The NHS could free up £480 million to reinvest into NHS services and improve patient care if trusts filled temporary vacancies with workers from a “staff bank” instead of using more costly staffing agencies, according to the UK health watchdog NHS Improvement. It is calling on all NHS trusts to take a “bank first” approach to recruiting temporary staff and only use agencies as a “last resort,” and set a target for all trusts in England to reduce their agency costs by 17% for 2018/19.

Temporary staff — such as doctors and nurses supplied by agencies — cost on average 20% more than those from the NHS’s own “staff banks” despite doing the same job, according to NHS Improvement.

“Temporary agency workers play an important role in ensuring staffing numbers remain at a level that provides the best possible care for patients and gives them the opportunity to work flexibly,” said Ian Dalton, chief executive of NHS Improvement. “But an over-reliance on high cost private agencies when there are other options available is not good for patients or for the NHS’s finances.”

John Nurthen, Executive Director Global Research for Staffing Industry Analysts said: “The reason private agencies cost more is because they are having to work harder to source skilled healthcare professionals that the NHS’s own staff banks have been unable to fill. The solution to this problem is more government investment in training and retaining nurses rather than demonizing private staffing firms.”

The NHS has cut its spending on agency workers by £1.2 billon, or one-third, since it introduced a cap on the cost in 2015. And for year 2017/18, spending on bank staff was higher than for agency for the first time in several years, reducing the NHS’ agency spend by £528 million. 

In September 2017, it was announced that the UK Department of Health had decided not to sell NHS Professionals, its publicly owned staff bank and the largest single supplier of flexible staffing to the NHS as it could not find a buyer who valued the business highly enough.