The Agenda for Change pay system for NHS employees has so far failed to deliver promised productivity improvements, according to the government spending watchdog.
A National Audit Office report said although the NHS has successfully transferred 1.1 million employees on to a new, simplified pay system, the Department of Health (DoH) did not put enough emphasis on getting trusts to develop new ways of working.
The DoH predicted that Agenda for Change would save at least £1.3bn by 2008-09 and productivity would increase. However, no central monitoring arrangements exist to show what impact the new contract has had on productivity.
A key element of Agenda for Change, the 'Knowledge and Skills Framework', which defines the skills needed for a certain role and provides a tool for reviewing their use in the workplace, has not yet been fully implemented by many trusts.
Audit Office head Tim Burr said: "It was no mean feat transferring virtually all NHS staff on to a new pay system within a very constrained timeframe, and this element of Agenda for Change has been a success.
"On the other hand, the benefits that should have come with this new simpler system, such as more effective working, have not been wholly achieved. So the programme as a whole has further to go before it achieves the intended value for money for the taxpayer."
NHS Employers, which represents trusts, said it was aware of the issues surrounding the slow implementation of the Knowledge and Skills Framework and was working to improve the situation.