Agenda for Change mileage reimbursement rates review (England)– October 2026
mechanism has been carried out in line with the NHS TCS Handbook.
On the 1 June 2026, the new Agenda for Change mileage reimbursement mechanism (England) was implemented in a phased approached. The first bi-annual review of the new mileage reimbursement mechanism has been carried out and has triggered a change to the rate of reimbursement for those on Agenda for Change terms and conditions from 1 January 2027.
Background
Section 17 (England) of the NHS Terms and Conditions of Service (TCS) Handbook sets out that mileage reimbursement rates are reviewed twice a year in April and October, using the previous months ONS CPI operations of personal transport equipment data. This data allows for the review of latest costs of various aspects of the cost of motoring, including fuels and lubricants, maintenance and repairs and spare parts and accessories.
The NHS Staff Council then uses this data as an inflationary measure for the cost of motoring, which is applied in aggregate to the Approved Mileage Allowance Payment Rates (AMAP) to estimate the costs of motoring for business miles and to set the rates of reimbursement in Section 17 (England).
The October 2026 review
The October 2026 review has been undertaken and due to a sustained increased in the CPI “operation of personal transport equipment” data, the rate of reimbursement has changed above a whole penny value.
Therefore, an increase in the below reimbursement rates for England will be effective from 1 January 2027.
| Rate up to 31 December 2026 | Rate from 1 January 2027 | ||
Type of vehicle or allowance | Annual mileage | Annual mileage over 4,500 miles | Annual mileage | Annual mileage over 4,500 miles |
Car | 59p per mile | 36p per mile | 61p per mile | 37p per mile |
Motorcycle | 30p per mile | 31p per mile | ||
Reserve rate | 30p per mile | 31p per mile | ||
These changes will apply to staff employed under Agenda for Change (AfC) terms and conditions and staff who are employed by organisations in England that use AfC reimbursement rates of Section 17 of the NHS TCS Handbook.
Co-chairs of the NHS Staff Council, Helga Pile, head of health at UNISON, and Bridget O'Kelly, chief people officer for Buckinghamshire Healthcare NHS Trust, said:
"We welcome the new mileage reimbursement rates and are pleased to see the mechanism operating as intended, responding to changes in inflation and the cost of motoring. The outcome of this first review demonstrates the value of employers and trade unions working together through the NHS Staff Council to ensure reimbursement rates remain responsive to changing costs of motoring. We would like to thank the Mileage Negotiations Group for its work in developing and implementing a fairer, evidence-based mechanism."
Next steps
Where local partnerships of employers and trade unions have agreed alternative local arrangements it is not the intention that this automatic review changes or replaces these mileage rates, although local partnerships may wish to incorporate reference to the new rates into their agreements.
Electronic Staff Record (ESR) colleagues have received the detail of these changes and have confirmed that a new rate will be updated in ESR from 1 January 2027, and a user notice will be published. Section 17 (England) of NHS TCS Handbook will be updated in due course to reflect the revised rates of reimbursement.
The next review of the mechanism will take place in April 2027.
What employers need to do
- Review the timeline of changes as detailed above.
- Contact local expense system providers to ensure that changes will be in place for implementation on 1 January 2027.
- Consider how current policies and procedures may be impacted.
- Communicate the above changes to mileage reimbursement with applicable members of staff.
