Pay in High Cost Areas

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High cost area supplements (HCAS) are paid to all NHS staff groups who are covered by the Agenda for Change agreement on working in inner and outer London and the fringe zones.

These supplements are expressed as a proportion of basic pay (including the value of any long term recruitment and retention premia) but are subject to a minimum and maximum level of extra pay. 

HCAS payments are pensionable.  They will not count as basic pay for the purposes of calculating the rate of overtime, unsocial hours pay or on call payments.

The current value of these payments is set out in the table below:

Area  Level (1 April 2017)
Inner London 20 per cent of basic salary, subject to a:
  • Minimum payment of £4,200 and a maximum payment of £6,469
Outer London 15 per cent of basic salary, subject to a:
  • Minimum payment of £3,553 and a maximum payment of £4,528
Fringe 5 per cent of basic salary, subject to a:
  • Minimum payment of £971 and a maximum payment of £1,682

More detail is available in Section 4 and Annexes 8 (zones) and 9 (rates) of the NHS terms and conditions of service handbook.

Review of HCAS

In response to a recommendation from the NHS Pay Review Body,  the NHS Staff Council was asked to undertake a technical review of HCAS. Frontier Economics were commissioned to undertake this work and their report review of high cost area supplement was published on 24 September 2014. A copy was sent to the NHS Pay Review Body.

The report found no strong evidence to suggest that local recruitment and retention issues would be improved systematically by changing the current HCAS system. Frontier's analysis found some evidence that relative pay affects a combined measure of recruitment and retention issues. However, when looking at any individual measure (such as staff turnover, vacancies and use of agency staff), there was no clear impact on relative pay. 

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