Crackdown on agency spending saves NHS nearly £1bn

The NHS in England has seen a significant reduction in spending on temporary staffing agencies, with nearly £1 billion saved in 2024/25, following the government’s introduction of stricter agency spending limits.

Introduced by Health and Social Care Secretary Wes Streeting in November 2024, the policy required NHS trusts to cut agency staff spending by 30% in the short term. According to recent figures, this has contributed to improvements in patient care, including reduced waiting lists and increased safety, as reliance on temporary staff has been linked to higher rates of clinical incidents.

The savings have supported pay increases across the NHS workforce. For example, consultants, GPs, and other senior doctors will receive a 4% rise, while nurses and other Agenda for Change staff will see average increases of 3.6%. The starting salary for nurses is expected to rise from approximately £27,050 to £31,050. Resident doctors will receive an average pay increase of 5.4%, including a consolidated payment of £750.

In 2023/24, the NHS spent around £3 billion on agency staff, with some agencies reportedly charging up to £2,000 per nursing shift due to staffing shortages. The government and NHS England have stated their intention to reduce or potentially eliminate agency spending entirely, with further measures under consideration if progress is not maintained by autumn.

A new joint delivery group from the Department of Health and Social Care and NHS England will oversee progress, while trusts have been instructed to assess bank staff rates to ensure they align with local market averages and to reduce use of bank staff – NHS staff who work temporary shifts at hospitals – by at least 10% in addition to limits on agency spending.

Health Minister Ashley Dalton 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.

‘We’re already backing our health workers with above-inflation pay rises and now, nearly £1 billion is being reinvested back to the frontline, getting patients off waiting lists and putting money back into our workforce’s pocket.’

Image: Shutterstock

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