Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Osborne reveals NHS pay restraint bombshell


Nurses working in the NHS will continue to see their pay restrained, with annual salary rises restricted to 1% over the next four years, Chancellor George Osborne has said today as he laid out the new government’s financial plans.

However, he also announced the national minimum wage for people over the age of 25 will increase – creating a “national living wage” – to £7.20 an hour in 2016, and then £9 by 2020.

In his first budget announcement since the Conservative government won the election, Mr Osborne said there was a “simple trade-off” between pay and jobs in many public services.

“I know there has already been a period of pay restraint. But we said last autumn there we would need to find commensurate savings in this parliament,” he said.

“So, to ensure we have public services we can afford and to protect more jobs, we will continue recent public sector pay awards with a rise of 1% per year for the next four years,” said Mr Osborne.

The chancellor said the NHS was the government’s “priority” and went on to reiterate the Conservative commitment to provide it with an additional £8bn a year by 2020, in line with the Five-Year Forward View, the five-year plan set out last autumn by NHS England boss Simon Stevens.

Mr Osborne said this was on top of the extra £2bn already promised for the NHS budget this year, which would amount to an additional £10bn a year by 2020.

However, he noted that the NHS itself would have to make “very challenging” efficiency savings over the coming years.

“Public spending should reflect public priorities and we have to make choices. Our priority is the national health service,” he said.

In its full budget document published today, the government states average levels of public and private sector pay are the same, but that public sector workers “continue to benefit from a significant premium once employer pension contributions are taken into account”.

“George Osborne’s announcement might look attractive at first glance, but he’s simply giving to the low-paid with one hand and taking away with the other”

Dave Prentis

It says restricting pay to 1% a year from 2016-17 onwards will save the government around £5bn by 2019-20.

The document also reveals there will be a “renewed focus” on reforming progression pay and other terms and conditions for public sector workers.

Meanwhile, it explains that workers over the age of 25 will be paid a premium on top of the national minimum wage to ensure they earn what Mr Osborne is calling a “national living wage” of at least £7.20 an hour from April 2016.

However, the Living Wage Foundation – an independent charity which calculates annual minimum rates of pay – sets the current UK living wage at £7.85 an hour, and £9.15 an hour for those living in London.

Unison described the 1% pay award as “miserly” and said the announcement would “hasten the reluctant exit of many dedicated staff from our hospitals, schools and local councils”.

The union’s general secretary Dave Prentis said: “The economy is growing yet public servants remain shut out of the recovery.

“Britain won’t have public services fit for 21st century needs, unless wages for public servants are high enough to attract the best recruits. Pay austerity might be over for MPs but it’s set to continue for many more years for everyone else in the public sector.”

He added “An hourly rate of £7.20 is not a living wage. George Osborne’s announcement might look attractive at first glance but as tax credits are cruelly snatched away – leaving many workers £1,200 worse off – he’s simply giving to the low-paid with one hand and taking away with the other.”

The Royal College of Nursing echoed concerns about the “shock” announcement to limit pay rises to 1% for nurses and other public sector workers.

It warned of “serious consequences” for nurses and patients, pointing to the ongoing struggle being experienced by the NHS in recruiting nurses.

“Nurses are already feeling the effect of what will now be a decade of severe pay restraint”

Peter Carter

Peter Carter, chief executive and general secretary of the RCN, said: “Nurses are working harder than ever under greater pressure as demand for their care is growing.

“That demand is only going to increase over the years to come,” he said. “Nurses are already feeling the effect of what will now be a decade of severe pay restraint and subsequent reduced living standards.”

He added: “This decision will make the situation worse as nurses realise they are not valued – the shock of this announcement will be felt by many.

“There is an independent NHS Pay Review Body that makes recommendations about NHS pay awards – until the chancellor spoke today, nursing staff were totally unaware that this was disappearing.”




Readers' comments (56)

  • 8:59pm

    Wow! Nobody was suggesting profiting from patients! The issue here is not that the public must pay more but that the government should be more sensitive in how they share out the national budget - particularly since MPs have cheerfully just accepted 11%.

    Unsuitable or offensive? Report this comment

  • Nurses have been badly paid since missus thatcher- sorry but it ain't going to change as has been proved today-off to be a tube driver

    Unsuitable or offensive? Report this comment

  • Check out what happens when a union cares for and supports its members taking strike action .................

    Unsuitable or offensive? Report this comment

  • To be honest, the 1% pay rise doesn't surprise but what worries me more is the talk of taking away unsociable hours!!!! My nightshifts are what keep my head above water every month and I'm sorry but Anon 8 Jul 8:59pm, you should be ashamed of yourself for even making a comment like that! No nurse profits from families and patients misfortunes but as professionals, we deal with difficult, heartbreaking and sometimes life-threatening situations and decisions in all scopes of the nursing profession and after many years of continued study to become better at what I do I think it's only right we are paid in accordance with this and the fact that the cost of daily living has increased dramatically over the last few years and continues to do so!

    Unsuitable or offensive? Report this comment

  • 10% for osborne and his cronies..great eh

    I hope all you nurses who voted tory are so proud of your achievment....and wait until your out of hours pay is cut!!!

    Unsuitable or offensive? Report this comment

  • michael stone

    Loads of responses very quickly - pay and working conditions, invariably attract responses like bees to honey. That seems to be true of all forums.

    Unsuitable or offensive? Report this comment

  • There is a genuine lack of steel in our
    We do this job to help make a difference to other people, their lives and to improve their quality of life.
    Money is not a nurses master.... we however should note the incredible work we do not only for individuals but for the communities and the general population.
    We must stand up and demand more respect, better conditions, more staff and of course a pay that reflects the commitment we show everyday in making a difference. Shame, Shame, Shame on the government and our nursing leaders....

    Unsuitable or offensive? Report this comment

  • I'm not sure this is a bombshell really, we've been treated badly for years. I've only just come into the profession. I did so out of love for the job, not the money. However, saying that, I'd like to earn enough money so that I'm not constantly worrying over bills, etc.

    If 1% was being rolled out to everyone - I get it. But for us to be penalised when they're getting a huge pay rise is just not fair.

    I love my job, I probably wouldn't leave the NHS, but it has crossed my mind many times.

    Unsuitable or offensive? Report this comment

  • "Added to that people with dementia who were wondering about and pulling out IV lines, which entails having to do the same job twice to rectify that"

    "I would suggest do the job properly in the first place in the correct environment with the correct skills and remember the "people with dementia" are mums, dads, aunties, uncles, husbands, wives and partners - humility and compassion would resolve this not loads of extra staff"

    Sorry, but why would doing the job properly in the first place stop people with dementia from pulling out the lines? Would it make them undertsand better why they had a line sticking out of their skin?

    I suppose more staff would help, in a way - there would be somebody to sit with people and distract them from pulling things out. Off topic, of course.

    Unsuitable or offensive? Report this comment

  • In response to "I came into nursing to care and serve the children and families placed in my care. I did not come into nursing to concern myself with profiting from their poor fortune" well done, but I do enjoy getting paid fairly for a job well done, I do not have the luxury of working as a charity case.

    Unsuitable or offensive? Report this comment

Show 102050results per page

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.

Related Jobs