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Pay freeze finally thaws as GPs get unexpected 2.29%

When it comes to pay, GPs haven’t had much to celebrate in recent years, since the heady days of surging wages in the immediate wake of the new contract.

By Gareth Iacobucci

When it comes to pay, GPs haven't had much to celebrate in recent years, since the heady days of surging wages in the immediate wake of the new contract.

Three successive funding freezes for most practices, driven by a Government determined to rein back on ‘overachievement' in the contract, have left the profession battered and bruised.

And with the country reeling from recession, GPs were feeling understandably downcast about the prospects for this year's pay negotiations.

So as world leaders gathered in London, it came as something of a surprise that the showdown between GPC negotiators and their NHS paymasters appears, on the surface at least, to have produced something of a victory for the profession.

The Doctors' and Dentists' Review Body, after weighing up starkly differing sets of evidence from the BMA on one hand and NHS Employers and the Department of Health on the other, decided last week the GMS contract should receive a 2.29% gross uplift for 2009/10.

In real terms, this will mean an average increase in net income of 1.5% for GPs, after taking into account expenses that continue to increase.

For many practices the numbers are rather less impressive – for those relying heavily on the MPIG, the uplift will barely cover those rising expenses.

But the more impressive victory is buried away in the pay review body's judgment, in its decision to reject two key arguments NHS managers were using to keep GP pay down.

The DDRB rebuffed suggestions that GPs could go on driving down their expenses and refused to take into account future enhanced service work that may or may not come GPs' way.

It therefore awarded a figure that while less than the 3.5% gross uplift the BMA demanded, was well above the 1.5% recommended by NHS employers, which the DDRB said would have produced a net uplift of zero.

It is also above the Department of Health's requested 1.6% gross uplift, which the pay review body said could have brought just a 0.4 % rise for GMS GPs.

After the Government accepted the DDRB's recommendation, GPC chair Dr Laurence Buckman hailed the award as ‘a victory for common sense'.

But Dr Buckman admits some practices will gain more than others under the complicated formula for carving up the uplift, which will pay percentage increases in the ratio 7:5:5:2 for global sum, the QOF, enhanced services and the MPIG.

Under the formula, the 10% of practices solely reliant on global sum will be the biggest winners, receiving an uplift of some 2.4%.

The 77% of practices still reliant on correction factor payments stand to gain the least, (around 0.7%) but will at least have their expenses covered.

The remaining 13% of practices which now have only tiny MPIGs will receive uplifts somewhere between these two.

‘Nobody loses,' insists Dr Buckman.

‘Everybody gets a pay rise, but there's a scale. The worst you do is get average expenses met. The net rise will pick up everybody's expenses for this year, which we were determined to have.'

The expenses issue formed a major plank of the GPC's evidence, with negotiators pointing out that GPs had been hit by three successive pay freezes, despite the fact the costs of running practices were rising inexorably.

Last October, Pulse reported the GPC's fears that escalating expenses would wipe out any pay rise for the vast majority of GPs if the Government limited the pay award to 2% or lower.

After examining the evidence, the DDRB agreed. ‘With regard to cash-releasing efficiencies, we do not believe it is appropriate for us to factor these into our recommendation for this year,' the pay review body said.

‘Indeed, now the expenses to earnings ratio has moved back towards the historical 60:40 split, it reflects efficiency savings that have already taken place.'

‘The fact they've now agreed to meet our expenses is a victory for common sense rather than a victory for anything else,' says Dr Buckman. ‘At last they are going to pay for some of the things we believe should have been met some time ago.'

There was further good news for the GPC after the DDRB batted away claims from NHS Employers that a 1.5% gross uplift would effectively lead to a net uplift of 2%.

This estimate was based on the dubious assumption GPs could expect to earn additional income outside of the core contract, with the employers confidently predicting a big jump in the money offered through local and national enhanced services.

