Care workers in England are to receive a substantial pay increase from 2028 after the creation of a new body of trade unions and employers designed to stem the exodus of workers from the sector by improving wages and conditions.
The health secretary, Wes Streeting, will put £500m behind the initial increase and will begin this year to establish the new negotiating body, which will create a fair pay agreement. However, unions have warned that the future pay increases will need “substantially more” investment.
The move was promised as part of a slew of measures in Labour’s workers’ rights package, intended to create better pay and working conditions in the struggling care sector, where low pay and insecure work have led to a recruitment crisis.
The final increase will be negotiated by the body – the first of its kind in the country – with the budget set by government also used to improve conditions at work.
Care workers are not expected to feel the benefits of the change for several years. After the employment bill passes parliament, there will be a consultation on the new pay body, which will be formally convened next year. It will conduct the negotiations in 2027, so that the pay and conditions improvements can come into force the following year.
It is hoped that the enhanced pay and conditions will improve retention in the sector, where a vacancy rate of nearly 10% is expected to be exacerbated by a crackdown on visas for overseas care workers.
Both employers and trade unions will sit on the new body. Its recommendations will be applicable across the sector, for private and public sector workers. The cash will come from the £4bn allocated in the spending review to adult social care.
Streeting will say at the Labour conference on Monday that the government “will no longer accept a system built on poverty pay and zero-hour insecurity”.
He will pledge that the fair pay agreement will be backed in law. This was a key demand of care sector unions Unison and GMB, whom the government has been keen to keep onside amid faltering relations with other unions.
Unison’s general secretary, Christina McAnea, said: “This is the first government to take the many problems in social care seriously, and more importantly, to act on them. The best way to begin getting a grip on this complex, fragmented sector in crisis is to improve wages through a fair pay agreement, backed by proper funding.”
But she said that although £500m was welcome, “substantially more will be needed to deliver the national care service the public deserves”.
She added: “Ministers will have to increase the funding behind the fair pay agreement at the earliest opportunity. Then wages in care can rise more quickly and the staffing crisis end.”
Streeting is expected to recommit to plans for a national care service, though the government has been criticised for the slow pace of the change. Lady Casey, a renowned Whitehall troubleshooter, has been tasked with producing a plan for delivering the new service over the course of a decade.
Streeting will also pay tribute to the former deputy prime minister, Angela Rayner, who was forced to step down earlier this month over errors in her stamp duty payments.
He said it was Rayner, a former care worker, who was the architect of the fair pay agreement, and “who understands the struggle care workers face, because she was one”.
