The Government plans to ‘eliminate’ the use of agency staff across the NHS by the end of this parliament and will consider a new law to enforce this if ‘sufficient progress’ to reduce spending on agency staff is not made by autumn 2025.
In a letter to integrated care boards (ICBs) and Trusts, health secretary Wes Streeting and NHS England chief executive Sir James Mackey said they would be taking ‘decisive action’ to ensure Trusts meet the temporary staffing target set out in the planning guidance. This target was to reduce spending on agency staff by 30% over the next financial year.
However, it added that the aim was to ‘eliminate agency use altogether by the end of this Government’s term of office’, and that the Department of Health and Social Care and NHS England would establish a delivery group to monitor the progress of this.
‘If we do not feel that sufficient progress is being made by the autumn, we will consider what further legislative steps we should take to ensure that use of agency staff is brought to an end,’ the letter said.
They added that so far agency spending in 2025 was down by £1bn compared to 2024, following the crackdown on ‘rip-off’ temporary staffing agencies.
In 2023 to 2024, the NHS spent around £3bn on agency staff, according to the DHSC.
Reducing costs and maintaining a flexible workforce
‘We are clear that there is no room for waste in the NHS and every organisation within the health service must play its part. It is simply not right that the taxpayer should foot the bill for billions of pounds of spend on agency staff,’ the letter said.
‘In most cases, agency margins are an unnecessary cost to the service, when other models allow access to the same flexible workforce.’
Health minister Ashley Dalton said: ‘The taxpayer has been footing the bill for rip-off agencies for too long – while patients have languished on waiting lists and demoralised staff faced years of pay erosion.
‘That’s why we are pledging to eliminate this squander, and through our Plan for Change we are making major progress and seeing a radical reduction in costs.
‘We’re already backing our health workers with above-inflation pay rises and now nearly £1bn is being reinvested back to the frontline, getting patients off waiting lists and putting money back into our workforce’s pocket.’
However, resident doctors in England have begun receiving their ballots for renewed industrial action after the British Medical Association said the Government failed to make an offer which would move them towards pay restoration.
Boost frontline services and help to cut down waiting lists
Further commenting on the plans for agency spending, Elizabeth O’Mahony, chief financial officer at NHS England, added: ‘The NHS is fully committed to making sure that every penny of taxpayers’ money is used wisely to the benefit of patients and the quality of care they receive.
‘Our reforms towards driving down agency spend by nearly £1bn over the past year will boost frontline services and help to cut down waiting lists, while ensuring fairness for our permanent staff.’
Last month, a survey by NHS Providers found that 47% of Trust leaders were scaling back services to deliver on financial plans and 37% said their organisations were cutting clinical posts amid financial pressures, with a further 40% considering this.
Some 94% said the steps needed to deliver financial plans would have a negative impact on staff wellbeing and culture at a time of existing low morale, burnout and vacancies.
Last year, Mr Streeting promised to cut long hospital waiting times back down to the NHS 18-week target via financial incentives and performance league tables, as well as announcing plans for stopping NHS staff resigning and then immediately offering their services back to the health service through a recruitment agency and a ban on NHS Trusts from using agencies to hire temporary entry level workers in band 2 and 3, such as healthcare assistants and domestic support workers.
A version of this article was originally published by our sister publication Healthcare Leader.
