers in the nursing profession. We did ensure that they were properly rewarded and had proper access to training. My worry is that we are seeing some of that break down.

In the immediate aftermath of the financial crash, it was acceptable, it seems to me, to ask the nursing profession to make a contribution to deficit reduction, but here we are, six years on, expecting people who are out there today, working flat out to keep an NHS in crisis going, to take pay cuts for the privilege of doing so. At some point, that strategy begins just to fall apart, and the NHS falls apart with it. I say to the Minister that we are not far from that point now.

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[Justin Madders]

My hon. Friend has encapsulated the challenge we always face when a service is privatised. Most often the only way in which the savings promised by the private company can be delivered is by changes to staff terms and conditions. I also agree that the pay freeze affects not only nurses, but the whole of the Agenda for Change workforce. Today we are focusing in particular on some of the effects on nurses, because there are clear reasons why that position is unsustainable.

To return to some of the contributions we have heard today, my right hon. Friend the Member for Leigh described clearly the impact on a ward of having agency staff, and how that creates uncertainty and is not the most efficient way of working. There is also the manifest unfairness of having someone on the same ward, who is only there for that particular shift, earning significantly more than permanent members of staff. How demoralising must that be for those involved? He was right to say in conclusion that we cannot afford to lose the good will of the nursing profession further.

In common with many hon. Members who have spoken today, I pay tribute to everyone who works in the NHS and the health and social care sector, not only to doctors and nurses, but to other allied health professionals such as porters, healthcare assistants, cleaners, receptionists, care workers, paramedics and countless others. It is important to remember that behind every story about the crisis that our NHS has faced this winter are patients waiting too long for treatment, and hard-working public servants doing everything that they can to prevent a very difficult situation from getting worse.

The NHS is the biggest employer in the country—and one of the biggest in the world—and it depends on the tireless efforts of its staff to keep going and meet the challenges of rising demand and insufficient funding. Let us be clear: we cannot indefinitely keep asking them to do more for less. I would argue, as other hon. Members have, that only the good will of NHS workers has stopped the current crisis from turning into a catastrophe. I recently heard the staff who work in our NHS described as “shock absorbers”. That seemed to be a pretty good description of how they are taking and absorbing the relentless pressure and stress of being on the frontline of an underfunded health service. They can take that for only so long before something snaps, which is why it is so important that we fully explore these issues today.

The incredible determination, professionalism and compassion that we see from staff comes against the backdrop of six years of pay restraint. Salary increases for NHS staff have either been frozen or capped at a level far below the rate of inflation. According to Unison, between 2010 and 2016 that represented a cut of more than £4.3 billion from NHS staff salaries, or a loss of between 12% and 19% in actual value since 2010. The Royal College of Nursing believes that since 2011 there has been a real-terms drop in earnings of 14% for its members. With Treasury forecasts indicating that the cost of living will go up by more than 3% every year between 2018 and 2020, it is not difficult to see how the current policy on pay restraint is unsustainable.

The policy is already beginning to have a huge personal impact on some of those affected. Registration fees have gone up by more than a third in two years, and we know well that wages have not kept pace with the cost of living. As we have heard, particularly from my hon. Friend the Member for Newcastle upon Tyne North, staff surveys from the RCN and Unison found that nearly two thirds of staff feel worse off financially than they did a year ago. Forty-nine per cent. had asked for financial support from a family or friend, 13% had used a debt advice service and 11% had used a payday loan company. About a third of nurses are struggling to pay their gas and electricity bills, 53% are working extra hours just to pay their everyday bills and 11% had pawned possessions. The Cavell Nurses’ Trust also found that 20% of nurses had skipped a meal in the last year due to money worries. Those are not abstract figures; they represent real people.

There was a lobby of Parliament today, and I am sure that some hon. Members in the Chamber went to hear at first hand from nurses how they are struggling. I met a nurse from the west midlands who works three days a week because of her caring responsibilities. She told me that she is living below the poverty line. Are we not ashamed that someone caring for our most vulnerable has to live like that? Are we really comfortable with a situation in which the people we are asking to care for our loved ones are having to pawn their possessions in order to make ends meet? In one of the richest countries in the world, can any of us accept the sight of nurses going to food banks?

