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NHS could save £480m a year by cutting agency staff

Research reveals five locum doctors cost the NHS over £2m a year

Mark Gould

Monday, 03 September 2018

The NHS could save up to £480m a year if trusts filled temporary vacancies with workers from a "staff bank" instead of using expensive temporary agencies, according to a new study.

The NHS trust regulator NHS Improvement says that temporary staff, such as doctors and nurses supplied by agencies, cost on average 20% more than those from the NHS’s own “staff banks” despite doing the exact same job.

Its study found that the five most expensive locum doctors currently cost the NHS more than £2m per year. One agency has been charging up to £480 an hour for one consultant, and £200 for a further five — compared to £76.10 which is what the NHS would expect to pay if they came from the trusts’ own “banks”.

Over 150 locum doctors have been working at the same trust for over two years, with 14 doctors having worked at the same trust for over five years. Almost 340 nurses have been reported as having worked over two years at trusts.

The NHS has already managed to cut its spending on agency workers by £1.2bn, or a third, since NHS Improvement introduced a cap on the cost in 2015. Also, improvements to staff rostering and new options of flexible working hours for NHS staff have meant fewer staff feel the need to join agencies in the first place.

Last year (2017/18), spending on bank staff was higher than for agency for the first time in several years, leading to a £528m reduction in agency spend for the NHS.

But the NHS is still missing out on significant potential savings, which could be instead used to improve care for patients.

NHS Improvement is calling on NHS trusts to take a “bank first” approach to recruiting temporary staff, and only use agencies as a last resort.

And it has set all trusts in England a target of reducing their agency costs by 17% for 2018/19.

Ian Dalton, the chief executive, of NHS Improvement, said: "Trusts have made fantastic progress in reducing spending on expensive private agency staff over the last three years. These savings mean more money for other vital NHS services and ensure every penny the NHS spends counts.

"But there is further progress to be made. Bank staff cost the NHS less than agency staff and could improve a patient's continuity of care. That is why we want trusts to take a bank first approach, and only use agency staff as a last resort.

"Temporary agency workers play an important role in ensuring staffing numbers remain at a level that provides the best possible care for patients and gives them the opportunity to work flexibly. But an over-reliance on high cost private agencies when there are other options available is not good for patients or for the NHS’s finances."

Miriam Deakin, the deputy director of policy and strategy at NHS Providers, which represents NHS community, mental health and acute trusts, said: "The reliance on agencies across the health and care system is a sticking plaster solution for the growing number of vacancies across the NHS and the increase in demand for services.

"Temporary staff continue to play an important role in the NHS staffing mix, but we urgently need a long-term approach to staffing that is underpinned by a comprehensive workforce strategy."

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