Where the IT pay cap will keep harming the NHS

Junior doctors’ strikes; chronic shortages of nurses, cuts planned across England -- all of this happening to our health service in 2016, a year which also saw a blanket pay cap on IT agency staff imposed, writes Don Tomlinson, managing director of health recruitment firm Max20.

Some might say that the last eleven months have been so bad for Health Secretary Jeremy Hunt and his Department of Health that 2016 is the NHS’s ‘Annus Horribilis’ -- not a year on which we “shall look back with undiluted pleasure,” as Her Majesty Queen Elizabeth II once remarked about 1992.

Also in the past is November 23rd 2015, the day Contractor UK published my article ‘How restricting pay rates will hurt NHS IT.’ Well, we can now look back almost one year on.

Equalising contractor and permie pay

Back then, on November 23rd, NHS Improvement (previously known as Monitor) introduced a cap on the amounts that what we and other specialist personnel agencies could pay staff who were contracting in the NHS. The plan then was -- and still is -- to bring the rates of contractor pay more in line with what a permanent equivalent would earn. This would be based on the NHS’s own Agenda for Change – pay rates.

I am afraid to say that the NHS rates caps have definitely begun to bite, as prior to them we could negotiate rates much more freely, and experienced NHS IT contractors could ask, and secure, more money per day for their expertise. Moreover, despite the positive spin put out by NHS Improvement, the fact is that almost two-thirds of finance directors at NHS trusts believe the quality of patient care has deteriorated in the past year.


The problem is that NHS Improvement has introduced rate caps on the basis of ‘one-size-fits-all,’ and while they may see this as a valuable corralling to bring the medical / clinical agencies in line, it has been a de-motivator for many of the agencies supplying specialist non-medical, non-clinical personnel, such as those skilled in IT.

Looking back over the past 12 months, we have seen a definite reduction in non-medical contractor requirements of about 10% on the previous year (prior to the cap’s introduction). But we have most definitely not seen any reduction in the need for specialist contract professionals with IT skills. We are now in constant discussions with the majority of our larger NHS Trusts, as to how to restructure projects and/or how to find more creative solutions which will enable their projects to be completed on time and within budget. These discussions are necessary because while the majority of projects underway are continuing, it is the new IT projects needing new funding that are hitting problems which the NHS Trust managers are trying to come up with new ways to solve. This is actually makes for an interesting challenge that may force new innovation.

Why the NHS's modernisation will suffer (and what the remedy is)

The challenge is made no easier by the fact that the NHS is a huge organisation, employing almost 1.5 million people (the largest employer in the whole of Europe), and no one can deny that changes must be made. But I firmly believe that the modernisation of the NHS, which relies on using state-of-the-art technology, will suffer if we don’t come up with different ways or rules for supplying specialist non-medical staff such as IT, Project Management, Information Management, Software Development contractors, and even computer-savvy scanners and data conversion staff.

We live in a time of an aging population and I cannot help thinking that anyone over the age of 30 will have their historic medical records stored somewhere in a paper-based format and not electronically scanned. So who is going to do all of the technical work of data preparation, scanning, validation, storage and so on across the country? We are currently supplying a team of project managers, trainers, IT support technicians and scanners to a large North West of England NHS Trust under their paperless initiative which, when completed, will be offered to other NHS Trusts across the country.

So there is still a massive amount of IT work to be done by the non-medical contractors and specialists despite NHS Improvement’s attempt to cap their pay rates willy-nilly. We must therefore get central government to see that the staffing pressures for the medical/clinical side of the NHS are dramatically different to those of the non-medical, non-clinical side; those in IT.

Final diagnosis

On the medical side, if there is a shortage of doctors and nurses today then wards will close today. On the non-medical side if we cannot staff up the big projects of tomorrow with sufficient numbers and quality of IT workers, then there could well be no NHS tomorrow.

And those big projects are ready and waiting. In fact, at the time of writing the market for specialist IT workers in the NHS and the wider healthcare market is currently advertising more than 6,000 NHS and healthcare-related opportunities (figures from gotojobboard), from specialist non-medical agencies around the country. Many of these opportunities are IT-related.

Finally, it is important to state that we do understand the need for the rate caps introduced by NHS Improvement almost 12 months ago, at least as far as the clinical staffing agencies are concerned, as something had to be done to counter the spiralling costs of supply. I also believe the next 12 months will show a shift in how non-medical agency suppliers develop innovative ways to work with the NHS to help them complete modernisation projects, particularly those in in IT. In this sense, for the health service’s non-medical partners such as IT staff suppliers and IT contractors, the recovery from a year without ‘undiluted pleasure’ appears to be in sight.  

Profile picture for user Simon Moore

Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
Printer Friendly, PDF & Email

Contractor's Question

If you have a question about contracting please feel free to ask us!

Ask a question

Sign up to our newsletter

Receive weekly contractor news, advice and updates.

Every sign up will be entered into a draw to WIN £100 Amazon Vouchers.

* indicates required