01/06/2015 21:42 BST | Updated 01/06/2015 22:59 BST

Jeremy Hunt Announces Clampdown On 'Expensive Staffing Agencies' That Are 'Ripping Off The NHS'

Jeremy Hunt ordered a clampdown on “expensive staffing agencies” that are "ripping off the NHS" on Tuesday, a move the health secretary intends will ease the financial woes of the beleaguered health service. The cost for agency staffing ran to £3.3 billion in 2014 -- more than the cost of all 22 million A&E admissions combined.

Fresh rules introduced by Hunt will set a maximum hourly rate for agency doctors and nurses, ban the use of agencies that are not approved, and put a cap on total agency staff spending for each NHS trust in financial difficulty, the Department of Health revealed.

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Hunt: 'It's outrageous that taxpayers are being taken for a ride by companies charging up to £3,500 a shift for a doctor'

Agency doctors are currently paid up to £3,500 per shift while the total bill for management consultants was more than £600 million last year. Hunt said an immediate cap of £50,000 will be applied to all management consultancy contracts, part of a package of new financial controls to cut down on waste in the NHS.

An April report by regulator Monitor found an "over-reliance" on contract and agency staff meant NHS foundation trusts reported a £349 million deficit during the last financial year, taking trusts in England overall to £822 million in the red.

NHS England boss Simon Stevens said the health service will need a further £8 billion by 2020 at the same time as needing to make £22 billion of efficiency savings.

Hunt said: "Expensive staffing agencies are quite simply ripping off the NHS. It's outrageous that taxpayers are being taken for a ride by companies charging up to £3,500 a shift for a doctor." The health secretary promised to use the vast size of the NHS to bargain down rates and “beat the agencies at their own game.”

However, shadow health secretary Andy Burnham accused Hunt of “trying to pull the wool over people's eyes,” suggesting the £3 billion agency bill is part of a larger problem created by “Tory mismanagement of the NHS.” He said: "The decision to cut 6,000 nursing posts in the early years of the last parliament, alongside big reductions in nurse training places, has left the NHS in the grip of private staffing agencies.”

Burnham, who is a candidate for the Labour leadership, said any serious proposal to break the hold of staffing agencies would mean recruiting “more nurses and increase training places immediately."

Peter Carter, chief executive and general secretary of the Royal College of Nursing, said it is “right to focus on getting better value for money,” but added that the NHS needs to look at the “root cause of this problem, not just the symptoms.” He said: “A lack of investment in nurse training and cuts to nurse numbers mean that trusts now have no choice but to pay over the odds for agency staff and recruiting overseas.”

Mark Porter, British Medical Association council chairman, said that agency staff are “an important part of the NHS workforce,” but should not be used as a “long-term solution to gaps in the NHS workforce.”

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