Patients may never feel full benefits from biggest NHS pay reform in UK history, says The King's Fund

Patients will never feel the intended benefits from the biggest NHS pay reform in UK history unless health service leaders secure changes in the working patterns and productivity of more than a million nurses and other staff.

That is the verdict of a new report published today by the King's Fund. Realising the Benefits? Assessing the Implementation of Agenda for Change is the first independent report on the impact of the new pay system affecting over one million nurses and other NHS staff, which was rolled out nationally in December 2004. The report is based on case studies of 10 NHS trusts and interviews with officials, union representatives and managers at national and SHA level, as well as with NHS employers and unions. While it does not purport to be a comprehensive analysis of Agenda for Change, it provides useful insight into the impact of the key pay reform to date.

The report says that following years of negotiations, national implementation of the new pay and career development structure was rushed and has exceeded all cost estimates. It concludes that for some NHS trust managers transferring staff to the new system became an end in itself rather than a way to achieve the longer-term benefits of treating patients more quickly and providing a higher quality of care. Unless Agenda for Change is properly embedded, and the associated Knowledge and Skills Framework becomes fully operational, the full benefits for patients and staff will never be realised, it warns.

However, most managers favour Agenda for Change over the old system and believe it can help them improve productivity and patient care.

King's Fund chief executive Niall Dickson said: 'Agenda for Change was intended to modernise more than a million NHS jobs and improve patient care. However, this limited but important study shows that as yet there are few signs it has delivered increased productivity or transformed practice and there is evidence that many staff are far from satisfied by the process.

'One of the most significant concerns raised by the report is the absence of an independent, robust evaluation of the impact of Agenda for Change – despite the fact that templates for such evaluation have been developed. Given the scale of the exercise, the millions of pounds of taxpayers money that have been and are being spent, the failure to undertake this is indefensible.'

The report reveals that the costs of Agenda for Change are more obvious than the benefits which are often hidden or difficult to quantify. The longer-term benefits will not be realised unless greater efforts are made to use the new pay system in the way it was intended – to facilitate and reinforce improvements in skills, roles and motivation.

Report author James Buchan said: 'Agenda for Change was supposed to benefit patients as well as NHS staff. Some trusts are using it to secure changes in working patterns. Others, dealing with a crowded agenda and nationally led pressure for rapid implementation, have seen it as little more than a 'tick box' exercise, rather than as a way to make services more effectively.

'Implementation has been rushed with no one body taking responsibility for ensuring all proposed benefits actually become a reality. As things stand, the ability to deliver all the potential benefits to patients is constrained by variations in local management capacity and willingness for following through with the reform’s original objectives. It will require additional effort and support to realise all the benefits envisaged when the new system was designed and agreed.'

It makes a number of recommendations:

  • It calls for a systematic, independent audit of the cost and impact of Agenda for Change. A list of benefits to be realised in the short, medium and long term was drawn up at the beginning of the process, but there is no evidence that this has been used to assess the progress at NHS trust level, or applied regionally or nationally to track success or failure in achieving intended benefits.
  • SHA chief executives must support networking and sharing of good practice in their regions to ensure patients feel the full benefits of reform nationwide.
  • Managers at trust level need to strengthen their commitment to both the spirit and letter of Agenda for Change to secure full benefits not just for the workforce but for improved care and increased productivity.
  • The need for the accompanying competency-based career structure, the Knowledge and Skills Framework, to be fully implemented so all staff have personal development plans and meaningful appraisals. The KSF needs to be kept simple, robust and properly resourced in order to build staff confidence that the system is designed to deliver career improvements.

Read the report: Realising the Benefits? Assessing the Implementation of Agenda for Change

Notes to editors: 

  1. Agenda for Change applies to all NHS staff apart from doctors, dentists and senior managers. It affects more than 1 million workers.
  2. Agenda for Change was first discussed in 1997, and the initial proposals were published in February 1999, but national roll out didn’t begin until December 2004.
  3. 99% of eligible staff were on Agenda for Change payments by end of 2006 although unsocial hours payments have still not been agreed.
  4. Agenda for Change replaced multiple complicated pay systems with just two pay spines, replaced London weighting with regional “high cost area” pay supplement and allows for recruitment and retention premiums for hard to fill posts.
  5. It incorporates a Knowledge and Skills Framework, a national job evaluation scheme and competency based-career framework which will provide every employee with a personal development plan.
  6. The Department of Health estimated that the overspend on Agenda for Change was £220 million in 2004/5 (in evidence to the Public Accounts Committee, March 2007)
  7. Interviews were conducted with participants between March and May 2007.
  8. Realising the Benefits? Assessing the Implementation of Agenda for Change by James Buchan and David Evans is availabel to download on The King's Fund website.
  9. For further information or interviews, please contact the King’s Fund media and public relations office on 020 7307 2632 or 020 7307 2581. An ISDN line is available for interviews on 020 7637 0185.