Millions of social care workers are to get annual NHS-style pay rises as the Government seeks to bring their wages closer in line with health staff.
A new negotiating body made up of trade unions and employers will negotiate pay rates, terms and conditions as part of a fair pay agreement.
The announcement is one of the last acts of Sir Keir Starmer and fulfils his Labour manifesto pledge to improve wages for the 1.5 million care workers in England.
Care minister Stephen Kinnock told The i Paper the plans marked one more step towards a National Care Service, something originally proposed by Andy Burnham when he was health secretary 17 years ago.
Problems in the care sector
But the Government is also under pressure to speed up reform of a funding model for social care, with the commission headed by Dame Louise Casey not due to finish work until 2028.
Pay and conditions for social care workers are notoriously poor compared with those of their NHS counterparts, who earn, on average, £7,000 more per year for equivalent roles.
The care sector has suffered from decades of under funding, with stretched services often criticised for delivering poor services. In December, The i Paper reported that vulnerable elderly residents were being evicted from care homes because local authorities were not covering the cost.
The cost of adult social care accounts for 19 per cent of a local authority’s budget according to the government, and children’s social care 11 per cent. According to the King’s Fund, local authorities spent £34.5bn on social care in 2024/25, an increase of 4.1 per cent on the previous year.
However, poor pay in the sector has been blamed for contributing to staffing shortages and high staff turnover, which has contributed to the poor level of service. But increasing wages could also push up fees in the private sector.
In its report published in April the King’s Fund pointed out that mounting staff costs, partly due to wage increases due to the minimum wage, had pushed up care fees.
“To recoup these costs, homes charge private payers more than local authority clients,” the report said.
Pay will be set for all staff in the sector
The new Adult Social Care Negotiating Body will operate in a similar way to Agenda for Change, the collective bargaining organisation which sets annual pay rates for NHS staff other than doctors.
The body will be in place by the end of this year and will have powers to set statutory pay rates for all staff in the care sector, regardless of whether local authorities or private firms employ them.
The average pay for a care worker in England is currently £12.60 an hour, equivalent to £24,000-£25,000 a year.
It will be funded by £500m already agreed with the Treasury and is being introduced as part of the Starmer Government’s Employment Rights Act.
Kinnock told The i Paper the country’s 1.5 million care workers “make such a vital contribution to our country and to our communities, and looking after our lives”, adding: “They’re just such a vital part of our workforce, and they deserve much better than they’ve had, and that is what this fair pay agreement is all about.
Kinnock said there was a “long way to go” for average care worker pay to have parity with NHS staff, but added: “We’ve got to work with what we’ve got, and slowly but surely, we absolutely want to have a National Care Service that works shoulder-to-shoulder with our National Health Service.”
Extra money is ‘not a silver bullet’
The minister said the £500m was “not a silver bullet” to address all pay issues in the care sector but was a “really important down payment on the future for the care workforce”.
Future spending on care worker pay beyond 2028 will be set out in the next spending review.Ministers have pledged £4.6bn in additional funding for adult social care by 2028-29.
Since Starmer came to power, the Government has increased the carer’s allowance for unpaid carers by £2,750.
Casey’s early recommendations to improve safeguarding, dementia care and support for those with motor neurone disease are being progressed swiftly so that people see tangible improvements this year, the Department of Health and Social Care said.
The Casey Commission’s phase one recommendations for delivering a National Care Service will be published later this year.
Care providers and workers, via their unions, will have voting rights on key issues including pay, terms and conditions as well as wider employment matters through a regular negotiation process.
It will be led by an independent chair, who will be appointed in early 2027, to oversee the negotiations between employer and worker representatives.
The first round of negotiations will start in April 2027, and the first agreed pay rates will be introduced by April 2028.
Paul Nowak, General Secretary, TUC said: “For too long care workers have been undervalued and underpaid for their vital work. The Fair Pay Agreement will help lift the floor of pay and conditions in the sector.”
In Scotland, social care workers enjoy a higher minimum pay than their counterparts in England.
The SNP-led Scottish Government introduced an “uplift” policy in 2016 which guarantees a “real living wage” for care staff in the sector – higher than the national living wage. The minimum rate of pay for Scotland’s adult social care workers increased from £12.60 to £13.45 per hour in April 2026.
A pay bargaining body for the sector north of the border was established earlier this year. The Scottish Trade Unions Congress (STUC) warned last year that that there was “a real risk that Scotland is left behind” if the UK Government introduced a negotiating body for England.
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