Reducing agency spend

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Employers use agency staff in a range of situations as a way to quickly fill difficult gaps and to ensure that services continue to be delivered.  

Guidance published by NHS Improvement consolidates all the rules surrounding the procurement of agency staff, including a ceiling on agency expenditure and introduction of maximum hourly wage rates. Further details can be found below.

The use of agency staff still represents a significant cost to employers however, and a strategic approach is needed in order to develop a more flexible and responsive workforce and to avoid inappropriate responses to cost pressures.

From this page you have access to examples of how temporary staffing has been managed in NHS organisations and information about what a successful long-term strategy, linked to effective workforce planning might look like. You can find out how the use of e-rostering can help to plan your workforce and reduce the need for temporary staff, and five high impact actions which trusts may want to implement as well how to guides on different aspects of agency usage.

Key points

  • Trust directors must understand their workforce needs in order to plan effectively and develop a workforce strategy that will deliver savings in the long term.
  • A planned, flexible mix of substantive and temporary staff can deliver cost savings and a high-quality patient experience.
  • Knowing the different financial and safety costs of different types of temporary staff will help trusts to make effective decisions about their flexible workforce.
  • Cultural change, supported by senior leaders, will be needed to implement a robust flexible workforce strategy.

What employers need to do:

  • Collect data and management information to build the foundation for a tailored flexible workforce strategy.
  • Research and implement relevant software packages to help manage temporary staffing and rostering.
  • Examine ways to use substantive staff more flexibly through careful workforce analysis – consider piloting your ideas with one department of staff group first.
  • Set up a staff bank or staff pool if none exist or consider extending existing bank arrangements to other staff groups.
  • Review procurement of agency staff to determine which staff are not being supplied under a framework or local agreement and how to make better use of agencies.
  • Review recruitment time-to-hire data and induction practices to reduce the demand for temporary staff.
  • Ensure that policy and practice are in place to improve the health and well being of NHS staff.
  • Explore the possible adoption of the staff skills passport to improve flexibility and deployment – consider the possibility of sharing trust-specific bank staff across organisations.
  • Re-examine internal controls and governance to improve agency authorisation and sign-off procedures, to the extent that board-level review is in place.
  • Involve HR and internal communications teams to implement organisational change and ensure staff engagement.

Consolidated guidance

The consolidated guidance from NHS Improvement outlines the rules on the procurement of agency staff across all groups including doctors, nurses and all other clinical and non-clinical staff which apply from 1 April 2016. 

The rules require compliance against a ceiling set for total agency expenditure, the use of approved frameworks to procure all agency staff at rates set at or below the price caps, and introduce a maximum hourly wage rates for agency workers from 1 July 2016. 

Ambulance trusts and ambulance foundation trusts also have to work within expenditure ceilings and use approved framework agreements from 1 April 2016 and apply the price caps and wage rates from 1 July 2016.

Further information on the agency rules can be found on the GOV.UK website.

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