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GPs brace for another cut in take-home pay

Exclusive: GPs have been warned they face yet another cut in take-home pay next year, after the Department of Health rejected a plea from the BMA for a change in the way practice expenses are taken into account.

In its official submission to the Doctors’ and Dentists’ Remuneration Body for 2013/14, the BMA argued rising practice expenses and new costs around CQC registration and revalidation meant the pay review body should urgently rewrite the current ‘uplift formula’ it uses to calculate a recommended gross increase in funding.

A spokesperson for the DDRB said that it had not yet decided whether it would make recommendations on GP pay or which uplift formula it would apply.

But the DH, which has already instructed the DDRB not to make new recommendations on pay, said it was determined to calculate the gross uplift required to deliver a 1% net income increase using the current formula – a move GP leaders predicted would mean another pay cut.

In its DDRB submission, the BMA asked for the full pay review process to be reinstated, and claimed if the current uplift formula was applied, even an intended 1% net income increase could actually result in a net decrease in GP take-home pay.

‘The formula used by the DDRB for calculating GP pay uplifts needs revising in light of evidence that gross and net GP earnings have failed to keep pace with inflation and rising staff costs,’ the BMA said.

‘Average GP net income has consistently failed to reach the review body recommendation or indeed the Government’s proposed caps.’

The BMA cited new costs such as CQC registration – likely to be between £550 and £850 for most practices in the first year – as a factor, and claimed ‘the share of premises in total expenses has continued to rise faster than general inflation’.

It also warned that increases in staff expenses have ‘consistently outstripped the Agenda for Change-based coefficient in the formula’.

But the DH said it had no plans to look again at the formula.

A spokesperson said that the DH’s position remained that outlined in a letter from former health secretary Andrew Lansley in July, in which he said there was no need for new DDRB recommendations because the current formula ‘provided a well-established basis for calculating the gross uplift needed to deliver a 1% increase in net income after allowing for expenses’.

GPC negotiator Dr Peter Holden said: ‘Any award that yields us less than inflation inevitably means a pay cut. A pay freeze is an utter luxury. The Government has conveniently forgotten that we have to pay our expenses. The DH is not playing fair.’

Dr Paul Roblin, chief executive of Berkshire, Buckinghamshire and Oxfordshire LMC,  said: ‘There will be expenses that haven’t been taken into account so it will be a pay cut on top of a pay freeze. We need to have a regular, annual DDRB that reflects the expenses and legitimate income consideration of GPs.’

Dr Sella Shanmugadasan, chair of Tower Hamlets LMC, said that expenses for everything from IT to utilities were increasing sharply, with
his surgery’s gas and electricity bills up by 9% in the past year.

‘We are expected to manage with no increase,’ he said. ‘If expenses are not taken into account proportionately, income will go down. It will have a big financial impact that will obviously affect services that practices provide.’


Read the analysis: Devil in expenses detail


How pay uplifts have fallen short

YearGross GP pay uplift (%)GP net income change (%)

Source: BMA estimates, DDRB submission 2013/14