2003 consultant contract reform agenda Changes to the local clinical excellence awards (LCEA) scheme and wider reform of the 2003 consultant contract

Status of negotiations Changes to LCEA – collective agreement reached With effect from 1 April 2018. Wider 2003 contract reform: formal negotiations on hold Delayed DDRB process - outcome (expected June 2018) will influence the funding envelope and reform timetable for wider contract reform.

Local CEA – drivers for change 2012 DDRB recommendations supporting reform: future local CEA should be time limited, payable for up to three years and non-pensionable. Further recommendations on performance being better linked to pay from the Public Accounts Committee have also been accepted by government. Opportunity to incentivise consultant performance against local organisational priorities.

Local CEA – drivers for change BMA legal challenge against Department of Health and Social Care (DHSC) on the contractual status of the scheme. This collective agreement ends legal action against DHSC and the risk of BMA challenge locally.

LCEA changes – 1 April 2018 to March 2021 Trusts must run annual LCEA rounds. Minimum investment ratio for new LCEA - 0.3 points per eligible consultant (headcount). New awards will be non-consolidated and non-pensionable. Awards will be retained for existing award holders (consolidated and pensionable).

LCEA changes – 1 April 2018 to March 2021 cont. Payable for a period of up to three years, paid annually by lump sum, with no additional programmed activity uplift. A requirement that an NCEA holder whose award is not renewed following application will revert to an appropriate LCEA level of between 7-8 (to be funded from outside the ratio). An internal appeals mechanism.

LCEA changes – 1 April 2018 to March 2021 Trusts must run annual LCEA rounds Amended LCEA schemes in place prior to 1 April 2018 can continue, subject to the requirements of the schedule and with reference to amended scheme guidance. Such schemes may be amended in future where there is agreement with the joint local negotiating committee.

LCEA changes – 2017 award rounds Any 2017 award round that an employer may choose to run and which concludes after 31 March 2018 should be granted in line with any local LCEA arrangements in place prior to 1 April 2018. Such awards are: pensionable and consolidated with payment backdated to 1 April 2017 (or as determined by the local arrangements, but before 31 March 2018).

LCEA interim agreement – funding arrangements Current investment ratio is 0.2 per eligible FTE - ‘largely cost neutral’ - funded by award holders retiring. Moving to an investment ratio of 0.3 per eligible FTE - again, ‘largely cost neutral’ - increase funded by recycling money from non-pensionability of new awards and removing APA enhancements. However, there is a small funding gap – NHS Employers submitting evidence to DDRB seeking targeting of funds on performance scheme, as well as holding back uplifts on existing CEA (local/national).

Successor LCEA scheme - from 1 April 2021 NHS Employers, with the BMA and HCSA, will seek to agree a successor scheme from April 2021, or earlier if acceptable to the parties. Should agreement not be reached, the following provisions (next two slides) have been agreed and would continue to apply.

Successor LCEA scheme provisions - from 1 April 2021 JLNC can agree local variations, but the following provisions must apply: new awards non-consolidated and non-pensionable awards payable for a period of up to three years, paid annually by lump sum with no APA uplift the total combined value per eligible consultant invested annually in LCEAs will remain unchanged.

Successor LCEA scheme provisions continued - from 1 April 2021 JLNC can agree local variations, but the following provisions must apply: LCEA made prior to April 2018 subject to a fair and reasonable process of review previous NCEA holders who have reverted to an LCEA will have these awards reviewed three years after the anniversary of the reversion an appeals mechanism.

National CEA provisions Consultants will continue to have access to a national awards scheme. SoS retains the right, after engaging in consultation, to introduce amendments and changes to the arrangements for NCEA from 1 April 2019. NCEA holders retain them as consolidated and pensionable awards subject to the existing review process. Reversion mechanism for NCEA award holders who lose awards following review. Additional pay protection should NCEA award values change in future.

Employer implementation activities Communicate changes to the terms and conditions – Consultants (England) 2003 in light of this agreement. Determine arrangements for 2017 award rounds. Review local arrangements and determine your approach and timescale for the commencement of 2018 award rounds in light of the changes. Consider equality issues – review local arrangements and adapt policy/processes to redress any apparent inequalities, encourage applications from underrepresented groups etc. Employers are encouraged to liaise with the joint LNC about the changes and any local variations, in line with the agreement.

Supporting materials Jointly agreed products: local CEA Schedule (2003 contract) supporting statement from co-chairs of the negotiation team FAQs. Additional products: equality impact assessment employer-focused FAQs and supporting slide pack supporting implementation products to follow (scheme guidance, implementation support pack, etc.) All products will be available from the NHS Employers website.

Structural contract reform elements – wider reform of the 2003 consultant contract Base pay New two point pay structure. Progression from pay point 1 to pay point 2 after five years. Immediate removal of automatic annual progression. Over time, PP2 to increase in value to match the top of the current 19 year scale. Affordable available capacity: incl. removal of opt-out and elective care Contractual provision to opt out of non-emergency work out of hours removed and replaced with a number of safeguards including limits to weekend working.

Structural contract reform elements – wider reform of the 2003 consultant contract Local clinical excellence awards Single performance management scheme in operation. New awards to be contractual, non-consolidated, non-pensionable and time limited with agreed and ring-fenced funding. Existing award holders: protection for existing awards but will be subject to review under new renewal and review criteria. Out of hours working No immediate changes being proposed but remains a longer term employer priority area - data and evidence base is not clear. System re-configuration and re-definition of local service provision complexities.

Any questions can be directed to: doctorsanddentists@nhsemployers.org