Thousands of hospital porters, cleaners and other contract staff will get big pay increases as a result of a deal brokered yesterday by Patricia Hewitt, the health secretary, to bring an end to the two-tier workforce in the NHS in England.
She said about 35,000 employees of health service contractors will get pay increases worth up to 25%. From April, their basic minimum will go up to £5.88 an hour, matching the terms available to staff directly employed by the NHS.
The deal was hailed by Dave Prentis, general secretary of public service union Unison, as "the beginning of the end of the two-tier workforce in the NHS". Contracted staff were "sick and tired of being treated like second-class citizens" and the union had been gearing up for industrial action across the NHS over the winter. That threat was now withdrawn, he said.
The deal did not affect Ms Hewitt's plans to allow private healthcare companies to open up treatment centres to operate on patients on the NHS waiting list. The big unions defeated her on that policy at the Labour conference last week and will continue to oppose it. But the agreement went a long way towards settling a dispute that has been running since the 1980s, when the Conservative government encouraged the NHS to cut its costs by contracting out cleaning, catering and other services. NHS staff who were transferred to the contractors had some measure of protection, but newcomers were paid less.
The terms offered to contract staff became particularly disadvantageous after their NHS counterparts were offered a better deal in the Agenda for Change programme last year.
From 2006-07, the contractors will receive £75m a year in additional payments from NHS trusts, which will have to find the money from the existing Agenda for Change budget. Transitional costs will be borne largely by the contractors. Staff covered by the agreement will get a minimum hourly rate of £5.65, backdated to this month. This will rise to £5.88 from April.
Mr Prentis said the deal to end the two-tier workforce in the NHS was better than one already achieved in local government. "It has been made possible by the extra investment being put into the NHS."
Sharon Holder, of the GMB union, said: "The NHS is leading the way on modernisation for the whole public sector."
The deal did not include electricians, plumbers and other contract staff who do not have direct contact with patients. There would have to be further negotiations to enhance their pay and conditions.
The CBI and the Business Services Association, representing the contractors, welcomed the deal. Companies providing services to the NHS would compete on quality and would no longer be seen as a cheap alternative, they said.
Ms Hewitt said the deal recognised that all NHS staff were part of the team.
