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NSW taxpayers are spending more than $100 million a year to fill nurse and midwife shortages as hospitals across the state increase their reliance on expensive and short-term health workers.
The total bill for agency nurses and midwives almost doubled from $55 million in the 2023 financial year to $102 million in 2024, NSW Health workforce data reveals.
Since she began agency nursing after the pandemic as a way of seeing Australia, Jill Carnell has witnessed the increased reliance on temporary health workers – especially in regional areas. Credit: Wolter Peeters
The sharpest spike was recorded in the Northern NSW Local Health District, where agency costs rose from $2.1 million a year to $24.4 million, a 1100 per cent increase in 12 months.
Murrumbidgee Local Health District, which covers an area from the Snowy Mountains to Wagga Wagga and across to Barham on the Victorian border, spent $17.1 million on short-term nurses and midwives. This was the second-highest bill in the state and more than double the $7.2 million spent in the 2023 financial year.
Western NSW, which covers 247,000 square kilometres from Oberon to Lightning Ridge, also saw agency costs more than double from $4.5 million to $11.1 million.
Asked about the sharp rise in agency nursing costs since 2023, NSW Health said health districts accounted for the costs in different ways before they were standardised in late 2024. “It is therefore difficult to reconcile or validate data from prior financial years,” a spokesperson said.
The numbers were revealed through freedom of information laws. They were submitted to the Industrial Relations Commission during the court’s arbitration of a wage dispute between the NSW government and the state’s 68,000 nurses and midwives.
The NSW Nurses and Midwives’ Association (NSWNMA) is seeking a 35 per cent pay rise over three years, an increase in night duty penalties, and more sick days. The government has offered nurses a 10 per cent pay rise split over three years.
Nurses and midwives have already accepted an interim 3 per cent boost backdated to July.
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The industrial court is expected to hand down its decision in the first half of this year.
Agency nurses and midwives are hired by private recruitment firms contracted by health districts to fill positions during parental or sick leave, for example, or more long-term vacancies in hard-to-fill roles.
Jill Carnell, who has worked as an agency nurse in both the Murrumbidgee and Northern NSW health districts, said better wages across the borders in Queensland and Victoria meant hospitals in southern and northern parts of the state were struggling to attract permanent staff.
“They could be going a short distance to get over the border, and their pay doubles,” said Carnell, a member of the NSWNMA.
Carnell said the demand for agency nurses was so strong in NSW that many hospitals were willing to offer concessions to staff to entice them to the area, such as not doing night shifts.
Short-term nurses and midwives can also earn more than the casual base rate with incentives such as accommodation, travel reimbursements and agency bonuses.
A NSW Health spokesperson said contracts with nursing agencies had been streamlined since 2024, and would be further improved with the rollout of its centralised locum and agency management system due to go live in mid-2027.
Former doctor turned Greens MP Amanda Cohn, who pushed for the crackdown on locum spending, said the reforms were welcome but were moving too slowly.
“This is a huge escalating cost and industry,” Cohn said. “There are enormous savings from bringing this in-house that can be reinvested in staff.”
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