The Department of Health and Social Care has awarded a £1.8 million contract to management consultancy Korn Ferry to advise on pay strategy and cultural integration as the government proceeds with plans to legally abolish NHS England and bring its functions under direct ministerial control. The contract covers work to define a unified organisational culture and establish the groundwork for a single pay framework spanning two workforces with substantially different terms and conditions.
NHS England currently employs around 18,000 staff in central administrative roles. The government's stated intention is to complete the legal absorption of those functions into the department by March 2027, with a target of reducing the combined headcount by 50 per cent by 2028. Voluntary redundancy programmes are already underway across both organisations. The scale of that reduction, alongside the structural complexity of merging two distinct organisations, is the justification the DHSC has offered for engaging external advisers rather than managing the process through existing civil service capacity.
Korn Ferry's mandate covers two related but distinct workstreams. The first concerns culture. The consultancy has been tasked with developing a joint executive team structure and defining the values and behaviours expected of a unified organisation. That work involves reconciling the operational culture of NHS England, which has functioned at some remove from Whitehall since the 2012 reforms, with the conventions and expectations of a traditional government department. The two organisations have different management styles, decision-making processes, and institutional identities, and the gap between them is not primarily a matter of org charts.
The second workstream is more technically complex. NHS England staff are employed under Agenda for Change, the pay framework that covers the majority of NHS workers and includes specific provisions around banding, progression, and terms of employment. Civil servants in the DHSC are employed under Civil Service pay arrangements, which operate on different structures and grade equivalencies. Bringing staff from both organisations onto a single, legally defensible pay framework without triggering employment tribunal claims or provoking industrial action requires detailed analysis before any proposals can be put to trade unions or tested against equalities legislation.
The contract was initially valued at £1.5 million. It was subsequently increased to £1.8 million to incorporate the pay landscape assessment, which the department described as a discovery exercise to establish an evidence base and define the parameters for any future unified pay strategy. The increase reflects the sensitivity and complexity of that component rather than an expansion of the cultural workstream.
The decision to spend £1.8 million on consultancy advice at a moment when thousands of staff across both organisations are facing redundancy has attracted criticism. The optics of commissioning external firms to advise on culture while simultaneously implementing one of the largest headcount reductions in NHS administrative history are not straightforward, and the DHSC has not yet set out a detailed public rationale for why this work could not be led by internal human resources and organisational development teams.
The broader question of government reliance on management consultancies to manage civil service reform is not new. Successive administrations have drawn on firms of this type for major structural change programmes, and the practice has been the subject of repeated scrutiny from the Public Accounts Committee. The argument for external engagement rests on independence and specialist expertise. The argument against rests on cost, accountability, and the question of whether the knowledge developed during such contracts remains within the organisation once the engagement ends.
The success of the merger will not be determined by the quality of the consultancy advice alone. It will depend on whether the pay framework that emerges from the discovery phase is acceptable to unions representing both NHS and civil service staff, whether voluntary redundancy numbers are sufficient to meet the 50 per cent reduction target without compulsory departures, and whether the remaining workforce is willing to operate under a set of values and behaviours defined in part by an external firm during a period of significant institutional uncertainty. None of those outcomes is guaranteed, and the £1.8 million contract does not remove the risks inherent in a restructuring of this scale.
