By Dr Tim Rideout, TERN Group Managing Director – Global Health and Social Care.
The Government and NHS England have unveiled plans to reduce the NHS’s reliance on agency staff, including proposals to restrict the use of temporary workers in certain roles.
Health and Social Care Secretary Wes Streeting has rightly pointed out that hospitals spend enormous sums on temporary staffing, sums that contribute to the significant overspends reported by most NHS providers. Reports reveal that the NHS allocated £3bn to agency staff in the last year alone. This represents a significant strain on taxpayer funds that could be better directed toward improving patient care, addressing staff shortages, and alleviating burnout among permanent employees.
Among the measures under consideration is a ban on NHS trusts using agencies to hire temporary staff in entry-level Band 2 and 3 roles, such as healthcare assistants and domestic support workers. While these plans aim to reduce costs, some argue they fail to tackle the root cause of the issue.
Kate Shoesmith, Deputy Chief Executive of the Recruitment and Employment Confederation, has highlighted that staffing difficulties in the NHS stem from years of underinvestment and inadequate workforce planning. She warned that such restrictions might inadvertently push workers out of the sector entirely, exacerbating the staffing crisis rather than resolving it. With turnover rates averaging 32% for the domestic NHS workforce and 13% for international recruits, the expense of recruitment remains a pressing challenge.
However, there is a viable and sustainable solution – one that reliably delivers cost savings, a current 96% staff retention, and high-quality care. TERN Group’s approach to addressing workforce challenges is built on recruiting and supporting permanent, fully qualified overseas professionals through AI powered technology. By partnering with overseas governments, TERN ensures ethical recruitment practices that address workforce gaps and lead to higher retention rates and lower recruitment costs.
The benefits are substantial. TERN reduces recruitment expenditure by absorbing costs related to vetting, training, onboarding, and ongoing pastoral support by nearly 80% annually for the average care provider. For NHS trusts, this translates to savings of over £30,000 per year and up to £155,000 over five years. These financial gains are complemented by the stability and continuity that permanent staff bring to healthcare teams, a stark contrast to the transient nature of agency workers.
However, these recruitment process savings are dwarfed by the benefits of reducing locum and agency expenditure. For example, the cost of employing a locum consultant can exceed £203,000 annually, while a permanent consultant’s salary is approximately £120,000, a difference of over £80,000 per role. Similar savings apply across other roles: a permanent Senior House Officer (SHO) can save an NHS trust around £50,000 per year compared to hiring a locum. Over time, transitioning to permanent contracts with TERN’s support would result in multi-million-pound savings for individual NHS hospitals, freeing up funds for critical patient care and infrastructure investments.
Moreover, TERN’s model materially reduces dependency on agency staff by facilitating direct engagement with trusted candidates, without the need for expensive intermediaries. The outcome is fewer locum contracts and more long-term placements, ensuring patients receive consistent, high-quality care while trusts benefit from predictable costs and cohesive teams.
It is clear that while agency staff play an essential role in plugging short-term gaps, the over-reliance on them is neither sustainable nor cost-effective. As NHS England launches consultations on these proposals, we urge policymakers to consider long-term solutions that balance reducing reliance on agencies and maintaining the quality of care.
Restricting agency usage, when combined with investment in ethical and effective permanent recruitment models like TERN’s, will prove transformational for the NHS. By redirecting resources from costly temporary staffing toward sustainable workforce solutions, the NHS can better support its employees, reduce financial pressures, and, most importantly, improve patient outcomes. TERN stands ready to help.
