Chancellor must answer three key questions on NHS pay and funding

11 March 2021

The chancellor must answer three key questions on NHS pay and funding at his upcoming evidence session on the Budget 2021 with the Treasury select committee on Thursday 11 March.

NHS Providers, the membership body for every NHS hospital, mental health, community, and ambulance service in England, has written to Mel Stride, chair of the Treasury select committee, to urge MPs on the committee to quiz the chancellor on his spending commitments for the health service.

NHS Providers is seeking reassurances from the chancellor that he will honour his commitment to give the NHS "whatever it needs" to meet any extra costs in dealing with COVID-19.

Even more pressing, is the need for the chancellor to clarify, why, with just 21 days to go before the new financial year starts, there is still no agreement on the NHS' budget next year.

Trust leaders fear that unless crucial negotiations between the Treasury and the NHS are concluded this week, they may have to start planning cuts of up to £7-8bn from NHS services from 1 April.

   

Trust leaders fear that unless crucial negotiations between the Treasury and the NHS are concluded this week, they may have to start planning cuts of up to £7-8bn from NHS services from 1 April for the first half of 2021/22 because they still have no certainty over their budgets next year, and the Treasury is still refusing to commit to covering the NHS' extra COVID-19 costs.

NHS Providers is also asking the Treasury select committee to press the chancellor on the decision to abandon the previous affordability assumption of at least a 2.1% pay rise for NHS staff, despite this being built into the NHS Long Term Implementation Framework and the extra funding for this rise being enshrined in the NHS Funding Act 2020.

NHS Providers is asking the Treasury select committee to put three questions to the chancellor:

  1. Will he honour his commitment to give the NHS "whatever it needs" to cover all COVID-19 costs?
  2. How he will ensure negotiations on the NHS' 2021/21 budget are concluded this week, allowing NHS leaders to plan their services for the next financial year, which starts in just 21 days' time?
  3. Why is he refusing to meet the minimum 2.1% affordability assumption that was covered by the NHS revenue settlement announced by Theresa May in June 2018 and enshrined in a formal act of parliament, the NHS Funding Act 2020?


Chris Hopson, the chief executive of NHS Providers, said:

"The chancellor has the perfect opportunity at Thursday's Treasury select committee session to put trust leaders' minds at ease on three key questions on NHS pay and funding.

"First, we want assurances from the chancellor that the Treasury will meet any extra COVID-19 costs incurred in by the NHS in full. Given the ongoing challenges, such as the backlog of care, budget cuts would be disastrous for patient care.

Trust leaders want the chancellor to confirm negotiations on the NHS budget for 21/22 will be completed this week so they can plan for the first half of the new financial year with absolute certainty.

Chris Hopson    Chief Executive

"Secondly, trust leaders want the chancellor to confirm negotiations on the NHS budget for 21/22 will be completed this week so they can plan for the first half of the new financial year with absolute certainty. It's unacceptable that 21 days before the start of the financial year, trust leaders still don't know what their budgets are.

"Thirdly, that the Treasury will honour at least the assumption of a 2.1% pay rise for our deserving NHS staff. As we set out in our evidence to the NHS Pay Review Body, our members have indicated their preference for a pay rise of at least 3%. Snatching planned pay rises from the pockets of NHS staff would be a huge mistake at a time when the NHS faces a major challenge on staff recruitment and retention."

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