Government NHS reforms cost £60m in redundancy payoffs

 
12 December 2012
WEST END FINAL

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Redundancy payments and other pay-offs to staff being cut from the NHS in London are costing tens of millions of pounds.

The bill for primary care trusts cutting their workforces came to more than £60 million in just two years, official figures show. Labour said the huge sum is equivalent to employing 2,240 nurses for a year.

Exit payments for 2010/11 cost Camden primary care trust £6.4 million, while Westminster spent £5.5 million and Tower Hamlets, £3.8 million.

It is believed some staff landed new NHS jobs soon after being made redundant with generous pay-offs. Shadow health secretary Andy Burnham attacked “the sheer scale of the waste of money resulting from the Government’s NHS reorganisation.

“It’s scandalous to spend this amount on managers’ pay-offs, only for many to be re-employed in the Government’s chaotic new NHS bureaucracy.”

Health bosses say a significant chunk of the £60 million went on redundancies when PCTs were merged into “clusters”.

Local health chiefs said Camden and Tower Hamlets faced such big bills partly because they were the employing organisations for a number of shared departments and functions which served not only their areas but PCTs in other parts of London. They also stressed that the changes led to lower management costs.

More than £250 million was spent by PCTs nationwide in exit payments over the two-year period, including compulsory and voluntary redundancies, early retirements, mutually agreed resignations and pay in lieu of notice.

Another wave of payments is being made — including hundreds running into six figures — as the remaining PCTs are replaced by groups led by GPs who will commission NHS services under Health Secretary Andrew Lansley’s reforms. The Government is under fire as it seeks to make billions of pounds worth of efficiency savings. Ministers claim the reforms will save on administration, allowing investment in front-line services and making services more locally accountable.

The Department of Health said: “Any costs associated with NHS reforms are one-off. By investing in these changes we will be able to reduce unnecessary bureaucracy and free up extra resources — £5.5 billion during this Parliament and £1.5 billion every year thereafter — for patient care.”

Most remaining PCT and strategic health authority staff are expected to move to new NHS posts.

“We want to minimise redundancies and maximise the retention of essential skills, so that patients and the wider public benefit from a high-quality health service,” the department added.

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