Ministers have been warned they will need to find additional funding for the NHS if staff are to receive pay rises above 1 per cent. Health Secretary Jeremy Hunt has confirmed the pay cap will be abolished for the health service. However, he would not say whether boosts to basic pay would come from cuts elsewhere in the NHS, indicating any increase would have to be linked to improvements in productivity. Mr Hunt told MPs:“We recognise it wasn’t sustainable to carry on with the 1 per cent going forward and that’s why next year we’ve been given the leeway to have more flexible negotiations. The latitude that the Chancellor has given me in terms of negotiating future pay rises is partly linked to productivity improvements that we will negotiate at the same time.” Simon Stevens, head of the NHS, told the Commons Health Committee that extra funds were needed to boost pay. “Over time it will be necessary for NHS staff to get rates of pay that are consistent with the rest of the economy,” he said. “But that does need to be funded.” Mr Stevens said that without additional cash in the next Budget, the NHS would struggle to meet its existing commitments. “The budget position for funding currently pencilled in for the National Health Service for next year and the year after looks extremely challenging and, if not mended, I think it is going to be very hard for the NHS to do all that has been asked of it over the course of the next year and the year beyond,” he said.