Nowhere is the problem more acute than in our capital city. The Nursing Times reported that 40% of nurses who currently live in London say that the cost of housing means they will be forced to leave the capital in the next five years. Of course that challenge is not unique to the health service, but vacancy rates in the London area are among the highest in the country, with at least 10,000 nursing vacancies. How long will it be before we reach a tipping point from which there will be no recovery?

The impact is not just on nurses in their daily lives outside work, but on their working environment. NHS staff surveys paint a picture that cannot be ignored. The 2015 survey for England found that 48% of those surveyed stated that a lack of staff was impinging on their ability to do their job, and only 43% felt able to manage all the conflicting demands on their time. The warning signs are there for us all to see.

Analysis of NHS England data by the Health Service Journal found that 96% of NHS hospital trusts in England had fewer nurses covering day shifts in October than they had planned, and 85% did not have the desired numbers working at night. In 2013, the regulator Monitor, now part of NHS Improvement, warned about the potential impact of continuing pay restraint, stating in a report:

“Capping wages for longer to keep costs down would be self-defeating for the sector in the long term as it would make recruiting and retaining good quality professionals increasingly difficult.”

We had that very clear warning four years ago, but we have not heeded it.

The evidence that we have heard today and on previous occasions has proved that that prophecy was correct. The Public Accounts Committee reported that the number of nurses leaving their jobs increased from 6.8% in 2010-11 to 9.2% in 2014-15. Simon Stevens gave evidence to that Committee in 2014, stating that pay restraint would not be an “indefinitely repeatable strategy”, yet that is exactly what the Government propose to do.

Pay restraint, along with a cut to the number of nurse training places in 2010, led to a situation in which the amount of money that the NHS spent on agency staff soared by £800 million in a single year to £3.3 billion in 2014-15. Although considerable steps have been taken to bear down on the figure since then, the situation only developed because of poor and short-term decisions made by the Government, and it remains the case that we still spend far too much public money on agency staff because the NHS has been unable to recruit and retain enough of its own. If we had maintained the levels set by the last Labour Government, we would have had 8,000 more nurses trained during the last Parliament.

Recent figures have revealed that the agency staff cap has been breached almost 2.7 million times in its first nine months of operation. That is a clear example of the impact of the recruitment and retention crisis on all areas of the NHS and how the current workforce balance is completely out of kilter. The use of agency staff is meant to be a temporary measure in times of particular demand and stress for the workforce, not a permanent feature. The fact that these incidences have run into the millions in less than a year should be a huge concern to the Government and a clear warning that the stability and continuity that we all want to see in our workforce is a long way from being achieved. The Government urgently need to address the situation in which hospitals seem unable to provide safe levels of care without relying permanently on agency staff.

The dependency on agency staff has made the case for a pay increase as strong as it has ever been. That is the view not only of the Royal College of Nursing, but of those that look at the impact of skills shortages on the wider economy. In March 2016 the Migration Advisory Committee found that many nurses are moving to agency work or leaving the profession altogether. The fact that the Government have had to put nurses on the skills shortages list should have been the point at which they realised that their pay restraint policy had reached the end of the road. Instead, they have ploughed on regardless, treating the symptoms rather than the cause.

In that regard, the disastrous policy of having tuition fees for student nurses will almost certainly make the position worse, not better. The Royal College of Nursing warned at the time that the policy could act as a disincentive for students from some backgrounds—particularly mature students and those on lower incomes—and early indications are that applications to study are down by at least 20%. If that turns out to be an accurate reflection of the position, the pressure on existing staff can only increase.

[Dr Huq]

At the weekend, on the doorstep, I met my constituent Dr Linda Burke, who is pro vice-chancellor for health and education at Greenwich University. She is really worried, because her university’s figures look like they are down by between 20% and 30%—UCAS will have final figures for late applications. She says that that is serious because it will directly reduce the number of nurses for the NHS. We should be thinking about our future workforce. Does my hon. Friend have anything to say about that?

[Justin Madders]

I am glad to hear that my hon. Friend is out on the doorstep on a Saturday morning, but sorry that the news she was given is so concerning. It is not, however, a surprise. This is something that just about everyone interested in the matter warned the Government of and, as she says, we will find out in the next month or so what the final figures are. If they are of the order that we are hearing about, the Government will have the opportunity seriously to reconsider the policy. Today, when I attended the lobby, I heard some student nurses saying that they are finding it difficult to get staff mentors, because senior staff are exhausted. They do not blame those staff for that; they understand the intolerable pressure, because they too see it for themselves.

