Lifting the cap: The fiscal and economic impact of lifting the NHS pay cap

Article

Workers in the NHS have experienced a seven-year pay squeeze, with a two year pay freeze from 2011/12, followed by pay capped at 1 per cent for the following five years. This has significantly eroded the value of pay in the NHS; pay for a band 5 nurse is £3,214 or 10.1 per cent lower today than pay for the same role in 2010/11.

In this briefing, we examine the fiscal and economic impact of two alternative scenarios for NHS pay over the next two years; increasing pay in line with Consumer Price Index (CPI) inflation, and a ‘catch-up’ rate of increasing NHS pay in line with private sector earnings plus 1 per cent.

Related items

  1. A mother and child from behind looking out of a window

    Restoring security: Understanding the effects of removing the two-child limit across the UK

    The government’s decision to lift the two-child limit marks one of the most significant changes to the social security system in a decade.
  2. A group of healthcare professionals sitting in a staff common room in a hospital in Newcastle

    Building a healthier, wealthier Britain: Launching the IPPR Centre for Health and Prosperity

    Following the success of our Commission on Health and Prosperity, IPPR is excited to launch the Centre for Health and Prosperity.
  3. The Home Office building in London

    A ‘paradigm shift’ in asylum and immigration policy?

    In 2019, a package of asylum reforms known as the ‘paradigm shift’ was passed by a broad party consensus in the Danish parliament.