Public Accounts Committee

Oral evidence: Managing the supply of NHS clinical staff in England, HC 731

Tuesday 23 February 2016

Ordered by the House of Commons to be published on 23 February 2016

Watch the meeting: http://www.parliamentlive.tv/Event/Index/2860eef0-36d6-4bf1-902c-344fd75bb5f7

Members present: Meg Hillier (Chair), Mr Richard Bacon, Chris Evans, Mr Stewart Jackson, Nigel Mills, David Mowat, John Pugh, Karin Smyth

Sir Amyas Morse, Comptroller and Auditor General, National Audit Office, Adrian Jenner, Director of Parliamentary Relations, National Audit Office, Laura Brackwell, Director of Health Value for Money, National Audit Office, and Marius Gallaher, Alternate Treasury Officer of Accounts, were in attendance.

Witnesses: Professor Ian Cumming, Chief Executive, Health Education England, Jim Mackey, Chief Executive, NHS Improvement, Charlie Massey, Director General, Strategy and External Relations, Department of Health, and Rosamond Roughton, Director of NHS Commissioning, NHS England, gave evidence.

Q1 Chair: Good afternoon and welcome to the Public Accounts Committee. We are here today to discuss the NAO’s Report on the supply of NHS clinical staff, which is clearly a vitally important topic as it involves all front-line staff—doctors, nurses and others directly involved in caring for patients.

              We have four witnesses today. From my left to right, we have Ian Cumming, the chief executive of Health Education England. We have Charlie Massey from the Department for Health, representing the permanent secretary and himself. We have Ros Roughton from NHS England in place of Simon Stevens, and no doubt representing herself as well; and Jim Mackey, the chief executive of NHS Improvement. Welcome back to those of you we have seen before.

              Given that the NHS employs in the region of 800,000 clinical staff, we recognise that that is a big cost to providers—around half of the total cost—and crucial to the operation of the NHS. We also recognise the complexity, as it takes time to train staff and ensure that a workforce plan is backed up with the pipeline necessary to do the work. However, the NAO Report makes it clear that long-term workforce planning could be much better than it is, and that the way short-term staff shortfalls are filled can be, and often is, very costly, and sometimes very inefficient as well, so that is one area that we wanted to probe.

              We want to hear a bit from you today about who is responsible for which aspects of the programme, what your vision is—there are four of you, so it would be interesting to know if there are differences of vision—and how you are planning to make sure that the future NHS clinical workforce will meet all the various policy requirements coming down the line. Just before you came in, we were discussing the proposed Government policy that women have £3,000 to spend on their own maternity care. Personalised budgets will have an impact on workforce planning as well.

              We want to hear how you will make the approach more robust, how you will deal with staffing shortfalls where they exist, including geographical variations, and how you will ensure that all this is done in a way that is efficient for the taxpayer, because that is clearly one of our main concerns as a Committee. I will hand straight over to David Mowat, who will be leading on the questioning.

              Q2David Mowat: Thank you, Chair, and good afternoon. Before we get into the nitty-gritty of the processes and how you do planning, just in terms of context, the thing that struck me when I was reading the Report is that you are planning broadly flat changes to clinical staff over the next three or four years. Yet if we look at how our health system in this country operates, we have something like 20% to 25% fewer doctors than equivalent health economies in Europe; I think we are 24th out of the 27 EU countries in terms of numbers of clinical staff.

              I wanted to check, first of all, that all of you are comfortable that we are in the right ballpark with numbers of doctors and they have all got it wrong, or perhaps it is because of how you manage your workforce. It is a very stark difference, particularly when I apply that to your apparent intention of keeping levels broadly similar in the next three or four years. Perhaps we can start with Mr Massey.

              Charlie Massey: The overall context is really important. The workforce, as the Chair was saying, is incredibly diverse. It changes, there is a huge amount of churn between different specialties and so on. As for the numbers that we have got, Ian may want to say a little more about the workforce plans that Health Education England talked about in their workforce plan published at the end of last year. They are planning to produce between 25,000 and 80,000 extra staff through the spending review period to enable us to fill the vacancies and meet some of the gaps in demand that we face at the moment.

              Q3 David Mowat: Indeed. The Report talks about 50,0000 gaps. My question, which you didn’t answer, was actually a wider one. Does the fact that we have 20% to 25% fewer doctors than equivalent health economies indicate that we are much more efficient and better managed, or are they doing something different from us?

              Charlie Massey: Others will have views, but I think we have a reasonably well managed clinical workforce across England. It is very difficult to make precise comparisons, because the nature of the workforces in different countries is different. Certainly, if you look at the different segments of our workforce, we have different expectations about the degree to which numbers will remain flat or grow during the spending review period. If you look at doctors, for example, over the last 10 years, we have seen a very significant increase in the number of consultants employed in the NHS workforce, and that rate of growth is somewhat different from other European countries. I think it is very difficult to create a neat comparison between England and those other countries.

              Q4 David Mowat: Right. So your point, just to cut through that, is that the comparison is too simple. Has anybody else got any other observations on the fact that we have so many fewer doctors than equivalent health economies?

              Ian Cumming: It depends which country you compare us with. There are some countries that have fewer doctors per 100,000 population than we have; in fact, in some parts of America, you would find that they have fewer doctors per 100,000 than we do in the United Kingdom. In the UK we also have something that is relatively unique in terms of how the system operates, and that is the role of the GP as a gatekeeper who provides that day in, day out care to families and populations, but also filters the workload that goes through to our secondary care consultants.

              We also have a much wider range of allied health professionals than you would find in many other countries in Europe, and they are able to operate on a greater, extended and expanded scope of practice than many other countries. In fact, I was talking to some colleagues from the EU just last week about some of the range of tasks that our radiographers, physiotherapists and OTs are able to undertake that in their country are undertaken only by doctors. If you group that together and look at the multidisciplinary, multi-professional approach we take to providing healthcare, that goes some way to explaining the numbers difference.

              Q5 David Mowat: Just on a point of fact, I think Mr Pugh has a question on this, but there isn’t much discrepancy between us and the rest of Europe. The only countries that have fewer doctors than us are Latvia, Estonia and Lithuania. I basically take your point, which I think is the same as Mr Massey’s: your view is that we manage it better, so the context or starting point for all our workforce planning is that there is some magic sauce in there, in terms of how you and people like you run the NHS, that means you can do it with so many fewer doctors.

              Ian Cumming: We manage it differently, I think.

              Q6 John Pugh: I want to follow through not on the quantitative point but on the quality or types of doctors who are training. We are talking about doctors in a rather global way. One of the interesting stats is that the figure on page 15 of the Report appears to show that we have more consultants in the country than GPs, which I think would surprise a few people. Are you happy with that balance? Do you think it is right? If you are not happy with it, what are you doing to change it?

              Ian Cumming: If you look back over the period between 2004 and 2014, we saw a 44% increase in the number of consultants employed by the NHS. That is a very significant increase. In that same period, we saw an increase in the number of GPs in this country of around only 15%. Over the past few years we have very much turned our focus and attention towards providing more GPs, because we would all recognise that GPs are currently a very hard-pressed specialty. There is a lot of pressure falling on them: people are living longer, some with more long-term conditions, and the population is growing.  Although our consultants in secondary care are of course actively involved in that, a significant percentage of the burden falls on GPs. We undoubtedly need more GPs, which is why we are currently part way through a programme with NHS England to secure an additional 5,000 GPs, 1,000 physician associates and 4,000 nurses and allied health professionals to boost the teams working in primary care.

              Q7 David Mowat: We have talked about GPs in the past—certainly in the session Mr Mackey was at—and one of the issues with them was the very high levels of turnover. I think the Report talks about 9% of nurses and doctors leaving every year on average. Is that a number that—

              Chair: Just to be clear, that is just nurses.

              David Mowat: I think there was a doctors’ figure as well.

              Laura Brackwell: It was just nurses.

              David Mowat: I beg your pardon. Who is accountable for trying to manage that figure down? Obviously one thing we can all agree on is that the cheapest and best way of manpower planning is to keep valuable people you already have. Which of the four of you is accountable for trying to improve that figure?

              Chair: You can put your hand up if you like.

              Charlie Massey: May I make a start? Obviously the Department of Health is ultimately accountable for securing value for money for healthcare spend across the system and has a really important role in aligning and co-ordinating partners across the system. Indeed, the Department of Health sets the Health Education England mandate each year. Nevertheless, as the Chair said at the beginning, workforce is an incredibly complex area. The reforms that we put in place from April 2013 with the establishment of Health Education England were designed to try to push the workforce planning and the commissioning of education and training to be more arm’s length from the Department. Those are the responsibilities that Health Education England takes, which is why it has been doing particular work on return to practice in relation to the point you made about nurses.

              Q8 Chair: Sorry, but Mr Mowat asked a very specific question: who is responsible? You say you are accountable overall, but who is responsible?

              Charlie Massey: The point I am trying to make is that workforce is an incredibly complex thing that underpins everything we do across the health and care system. I was going to come on to say that employers have a really important role because each and every one of those nurses is employed by individual trusts or elsewhere in the system. That is where NHS Improvement’s role is really important too. I do not make an apology for saying that there is not a simple answer, because if there was, it would almost by definition be wrong.

              Q9 David Mowat: No, but it is too easy in a way. Of course the employers are the trusts but the difficulty is that that prompts one to ask why do you have a centre if the accountable body for everything is the trust? Supposing that 9% departure rate for nurses, as the Chair said, goes to 15% next year. In many organisations, there would be very clear managers who would be personally accountable for that having happened and would be trying to manage that down. In the NHS, where is that accountability?

              Jim Mackey: That is where we would come in. It is right that individual employers are responsible for that but, as NHS I, we will be trying to ensure that providers are in a healthy position in terms of staff satisfaction, staff productivity, retention and so on. We try to identify those that may have problems and support them to get—

              Q10 John Pugh: Who collects the data that tell us why they left and where they went? Do we have any data on that? Is there any centrally held bank of information so we can say why 7.9% of staff on average and 9% of nurses leave? Is there any collation of data on that?

              Charlie Massey: The employer staff record collects data at a trust level and it collects a lot of that data. I do not think that we have enough of that data at the moment and, indeed, Patrick Carter makes the point in his report that we need to get better at managing demand and better at understanding the destinations and reasons for people leaving. We need to be more systematic in the way in which we do feedback and exit interviews when people leave trusts. A lot of the data exists in the system and a lot of that data is at a national level.

              Q11 David Mowat: Just for complete clarity, do any one of you systematically read exit interviews for nurses, doctors, GPs or any other part of the organisation that you manage and that may be recording leaving figures at a higher rate than we would all like?

              Rosamond Roughton: Certainly in my area of responsibility, which is oversight of the commissioning of primary care services, we have commissioned a detailed review of all the evidence about why doctors are leaving earlier than their retirement age. We will be getting the report by the end of this week and that will be one of the building blocks in terms of delivering the extra 5,000 doctors in general practice, which we want to do.

              Q12 Chair: Have you included in that the pension pot limit?

              Rosamond Roughton: We have run some focus groups to ask about the pension pot issue and, anecdotally, we are hearing messages about people who have reached their pension pot limit feeling that they have some alternative options.

              Q13 Mr Bacon: Is the review that you have just referred to and that is being published in one week specifically addressing the issue of pensions?

              Chair: Just to be clear, you are not publishing. You are getting it back—

              Rosamond Roughton: We have commissioned a review to look at all the evidence out there—all the research that has been done in this country and some international work as well, although it is less relevant in this context—that gives us information about why doctors might be leaving general practice.

              Q14 Mr Bacon: And what is the answer to my question?

              Rosamond Roughton: The answer to your question is that we have not asked them to look specifically at the pensions issue. We have asked them to tell us what the evidence tells us.

