NHS pay review body: twenty-sixth report 2012 - Official Documents

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3.15 The OBR forecast in November 2011 that employment levels will be broadly unchanged between 2011 and 2012 but will gradually pick up from 2012. In line with a weaker outlook for GDP growth, the OBR revised up its projected level of unemployment from 2.5 million to 2.8 million in 2012. The unemployment rate was expected to rise, rather than fall, in 2012. Between the start of 2011 and the start of 2017, the OBR expected total employment to increase by around 1 million. Within this, private sector employment was expected to increase by around 1.7 million, offsetting a total reduction in general government employment of around 710,000. Average Earnings Growth and Pay Settlements 3.16 Private sector average earnings growth remained modest throughout 2011, at 2.0% in the three months to November 2011. Public sector average earnings growth (excluding the nationalised banks) was at 1.4% in the three months to November 2011 (see Figure 3.10). Figure 3.10: Average weekly earnings (total pay), three-month average, 2006 to 2011 % annual growth 8 6 4 2 0 -2 -4 2006 2007 2008 2009 2010 2011 Whole economy Private sector Source: Office for National Statistics. Public sector Public sector ex financial services 3.17 The OBR revised down its forecast for earnings growth in November 2011, in line with higher expected unemployment and lower productivity growth8 . It expected wage growth of around 2% in 2012, picking up gradually to 4.5% from the second half of 2014. Adjusted for inflation, this implied negative real wage growth until the start of 2013. The Treasury’s average of independent forecasts expected slightly higher average earnings growth of 2.4% in 20129 . 3.18 The median pay settlement level was stable at around 2.5% throughout 2011, up slightly from 2.0% in 2010, on the Incomes Data Services (IDS) measure (see Figure 3.11). Pay settlement levels were below inflation throughout 2010 and 2011. According to settlements monitored by IDS, only 8% of private sector pay settlements in 2011 had 8 Office for Budgetary Responsibility, Economic and Fiscal Outlook, November 2011. Available at: http://cdn. budgetresponsibility.independent.gov.uk/Autumn2011EFO_web_version138469072346.pdf. 9 HM Treasury, Forecasts for the UK Economy: A Comparison of Independent Forecasts, January 2012. Available at: http:// www.hm-treasury.gov.uk/d/201201forecomp.pdf. 27
28 been freezes compared to 20% in 2010. The vast majority of public sector pay reviews had been freezes, with the exception of a 1.4% pay increase at Royal Mail and the Post Office. Figure 3.11: Pay settlements, 2008 to 2011 (three-month average) % 6 5 4 3 2 1 0 -1 -2 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Sources: Incomes Data Services, Office for National Statistics. Evidence from the Parties Apr-10 Jul-10 Oct-10 Jan-11 Median RPI inflation Upper and lower quartiles 3.19 The parties’ evidence was submitted in September and October 2011 and therefore reflects the economic and labour market indicators available up to the time of submission. The Health Departments 3.20 The Department of Health provided the overview of the general economic context for the UK. The Government considered that the UK economy was still recovering from the deepest recession in living memory during which GDP fell by 6.4%. In March 2011, the OBR forecast GDP to grow 1.7% over 2011 rising to above-trend rates from 2012. The Government added that output expanded for the first half of 2011 but it was less than forecast by the OBR. 3.21 The Government commented that global conditions were making the recovery more difficult and, while it had taken action to tackle the deficit, the UK was not immune to risks posed by deteriorating global confidence and instability in financial markets. The Government considered Britain’s deficit was the largest in its peacetime history and it was committed to a fiscal mandate which would achieve cyclically-adjusted current balance by the end of the rolling, five-year forecast horizon. At Budget 2011, the Government reaffirmed its aim to restore the structural current deficit to balance over the course of the Parliament. Net borrowing in the year (to the time of the evidence) was broadly in line with the OBR’s forecast but there remained substantial uncertainty over the medium term particularly in relation to market sentiment towards high-deficit countries. The Government concluded, therefore, that the UK faced significant risks until fiscal sustainability was restored. Apr-11 Jul-11 Oct-11 Dec-11
Page 1 and 2: NHS Pay Review Body Twenty-Sixth Re
Page 3 and 4: ii © Crown copyright 2012 You may
Page 6 and 7: Contents Summary of Recommendations
Page 8 and 9: level since August 1994. We have co
Page 10 and 11: Chapter 1 - Introduction and Backgr
Page 12 and 13: in his 20 June 2011 letter that the
Page 14 and 15: 1.21 At the time of submission of t
Page 16 and 17: Chapter 2 - Recruitment, Retention
Page 18 and 19: Table 2.1: Change in NHS workforce
Page 20 and 21: Table 2.3: Leaving and joining rate
Page 22 and 23: Distribution of Staff on Agenda for
Page 24 and 25: Table 2.5: Median gross weekly pay
Page 26 and 27: Figure 2.8: Growth in median gross
Page 28 and 29: Figure 2.9: Estimated pension membe
Page 30 and 31: 3.4 3.5 Figure 3.1: Distribution of
Page 32 and 33: Figure 3.4: Composition of FTE staf
Page 34 and 35: Inflation 3.10 In the context of th
Page 38 and 39: 3.22 The Government noted that infl
Page 40 and 41: of components of CPI and RPI over t
Page 42 and 43: Table 3.1: NHS revenue since 2000/0
Page 44 and 45: 3.46 The Department added that rece
Page 46 and 47: surplus on its Departmental Expendi
Page 48 and 49: Evidence from the Parties The Healt
Page 50 and 51: 3.83 We make our assessment of the
Page 52 and 53: staff median earnings across the ec
Page 54 and 55: equired to seek evidence or advice
Page 56 and 57: 4.17 For this report, Unite initial
Page 58 and 59: Table 4.4: Staffing establishments
Page 60 and 61: pre-registration trainee pharmacist
Page 62 and 63: Proposal for a National Recruitment
Page 64 and 65: 4.47 UCATT has drawn to our attenti
Page 66 and 67: Chapter 5 - General Workforce Issue
Page 68 and 69: • • • • • • Specialist
Page 70 and 71: 5.19 The 2011 NHS Staff Survey in E
Page 72 and 73: Our Comment 5.34 From the evidence
Page 74 and 75: planning process could become fragm
Page 76 and 77: Staff Bodies 5.60 The Staff Side sa
Page 78 and 79: Chapter 6 - A Forward Look 6.1 In t
Page 80: Data and Evidence Requirements 6.13
Page 83 and 84: 74 PROTECT UNTIL PUBLICATION PROTEC
Page 85 and 86: 76 PROTECT UNTIL PUBLICATION 114
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80 PROTECT UNTIL PUBLICATION PROTEC
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82 Deputy First Minister & CabinetS
Page 93 and 94:
Appendix B Recommended Agenda For C
Page 95 and 96:
C2 C3 86 Figure C3: Composition of
Page 97 and 98:
Table C4: Ambulance 88 England FTE
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Note that, in years when the number
Page 101 and 102:
Table D3: HCHS Paybill per FTE (£)
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Table D7: HCHS Workforce (FTE) 1,8
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APPENDIX F Previous Reports Of The
Page 107 and 108:
APPENDIX G Glossary AfC Agenda for
Page 109 and 110:
UK United Kingdom VAT Value Added T
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