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GPs warned pay rise could depend on making staff cuts

GPs are faced with the prospect of laying off staff if they want their promised pay rise from the new contract.

Medical accountants have revealed practice profits are being hit by rising staff salaries and administrative costs.

The GPC has promised GPs a 46 per cent average pay rise in the first three years of the new contract based on a 23.5 per cent jump in expenses over the period.

But accountants predicted expenses could jump by at least that amount over the next 18 months and would eat into GPs' 11.3 per cent pay rise for this financial year.

Rosemary Smith, GP liaison manager at accountants Sandisson Easson in Wilmslow, Cheshire, predicted most practices' profits would be 'standing still' for 2003/4. She said: 'In March next year GPs are going to be lucky to see a 5 per cent increase.'

Liz Densley, a partner at accountants Honey Barrett in Bexhill-on-Sea, East Sussex, said pay rises would 'not be as big as headlined'.

She added: 'From talking to GPs, I expect expenses to increase very much more than original estimates suggested.'

Bob Senior, director of medical services for BKL Tenon accountants in Eastleigh, Hampshire, said he was advising GPs to compare their staff costs with income they expect from quality pay. 'They need to see how much they pay their staff per quality point and whether it would cost them more than they get back,' he said.

Net profits for GMS practices in 2002/3 rose by between 5 and 10 per cent and early indications for PMS practices show a rise of between 10 and 15 per cent.

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