              Q15 Mr Bacon: So you expect that they would look at that.

              Rosamond Roughton: If that has come up in research, we would expect them to tell us that.

              Q16 Mr Bacon: You made it sound as if you had done something different on pensions. You have done a couple of focus groups and, anecdotally, this that and the other. Everyone knows that this is an important issue. Are you saying that when you commissioned this review, you did not specifically mention it and say, “Make sure you look at this”?

              Rosamond Roughton: They are doing a meta review. They look at all the pieces of research that have been published.

              Q17 Mr Bacon: What does meta review mean in English? Most of us don’t speak Greek.

              Rosamond Roughton: Meta review means that you look at all the pieces of research that have been done. It is not a piece of research from first principles. It is looking at whether we can bring together the 20 pieces of work that have been done.

              Q18 Mr Bacon: It is looking at the available work that has been done.

              Rosamond Roughton: Yes.

              Q19 Chair: May I just check something? You are receiving this. Mr Bacon talked about a publication date. I am not sure whether they are the same things. Would you clarify that?

              Rosamond Roughton: When we receive this, I would see no reason why we would not then publish it.

              Q20 Chair: Straightaway pretty much—within weeks.

              Rosamond Roughton: Yes.

              Q21 Chair: You talk about existing research. The pension pot issue is a fairly recently arrived one, so is there research out there?

              Rosamond Roughton: That is the question. That is why we have run some focus groups of existing doctors and doctors who have recently left general practice to understand what the issues are.

              Q22 Chair: To be clear, is this just doctors?

              Rosamond Roughton: This is just doctors, but we are beginning to do some work—it has not started yet—on nurses in primary care as well.

              Q23 David Mowat: First, it is good that you are doing that. You presumably, or potentially, will then take some actions to address issues of doctor and nurse retention. So you are in a way acknowledging that the centre has a role to play, which was not entirely the answer that your colleagues gave when they said that it was principally all the people in the acute trusts who are responsible for this. I am just interested in how that accountability ends up, because you can do all these focus groups, you can commission all these reviews and you can say, “Well, that’s the reason. I wouldn’t mess about with it,” but there is still a problem. Who has taken responsibility for it?

              Rosamond Roughton: The world of general practice, with 7,800 independent providers that are on the whole very small, is governed by different legislation and regulation from the role of NHS trusts and foundation trusts, where you have got a board, an HR director and all the things that go with that. For general practice, given that, as Professor Cumming said, we are concerned about the need to increase the number of doctors working in it and the number of staff, I am concerned to make sure that the staff who are working in that area are supported in doing so. For very small providers, which may be employing three people, we need to do something nationally, as well as what they can do as individual employers.

              David Mowat: Okay. Let us leave that for now then—

              Q24 Karin Smyth: Before we leave it there, the recruitment issues in general practice have been well known for many years, but the entire strategy around the five year forward view for NHS England, including the vanguards and so on—every model—is predicated on out-of-hospital care, medically left predominantly for and based on general practice. So has the stable door been bolted—or whatever the right phrase is—by doing this review now, to understand those issues better, when we are two years into the five year forward view?

              Rosamond Roughton: At NHS England, we set out our absolute commitment to investment in general practice. I think that over the past two or three years you can see that that investment has increased by more than it had previously. In our board’s paper in December we set out the primary care allocations, which are between 4% and 5% a year for the next five years. I think we are working hard to shift, if you like, the balance of investment around the wider NHS, so that we do have sustainable general practice working as part of wider services.

              Q25 Karin Smyth: We know that the percentage spent on general practice has been declining over that period of time, so even to reverse it will take—I don’t know. How long do you think that will take? When will you get back to a position in which general practice as a percentage of spending in NHS England is equal to where it was in 2008?

              Rosamond Roughton: I do not know the answer to that, but I know that over the next five years the proportion of investment going into general practice will be greater than that going into other services.

              Q26 Karin Smyth: So what is the risk assessment of delivering the five year forward view based on those models, given where we are with recruitment into the GP workforce?

              Rosamond Roughton: I think the “Five Year Forward View” and some of the models set out in it are part of the solution to some of the problems that have been experienced in general practice. So some of the new models of care that have been developed for general practice to work with wider services are building much greater resilience, as well as providing more integrated services to patients. I almost see the five year forward view as part of the solution to some of the risks that you are describing.

              Karin Smyth: We will perhaps pick up on the other workforce models underpinning that later in the session.

              Q27 David Mowat: To move on to workforce modelling, the basic structure is bottom up, so the trusts estimate their workforces and it trickles up and eventually a sort of staffing plan is produced. What I am interested in, though, is how that is reconciled to the financial constraints that the trusts are clearly under, in terms of the budget and the amount of money available to them, and how any staffing contradiction is worked through. Or are they just forced, essentially, to put in a staffing plan that reflects the budget that they have available?

              Jim Mackey: I have not done this yet in this role, but in an FT last year, when we submitted plans, you would get Monitor or the TDA coming back having assessed whether there was an inconsistency between the workforce numbers and what the financial plan or the strategy was, and you would be challenged on that. We would expect to do that, especially this year in the STP process, where organisations are trying to demonstrate really significant change and are testing the consistency to see whether that flows through from a workforce point of view and a financial point of view.

              Q28 David Mowat: Right. So the answer to my question is, in a sense, that if they came up with a staffing plan that did not fit the financial constraints they would be told to have another go at it, effectively—

              Jim Mackey: First of all, you are looking for consistency, so if an organisation was saying that it was going to make a cost reduction of £20 million but its workforce was going to increase, you would clearly want to understand how that was going to work.

              David Mowat: You would.

              Jim Mackey: And this year we would particularly be looking at changes relating to the locum and agency cap and how that translates into—

              Q29 David Mowat: Well, we will come back to agency staff. I suppose, though, that you could argue that it looks like what has happened is that financial constraints were on the acute trusts at the start of the year—perhaps what I am about to say is unfair—and that it all balanced and everything else, but as the year went on they discovered that it was too ambitious and, as a consequence, they had to find temporary staff, extra staff to help to meet safety parameters and all that went with that, and we have appeared to end up with a £2 billion or £3 billion overrun, which has been incurred in what you might call an ad hoc manner during the course of the year. That might be a symptom of a financially driven staffing model at the start of the year that they did not really buy into.

              Jim Mackey: I can see why you would draw that conclusion. Again, I will not be able to use this defence for very long but I was not in this position last year. What I would say is that as an FT—

              Chair: An FT is a foundation trust.

              Jim Mackey: When I submitted my plans I did not feel under any pressure to give a specific answer or feel constrained in any way. Our plan reflected what we thought was reality.

              Q30 John Pugh: But Mr Mackey, in your report, from NHS Improvement—in February 2016, so it is up to date—there is the line, from your organisation: “Providers have told us the workforce forecasts might understate true demand as they are often driven by financial controls”, which is the point that Mr Mowat has just made. That is not me saying that; it is your report saying it. So rather than contest what Mr Mowat has said you really ought to agree with him, shouldn’t you?

              Jim Mackey: What I am saying is that I was in a different position last year and at no point did anyone—

              John Pugh: This is February 2016.

              Jim Mackey: At no point did anyone come back to me and argue that we needed to squeeze our financial plan or squeeze our workforce to fit the plan. I think that there were different approaches between Monitor and TDA last year around control totals, financial planning and workforce planning, so I understand the comment but I would not go any further than that.

              Q31 David Mowat: Looking at this year, then, what do you think caused such overly ambitious workforce planning by all the trusts, such that they are all now overrunning in a way that implies a systematic problem rather than an individual one? What caused them all to get their plans wrong by so much?

              Jim Mackey: They didn’t all get their plans wrong—

              Q32 David Mowat: Fair enough. Three quarters of them did. So one quarter didn’t. Just for the record, they didn’t all.

              Jim Mackey: The biggest driver of cost was the perception of the approach to safe staffing or the perception associated with the inspection regime. Most providers felt under pressure running into an inspection, or post-inspection, to commit to additional staffing. They probably were more optimistic at the planning stage that they would be able to manage that and then, as the evidence emerged from other inspections or from other issues, they might have had to take more risk in that regard. From a planning point of view we missed that. That’s a fair point.

              Charlie Massey: May I add to that from a departmental perspective? It became clear last year that the way in which providers were addressing some of the quality questions on the back of Francis wasn’t aligning well with the financial plans that they put in place. Many providers were interpreting some of the NICE guidance around safe staffing to mean things that NICE didn’t want it to mean. Indeed, the perception of what CQC inspectors coming into hospitals would say about staffing ratios drove behaviour, and many providers felt that quality was much more important than managing cost. Having seen that, across the system we brought together our thinking between NHS Improvement, the Department and the CQC to ensure that we were able to bring the quality and finance pieces together.

              Q33 David Mowat: Both of you—Mr Mackey and yourself—have just used the term “perceptions” about safe staffing levels, which I think is quite interesting. That says to me that the implication is that they were overly conservative in their staffing levels, and that they took a view to staff too highly. That is sort of what you both just said to me.

              Charlie Massey: Yes, that is what I am saying. If I can just give a bit more explanation—

              Q34 David Mowat: I don’t want to paraphrase or put words into your mouth, but I think you just said that they actually took quality to be more important than cost.

              Charlie Massey: In many instances. The issue in play is that NICE produced some staffing guidance on adult nursing during the day and what—

              Q35 David Mowat: That was the 8:1 guidance, wasn’t it?

              Charlie Massey: It was the guidance that said that there should not be a specific ratio that providers apply willy-nilly in their hospitals. It did say that there is some evidence that where numbers fall below one in eight, providers need to think very carefully about the acuity of the patients, the skills mix of the staff they are using and the geographical nature of the wards within which those patients are being cared for. Therefore, the one in eight was not a requirement that trusts should apply. We then saw, through the early part of last year, that, particularly with inspections about to happen, many providers took the one in eight as a requirement, rather than as something that should trigger conversations and questions around their board tables.

              Chair: I am going to bring you back on that later, because your answer is full of issues that we want to probe. I am going to bring in the Comptroller and Auditor General, and then go back to David Mowat and Professor Cumming.

              Sir Amyas Morse: Forgive me if my memory is playing tricks on me, but didn’t you have quite a lot of difficulty getting the plans agreed last year? Didn’t you have a first version of the plans, which you sent back because they weren’t cost-effective enough? Far from everybody being happy about this, actually quite a lot of people weren’t happy. Isn’t that true?

              Jim Mackey: Yes. I think there was a lot of downward pressure on plans, because in aggregate they didn’t come to—

              Sir Amyas Morse: So when left to themselves, they weren’t concluding that there was enough resource. They were told to go and do their plans again, if I remember rightly, by quite a large number of trusts.

              Q36 David Mowat: That is not what you just said to me, Mr Mackey.

              Jim Mackey: What I said was, that didn’t happen to me. I was a foundation trust—

              Sir Amyas Morse: Okay, it didn’t happen to you. That’s good. But it happened to quite a lot of trusts.

              Jim Mackey: There was an iterative process with a lot of downward pressure. There was a different process between Monitor and TDA, so there was more pressure on NHS trusts than on foundation trusts. Regardless of that, the link between the workforce plans and the financial plans has historically been very poor in the NHS. There is an underlying issue that has been there forever.

              Q37 Chair: I know Professor Cumming wants to come in. Is it on this point?

              Ian Cumming: It is. I was going to help the Committee by giving you some figures. Between 2012 and 2014-15, the number of nurses employed by the acute sector hospitals in this country went up by 24,000. That was in response to the quality concerns that were seen coming out of Mid Staffs. What has caused some of the problems with the expenditure on locum, agency and temporary staff is the fact that we haven’t been able to produce 24,000 nurses in the timescale that the system has demanded. It takes roughly four years to produce a nurse from the day in which we go out to universities and say, “We would like to commission a training programme.” It takes a year to recruit the nurse and to build the programme, and then three years to train them. We currently train about 20,000 nurses a year. If we see a growth for 24,000 nurses in just over two years, that leaves hospitals with a gap that they have been filling with bank, locum and agency staff. That gap has been about 50% of that number—about 12,000.