NHS Employers projected a £30-50m increase next year through local enhanced services and a further £50-100m from national programmes such as the cardiovascular screening programme.

But the DDRB's evidence poured cold water on those figures, saying: ‘Our view is additional work is not guaranteed for all practices. We believe when deciding the uplift it would not be appropriate to take account of additional work GPs might take on.'

The DDRB's claim is supported by a recent Pulse investigation into LES payments, which revealed a patchy picture of investment, with many PCTs counting extended hours even though this were paid for by money taken from the core contract.

Dr Buckman says the money available to GPs through enhanced services is ‘nowhere near' the figures quoted by the employers.

‘The amount of money PCOs give up to LESs is very small and was always meant to be bigger than it is,' he insists.

Dr Richard Vautrey deputy chair of the GPC, says negotiators remain very concerned that LES and DES money is not getting through to GPs on the frontline.

In particular, he says, the GPC will be keeping a close eye on the ‘piecemeal' rollout of vascular screening this year, which he fears will result in ‘very fragmented LESs of variable quality and variable investment'.

But while the DDRB was sympathetic to the negotiators' arguments over enhanced services, it was less so when it comes to registrars.

Here was the one bit of outright bad news. The DDRB accepted plans to reduce GP registrar supplements from the current rate of 50% to 45%, bringing them in-line with hospital doctors.

Still, Dr Colin Brown, a GP in Paisley, says that given the current economic chaos, GPs should be thankful for anything they can get.

‘At a time of worldwide recession, it is a considerable achievement by our negotiators to get an overall rise.'

Dr Gavin Jamie, a GP in Swindon, adds that there will be ‘quite a spread' in terms of the uplifts practices receive.

‘The people who are going to do best will be those without MPIGs, next best will be the 13% with very small MPIGs who come off it to some degree.'

‘Overall, because everyone's up a bit, it's probably the best one for some years, even if it might not be as much as we wanted.'

For its part, the Government has been relatively passive in its acceptance of the DDRB's ruling. A DH spokesperson describes the deal as: ‘a good deal both for the NHS staff affected and for patients and taxpayers'.

But with the GPC due to hold imminent showdown talks with health minister Ben Bradshaw over support for losers from the changes to the QOF prevalence formula, the fallout from this year's pay award is far from over.

‘There's still a long way to go yet. [but] I think most GPs recognise this is probably as good as they can expect,' says Dr Vautrey.

‘It's a significant step forward from where we have been for three years. It starts to send a signal that practices can look forward with a better degree of confidence than they've been able to.'

Which is more than a lot of business can say.

How the DDRB shot NHS managers down in flames:

Expenses…

NHS Employers: ‘The comprehensive spending review announcement included the expectation of further value for money reforms realising annual net cash-releasing efficiency savings.'

DDRB response: ‘We do not believe [taking further savings into account] is appropriate now the expenses to earnings ratio has moved back towards the historical 60:40 split, reflecting efficiency savings that have already taken place.'

Additional work…

NHS Employers: ‘We believe an uplift of 1.5% to the gross GMS contract will, when added to the other significant additional income GPs could earn outside of their GMS contract payments, result in broadly a 2% increase in GP net pay.'

DDRB response: ‘Our view is as additional work is not guaranteed for all practices, we believe when deciding the uplift it would not be appropriate to take account of additional work that GPs might take on.'

FAQs

How did the new formula come about?
The ratio formula was designed to reduce reliance on the MPIG, with practices paid differential uplifts for the global sum, QOF, enhanced services and the correction factor.

What happens now?
The GPC will soon be writing to all GPs to inform them of exactly how the changes will affect their funding. Negotiators are also set for imminent talks with health minister Ben Bradshaw to discuss the contract changes.

Who gains the most?
Practices solely reliant on global sum (roughly 10% of the total number) stand to make ‘substantial rises', according to the GPC. Gains for these practices are likely to be in the region of 2.4%.

The deal will mean an average rise of 1.5% in net income

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