NHS trusts are spending millions outsourcing staff to private companies, says UNISON

NHS trusts across England are spending millions of pounds outsourcing staff to new arms-length private companies, says UNISON today.

Using a Freedom of Information (FoI) request, UNISON has revealed that NHS trusts are shelling-out huge amounts of money on consultants. These companies are advising trusts on the setting up of wholly owned subsidiaries (or subcos), to which staff are then outsourced.

UNISON says these new companies appeal to NHS trusts because they can reduce their VAT payments, and cut the pay and pensions for any new staff recruited. The health workers that are being transferred tend to be the lowest paid within the NHS, such as porters and cleaners.

Only 21 out of 31 NHS trusts that UNISON approached complied with the FoI request – published to coincide with the start of its annual health conference – but the amount spent by just 15 of them is already in excess of £3.2 million.

Topping the list of high-spenders is Clatterbridge Cancer Centre in Birkenhead, which spent more than £661,000 establishing a wholly owned subsidiary.

The Royal Free London NHS Foundation Trust and Gloucestershire Hospitals Foundation Trust have both already spent a minimum of £400,000 setting up subsidiaries. Meanwhile, Airedale NHS Trust in Yorkshire spent an estimated £343,000 outsourcing staff.

To put some perspective on the amount spent by some of these trusts, UNISON has found that the £3 million outlaid to date on transferring staff could have paid the annual salary of around 200 extra hospital cleaners*.

UNISON head of health Sara Gorton said: “The amount of public money being frittered away on transferring NHS staff to private companies is a disgrace, especially at a time when there’s such a huge squeeze on resources.

“These wholly owned subsidiaries are creating a two-tier workforce where new staff are likely to be far worse off in terms of their pay and pensions. There is also no evidence that these new companies improve efficiency or productivity.

“Porters, cleaners and other staff chose to be part of the NHS team, not to be contracted out and treated like second-class employees.”

  • What’s the big deal about subcos? union-news.co.uk editor Tim Lezard explains all here.
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