              Q38 David Mowat: That strikes me, though, as a slightly separate point to whether or not the financial constraints that the trusts were under caused them to do iffy headcount plans, which has caused the £2.5 billion to £3 billion overrun we have seen this year. I am getting slightly different and ambiguous answers on that. Two of you made a perception point, which I thought was very interesting. Your sense, sitting here as leaders of the NHS, is that hospitals may have overreacted to Mid Staffs, the NICE 1:8 guidelines and that type of thing and got too many people in. Is that what you said?

              Jim Mackey: On the perception point—

              David Mowat: You both used that word.

              Jim Mackey: Since I started this job, if you talk to national colleagues, there is a view that there was not an intention for there to be a mechanistic 1:8 approach and all the other things that happened around staffing. In foundation trusts and NHS trusts, it felt mechanistic, so there is a disconnect between the local level and the national level. That is what I mean by perception.

              Q39 David Mowat: I understand that, but if it was mechanistic, would they not have got their original staffing plan right? They would have just said, “We’re going to use 1:8,” or whatever it is. The trouble is, that came up with a number that was too big a budget, and therefore they were beaten back. Then, of course, they got new budgets and that was all fine, except the outturn was that they did it anyway, and we have a £2.8 billion overrun.

              Jim Mackey: There is probably something in that, but these things are never that straightforward. If you take some of the organisations with the biggest deficits—my understanding is that Barts Health, for example, submitted a plan that was broadly based on 1:8, and actually during the year it decided to move to 1:6, or 1:6 happened in a less than planned or controlled way. Nobody pushed them or said, “Go to point 8 in the planning process.” They spent significantly more on their workforce during the year by going to a different standard in an unplanned way. We were trying to correct that.

Q40 David Mowat: That is a different set of problems. Let’s turn to 1:8. You have taken away from NICE the responsibility for those sorts of guidelines, I guess for the reasons we are hearing about today—you felt that was inappropriately high and therefore you didn’t want NICE giving the sorts of guidelines that caused these budgetary issues further down the line. Would that be true, Mr Massey?

              Charlie Massey: The way in which we approached this was that NICE produced their guidance. I think the view among us at a national level within the system was that trusts were hearing the quality message more strongly than the financial message, and therefore the degree to which the workforce plans and the financial plans were properly aligned was, it became clear, something we should have been questioning.

              That is why the Secretary of State announced last summer that we needed to bring the question of support and improvement for trusts more closely together with the question of safety. That is why Dr Mike Durkin was brought with his safety responsibilities from NHS England into NHS Improvement, where we have made a very concerted effort since then to bring the questions of quality and finance together. Just last month, NHS Improvement and the CQC wrote to all chief executives of trusts saying we need to ensure we can achieve quality in a sustainable way within the resources available, and that therefore NHS Improvement and the Care Quality Commission would be looking together at the questions of quality and finance.

              Q41 David Mowat: If it is within the resources available, does that not mean you are putting cost above quality?

              Charlie Massey: I think the phrase I would use is “sustainable quality”.

              Q42 David Mowat: I understand that, but you just talked about saying, “You’ve got to do what you can do within the resources available”. That is fine, to a level, but it implies that if there is a trade-off or an issue at some point, it is a question of saying, “That’s the resources, guys. Get on with it.” I don’t want to make a cheap point about this, but in a sense, that mindset is where Mid Staffs started.

              Jim Mackey: Nobody is saying they need to cross a safety or quality line. What we are trying to say is that for so long, there has been a very strong focus on quality, and money has not been considered at all in some cases. Good organisations look at these things in the round, and that is what we need people to do. Safe staffing is not as simple as a set of inputs such as 1:8. We need nurse directors to take judgments based on the acuity tool and so on. There are processes that need to go on that look at things in the round. At the end of that, if somebody submits a plan to us and says that they can’t deliver safe staffing within the resource available, we would absolutely not be pushing them to say that they can.

              Q43 David Mowat: What about if a hospital were to say to you that they can’t deliver the various targets that you guys set from the centre, such as for A&E and various other things? What happens if they say, “We can’t do those within the resources envelope. Something is going to have to give”? What would you say?

              Jim Mackey: This happens all the time. We have more evidence now from the Carter review of relative productivity. We spent a lot of time yesterday looking at some of the indicators on care and hours per patient per day, the productivity of the workforce, etc. We now have more information that we would bring to bear to form a judgment with them as to whether that is right. Increasingly, we are connecting providers. Provider A might not think it is possible, but provider B, in almost exactly the same circumstances, can.

              Q44 David Mowat: I can understand why you are saying what you are saying, especially Mr Mackey. It is reasonable that there has to be some kind of resources envelope, and if these guys are all out there spending money apparently without any cognisance of that—[Interruption.] The trouble is, if I am at the coalface, and that is turning into unmanned rosters and things like that, you can see why they feel, “Let’s get an agency person in. I don’t care what they are saying up there. We are not going to do this.” How you marry that together is quite difficult, and I am not sure you’ve got it.

              Jim Mackey: It is, and my view is that if you go back four or five years, we could have been more confident had boards made those judgments in the round. Then, there was the nurse director view, the ops director view, the FD’s view, etc. Then, the system was more in balance and there was more robust discussion and a firmer, clearer plan. Over the last couple of years, that has clearly got out of sync and we need to try to get back into a position where boards feel more able to discuss how money and quality fit in the round. At the end of that process, if they don’t believe they can deliver what is required within the resource available, we will absolutely try to work through them to find solutions.

              Q45 Chair: But Mr Mackey, the budget is sent down and the staffing arrangements, particularly in acute trusts, are set up to meet that budget. You say, “Fine. If they can’t manage it, they come back to us.” Who pays? We have already seen a huge issue with acute trusts. Who pays? If a trust comes to you and says, “We can’t do what we need to do within this envelope of money,” what happens next?

              Jim Mackey: The first thing is that we must be sure that they can’t pay, manage that resource and deliver the quality expectations within that resource. Almost always when that happens, there is somebody else who can do it in the same circumstance. I don’t think we should just assume that it is impossible. We need to use the evidence that we have to try to get to a position that is manageable. Ultimately, if it isn’t possible and there isn’t sufficient resource within that commissioner, we will have to find a national solution for the money. We will not get to a position where we force providers to deliver unsafe care.

              Chair: You stay there. I am going to go back to the Department of Health in a moment, but I will bring in the Comptroller and Auditor General.

              Sir Amyas Morse: I find it very helpful that you are answering so frankly, but you were saying that in the last few years it has got out of sync and that what you really want is for these boards to be able to make these judgments themselves, not for you to have to intervene to help them.

              Jim Mackey: Absolutely.

              Sir Amyas Morse: If we are trying to guess what might have made it go out of sync over the last few years, do you not think that the main change factor has been the continuing efficiency programme pressing down on the budget levels available to them? Is there anything else?

              Jim Mackey: I think an unrealistic efficiency expectation last year was a factor.

              Q46 Chair: It is 4% over the last five years.

              Jim Mackey: It has been building over the last few years, and the deficit has increased over time. Probably last year, and maybe the year before, it probably tipped and got to the point where it was out of control. We are doing lots of things to try and get that back into sync. That is my point on being out of sync. We can’t run the NHS from here. We have 255 independent boards that need to be making their own judgments.

              Going back to the earlier point about how you make these judgments, on top of looking at the money and performance standards, pretty much every board now has a ward assurance and nursing assurance report that looks at acuity, sickness levels, turnover rates and complaints. The board needs to consider them in line with the financial report and how the board compares with peers. We have been trying to help them do that, and we have been using it in our assessment of how providers are doing.

              Q47 Chair: Mr Massey, Mr Mackey just said that if there is a real problem and the trust cannot deliver what it needs to do safely in the money envelope it’s got, he has to find—I think I quote you right, Mr Mackey—a national solution to the funding issue that I guess falls within the Department of Health. What do you do then if a hospital says it cannot deliver safely?

              Charlie Massey: In the first instance, that will take the form of a conversation between the commissioners and the providers as to whether or not there is more room within the commissioning envelope in terms of supporting those trusts that are most in trouble. Clearly, another dimension of this at a national level is to think about whether or not there are some structural issues with the way in which we organise services nationally. The CQC inspection regime has shone a light around that.

              Q48 Chair: These things take a while. On the first one, you are suggesting effectively that a commissioner shunts money to the trusts in difficulty, possibly away from the trust they already have a relationship with, so perhaps you can explain that. Secondly, the other changes you are beginning to describe are much longer-term changes. If I was chief executive or financial director of a trust now, and Mr Mackey’s organisation agreed we couldn’t do what we needed to do safely with the money available, what does the Department of Health do then?

              Charlie Massey: The Department will have some very serious conversations. It is a triumvirate approach. The Department will sit down with NHS Improvement, formerly Monitor and TDA and with NHS England to think about the support that we need to provide to that trust. Quite often that is support in the form of leadership rather than big cheques that need to be written, and the Department will also think about where that trust is sitting in relation to the CQC inspections.

              If a trust is in special measures, we will need to think about how we ensure that we are enabling that trust to provide safe care to their local populations while making all the changes that may be required in terms of leadership, and ultimately in terms of the configuration of those services locally, which take a long time. Therefore we need to think collectively about how we ensure the money is there.

              Q49 Chair: You weren’t at our last session. Dame Una was here from the Department. We were looking at acute hospitals, as you may be aware, and it was clear that the Department is bailing out all those acute trusts with deficits for this year. So the money comes from the Department of Health’s funds—the taxpayers’ funds in the Department of Health.

              Charlie Massey: Ultimately, clearly the Department has the fundamental role in terms of ensuring that the system remains solvent, and ultimately we obviously have conversations with—

              Q50 Chair: Given what you are already spending on acute trusts, will you be overspending on your budget by the end of this financial year?

              Charlie Massey: We are not expecting to be. We are leaving no stone unturned, working with NHS Improvement and NHS England to ensure that we are able to bring this year in on its envelope.

              Q51 Chair: What is the current gap in your budget?

              Charlie Massey: I am sorry; I don’t have that.

              Q52 Chair: We have different figures: £1.8 billion at the last hearing—that was just acute trusts—and £2.2 billion—

              Karin Smyth: £2.8 billion for the acute trusts.

              Q53 Chair: It is varying. Could you help us pin down what the gap is?

              Jim Mackey: I will help from the provider perspective. When I took up this position in November, providers were expected to hit a deficit of about £1.8 billion. In an aggregate, that allowed the system to not bust the DEL. That has drifted a little bit, so our current forecast—I revised the forecast at around Christmas. It looked like it was about to gross 2.8. From there we would do things like capital revenue transfers, some balance sheet changes, asset realise, things that we have discussed before. That gets to a more manageable number. At that time we thought we could still get close to £1.8 billion. At the moment I think we are looking at a gross £2.8 billion and getting down to about £2.2 billion or £2.3 billion.

              Chair: So our figures are right.

              Q54 Karin Smyth: Some of that is capital transfer in year, isn’t it?

              Charlie Massey: Yes.

              Q55 Karin Smyth: I am a little bit chilled by some of the previous conversation, with phrases about NICE and CQC driving providers to balance quality in order to manage costs, given where we have come from. If I am an acute trust chief executive in a provincial city, what do I do? Who do I go to when I am genuinely worried about the quality of that service? We have just had the staff survey out, which, when you go beneath the headlines, suggests some real concerns about the staff and the quality of service that they are providing. I am going to talk to a number of people locally before I get as far as you, Mr Massey, in the Department of Health. We need to be clear about the message going from this session about that quality-cost balance, given the discussions and concerns over the past few years.

