Last reviewed 4 June 2019
The Department of Health and Social Services (DHSC) has launched proposals to make pensions more flexible for senior clinicians in the hope of improving workforce retention.
The Government will consult on proposals to offer senior clinicians a new pensions option, which would allow them to build their NHS pension more gradually over their career by making steadier contributions and without facing large, regular tax charges.
The implications are that clinicians will be able to take on additional shifts to reduce waiting lists, fill rota gaps or take on further supervisory responsibilities.
The proposal, known as a 50:50 option, would allow clinicians to halve their pension contributions in exchange for halving the rate of pension growth. This comes in response to senior doctors arguing that pension tax charges were discouraging them from taking extra work to support patients and causing them to question whether to stay in the NHS Pension Scheme.
The agreement forms part of the NHS’s first ever NHS “People Plan”, published on 3 June 2019, which focuses on actions to recruit more staff; make the NHS a great place to work; and support staff to deliver modern care.
Health and Social Care Secretary Matt Hancock announced: “The reforms we are setting out today will give clinicians greater flexibility to manage their pensions, have more control over their future, and offer a deal that’s fair to doctors, taxpayers, and the patients they care for.”
Only those clinicians who have built up more than £40,000 in contributions in their NHS pension in a year and/or have an adjusted income of over £150,000 will be affected by the new proposal.
British Medical Association (BMA) Chair Dr Chaand Nagpaul said this option would not prevent people from reducing their working hours. He said: “For many months, the BMA has been expressing concerns about the current pension taxation system, the unintended but serious consequences this is having on patient care and the wider NHS and so we welcome the fact that the DHSC and NHE England have today acknowledged the problem.
“We welcome that in his announcement the Secretary of State has stated that in addition to the 50:50 proposal in the interim People Plan, he is willing to discuss with the BMA other models for pension flexibility in order mitigate the current disincentives for doctors to provide NHS services.”
The proposals for the “People Plan” are available at www.longtermplan.nhs.uk.