NHS GPs in England will receive £11.8bn in government funding in 2024/25 in a stopgap arrangement introduced to give the new Labour administration time to draw up its long-term funding plans in the wake of the general election.
The settlement includes a 6% pay uplift as recommended by the Doctors and Dentists Review Body (DDRB), which will be backdated to April 2024. This will be provisioned via a 7.4% increase in the global sum, which will now be worth £112.50 per patient.
The implementation of the temporary contract brings to an end an impasse which had seen GPs vote to take industrial action. The last five-year contract settlement for GPs, agreed in 2019, came to an end in April. But with a general election looming, it was not possible to negotiate another five-year contract. The previous government therefore proposed a one-year stopgap in March.
However, a proposed 1.9% funding increase, less than the 2% year-on-year uplift agreed in the previous contract, was overwhelmingly rejected by GPs on the grounds that inflationary pressures post-COVID had already left GP budgets smaller in real terms than they were in 2019. The BMA entered into dispute with NHS England over the changes, and within the first month of winning the election, the new Labour government was faced with more than half of GPs agreeing to take ‘collective action’.
Playing catch-up
While the avoidance of industrial action and a settlement above the rate of inflation is welcome news for the sector, the BMA has also pointed out that the 7.4% increase in the global sum does not make up for the real-terms deficit in GP incomes built up since 2019. Indeed, the DDRB pay recommendation was based on data from 2021/22, with the BMA arguing that the deficit in earnings is much worse now than it was then.
Even if the increase in funding targeted at staff did make up the deficit, staffing costs are just one piece of the complex financial puzzle practices face. Funding support for staff costs makes up around half the overall settlement GPs receive, but there is no firm obligation for practices to pass those funds onto staff. Practices are independent contractors with freedom to make their own decisions how to use the money the receive from the NHS. Only salaried GPs are guaranteed to receive the 6% pay increase because rises inline with DDRB recommendations are built into their contract.
For other staff, it is left to the discretion of individual practices to decide whether to pass on increases, or use the funding to plug other holes in budgets as they continue to play catch-up with the sharp rise in cosys post-COVID. With average profit margins forecast to only reach 3% by the end of the 2024/25 financial year, the overwhelming majority of partners are unlikely to see anything like a 6% increase in what they take home.
While the temporary contract will keep the cogs of England’s GP sector turning until April next year, the sector will have to wait on the Labour administration to publish its long-term strategy for the NHS before the next contract can even be considered. With workforce shortages exacerbated by staff leaving the sector over pay and conditions an increasingly glaring issue, GPs can only hope that they won’t be left in limbo for too long.
Download the Xeinadin GP sector report for an in-depth analysis of the financial state of play of general practice in England.