              Charlie Massey: Fundamentally, the questions about quality and the staffing that is required to support quality must be decisions that are taken within a trust. That is not a decision—

              Q56 Karin Smyth: May I stop you there? When I say that I don’t believe that I can deliver that service within that cost and I am going to shut off or close some services, will I have support from the Department to do so?

              Charlie Massey: That is a conversation that, in the first instance, will take place between the trust and NHS Improvement about whether that actually is the case. What we saw with a lot of the work that Lord Carter produced recently is that there is actually a huge amount of variation in terms of the ways in which different trusts approach those questions. Mr Mackey talked about care hours per patient day, which vary from six hours to fifteen hours in different trusts. They do not necessarily align where you might expect with the CQC judgments about quality and safety.

              Q57 Karin Smyth: So, Mr Mackey, you have the capacity to go around the country to have those conversations with individual trusts.

              Jim Mackey: We are building the capacity now to try and build stronger regional teams so that these things can happen on a regional basis. We are struggling to do that at the moment, but we will be there or thereabouts when we go live in April.

              I actually think that the first conversation is one with a commissioner—

              Q58 Karin Smyth: With NHS England on the ground or with the CCG on the ground?

              Jim Mackey: Probably the CCG. It depends on whether the service is a CCG-commissioned service or a specialist-commissioned service. It would absolutely be flagged up to us so that we could help to find a solution.

              Q59 David Mowat: I wanted to move on to slightly more specific areas to do with the manpower planning, but to summarise the last 20 minutes or so, we started off with me suggesting that the £2.8 billion overrun that we are trying to manage down at the moment occurred due to optimistic planning. The NAO Report talks about admissions being up 2.8% on average in the last five years, GP referrals being up 3.5% and, roughly speaking, funding being up in line with that—historically, at least—and yet staff levels are only up by 1.4%.

              We see a consequence of what I would call optimism bias here, which is that we have tried to do staff planning in a way that was too tough for the underlying real world. What they had to do in the end were short-term, temporary things with agencies and all that happened. I wonder whether you are facing up to that reality and whether you are asking them to do something that just cannot be done. In the end, you guys are going to have to call it.

              Jim Mackey: Yes. That is our big job in the next couple of months. We had first cut plans from providers on 8 February and we are now assessing them. It is not in our interests to start to plan the year with an over-optimistic plan—

              Q60 David Mowat: No, it is not, because it would be fooling everybody. It is fooling the Secretary of State, Parliament—everybody. That is what I mean. You guys have to call it and be careful that you are not demonstrating optimism here and that you don’t say, “Somehow, Lord Carter has an idea on procurement and that’ll fix it,” because that’s probably not true.

              Jim Mackey: Yes, there is a judgment, and it looks like that judgment was wrong last year. The deficit—in the way that you described it—didn’t just pop up this year; it has been building up for a few years, as NAO Reports have described previously. This didn’t just happen on 1 April. The pressure has been building over time, and we will do our best to try to correct that next year. We absolutely have to get really close to providers to understand what is reasonable.

              Q61 David Mowat: Yes, I think it might be a bigger issue than just a question of the mechanics of budgeting, but let us leave it at that.

              Jim Mackey: Absolutely. I spent the morning with about 20 chief executives just trying to get underneath this to see where people are for next year.

              Q62 David Mowat: All right. I have a question for Professor Cummings on health education. You were set up, in a sense, to add some strategic thinking to the—this is perhaps a simplification—bottom-up planning coming out of the acute trusts. I was quite interested by a point in the Report that I think quoted the Centre for Workforce Intelligence report. They talked about different requirements for different specialties and used the example of tropical medicine being overly supplied and overly popular, and you failed to take that into account in the staff plans that were put forward. Were they being fair about that? Since that was your main raison d’être, that seems quite a severe accusation.

              Ian Cumming: Yes. Of course, the CfWI was simply one source of information that we received. We receive many different sources of information and advice from medical royal colleges, individual employers and our own demand surveys across the NHS. In that specific example, it is fair to say that no, we didn’t take deliberate action, because the view of other people that we had spoken to and the view of employers was that this was a workforce that, at the moment, we continued to need to develop for the future.

              Q63 David Mowat: Right. Could we perhaps go to paragraph 3.11 on page 36? It states that you have not been “consistent and comprehensive in making…adjustments to training places”, which implies that it is an ad hoc process of some kind. Clearly, given all the constraints out there that we have been talking about, it is pretty important that we get this as right as we can. If this is an agreed Report, are you accepting that on behalf of your organisation?

              Ian Cumming: I think that, to date, we have certainly not made a whole range of individual adjustments to postgraduate medical training places that individual organisations have suggested to us. We need to remember, first of all, that doctors in postgraduate training are also delivering a service while they are in that training, so we are constantly balancing the service commitment with the training commitment.

              Q64 David Mowat: You mean junior doctors who are working.

              Ian Cumming: Yes, who are actually working in hospitals. Over the time we have been in existence, we have reduced the number of surgeons in training, for example, but we have to do this in a gradual way. If we simply decide that we are going to take large numbers of surgical training posts out in the following August, the hospitals affected need to work out how they are going to continue to provide the cover for the patients in the hospital—how they are going to continue to provide the rota cover.

              We have a number of areas where we have made adjustments. This year, for example, we have removed entirely something called broad-based training, which is a rotation programme for doctors to give them experience and exposure to a number of different specialties before they ultimately make their mind up about what they want to do. We have taken that out because we felt that we needed to increase the number of training posts in radiology and emergency medicine. By taking out that broad-based training, we have put those additional numbers this year into new training places, and those are the two specialties that not only employers, but royal colleges and others have been telling us are in particular need for future years.

              The other point to make is that we are not looking at the way in which the service is provided now. From the day somebody enters medical school to the day they become a consultant is somewhere in the region of 13 to 15 years. From the day somebody enters specialty training to the day they become a consultant, you are typically looking at five to eight years, so we are constantly looking five to eight years ahead at what the service would need, and not at what the service needs now.

              Q65 David Mowat: Yes, that is right. So you do not really accept the point made in paragraph 3.11. I was quite surprised that it was an agreed Report, because I thought it was quite a serious point they made, given that your organisation is charged with actually doing that precise role.

              Ian Cumming: The CfWI did state what it says in the Report, but I could also produce royal college evidence that would state exactly the opposite. Part of our view is to try to weigh the balance of the opinions and the balance of the evidence and come to a conclusion, but also to take into account those other factors that I have mentioned.

              Q66 David Mowat: Training budgets are flat, aren’t they, or they are going to be flat in cash terms for this Parliament?

              Ian Cumming: Yes.

              Q67 David Mowat: Is that a problem?

              Ian Cumming: We have looked at what we are able to commission with the resource that is made available to us. We have been given flat cash for the balance of this Parliament in terms of the spending review. With that flat cash, we have been able to commission by 2020 a net increase of somewhere in the region of between 25,000 and 80,000 additional staff, compared with what the NHS is employing for the moment. That is between 25,000 and 80,000 additional clinically qualified staff who will be available to the NHS to employ by 2020 using that flat cash.

              Q68 David Mowat: All right. That is coming out of medical school and nursing school, rather than out of specialty training.

              Ian Cumming: Everything.

              Q69 Chair: Isn’t that partly because you are now charging nurses to go through training?

              Ian Cumming: No. Because of the time lag, the first nurses or AHPs who will be subject to tuition fees would not enter education until 2017, so they would not come out until after the 2020 period.

              Q70 John Pugh: Do you consider that to be adequate? Given the underestimating by the key trusts, I expect you would want to add 10% to what they are asking for, wouldn’t you?

              Ian Cumming: Our worst-case scenario of what will come through is the 25,000, and that probably would not be adequate for the NHS to meet all its needs. That is our worst-case modelling scenario. Our mid-case modelling scenario, which is the 80,000 additional clinical staff available for employment by the NHS, certainly would meet all the projected demands for the NHS based on the five-year forward view projections.

              The other thing that we have to remember is that the NHS is not the only employer of clinical staff. We do not just train for the NHS; we also train for the private sector, the independent sector and social care. They come out of the undergraduate commissions that we make at the moment.

              Trying to balance the movement of staff between the different sectors is difficult, and the other challenge perhaps comes back to a point that the Committee made earlier on how we retain people once they have been trained. We know, for example, that in England there is something in the region of 100,000 nurses on the nursing register who are not practising as clinical nurses in the NHS or care sector in England. That is a very large number of people. If you look at all the people available for employment, the number is quite significant. What attracts them into jobs and helps retain them in those jobs is just as important as the training numbers.

              Q71 Chris Evans: I want to ask a simple question. It is all very well quoting figures, as you have in the Committee today, but simply what is morale like in the NHS at the moment?

              Ian Cumming: The NHS staff opinion survey was published today, and it is fair to say that the impact of the junior doctors’ dispute has been significant on the morale of the medical workforce in the NHS. My organisation is the training organisation, so we have contact with people more when they are in training than when they are actually in employment. It may be that Jim and others want to comment on the morale of people actually working for the NHS.

              Q72 Chris Evans: May I ask you something directly, Mr Cumming? You wrote a letter to the chief exec of Health Education England, where you said: “I have received far too many reports of material on social media and elsewhere extending beyond fair comment into the realm of abuse.” Do you think that knockabout will affect morale? That direct comment, complaining on social media, which to be brutally honest as politicians we have to put up with on a daily basis, as do most people in any walk of life, I think—do you think that carping about social media abuse will help morale?

              Ian Cumming: I don’t think it is carping about social media; it is about professional behaviour. We can all disagree and have differences of opinion, but when individuals at a relatively junior level in my organisation have been sending out letters on behalf of the organisation and have been receiving direct very abusive emails from individuals in the system then, no, I do not think that that is acceptable.

              Q73 David Mowat: I am interested in your answer on the flat funding. We have got the health service. We are all getting older, and our country’s population is increasing quite quickly, yet it seems that we can have a flat training budget for the NHS and it will all be all right. That is really your evidence, although the words that you used were a little different to that. You said that if the five-year forecast is okay, that means we are okay. That might be your caveat in this, because it just does not seem to reconcile.

              Ian Cumming: The numbers of people in training at the moment allow for growth in the NHS. Over the past 10 years, we have seen a 44% growth in the number of consultants. The number of people that we have in training at the moment would allow for that sort of level of growth in years to come. The number of people in training is predicated on growth; it is not predicated on replacing every person that leaves with one person in the new system.

              In regard to the five-year forward view, the NHS received £10 billion of real uplift in the spending review settlement. Against that figure, if we continue to operate as we operate now, we would have a demand for somewhere in the region of £30 billion, given the increasing demands. Are we producing a workforce to meet the NHS that in five years’ time spends £30 billion more than it is spending now? No, we are not. Are we producing a workforce that allows the NHS to spend what it has been given, which is the £10 billion more? Yes, we are. To get to that, it has to be about how we do things differently, how we get upstream, how we improve the health of the population and how we focus on efficiency and the quality of care that we deliver.

              Q74 David Mowat: Okay. I have one final question in this area. Something interested me in the Report that I had not realised: the centre pays for a large chunk of junior doctors’ salaries, not the trusts themselves. The cost to the trusts is in fact less than for nurses, I think.

              Ian Cumming: It varies.

              Q75 David Mowat: Or can be, or similar, then. Are you concerned that that might drive sub-optimal behaviour? It struck me that it might.

