On Monday 2 June, the UK Government has announced that almost £1 billion in savings has been redirected to NHS frontline services after a crackdown on agency staffing. This comes after Health and Social Care Secretary Wes Streeting introduced strict spending limits on agency staff in November, calling for a 30 percent reduction in short-term spending by NHS trusts.
The savings, achieved during 2024/25, are part of a broader government effort to increase NHS funding and address long-standing challenges in workforce management and patient care. Officials said this reduction in agency spending will allow more resources to improve patient care, reduce waiting lists and enhance clinical safety.
The Government argues that reducing reliance on temporary staffing helps cut clinical incidents and boosts care quality.
The reforms have supported above-inflation pay rises for NHS staff, including doctors and nurses, fully funded from central budgets. Resident doctors, for instance, will see a 5.4 percent average pay rise, while Agenda for Change staff, covering nurses, health visitors and porters, will receive a 3.6 percent increase. The starting salary for a nurse is set to rise to about £31,050.
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Call for NHS trusts to reduce agency dependence
Streeting and NHS England Chief Executive Jim Mackey have urged NHS trusts and integrated care boards to build on these savings and eliminate agency spending altogether. Should progress stall, the government has indicated it may consider legislative action by autumn to enforce further reductions.
Ashley Dalton, Health Minister, 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.”
The NHS reportedly spent £3 billion on agency staff in 2023/24, with recruitment agencies charging up to £2,000 for a single nursing shift due to the 113,000 staffing vacancies across the service. The government has previously directed NHS trusts to reduce bank staff use by at least 10 percent, while also evaluating local market rates to ensure they do not exceed average equivalent agency rates.
Elizabeth O’Mahony, Chief Financial Officer at NHS England, commented, “Our reforms towards driving down agency spend by nearly £1 billion over the past year will boost frontline services and help to cut down waiting lists, while ensuring fairness for our permanent staff.”
Nicola McQueen, Chief Executive at NHS Professionals, supported the government’s approach, adding, “NHS Bank services are transforming workforce deployment, boosting productivity, and driving substantial cost reduction across the NHS. Last year we displaced over £680 million of external agency fees across NHS Trusts and healthcare organisations, providing more than 40 million hours of patient care.”
REC response to government measures
The Recruitment and Employment Confederation (REC) responded critically to the government’s announcement. REC Chief Executive Neil Carberry challenged the notion that agency work is the primary issue within the NHS workforce model.
“Employers globally use agency staff to effectively manage employment costs and varying demand as an addition to their core substantive employees,” Carberry said. “Agencies help save money and improve service, while offering skilled professionals the working lives they want.”
Carberry criticised the Department of Health’s approach, arguing that cost controls have punished agencies that adhered to government guidelines, while others have continued to charge higher rates.
“Officials have built a system that has raised bank costs higher than agency, and punished those agencies who signed up to cost controls at the expense of those that didn’t in the name of this crusade,” he said.
He also voiced concern over the potential impact of further cuts on NHS staffing safety, warning that the “scapegoating statement” from the government might raise public alarm and demoralise agency workers, who remain essential to the system’s operation.
“The NHS needs a balanced workforce strategy. That means combining long-term investment in training and retention with a flexible approach to meeting immediate pressure and treating agencies as partners rather than as peripheral players to be blamed,” Carberry added.
