Policy briefing: Chancellor’s statement on NHS pay (29 July 2024)

What has been announced?

Addressing the House of Commons on Monday 29 July, the Chancellor, Rachel Reeves, has made a series of important economic announcements relating to NHS pay.

The Chancellor confirmed that the Government and the British Medical Association (BMA) have reached an agreement to put a new pay offer for junior doctors. If accepted, this offer will deliver an additional pay rise of between 3.71% and 5.05%, averaging 4.05%, on top of their existing pay award for 2023-24. This will be backdated to April 2023.

The Chancellor said that the Government will also accept the recommendations of the Review Body on Doctors’ and Dentists’ Remuneration (DDRB) for 2024-25 and uplift each part of the Agenda for Change pay scale by 6%, plus £1,000 on a consolidated basis, averaging an increase of over 8%, with an effective date of 1 April 2024. Both rises combined means a doctor starting foundation training in the NHS will see their base pay increase to £36,600, compared to around £32,400 before this offer was made. A full-time doctor entering specialty training will see their basic pay rise to over £49,900 from around £43,900 before this offer was made.

The Chancellor stated that in order to meet the recommendation of the Pay Review Bodies, Treasury is asking all departments to find savings totalling at least £3bn ahead of the Autumn budget, including measures to stop all non-essential spending.

What do we say?

Along with leaders across the health sector, we welcome the confirmation from the Government that hardworking health service staff will benefit from an above inflation pay rise.

However, our members are only too aware that this year GOS contracts rose by only 1.68%, under the previous Government. As was set out in the statement from the OFNC, of which we are a member, this represented another real-terms cut to the NHS sight test fee. There was also no increase in the domiciliary visiting fee, the pre-registration training grant, or the CPD grant.

We, along with sector partners, will be setting out the clear case to the NHS and Government on the need to improve on this offer in the next round of GOS contract negotiations. Key factors include: 

• The impact of cost and wage inflation on an already under-funded sight test
• The history of previous under-inflationary settlements
• The cost increases resulting from the changes to the education and training for optometrists
• The cost of additional administrative burdens on GOS providers resulting from changes to referral processes
• The impact of fuel and transport cost increases on the domiciliary sector.

We have long-campaigned for the need to make better use of optometrists to tackle the backlog, and prevent avoidable irreversible sight loss, but a real-terms increase to the NHS sight test fee is needed to ensure the sight test is funded fairly.

The announcement by the Chancellor that at least £3bn out of the total £9bn cost for accepting all of the pay review body recommendations will be absorbed by government departments is significant. We will continue to put forward solutions to the Government, including our latest policy work on glaucoma care, and our One million campaign to help address the GP appointments crisis ensuring eye care can be provided to patients close to home and cost-effectively.