              Ian Cumming: I think the reason for doing it is absolutely appropriate. A junior doctor is delivering service but is also in training. My organisation pays the NHS trust or the community provider, whoever it may be, for the training time. The time that they are not delivering productive patient care, they are actually being trained. The balance of the time, when they are contributing out of hours or delivering service, is paid by the individual employer. It is really important because it allows us to protect that time and to hold individual employers to account for that training time.

              Q76 David Mowat: Maybe I misread it, but I had the impression that you paid for more than half the salaries for junior doctors.

              Ian Cumming: No; it depends on what level the junior doctors are. There are about 30% of junior doctors that my organisation does not pay anything towards at all. They are fully funded by the local NHS. For the balance, roughly speaking, we pay about 50% of the basic salary of junior doctors.

              Q77 David Mowat: What would worry me was if it created a market for people that was over and above what could eventually be satisfied with more senior training contracts, and they were just used because they were cheap. Effectively, they would be misled career-wise into dead alleys. Do you understand that point?

              Ian Cumming: We are conducting a review of that at the moment, because we pay roughly speaking 50% of the salary of a junior doctor. If I take anaesthetics as a specialty, you actually get very little service commitment out of a brand-new trainee in anaesthetics because they need to be trained, and they are not safe to be left on their own without a more senior doctor supervising them. So you get very little service commitment out of them. If you take an anaesthetic trainee in the last year of their training, they are actually able to do almost everything that a consultant can do, and therefore a lot of service commitment comes out them.

              My organisation at the moment still pays 50% of the salary at whichever stage in training they are at. We are looking at the moment about whether that is fair or whether we should skew that, depending on how much service is given to patients and how much time is spent in training.

              Q78 John Pugh: Just following on from that point, does that lead to certain perverse incentives—for example, for hard-pressed hospital trusts to employ lots of junior doctors in circumstances where more qualified doctors would be appropriate? Is that within the compass of your investigation?

              Ian Cumming: Training doctors’ posts are controlled by ourselves in terms of numbers. Working with our regional and local teams, we would determine the best places for doctors to be trained. That is based on the mix of different activity that is available, on the quality of training that is available and the number of doctors and trainers that are available. So we would make a decision based around the quality of training that is able to be delivered, but obviously also recognising that junior doctors do provide service as well. That links back to my earlier question about why we cannot take knee-jerk reactions—

              Q79 John Pugh: So you are not aware of financial pressures on the acute trusts feeding into the mix here. Obviously, I am told that a junior doctor can cost less than a nurse in certain circumstances.

              Ian Cumming: I think, depending on the stage of their training they are, but we are paying for training; we are not paying for the time when they are actually treating patients. We are paying for time that we expect them to be receiving training.

              Q80 John Pugh: Okay. There are variations in this Report with regard to the shortages. There are variations in regions, where there is obviously a great difficulty in finding nurses in London. There are also difficulties with small hospitals getting an adequate spread of the consultants—or junior doctors—that they require because of training arrangements and the limitations that that hospital may hold, compared with a big teaching hospital. In terms of workforce planning, whose job is it to address those issues and ensure that London gets enough nurses and small hospitals get enough doctors?

              Ian Cumming: It is my organisation’s responsibility. We have 13 local education and training boards, which are part of my organisation. They are advisory committees to my organisation. They advise us on what they believe needs to be commissioned to meet need locally. If I use GPs as an example, this becomes quite complex. On an annual basis, on average for the past five years, we have attracted 2,700 junior doctors into GP training. In each of the past four years, we have increased the number of GP training slots, but we have still attracted, on average, 2,000 junior doctors into GP training every year. So the number of slots has grown, but the number of applicants has remained broadly consistent.

              However, what we’ve continued to see in that time period is every training slot in London being filled. In London, Kent, Surrey and Sussex, for example, we have got 100% fill of all our GP training slots, and because the number of slots has gone up, those people have had to come from somewhere else. By and large, the further north and east you go, the numbers have therefore gone down as a percentage of fill rate, because people have been attracted more towards London. So, in the case of GP training, London is very attractive.

              If I were to use paramedics and look at their workforce, the West Midlands ambulance service is reporting basically zero vacancies for paramedics. The London ambulance service is reporting somewhere in the region of a 20% vacancy factor for paramedics. So it’s specialty-specific; it’s profession-specific; and we need to look at each individual area and consider how we can best address them.

              Q81 John Pugh: It is very refreshing, Professor Cumming, that you came back straight away to say that you are responsible for ensuring that these problems were dealt with; that is very encouraging.

              May I turn now to Rosamond Roughton and Charlie Massey? Given what we’ve heard so far—basically, there is not fundamental disagreement about the picture—acute trusts are underestimating what they need and then they are backfilling later in the year with agency staff. There’s no way on God’s earth that you are going to make the—what was it—£1 billion worth of savings on agency staff, is there?

              Charlie Massey: The agency question is one that obviously has been a significant contributing factor to the level of financial challenge we’ve got in the system at the moment. NHS Improvement, and Jim is better qualified than me to talk about a lot of the detail of this, has gripped that question within the NHS. So we’ve essentially set price caps; we’ve tried to get rid of procurement arrangements for procuring temporary staff; and we’ve been ratcheting down those price caps, most recently at the beginning of this month, as a way to enable trusts essentially to drive better value in the way that they can recruit temporary staffing.

              Q82 John Pugh: But being direct, you’re unlikely to make—I mean, the Government heralded £1 billion worth of savings from these measures. You’re not going to make £1 billion, are you?

              Charlie Massey: Well, we talked earlier about some of the other things that we’ve been doing to ensure that we can get ourselves into a good financial position in terms of capital—there are revenue switches, and so on. Clearly, however, the agency question is a very challenging one for us—

              Q83 John Pugh: Challenging. Okay.

              Charlie Massey: It also relates to the fact that Professor Cumming was saying that it takes some time to generate doctors or nurses within the system. A lot of the problems that we’re facing at the moment relate back to the fact that Robert Francis identified in the Mid Staffs report that there were significant shortcomings in terms of the amount of nursing capacity we had in the system. That drove a very immediate response from trusts in terms of their own demand for staff, which we didn’t have enough capacity in the system to respond to. That’s where a lot of the drive for increased agency cost arose.

              Q84 John Pugh: Monitor said that you’re only likely to make about £200 million in savings, but it also said that 50% of employers would probably be forced to breach the maximum cap, and I think that a recent survey for the Health Service Journal showed that a large number of hospitals are already working outside the framework. The cap is not going to have that much effect, is it?

              Charlie Massey: Jim, you’re better qualified than me on this.

              Jim Mackey: I will just add that there has been a bit of a misrepresentation of some of those facts in recent weeks. About nine in 10 organisations have to breach the cap at some point, but 75%-ish of locum and agency shifts are being delivered within the cap. So there are a lot of statistics that you can look at with all of this. Overall, it looks like the cap is working and the level of overrides is manageable, and the February cap change hasn’t increased the level of overrides to a worrying extent.

              Q85 Chair: Is there a pattern about which groups of staff, or which areas or regions—?

              Jim Mackey: It’s not really a pattern. There are some organisations that are specifically struggling, but you couldn’t really say it’s one region, one specialty or one kind of staff—

              Q86 Chair: So it’s down to the institution and its reputation?

              Jim Mackey: It’s much more complex than that.

              On the £1 billion savings, my view on that is I’m pretty confident we can save £1 billion; it’s about how quickly we can do it. It’s not going to happen overnight, but the plan to take the agency cap further in the new financial year—I think I described that when I was here to talk about money—will mandate providers to use framework suppliers and the framework suppliers will have to pay NHS rates.

              Q87 David Mowat: What doesn’t ring quite true in the agency discussion is that the NAO Report talks about the increased use of agency nurses, and it makes it very clear that most of that increase between 2012 and 2015 is on volume, not rate. On page 40, section 4.9 says that three quarters of the agency overrun, or delta increase, is a volume variant—they have used more people than they wanted to, or thought they would have to—not a rate variant, so you are addressing the rate variant, which isn’t really the problem. The problem is that the staffing plans were wrong by so much in the first place that all this cap stuff is only marginal.

              Jim Mackey: Right, but we have to tackle both. We are tackling the volume thing. That goes back to the CQC safe staffing NICE issue and so on.

              Q88 David Mowat: Yes, it does, but you have talked to us as though the real issue here is agency firms putting up rates and forcing up things and ripping off acute trusts, whereas the Report says it is not that at all. The reality is that most of the increase, three quarters of it, is a volume increase—lack of people—and the rest of it is an increase in rates. So when you have talked to us about all the work you are doing to put caps on and all the rest of it at this hearing and at previous hearings, that is not really the point.

              Chair: Before Mr Mackey answers, it is fair to say that in the last session on acute trusts, Mr Simon Stevens, your boss and chief executive at NHS England, on three occasions raised the issue of the hourly rate, rather than the volume. Isn’t that rather misleading? It is about the number of hours, not about the cap, as Mr Mowat has made clear.

              Jim Mackey: It is a combination. If we go back to that discussion, I made the point that—

              David Mowat: It is a combination, but the proportion of hours is much higher—

              Jim Mackey: If I can finish, I made the point to Sir Amyas Morse in the last meeting that it is about volume and price, and we are trying to deal with volume and price in this approach.

              Sir Amyas Morse: I agree with that, but, to be fair, when the first thing you talk about, where very emotional language is used, is all about rates and not much talk about volume, we need to take a bit of a grip of ourselves when we do that, because it is inclined to give people the wrong impression. We just need to be very careful about that, frankly. If 80% of it is volume and 20% of it is rates, we should be giving 80% emphasis to the volume, not the other way round.

              Jim Mackey: Yes.

              Sir Amyas Morse: We need to be careful about that. I think the Committee was left with the distinct impression that this was mostly about rates.

              Q89 Chair: Ms Roughton needs to come in here because NHS England was particularly keen to get across in our last session that one of the biggest problems for overspends at acute hospitals was the rate at which agency staff are paid. Do you have anything to say, Ms Roughton, in the light of what David Mowat and the Comptroller and Auditor General have said?

              Rosamond Roughton: I would say that, from what you have said, it is rate and volume, so we need to make sure that we look at both.

              Q90 Chair: The rate was very much emphasised by Simon Stevens in the acute trusts hearing. I think you were sitting next to him.

              Rosamond Roughton: Not at the acute trusts hearing.

              Chair: Forgive me. He comes so often to us.

              Jim Mackey: I remember that that point was made by Simon. I agree that we need balance in this discussion, which is why we put so much effort into the joint letter from me and Mike Richards. The discussion we are having about rebalance and quality and safety and the work that we are doing jointly with CQC and NHSI is being driven largely by a volume increase, but there has been abuse of the system and extortionate rates charged and so on, so I accept the point; we need to have a balanced discussion about it. The biggest benefit will come from volume reduction.

              Q91 John Pugh: The real problem is not that you are employing agency staff and paying too much for them; it is that you are employing far too many agency staff. In the Health Service Journal, one chief executive says, “We publish monthly nurse numbers by ward and day and night shift. So there is greater scrutiny at the time when the avenues to recruit are reduced… That’s created a market for temporary staff… If you say you will have four staff in and you have one vacancy and then one staff calls in sick—before Mid Staffs there might have been some muddling through,” but not now. So they are understaffed. Prior to that, the acute trusts were comfortable to some extent being a little bit understaffed. As many of you have said in your answers so far, Mid Staffs has made that scenario impossible, so the volume of agency staff is going up, and it is systemic.

              Jim Mackey: That is partly what I was on about earlier, about boards making judgments again in the round. My view would be that nurse directors and ops directors have felt less able to manage risk in the past couple of years than previously. So we have maybe corrected too far and have been too risk-averse with some of that. We are not saying go back to a Mid Staffs scenario. We are just saying that it needs rebalancing a bit. The NHS is such a huge employer, a slight rebalancing is seriously impactful.

