Health and social care

NHS Pay Modernisation: New contracts for general practice services in England

“There is no doubt that a new GP contract was needed and there are now 4,000 more GPs than five years ago. But in return for higher pay, we have yet to see real increases in productivity. The extra money flowing into practices has largely benefited GP partners rather than rewarding other important members of the practice team. Primary Care Trusts now need to deliver to patients the benefits that were expected in return for GPs increase in pay.”

Report cover showing a doctor checking a child

“There is no doubt that a new GP contract was needed and there are now 4,000 more GPs than five years ago. But in return for higher pay, we have yet to see real increases in productivity. The extra money flowing into practices has largely benefited GP partners rather than rewarding other important members of the practice team. Primary Care Trusts now need to deliver to patients the benefits that were expected in return for GPs increase in pay.”

Tim Burr, head of the National Audit Office, 28 February 2008


The new contract for general practice has contributed to improved recruitment and retention of GPs, with numbers increasing from 26,833 to 30,931 since 2003. However, according to a report out today by the National Audit Office, the contract has cost the Department £1.76 billion more than it originally budgeted for.

Today’s report found that, in the first two years of the contract, productivity has fallen by an average of 2.5 per cent per year. GPs are working on average seven hours less per week than in 1992, partly because of the removal of the responsibility for out of hours care. While the number of consultations with patients has increased, these are not in proportion with the increase in costs. Primary Care Trusts’ spending on GP services has however now started to level off.

The largest overspend of the contract was due to an underestimation of the amount that GPs would earn from the pay for performance scheme, the Quality Outcomes Framework (QOF). While there is evidence that the QOF has improved consistency in the quality of care, it is too early to say if overall patients’ health has improved as a result.

In 2005-06 the annual average pay of a GP partner was £113,614, an increase of 58 per cent since 2002-03. GPs report, however, that over the last year their pay has stayed the same or decreased. GP partners have taken more profit from the practice as pay while the average salary for GPs they employ increased by only three per cent in the first two years.

The report found that nurses are delivering more practice work leaving GPs to spend more time with more complex cases. The proportion of consultations undertaken by practice nurses increased from 21 per cent to 34 per cent between 1995 and 2006. GPs now spend more time with each patient, an average of around 12 minutes compared to 8 minutes in 2002-03.

The report concludes that Primary Care Trusts have not made use of all the levers in the new contract. Money for new local services has not led to improvements such as increased opening hours and some of the most deprived areas remain under-doctored. Some 40 per cent of GPs believed that aspects of the contract had not helped tackle health inequalities.

The NAO recommends that the Department develop a strategy for yearly negotiations on the QOF and the QOF should be based more on health outcomes. Primary Care Trusts should provide more services based on local need and review the number and skills of staff employed to commission and performance manage GP services with the aim of improving local commissioning.


Publication details:

ISBN: 9780102953015 [Buy from TSO]

HC: 307 2007-2008

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