The Daily Mail has a large story about how much the NHS is paying to hire agency staff to cover holes in the payroll.

Millions of pounds of health service funds are being wasted employing agency nurses on up to £128 an hour. This is almost ten times the amount paid to an experienced staff nurse  -  and equates to a salary of £250,000. Overall, the health service spent almost £800million on agency doctors, nurses and consultants in 2006-07, according to the figures uncovered in a Freedom of Information request. That could fund around ten hospitals or employ 30,000 full- time experienced nurses.

But the important line is I think this:

He said many nurses were emigrating, partly because the NHS could not help with high housing costs in many areas.

Or if you want to put that more properly, the NHS cannot vary wages across areas with different living costs, for it is bound into a rigid straitjacket of national pay scales. We looked at this near the beginning of last year.

Wages and living costs vary widely across the country but NHS pay (bar a too small London weighting) does not. Thus a nurse of a specific grade trying to live in the SE is in poverty compared to one on the same wage elsewhere. Not surprisingly those parts of the NHS in the more expensive areas of the country find it difficult to recruit and retain staff. They thus have to hire agency staff at great expense….and note that being agency staff is the only way that staff in such expensive areas can earn more than the nationally set NHS wages. This leads to less than desirable outcomes: 

A 10 percent increase in the outside wage is associated with a 4 percent to 8 percent increase in AMI death rates.

That is, in richer areas of the country, where wages are higher, death rates from heart attacks are higher than in areas with lower general wages, because the NHS national wage rate makes hiring and retaining staff more difficult. It isn’t just the cost of those agency staff which is the daily outrage, it’s that people are dying because we have a national pay scale.

The obvious answer is to abolish the national pay scale and tell hospitals to pay whatever they need to to attract the necessary staff. Sadly it won’t happen, for there are those who would insist that death for some is better than any violation of their sense of what is just or righteous. Like, for example, wages set upon supply and demand rather than central planning.