              Q92 Chair: Can I just be clear? We are talking about agency staff now, but it came out very clearly at the previous hearing and again today, Mr Mackey—you are very candid and we appreciate that—that the 4% efficiency savings over five years have caused a major squeeze, particularly on acute trusts’ budgets, and that must have an impact on their planning, so that they then have to resort to agency staff because they have less capacity overall. If there is a little bit of a squeeze, they have to fill the gap; they don’t have any extra capacity. Do you agree that is also a factor? Perhaps Ms Roughton would also like to comment.

              Jim Mackey: I would agree. A lot of this agency work is aimed at trying to encourage people to go back into substantive employment within NHS organisations. So we would expect to see in plans an increase in substantive permanent staff and a reduction in agency staff. Overall, hopefully, that will balance out and deliver quality and money together. We do need to be very realistic about what is achievable in the current world.

              Q93 Chair: But they have to be able to afford it. Ms Roughton.

              Rosamond Roughton: We would say that clearly we always need to be looking at how we get more efficiency out of the health service in general. Getting the balance right about the right number for the efficiency element is, as Mr Mackey said, always a judgment. What we can see and what the work done by Lord Carter shows is that there is still scope in some parts of the country to learn from others about how they can continue to provide great care and deliver some efficiencies. One issue is about looking at this at macro level and then what it means in individual places where it can have different impacts.

              Q94 Chair: I am glad you talk about different places. There can be a tendency in a Committee such as this to talk at a very high level, but it is patients on the ground who also suffer through the use of a lot of agency staff, without having a regular staff. I see you nodding, Mr Mackey. I hope we would all agree that it is not a good situation for the NHS to have turnover and churn in the way that you get with temporary staff.

              Jim Mackey: It needs to be more stable. My overriding point in this is that the NHS is really complex and very variable. My old organisation, Northumbria, is the most productive from a nurse-staffing point of view, and I think today has the best staff survey in the NHS for the second year running.

              Q95 Chair: We are hoping you will bring a bit of that magic to NHS Improvement, Mr Mackey. A good advert.

              Jim Mackey: Just to be clear, we have other organisations, so this is not about me or claiming credit. There are other organisations that have seriously increased the pay bill in the past couple of years and staff satisfaction, patient satisfaction and outcomes have declined at that time. That highlights the fact that this is really complex. It is not something that can be solved by us. We need local boards to make good judgments in the round, supported by us. That is where we need to get to.

              David Mowat: I think, Mr Mackey, that is why you have got the job that you have.

              Q96 Chair: Professor Cumming wants to come in on this point.

              Ian Cumming: I just wanted to make the point that, in terms of availability of qualified nursing staff in particular, this year has been the lowest ever output from universities in England because of decisions made in 2011. We have a number of NHS employers who are simply unable to employ the nurses that they want and need because they are not there as new graduates. From next year, we will have 800 more graduates. The year after that builds, and the year after that builds, as the increase in commissions we put in place from 2012-13 onwards start feeding through the system. There will be 800 more qualified nurses entering the system in 2016. They will be available for trusts to employ, which should help to take some of the pressure off the agency bill.

              Q97 David Mowat: I just want to get some clarity on this point on to the record. If a clinician is required at short notice to complete a roster or whatever, and they ring up and the only one they can get is over the cap, what do they do?

              Jim Mackey: They can break the glass. We call that a “break glass” situation. They can absolutely do that, and we track them.

              Q98 David Mowat: So the cap is a best effort sort of thing.

              Jim Mackey: Yes. It is a demonstration; it is not an absolute thing. If it was, we would be sending the message that quality doesn’t matter. There has to be a local judgment, but this has got out of control from a volume and price point of view, and it needs to be corrected.

              Q99 David Mowat: We don’t want to get into an approach of fixing a symptom, not a cause. There might be a lack of graduate nurses, but I think we can all agree that the underlying cause is that permanent headcounts have not been enough to meet the demand as the year has progressed. That is what has to be fixed in the medium term. Anything that stops that from happening is not likely to fix the agency problem either.

              Charlie Massey: It is a bit more nuanced than that. I don’t think we were saying that this is just about the permanent headcount. A lot of this is about how the volume piece can manifest itself in terms of managing demand, and it goes back to a lot of the things Mr Mackey was talking about in terms of Northumbria’s productivity versus some other trusts. Lord Carter shone a light on this: there is a huge amount of variation in the productivity and in the number of contact hours per patient per day in different trusts that does not align with the quality of care that is provided. Some of it is about whether or not the overall headcount is right, but it is also about whether or not we are delivering quality of care as efficiently as we could. What Lord Carter showed is that in some areas there is quite a significant degree of variation that shows that there is a bit more to go at on that side in terms of managing demand as well.

              Q100 David Mowat: I understand that. On Lord Carter’s review, because you have raised it a couple of times now, it strikes me as being easier to demonstrate differences in performance, which has happened—Mr Mackey mentioned it as well, and I can see that that would be the case in procurement and everything else—but sometimes harder to make everybody as good as the best. If I was sitting where you four are sitting, I wouldn’t assume that it could be done that straightforwardly, but that is a matter for you.

              Charlie Massey: I completely agree.

              Q101 David Mowat: I want to come back to one point that Mr Mackey made. He used the term “abusive” about agency people. I am sure that that is true on occasion, but the Report shows rates having increased by 16% over a two-year period, which is quite steep, but I would say that that is not indicative of a major gouging exercise.

              Jim Mackey: I think the comments that Simon made last time—I have made some subsequently—refer to specific instances that we are aware of. In aggregate, it is high—it is an increase that we cannot afford—but we are not saying that that is happening everywhere. We just highlighted specific examples. I have personally been on the end of some of these calls where people have just tried to barter rates up.

              Q102 John Pugh: I have a few clearing-up questions. In the 2016 NHS Improvement report, there is a statement that e-rostering should be spread, and that was obviously recommended by the Carter review. Are you responsible for doing that, or is a collective responsibility shared across the NHS?

              Jim Mackey: At the moment, technically, each individual provider needs to do their thing in terms of e-rostering. Not every provider has it. A lot of the e-rostering systems do not actually produce the level of information that is required. We had a discussion yesterday, and we probably need to kick off a national procurement exercise so that there are perhaps four or five providers of e-rostering systems that are available to the NHS, that are established, and that we understand work well, so that providers can call off them.

              Q103 John Pugh: In broad percentage terms, how many providers in the NHS do you think do not currently have e-rostering?

              Jim Mackey: My guess would be that 70% to 80% have e-rostering. Again, my former trust had e-rostering, but we couldn’t get any information out of it, so a lot of this stuff was still done manually.

              Chair: Another IT problem.

              Jim Mackey: Yes.

              Q104 John Pugh: Mr Massey, are you aware of any major manpower report or review of staffing, apart from the annual review and so on, having been presented to the Secretary of State since the general election?

              Charlie Massey: The Secretary of State constantly has conversations with me and Professor Cummings—

              Q105 John Pugh: But you are aware of no specific report that has been done apart from the annual—

              Charlie Massey: We have our workforce statistics, which are constantly churned through the system. I am not sure what you are driving at.

              Q106 John Pugh: What I was really driving at was that if you are going to announce a seven-day NHS and some sort of change, you would think that it would be prefaced by some scoping of how difficult it may or may not be to provide.

              Charlie Massey: On the seven-day service point, the workforce questions that arise are quite complex and will be different—

              John Pugh: What I am asking is whether they were discussed before it was announced.

              Charlie Massey: There were conversations both before and after the general election about seven-day services and what that would require.

              John Pugh: Right. Looking ahead—

              Q107 Chair: Was there a figure attached to that? There is a budget implication, so was that discussed?

              Charlie Massey: Clearly, the Government made their decision through the spending review for £10 billion in extra real income into the NHS for 2020-21 compared with 2014-15, including significant front-loading, to meet some of the Government objectives around seven-day services, as well as delivering on the five year forward view. It is on the back of that that we published NHS planning guidance at the back end of the last calendar year. We have also asked local and regional footprints to advise on their sustainability and transformation plans.

              Q108 Chair: Forgive us if we are a little cynical, but we are members of the Public Accounts Committee and it goes with the territory. The £10 billion was announced in the five year forward view and is often promised as the solution to lots of things. I am just a bit unclear as to whether that really included the seven-day working.

              Charlie Massey: Seven-day services were very much part of the conversations that informed the decisions that were taken as part of the spending review. At the moment, we are working with eight trusts on precisely what the implications of seven-day services will mean. It differs substantially from one local health economy to another. It does not necessarily mean additional costs, because if you look at some of the earlier adopters, such as Chesterfield, it is about having more senior clinical decision makers available seven days a week. It has been able to do that without increasing—

              Q109 Chair: I’m going to bring in the Comptroller and Auditor General on that.

              Sir Amyas Morse: For my technical information, when you use the word “conversation”, does that mean “evaluated plan” or does it mean “chat”?

              Charlie Massey: Clearly, in all of the discussions that we have with Ministers, our responsibility is to bring what evidence we have into those conversations and to bring all the players across the system—

              Sir Amyas Morse: Given that a major policy initiative with very substantial resource implications was being made, you presumably presented detailed work on how it would work in an impact assessment or something of that sort.

              Charlie Massey: We brought together a range of—it is very difficult to pick one thing out, because there is an awful lot that is common to both the seven-day service and the five year forward view in terms of the decisions that Ministers made. Clearly, the numbers within the five year forward view were ones that the whole system had owned in terms of the so-called £30 billion gap and the £22 billion of efficiency assumptions that generated the £8 billion number. The Chancellor clearly decided that £10 billion, with front-loading within it, was the right number for the NHS going forward.              A lot of the thread of our conversations today has been about marrying national and local plans. It is actually quite dangerous to rely solely on one or the other. My view, and that of all leaders across the health and care system, would be that it is difficult right now to get a precise figure or to have a mechanical approach for how you would deliver seven-day services in different areas. It will differ from one place to another, and that is precisely what we are thinking through, and we want to get those STP plans—

              Q110 Chair: Surely, Mr Massey, you did ask trusts to give some input? When the European time directive came in for junior doctors, there was a lot of work done to analyse what that would mean in terms of extra staff and, in particular, doctors in hospitals. Surely something similar was done for seven-day working.

              Charlie Massey: We did a lot of work with NHS England on trying to get as good an understanding as we could of some of those issues. Clearly, that related very closely to the work that Bruce Keogh had done with the Academy of Medical Royal Colleges on the 10 clinical standards.

              Q111 Chair: So on the answer to whether you went to the trusts or whether it was via NHS England, did NHS England speak to the trusts?

              Charlie Massey: We spoke to a range of trusts. We did not speak to every single trust, because different trusts were in a different place on that. We spoke to trusts through last summer and last autumn, and the evidence from that engagement was very much part of the decision-making process within Government.

              Q112 Karin Smyth: What is your definition of seven-day working?

              Charlie Massey: The work that the seven-day services forum worked through, which Bruce Keogh led with the Academy of Medical Royal Colleges, focused on four of the 10 key clinical standards to be prioritised, and that is very much around urgent and emergency care admissions at weekends. That is not about the full range of diagnostic services and elective care on Saturdays and Sundays.

              Q113 Karin Smyth: You are only talking about urgent and emergency.

              Charlie Massey: In terms of seven-day services, the focus within hospitals is on urgent and emergency care and ensuring that there is the right senior clinical decision-making support at weekends to ensure that patients have the same quality of care when being admitted at weekends as they would get were they admitted during the week.

              Q114 Karin Smyth: For urgent and emergency care only.

              Charlie Massey: Yes.

              Q115 Karin Smyth: You are continuing with that definition in your conversations with trusts.