The change to student fees will add an extra penalty on those training from this year onwards, due to the Government’s decision to freeze the student loan repayment threshold at £21,000. That means that all future nurses will face a real-terms pay cut. According to Unison, based on current salaries, the average nurse, midwife or allied health professional will lose more than £900 per year to meeting their debt repayments. In practical terms, for a nurse on band 5, that means a salary cut approaching 5%. It is abundantly clear that that will make staff retention harder, not easier; there is a clear link between pay and retention levels.

Nobody is suggesting for a minute that anyone who goes into nursing is motivated by money, but when someone who has just finished yet another draining shift, going above and beyond the call of duty time and again, finds that they do not have enough cash in the bank to feed themselves and their family, and when each year their wages buy them less and less, they could be forgiven for thinking, “Is it all worth it?” It is morally wrong for the Government to put our nurses in that position, and it makes no sense economically either.

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[The Minister of State, Department of Health (Mr Philip Dunne)]

Mr Evans, I am grateful to you for calling me to wind up the debate. It is a pleasure to serve under your chairmanship. I congratulate the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) on taking up the petition and giving a well-constructed speech, with which many people listening to the debate—not just Members from her party, but those outside—will feel considerable sympathy. I express similar sentiments towards the hon. Member for Ellesmere Port and Neston (Justin Madders). Although I do not agree with his prescription, I thought that he conducted himself in a thoroughly considered way, as usual. It is a pleasure to be shadowed by him, as well as by the hon. Member for Central Ayrshire (Dr Whitford), who as usual made a constructive contribution.

[Sir Roger Gale in the Chair]

First, I should say that we are all rightly proud of our national health service and the staff who work incredibly hard day and night for the benefit of patients. They undoubtedly deserve a cost of living increase, but we must recognise that the financial and quality challenge facing the NHS is unprecedented. These are not normal times. I deny the allegation that Agenda for Change staff are undervalued, as the right hon. Member for Leigh (Andy Burnham) indicated in his speech, which was knowledgeable, given his previous role as Health Secretary. Staff at all levels in the NHS do a fantastic job, and it is vital that we in Government and the leaders of the NHS recognise that staff morale is important to maintaining staff commitment to services.

In my experience of making visits across the NHS, hard-working staff put patients first every single day of the week. They do so because caring for sick and vulnerable people is as much a vocation for them as it is a job. I know that pay restraint is challenging, but when I speak to staff, they tell me that they want to know that the right number of staff will be working alongside them in the hospital or community setting. The Government have listened. Contrary to some of the contributions made by hon. Members, staff numbers have increased significantly across most grades since May 2010. We have recruited almost 11,800 more doctors. More than 13,300 more nurses are working on our wards today than in May 2010—the overall number of nurses working for the NHS is at an all-time high. There are over 2,100 more midwives, and more than 6,300 currently in training, as well as over 1,500 more health visitors and over 2,400 more paramedics.

The allegation that people are leaving the NHS in droves is simply not borne out by the facts. The most recent workforce statistics were published last week, covering the period ending October 2016, and they showed that a record number of full-time equivalents were working in our NHS.

[Dr Huq]

The Minister is giving figures for the current workforce, but does he have any for the future workforce? I mentioned my constituent, Dr Linda Burke, of nursing and education studies at the University of Greenwich. She is worried that due to the cut in nursing bursaries, the number of applications is falling, possibly by as much as 30%. The RCN itself has said:

“We have consistently raised concerns to the Government… Despite 100 years of nursing knowledge and expertise, our advice fell on deaf ears.”

The RCN is effectively saying, “We told you so.” Will he remark on that?

[Mr Dunne]

I can say to the hon. Lady that there are 51,000 nurses in training today—I cannot tell her whether that is a record number, but it is a very significant number. There are 1,600 paramedics in training, which I believe is a record number. She and one or two other hon. Members have given anecdotes today about applications for new courses starting in the autumn, but I cannot tell her what the figures will be, because I have not yet seen any numbers published by UCAS. I think that they are due in the coming days, so we will have to see.