Most NHS pay is governed by the Agenda for Change contract, which separates pay into a number of pay bands.
The rates of pay on Agenda for Change are reviewed on a yearly basis by the government, which usually means that there is a pay rise agreed for each year.
In theory this pay rise should be applied for the start of the tax year in April. However, in practice, the complex process of agreeing and implementing a pay rise for hundreds of thousands of staff often means that pay rises end up having to be backdated to cover the period between April and whenever changes in pay are actually implemented by NHS finance teams. The NHS pay rise has only been agreed twice before April in the past 5 years.
How will the NHS pay rise for 2024 be decided?
To try and protect the NHS pay rise from becoming tied up in political debate, the government asks the NHS Pay Review Body (PRB) to provide recommendations on what it thinks is both affordable for the NHS and fair for NHS staff. The Pay Review Body is normally made up of economists, HR experts and people who have held senior trade union roles in the past. Board members are appointed by the government.
The recommendations provided by the PRB take the form of a lengthy report including highly detailed recommendations on pay and related matters and evidence from trade unions, other industry bodies and the Treasury – you can read previous reports on the PRB website.
When will the NHS pay rise for 2024 be announced?
This year, the government delayed its instructions to the PRB by a month, which means in turn that the deadline for the PRB to return its recommendations will be a month later than usual – May 2024.
In the past, there has been some difference between the PRB’s deadline for submitting their report and the report being made public alongside agreed changes in NHS pay by the government.
Given all the above, we expect that a pay rise is unlikely to be announced before June 2024; depending on exact timings, NHS staff may not receive any extra pay until their August pay packet.
How much will the NHS pay rise be for 2024?
Until the PRB’s recommendations are published, we won’t know for sure. However, from speaking to a range of NHS finance professionals, we understand that most NHS organisations are budgeting for a maximum overall rise in wage bills of between 4-5% for 2024. If we assume a pay rise of 4.5% across all bands, that would mean:
- Pay for someone at the bottom of Agenda for Change Band 5 rising from £28,407 to £29,615
- Pay for someone in the middle spine point of Agenda for Change Band 6 rising from £37,350 to £39,030
- Pay for someone at the top spine point of Agenda for Change Band 8a rising from £57,349 to £59,930
However, the government’s instructions to the PRB also included specific references to affordability given the current economic climate. Some government finance contacts we spoke to believe this means the government is unlikely to be willing to match or exceed inflation, which (as of February 2024) is at around 4% according to most measures. This might mean a raise in the region of 3-3.5% is more likely.
It is also worth noting that pay increases are not always applied uniformly across all pay bands. In recent years there has been a trend for larger pay increases for staff on lower pay bands (including the removal of Agenda for Change Band 1) and smaller increases for more senior staff (or even no increases for some senior staff, such as those on Bands 8a and above).