              Charlie Massey: We asked Bruce Keogh and the Academy of Medical Royal Colleges which of the clinical standards were the most important to focus on in improving outcomes for patients.

              Q116 Karin Smyth: Is that the Minister’s definition of seven-day working?

              Charlie Massey: The agreement between the Department, NHS England, the Secretary of State and Bruce Keogh is on focusing on those four key clinical standards for urgent and emergency care admissions to ensure that we are delivering seven-day services in hospitals during this Parliament.

              Q117 John Pugh: I think, Mr Massey, that we have to accept that it is a work in progress, but given that you do think ahead and model things, I have one small point. A lot of the recruitment from overseas, which the NHS depends on, used to come from far and wide. It now disproportionately comes from the EU. Are you modelling the consequences of Brexit in the Department of Health?

              Charlie Massey: I am not sure that Brexit would have an impact on our ability to recruit nurses from the EU. Certainly we will be thinking about all those questions over the coming months. There may be others in the Department who have given it more thought than I have as yet. At the moment, I am not anticipating that it would constrain the ability of trusts to recruit nurses from the EU. There certainly has been a lot of focus on whether we are getting enough nurses from outside the EU. This perhaps relates back to the agency conversation that we were having earlier, but last year trusts for the first time faced more grave difficulties in trying to get nurses from outside the EU into the NHS, and that was one of the reasons why we agreed as a temporary measure to put nurses on the shortage occupation list.

              Q118 Chris Evans: Can I refer to paragraph 4.20 on page 44? That paragraph talks about tier 2 visa rules. It states: “The Royal College of Nursing estimated that up to 3,365 nurses currently working in the UK would have to leave the country from 2017 as a result of these changes.” That does not make very good reading, does it? It is a bit concerning. Next year, you could lose nearly 3,500 nurses.

              Charlie Massey: Those are the Royal College of Nursing’s figures. I do not have my own figures to hand on that. Clearly, a number of nurses coming to the UK through the migrant route do not intend to stay in the UK for a long time. Whether the 3,365 is a worst-case scenario—I could not give you the range.

              Q119 Chris Evans: Could you write to us with that figure?

              Charlie Massey: It says here that it is the Royal College of Nursing’s estimate.

              Q120 Chair: Could you provide them if you don’t have your figures to hand?

              Charlie Massey: I can certainly write to you with—

              Q121 Chair: I assume you have them if you are responsible for—

              Charlie Massey: I’m sure I can give you what we have on that.

              Q122 Chris Evans: Even the BMA said there’s a real problem with the visa rules at the moment. What advice are you giving to the Secretary of State? Are you speaking to the Home Office about the visa rules? It seems to be a real problem, in terms of recruiting people from outside the EU, as you said, and it is mainly down to those rules. The BMA and the Royal College of Nursing are saying the same thing.

              Charlie Massey: This is a very live issue within Government, and the Government has not yet announced its conclusions on it. As a temporary measure, we agreed with the Home Office and the Migration Advisory Committee to put nurses on the shortage occupation list last autumn. We submitted evidence to the Migration Advisory Committee with the support of Health Education England and others across the system. Where we go with that is a live issue for us, the Home Office and other Government Departments.

              Q123 Chris Evans: This seems a massively vital issue. There are 3,365 nurses—I grant that that is according to the Royal College of Nursing. You are reviewing this in February 2016—this month. When is this due to report? What actual date have we got? You say February 2016, which is now.

              Charlie Massey: It is imminent. I could not give you a precise date, but I know that the Government will conclude on this imminently. It is important to put the matter into perspective. We certainly should not think lightly of the 3,365, but that is 1% of the entire nursing workforce. We are doing a lot of other things to ensure we have got the nurses we need. It is not just about employing them through agency routes. Health Education England has done an awful lot of work on, for example, return to practise, which is a much cheaper route for getting nurses into employment than training new ones. This is clearly an important issue that we take very seriously, but it is one of a number of issues that we are looking at.

              Q124 Chris Evans: Is there a particular problem in London? Paragraph 4.22 of the Report states: “According to data from the Home Office, around half of the nurses recruited by the NHS and entering the UK under tier 2 visas in 2014‑15 were recruited by just three London trusts.” Do you know why only three London trusts were recruiting?

              Ian Cumming: Perhaps I can help with that. We keep figures on vacancies in all the trusts, and the highest area for vacancies is north, central and east London, with vacancies of about 15% of their clinical workforce. What we are seeing is that some of the larger organisations in London are desperate to fill their vacancies. As a comparator, the figure for the north-west of England is about 3.5%.

              Q125 Chris Evans: Is that something to do with the cost of living?

              Ian Cumming: That is undoubtedly part of it. It is also that, certainly for nursing and some other professions, people tend to work here for a few years and then move out of London. One way we monitor that is to look at retirement. Retirement from employment in the NHS in London is the lowest of any part of the country, because people do not tend to retire from their jobs. They move somewhere else and then retire from wherever they have moved to. It tends to be a younger, more diverse and more transient workforce.

              Q126 Chris Evans: Do you have any figures about how many people move between trusts? Paragraph 4.23 of the Report says: “Overseas recruitment was previously coordinated regionally but responsibility now rests with individual providers. This means that trusts are potentially competing for the same staff.” What data do you have about people who have switched? It says here: “on average around a fifth of overseas nurses leave their trust within the first two years of employment”. Do you know why they are switching? Again, is it a cost of living issue? Is it pertinent to London, or is it across the board?

              Ian Cumming: It is multi-factoral. We know that about 20,000 people move between different NHS employers on an annual basis. They move from one trust to another, whether for a promotion, to move to a different geographical area or whatever it may be. We have not got the detailed information about the reasons for all of those moves. As we review the data that we want in the future, that is one of the areas that we would like to capture. We see movement between the health and social care sector, we see movement between the private sector and the independent sector, and we see geographical movements around the country—particularly in areas such as London.

              Q127 Chris Evans: But would it not be easier to move back to the regional model, rather than the individual provider, as there is real competition for staff there? If you have a situation in London where the cost of living is higher than the rest of the country, and someone who would look more leniently on the midlands would go to the midlands, taking London’s potential recruitment away, do you think that would be an issue if we moved back to placing people where the needs are highest?             

              Ian Cumming: Cost of living is one factor. Equally, there are many people who want to work in London because of the fantastic opportunities for research, for teaching and for the absolute world-leading healthcare that is delivered in London and that may not be available to the same extent further out. So, there are pulls and pushes in terms of the workforce moving in London.

              Certainly, as part of the geographical analysis that we do through our local education training boards, and we have three covering London, we ask them very specifically to look at those local factors and to build them in to their recruitment and retention strategy. If I take GPs as an example, in the east midlands—where we have a particular problem recruiting GPs into training posts—what we have done is to put in 28 different measures. Don’t worry; I won’t go through all of them. But I will give a few examples.

              We have put in a pre-GP year to give people the opportunity to work in that area and to prepare themselves for going into GP training. We have given people a year after they have completed their GP training to develop a special interest in that particular area. And these things are starting to attract more people into these areas that historically have not been top of their list through choice. What we are finding as well is that once people get into these areas, actually reality isn’t perception, and they have a really refreshing and a really rewarding career once they have gone there and experienced working there.

              Q128 Chris Evans: There is another thing that I want to touch on as well. I will again quote the Royal College of Nursing, which estimates that the cost of recruiting a single nurse from overseas can range from £2,000 to £12,000, compared with £79,000 to train a nurse in England. I know that I have quoted figures there from the RCN, but are they correct?

              Ian Cumming: Broadly speaking, yes. You can reduce the cost of recruiting from overseas, so our west midlands team has been working with a cohort of trusts and they have recruited some nurses from overseas at an average cost of £900 per nurse to bring them into this country. As for training a nurse, it depends on how you calculate the figures, but the cost of training a nurse from scratch in this country is somewhere between £50,000 and £80,000. Training a consultant surgeon costs the taxpayer about £750,000, from day one—entering medical school—to becoming a surgeon. So, yes, those figures are correct.

              Q129 Karin Smyth: I wanted to pick up on nurse numbers in particular, but I will pick up on that point as well.

              Professor Cumming, I think earlier you said that there were about 800 more nurses coming on-stream. We were at about 20,000 a year, weren’t we? But we have dipped. I understand from the RCN—perhaps it would say this, wouldn’t it?—that it is still saying that there will be cuts and that we will suffer from this lag for years to come, particularly given the problems around acuity and demand that are coming on-stream. Could you talk about that on a regional basis for us a little bit?

              Ian Cumming: Our prediction on the levels of nurses that we’ve put into training over the last three years is that by 2019-20 supply and demand will match, but we have a gap between now and 2019-20, when there will be more vacancies than there are our own trained nurses coming through.

              That has been part of our evidence to the MAC, to seek some relaxation of the rules around our being able to bring nurses in from overseas to help us with that temporary period of time, because we remain committed—in fact, it’s part of my mandate in Health Education England—to maintain supply and demand in equilibrium. However, it will take a period of time to catch up with the reduction in numbers that was introduced—well, the numbers started going down basically in 2010-11, so on the back of the 2008-09 global economic downturn.

              QIPP—the Quality, Innovation, Productivity and Prevention programme—in the NHS predictions were made about a significant reduction in demand for nurses. Commissions were reduced at all our universities across much of the UK, but specifically for my area, England. Those are the nurses who are now coming through the system. So the first year of the increase back up again will come through next year, and then we will see an increase in the output from universities from each of the following years after that.

              Q130 Karin Smyth: So for the next three years, there’s a shortage?

              Ian Cumming: Yes.

              Q131 Karin Smyth: That needs to be met by this overseas recruitment or—let’s not go back there, but—agencies?

              Ian Cumming: Yes.

              Q132 Karin Smyth: Is there a difference across regions with that shortage?

              Ian Cumming: London, because it has a higher turnover of staff, tends to be more susceptible. If you look at the south-west of England for example, the turnover there is much lower and therefore the vacancy factor becomes far less of an issue, because people work there, stay there and retire there. So it is variable.

              The other issue that we are working on at the moment is skill mix. My organisation is consulting at the moment on the creation of a new post of nurse associate. They would work between a healthcare support worker and a degree level registered nurse to help provide more support. So it is skill mix and grade mix, but it is also making sure we have the number of nurses that we need. Geographically, it is an issue, but it is perhaps not as great an issue as sometimes portrayed.

              Q133 Karin Smyth: If we had more time, it would be interesting to talk about that skill mix issue. On where Mr Evans is coming from, Bristol is still recruiting overseas and we have a workforce that is totally able to meet some of those jobs, but they are not being supported to get into them.

              Ian Cumming: Subject to consultation, we intend to start training the first 1,000 nurse associates this calendar year on a course that will be in the region of 18 months to two years long, and then we will build that in consecutive years, but that is subject to consultation at the moment.

              Q134 Karin Smyth: Mr Mackey, you talked about how people coming on to the framework will have to pay NHS rates. Do you have a view that you could share with us about the outcome of the negotiations with the junior doctors, which now means that trusts are having to look at their own workforce modelling and pay rates in the next few years?

              Jim Mackey: Could you clarify that?

              Q135 Karin Smyth: Foundation trusts are now looking at how they will manage the outcome of the junior doctor contract, which creates a challenge for the NHS payment framework. You were clearly saying that all suppliers will be on NHS rates. Are you confident that that will survive? Will the NHS national pay rates survive?

              Jim Mackey: Absolutely—no question about that.

              Q136 David Mowat: I have one observational question, Mr Massey, on your answers to Mr Pugh on the seven-day NHS issue. We got to the fact that it is all included somehow in the £10 billion that was approved by the Chancellor. Ballpark, how much of that £10 billion is needed for the seven-day NHS?

