NHS spent more than £1bn on staff severance packages

50% rise in the number of senior staff receiving redundancy payouts of over £200,000

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The Independent Online

The NHS has spent nearly £1.4bn on staff redundancy packages since the coalition came to power, according to official figures

Nearly 1,000 health service employees have received six-figure exit deals within the past year, with 157 departing managers and those leaving other senior positions receiving more than £200,000, a 50 per cent rise on the previous year, the Sunday Telegraph reports.

A number of officials have received payments of £600,000 upon leaving as part of the coalition's ongoing restructuring of the NHS.

The figures gave further ammunition to campaigners who argue that the government was wrong to ‘ring fence’ the health service from the austerity programme that has affected almost all other areas of public spending.

Labour blamed the redundancy costs on the “unnecessary reorganisation” of the NHS carried out by Andrew Lansley, the former Health Secretary.

Nicholas Hicks, director of public health at Milton Keynes Primary Care Trust, was among the NHS executives receiving the largest severance packages.

Mr Hicks was awarded around £600,000 when he left the trust four months ago.

Andy Burnham, the shadow health secretary, said, “Billions have been siphoned out of the NHS front-line to pay for an unnecessary restructuring that no-one voted for and David Cameron personally promised would not happen.

“At a time when the NHS needs every penny it can get, we have a Prime Minister handing out gold-plated, six-figure pay-offs to hundreds of managers and P45s to thousands of nurses.”

While in opposition David Cameron promised that the Conservatives would not impose any more “pointless and disruptive reorganisations” on the NHS.

The extent of the health service’s spending on redundancy packages is revealed in the Department of Health’s recently-published annual report.

Between April 2010 and the end of March 2013, the NHS spent a total of £1.4bn on redundancy payments for 32,089 staff. The average package is worth more than £43,000.

During the year 2012/13, 958 health officials received payoffs worth more than £100,000, up from 628 the previous year.

NHS employees typically receive redundancy of one month per full year of service, with the amount usually capped at 24 months’ pay. However, executives sometimes manage to negotiate better deals.

Matthew Sinclair, chief executive of the Taxpayer’s Alliance told the paper, “There is a severe danger that golden goodbyes for senior staff in the health service could undermine any savings the Government reforms could bring.

“If there wasn’t a ring fence around health spending then maybe NHS executives wouldn’t be so cavalier with their budgets by awarding such lavish payoffs.”

The Department for Health said last night that the costs of the redundancy programme will be outstripped by the savings of the government’s reforms to the NHS.

A spokeswoman said, “Last year we started changes that put doctors and nurses in the driving seat as they are best placed to take decisions about care for their patients.

“The changes made as a result of the reforms mean a huge net gain for the taxpayer. They will save £5.5bn during this Parliament and £1.5bn every year thereafter, to be reinvested back into patient care.”

A National Audit Office (NAO) report published last month found that over 20 per cent of NHS staff made redundant as part of the reforms had been re-employed by the health service.