Budget headlines


19 / 3 / 2014 12.05pm

The Chancellor of the Exchequer has just finished presenting his 2014 Budget so, in keeping with providing you with timely updates, I thought that you would find a quick summary of the key NHS and workforce announcements that you can share with your Board and colleagues useful. I have also taken this opportunity to give you a quick update on the work that we are continuing to do to support you on pay, pensions, health and wellbeing and the support we are giving to the 'Keogh' trusts.

The Budget – key announcements 

  • Protection of the NHS budget would continue.
  • Continued commitment to public sector pay restraint.
  • The waiver of inheritance tax for any employees who lose their life performing emergency duties.
  • Abolition of VAT on fuel for air ambulances and a new air ambulance for London.
  • Personal tax allowance to increase to £10,500 from next year and the threshold for higher tax band to increase to £42,285, also from next year.
  • Funding for a further 100,000 apprenticeships.
  • Duty escalator for alcohol to be abolished but the rise in duty above inflation confirmed for this year. Duty on beer reduced by 1p.
  • Tobacco duty to rise 2 per cent above inflation and the duty escalator to continue.
  • Fuel duty will be frozen.
  • Minimum wage will increase by 3 per cent.
  • The abolition of the 10p tax rate for savers.

We will of course update our website pages as we get more information and provide further information in the workforce and manager bulletins.

There were also lots of announcements relating to pensions. We will discuss implications with NHS Pension Scheme colleagues and update you separately once we know of any implications for scheme members and employers, so do keep an eye on our pension’s latest news pages. 

In addition to the Budget, I also thought I would update you on what has been another busy week.


Following last week’s announcement, we have received a number of questions from employers. We’ve collated these into an initial FAQs document which can be accessed on the pay section of our website. We will regularly update these and if you have any questions then please email them to agendaforchange@nhsemployers.org and we will add them to the document.

NHS Pensions

You may have also seen that last week, HM Treasury published the framework for determining the public service pension scheme actuarial valuation and the cost cap mechanism.  The employers contribution to the pension scheme will be determined using this framework.   The NHS Employers organisation responded to a series of consultation exercises undertaken by the Treasury resulting in the final framework.  From work undertaken through the NHS Pension Scheme Governance Group the employers contribution rate effective from 1 April 2015 has been determined as 14.3% compared to the current 14.0%. This creates a cost pressure for employers of 0.3%.   We will of course keep you informed of developments over the coming months.

Staff health and wellbeing

I also wanted to let you know that Sian Williams, clinical director at the Health and Work Development Unit and I have written to all chief executives to inform them that the results of the national audit of NHS trusts implementing NICE public health guidance for the workplace are available.

The audit, carried out on 178 trusts that together employ nearly 900,000 staff, 73 per cent of the NHS workforce, looked at the six pieces of evidence-based guidance for the workplace published by NICE, covering board engagement, mental wellbeing, long-term sickness absence, obesity, physical activity and smoking cessation.

The results, I hope, provide a timely reminder of what trusts can do to support their staff while they strive to deliver high quality patient care in challenging circumstances. 

A summary of the findings is available on our website, there is also a checklist for action that I would encourage you to take a look at.

Supporting the Keogh Trusts

We have started a lively and engaged network which includes Senior HR representation from all 14 Keogh Trusts focussing on common issues across workforce and leadership domains. There is tremendous energy and commitment from this group of HR Directors to learn from the process that they have been through, to share good practice, to learn from high performing organisations and to support their colleagues and all their staff and to ensure that their organisation is delivering care that is clinically effective, safe and delivering as positive an experience as possible for patients.

Professor Sir Mike Richards, Chief Inspector of Hospitals was able to spend an afternoon with the HR Directors earlier this month and accepted the value that including workforce leaders in inspection teams would bring. We have already provided a list of willing volunteers to CQC. We will, of course, be sharing learning from this group with our wider HR community and will let you have some more updates over the coming weeks.

Compassion in Practice Week

You may also have seen that this week, we are celebrating Compassion in Practice week. There are lots of ways to get involved including a podcast, recorded webinar and twitter chat. All the details are on our website and if you haven’t yet had time to watch our short video celebrating the work of Dr Kate Granger called #hellomynameis I really would urge you to do so. It’s only a few minutes long and well worth it. All the information is on our Compassion in Practice web page.

As always, I'd welcome any comments or feedback on how we can help and support you.

You can contact me at deanroyles@nhsemployers.org. You can also follow us on twitter and join my LinkedIn page where I will be posting regular updates.


With best wishes,


Dean Royles

Chief Executive, NHS Employers

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