              Charlie Massey: We have not separated out in that way. Part of what we are trying to achieve through a seven-day service is very much at the heart of what we are trying to do in terms of new models of care and the way in which we are looking at different—

              Q137 David Mowat: So, for example, if you did not do the seven-day contracts that are potentially being imposed, how much do you think you would save by not doing it? You must have an idea of what the number would be.

              Charlie Massey: Can I be clear? In terms of the junior doctors’ contracts that you are talking about—

              Q138 David Mowat: It is not just junior doctors, is it?

              Charlie Massey: For the junior doctors’ contracts, we are not changing the overall envelope of pay—the amount we pay—for junior doctors.

              Q139 David Mowat: No, but if they are working more weekends, presumably somebody else is having to provide cover, if you have the same number of doctors, shifts, rotas and rosters that they are not doing in the week.

              Charlie Massey: It is important to look at the whole of the contractual environment in thinking about that. Clearly, there has been an awful lot of attention over the last few months around junior doctors.

              Q140 David Mowat: I don’t want to spend too long on this; I just wanted to understand. You said the £10 billion covers the seven-day NHS. I think you have told me the answer.

              Charlie Massey: Yes. There is no separate pot set aside for something with the specific label of seven-day services.

              Q141 David Mowat: It does not give a great feeling of warmth that you understand the implications of the policy in terms of manpower. Another way of asking the question is what is the delta in manpower—or man and woman power—that you need to meet the seven-day NHS? There must be an implication.

              Charlie Massey: I wish it was a question that could be answered in a simple and mechanical way that applied to every single trust and local health economy—

              Q142 David Mowat: Right, but if you don’t know the answer approximately—I understand you might have to work it through in detail, but if you don’t know in broad terms what the answer is, how can you be doing the policy?

              Charlie Massey: It differs so substantially from one local health economy to another. When we have looked at some of the eight adoptor trusts, some of those have talked about that driving cost savings. A lot were talking about the reduction in bed days that happened as a result of that, without leading to additional cost in terms of the deployment of their senior clinical disciplines.

              Q143 David Mowat: Yes, but you are the guys sitting above all of these trusts. You have already given evidence that if all the trusts were as good as the best trust, the world would be a better place, and everything like that. I am surprised that you can put this policy in place without having some idea of the implication for staffing levels at the headcount planning level—that is what today’s hearing is about—or, indeed, for cost and budget.

              Charlie Massey: That is a big part of the reason why the planning guidance in December asked local footprints to create their own sustainable transformation plans that bring together all of those issues.

              David Mowat: What if the answer comes back as being more than £10 billion?

              Q144 Karin Smyth: If we look at appendix 3 on your data and what you know about the workforce, there is no “readily accessible” data on vacancy rates, there is limited data on course completion rates, there is limited data on leaver rates and there is no inclusion of information on temporary staff employed by agencies. So you don’t know, do you?

              Charlie Massey: The Report rightly identifies that there are some data gaps within our workforce planning.

              Q145 Karin Smyth: That’s generous.

              Charlie Massey: I wouldn’t disagree with that, but that isn’t to say that we aren’t taking action across the system to fill those data gaps. We have a workforce information architecture process where we are essentially coming to plan specifically for how we are going to plug those gaps. That feeds into the workforce advisory board that Professor Cumming chairs, which looks at workforce planning across the system to deliver seven-day services and the five-year forward view. We have work in train, but we don’t yet have that data, which I agree is something that we need. I hope that next time we have this conversation, we will be looking at it from a very different perspective.

              Chair: I have to say that the lack of data, as Karin Smyth has rightly highlighted, worried us before the hearing, and I am not sure that we are convinced by the answers that you can do your job without that data. I am going to bring Chris Evans in for a quick-fire, and then I have a few more.

              Q146 Chris Evans: Just a quick piece of information. I have just had a news text saying that the BMA has announced three further dates for industrial action. How will the seven-day service work in light of that, especially with junior doctors leaving?

              Charlie Massey: Obviously, that news has come in since we have been sat here today. Clearly, the position we have got to where we are introducing a new contract is not one that we were aiming to achieve. We brought David Dalton in to lead the negotiating team with a very clear and genuine objective to reach a negotiated conclusion.

              David Dalton led a process with a range of chief executives across the service who said that they thought the contract he had developed was fair and reasonable. They also said it was important that there was certainty for the service moving forward, which is why the Secretary of State made the decision to introduce a new contract. It is a highly regrettable consequence that there is more industrial action, as you say. Every day of industrial action where elective care is withdrawn is a day when 3,000, or more, fewer planned appointments are kept with patients. Clearly, we all need to be very anxious about the degree to which that affects patient safety.

              Q147 Chair: We have heard the Secretary of State say that in the House of Commons, and in the media, a number of times. Given that you have acknowledged that you don’t have the data—you freely acknowledge that—it is interesting that the Secretary of State and the Department went out and imposed a contract on junior doctors when there are real gaps in your long-term planning for staffing. It seems like you are flying blind.

              Charlie Massey: We believe that the contract that we are imposing is better, safer and more reasonable than the one currently in place. It means that doctors who could now be working up to 91 hours a week—

              Q148 Chair: My point is that you don’t have the data to really understand the impacts of the decisions at the centre. You have acknowledged that, and we have heard some of the concerns about that lack of data coming through in evidence today.

              Charlie Massey: That is part of the reason why we asked David Dalton to lead that negotiation process.

              Chair: He didn’t have the data, either.

              Charlie Massey: Well, working with a range of chief executives. I think one of the themes of the conversation this afternoon has been that this is a question of judgment as well as one of scientific fact. I take very seriously what the range of chief executives that David Dalton was engaging with have to say.

              Q149 Chair: We will not go further down that line, because I am aware of time. In the last couple of minutes, I want to ask a couple of particular questions. First, Professor Cumming, there are going to be more nursing training places because the cap is being lifted, but there is also going to be a loss of maintenance grants and funding for those student nurses. How can you be sure, and what analysis have you done to predict, that those nursing places will be filled and that they will be filled by people who actually want to work in the NHS?

              Ian Cumming: We know that, roughly speaking across the country as a whole, there are about three applicants for every nurse-training place created at the moment. A number of those applicants are bitterly disappointed when they are not recruited. Many of them then go into other caring roles and seek to access nursing or one of the allied health professions, whatever it may be, through that different role in future.

              We have a system at the moment that, in terms of the number of commissions that we are able to place, is constrained by the level of resource made available to us. We are moving to a system whereby people are able to access the Student Loans Company for tuition fees and also for the cost of maintenance.

              The issues we are exploring at the moment are how we continue to use the resource that we have to ensure appropriate geographical distribution, so we spend £150 million a year on clinical placements for students in training—that is non-doctors—nurses and allied health professions. How do we use that to ensure that we incentivise people going to areas that may be less popular?

              Q150 Chair: The Report says that 71% of trained nurses end up working in the region in which they were trained. Surely it is where the training places are that will matter, among other things.

              Ian Cumming: It matters very much indeed. One issue we need to ensure does not happen is that people are attracted to a university because it may be a university in an area where students particularly want to go, or is one with a particularly good reputation. That would potentially attract people away from an area that may still require the number of nurses to be produced for the NHS but may not be able to fill numbers. That is where we will come in with £150 million, in terms of utilising that clinical placement money to try to keep the balance around the country.

              It is not just geographical, though that is important. It is also specialty and profession base. We need to ensure that we continue to fill courses for some of the really small professions, tiny ones such as orthoptists and orthotists, because they are crucial to the running of the NHS. Some of the smaller programmes have the potential to need more focus and attention for us as we make the transition, than some of the very big programmes.

              Q151 Chair: I was going to ask about specialisms so I am glad you are focusing on that. One concern I have, especially in a constituency like mine in east London with a great deal of poverty, is that a lot of women with children—not just women; people who are maturer—want to go into nursing. It is a good opportunity for people who have aspiration.

              However, between the cost of housing and the cost of tuition fees, those people are in a very difficult position. Have you factored in those costs in terms of how many people it will deter from applying? Have you also looked at or had any conversations about the cost of housing, particularly in expensive areas of the country?

              Ian Cumming: We have not been focusing specifically on the cost of housing but, in terms of whether or not a transition to the Student Loans Company will have an impact on the numbers applying, yes we have been looking at that. We know, for example, that with many of our nursing degrees in particular we are seeing more mature people apply. That is really good for the profession because we get a mix of people with life experience.

              Q152 Chair: Will those people not be deterred by the loan system?

              Ian Cumming: We don’t know, is the honest answer to that. We did not see that happen when we saw the student tuition fees introduced elsewhere. That did not have an impact. Remember we are, of course, introducing an alternative route to degree-level nursing as well. People who wish to do the nursing associate programme, which I said earlier is subject to consultation, will be able to continue to work for an employer and go beyond that into a degree-level registered nurse position. They would be able to achieve their nursing degree while working for the NHS and while their fees were being funded and supported.

              Q153 Chair: That is an important crumb of comfort for constituents like mine. While we have you all here, housing came up at previous hearings. Mr Massey, how much is the Department focusing on the real issue of affordable housing for key workers in our NHS? Because even newly qualified consultants in some parts of London find it hard to afford to live here. Certainly, if you are a nurse or healthcare assistant, it is practically impossible.

              Charlie Massey: Perhaps I could start to connect this to the conversation you just had with Professor Cumming in relation to the announced changes around nurse bursaries and student loans. The Government will issue a consultation paper soon that will ensure that people who are doing nursing as a second degree will be able to access student loans.

              Q154 Chair: Sorry, we have covered that and it is becoming ever clearer. I was asking particularly about the Department’s strategic role in ensuring that there is housing available, so that people can actually afford to live and work in London in particular.

              Charlie Massey: We do not have within the system specific housing bursaries for particular workers within the NHS. What there is within the NHS are freedoms that trusts have around some of the issues around pay, so they can pay recruitment and retention premiums, and high-cost area supplements. So if—

              Q155 Chair: Can I say, Mr Massey, that you know London, I am sure, and I know London? If you are wanting to work at Barts, for argument’s sake, right on the doorstep of my constituency, or even at the Homerton, a housing bursary or an extra bit of money on your pay is probably not going to be enough even to enable you to rent privately; it is certainly not enough to get on the housing ladder and become permanently based somewhere and become a permanent member of NHS staff in that area. It is more about the capital assets that the NHS has got. Perhaps you can answer that point. Is the Department doing anything to direct or encourage authorities or indeed to use PropCo to encourage sales of capital assets to provide housing, whether subsidised or affordable, for key workers in the NHS?

              Jim Mackey: I can help with that. It is part of the NHS estates rationalisation plan around surplus land that some land—I am a bit hazy on the numbers, but I can get you the facts on this—has to be sold for homes for nurses and other healthcare staff. It is at the early stages of the plan—it will be developed over the next few months—but it is part of the plan.

              Chair: It is a vital part of the plan. I am just concerned that it has got to be debated, because whatever Mr Cumming achieves and whatever else is achieved, if people cannot afford to live in an area—it is London today but it might be Bristol tomorrow—

              Karin Smyth: Bristol, too.

              Chair: In Bristol, too. Just imagine what it is like to live on a healthcare assistant’s salary: even the private rented sector is now out of reach, so you have got to be in social housing if you are lucky enough to get it. It is worth hammering home that that puts people out of the system.

              I am aware that time has moved on. We have covered a lot of ground, although not everything that we wanted, but we thank you for your candour. Our uncorrected transcript of the hearing will be out in the next couple of days, straight on to the website, so if you look at that and you have any issues, please raise them with the Committee staff. At the rate we are publishing reports, the report will probably be published after the Easter recess. We will write to you with the points that you promised to write to us about to remind you of them. Thank you very much indeed for coming along.

              Oral evidence: Managing the supply of NHS clinical staff in England, HC 731                            24