NHS must show pay restraint to save jobs, HR chief Clare Chapman warns

The people chief of the NHS has sent a clear signal to unions that the health service must implement pay restraints to save jobs as it grapples with tighter budgets next year.

Workforce director-general Clare Chapman refused to rule out recommending a pay freeze for all staff from April 2011 in a bid to minimise the number of redundancies and deal with expected budget cuts.

In April, nurses and other NHS staff will enter into the final year of their three-year pay deal, worth 8% in total, which will bump up pay by 2.25% for 2010-11.

The government has pledged to protect the deal, but Chapman (pictured left) could not rule out minimal or no pay rises in future.

She told Personnel Today: “There will be a big trade off between pay restraint and the number of jobs. The more we can exercise pay restraint, the less impact it will have in terms of jobs.”

The NHS will enter into talks with unions about pay rises from 2011 towards the end of this year. Pay awards are set by an independent body and usually depend on the level of inflation.

When asked about the possibility of a 0% pay rise, Chapman said it was “too soon to say”. However, she said: “What I’m saying is it’s very clear that there will need to be discussions around the trade off between pay restraint and jobs.”

The HR chief insisted it was “far too soon” to be contemplating the number of job cuts, adding: “The very first thing, quite rightly, that services are doing at the moment, is looking at what they can do to release efficiencies, to invest [resources] back into care and staff experience.”

Mike Jackson, deputy head of health at Unison, the main NHS union, stressed that pay levels were determined independently by the NHS Pay Review Body.

He said: “I accept that job security is probably the biggest issue among NHS staff in the period coming forward. We are here to sit down with government, to discuss the relationship between job security and pay.”

Jackson added if the government showed it was serious about minimising redundancies, Unison would accept the need for pay restraint to save jobs.

But, he said: “The question is whether employers can provide job security. If they can’t, they can hardly ask us to provide pay restraint.”

He warned that if inflation was high towards the end of this year, it would be “more difficult” to agree a pay deal based on moderation.

Last week the government announced senior NHS managers earning more than £81,800 would have their pay frozen in 2010-11.

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