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Volume 175: debated on Wednesday 4 July 1990

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To ask the Secretary of State for Health if he will make a statement on the remuneration of community pharmacists.

Negotiations with the Pharmaceutical Services Negotiating Committee (PSNC) on the remuneration of community pharmacists for the year beginning 1 April began last December. Since then my officials have held numerous discussions with the PSNC and I have myself met the chairman of the PSNC on two occasions, once accompanied by members of his committee and once alone. I am disappointed that after months of negotiations, during which we have made significant concessions, the Pharmaceutical Services Negotiating Committee was unable to agree what I regard as a fair and reasonable offer, and has declared a state of dispute. I am not prepared to see negotiations drag on indefinitely, depriving the smaller independent pharmacies in particular of the increases due to them. I have therefore reluctantly decided to implement new fee scales from 1 August, backdated to 1 April. I have written today to the chairman of the PSNC informing him of this decision.The settlement to be implemented is for a global target sum of £555.5 million, giving an increase in remuneration of 7.5 per cent. over the target for 1989–90. The increase in professional fees, the main element of remuneration, will be 7.5 per cent. over 1989–90 levels. Following a discount inquiry last year, a new discount scale of 9.67 per cent. will be implemented at the same time. My officials have today written to the PSNC seeking its urgent final comments on the detailed fee and discount recovery scales proposed within the global total, to enable them to be published in time to take effect from 1 August. Both scales will be backdated to 1 April, and to avoid hardship I propose to make interim payments based on estimates of the backpay due at the same time as the new rates are paid on 30 October. Adjustments in payments due following detailed recalculation will be made in payments due on 1 January. As part of the settlement I will honour two further concessions made in negotiation, that there should be a mechanism for collecting any over- or under-payment against the target for the year during the following year, triggered by variations greater than £250,000; and the establishment of a joint working party on the role of pharmacists, to reflect the wider definition of pharmaceutical services made possible by the National Health Service and Community Care Act.In declaring a state of dispute, the PSNC also made a reference to the pharmacists' review panel. The PSNC has already made it clear that its long-term aim is to establish a review body and reference to the pharmacists' review panel would be a step towards this. That is something I cannot accept. In my view the terms of the reference by the PSNC would represent a significant departure from the way in which the pharmacists' review panel has previously operated, and it would not be appropriate for it to accept the reference. Should it do so, my Department will of course co-operate fully and I will study any view reached by the panel, but only as background to discussions on remuneration in future years.