Under joint plans to be put forward for consultation, NHS trusts could be banned from using agencies to hire temporary entry level workers in band 2 and 3, such as healthcare assistants and domestic support workers. 

The consultation will also include a proposal to stop NHS staff resigning and then immediately offering their services back to the health service through a recruitment agency.

Health and Social Care Secretary Wes Streeting said: ‘For too long desperate hospitals have been forced to pay eye-watering sums of money on temporary staff, costing the taxpayer billions, and pulling experienced staff out of the NHS. We're not going to let the NHS get ripped off anymore.

‘Last month the chancellor made a historic investment in our health service which must reform or die. I am determined to make sure the money is well spent and delivers for patients.

‘These changes could help keep staff in the NHS and make significant savings to reinvest in the frontline.'

Recruitment agencies have charged NHS trusts up to £2,000 for a single nursing shift, thanks to the 113,000 staffing vacancies across the service, and costs of this kind were driven up further by periods of strike action.

Julian Kelly, NHS chief financial officer, said: ‘The NHS is committed to ensuring every penny of taxpayer money is used wisely to the benefit of patients and to ensure fairness for our permanent staff. While agency spend is at a record low, with trusts on track to save £1bn over two years, we want to go further still.

‘That's why the NHS, working alongside the government and providers, will launch a consultation with a view to stop using agencies to fill entry level posts, building on the approach we have successfully imposed for administrative and estates staff.'

A consultation will be launched by NHS England in the coming weeks, seeking views on the new proposals from staff, unions, and NHS provider organisations.

In addition, Streeting is set to announce that there will be financial implications for very senior managers if they are failing to improve their trust's performance, preventing staff from doing their jobs, or letting patients down with poor levels of care. 

Streeting is due say: ‘I'm prepared to pay for the best and I will defend financial incentives to attract and keep talented people in the NHS. It's a big organisation that should be competing with global businesses for the best talent.

‘But there will be no more rewards for failure. We have got to get a grip on runaway spending and make sure every penny going to the NHS benefits patient – changes will not be popular but it's a case of reform or die.'