National Health Service Pension Schemes (Member Contributions etc.) (Amendment) (No. 3) Regulations 2022

Wednesday 11th January 2023 Lords Chamber

Motion to Regret

19:37

Moved by

[Lord Davies of Brixton]

That this House regrets that the measures proposed by His Majesty’s Government in the National Health Service Pension Schemes (Member Contributions etc.) (Amendment) (No. 3) Regulations 2022 (SI 2022/ 1028) are insufficient to address fully the problems with staff retention in the NHS arising from the NHS pension arrangements.

Relevant document: 15th Report from the Secondary Legislation Scrutiny Committee

[Lord Davies of Brixton (Lab)]

My Lords, to a certain extent the burden of this Motion is uncontestable; the Government themselves accept that the measures proposed are insufficient because they have put down some further changes that will come before us in due course. I look forward to a further debate. This is an important issue, and I welcome the opportunity for a discussion.

Yesterday, on the winter crisis Statement, the Minister said that

“we should be learning all lessons. I like to think that, three months into my role, I am learning some of those lessons.”—[Official Report, 10/1/23; col. 1316.]

I am pleased to provide the opportunity for the Minister to learn more about the impact that the pension tax rules—the lifetime allowance and the annual allowance—are having on the work that he is undertaking to get our NHS back into shape. I did not seek to intervene yesterday when the Minister made the Statement, as I knew we had today’s debate. Of course, the crisis is not the product of short-term problems but the result of 12 years of political choices—but we are not going to debate that again.

The taxation issues, however, are still highly relevant. It is no good promising extra beds and shorter waiting times if you do not have the staff to provide the care, and there is no doubt that the rules are having an adverse effect on staff retention at senior levels, as well as—possibly even more important—on the morale of the staff whom we depend on. We are all agreed: for example, the last Prime Minister promised to

“stem the exodus of doctors from the NHS”,

and the Prime Minister before that promised to fix the pension tax relief rules. The current Chancellor, albeit before he took up that role, called the situation a national scandal. He also tweeted on 4 August that, among the actions needed to get the NHS back on its feet, the Government should:

“Grant an immediate exemption for doctors to public sector pension rules which are currently forcing them to retire in their fifties in alarming numbers”.


Even the current Health and Social Care Secretary, Steve Barclay MP, has said that the NHS Pension Scheme

“is one of the best in the country, but it’s not working as it should for everyone”,

so I am pleased that the Minister is here and ready to learn lessons. The problem, as he might be the first to acknowledge, is that the real solutions are not in his hands or those of his department. The solutions lie in the hands of the Treasury, which sets the pension tax rules and effectively controls the rules of public service pension schemes. Of course, this is a general problem which I could speak at great length about, but given the crisis we face in the NHS it is right that in this debate we should focus on what can be done in this area for the NHS.

As I have said, my Motion is indisputable. These provisions were inadequate and we have further changes, which are currently the subject of discussion. The Secretary of State has said:

“We need a system where our most experienced clinicians don’t feel they have to reduce their workload or take early retirement because of financial worries”.


This suggests that he understands the problem but, unfortunately, the further proposals currently out for consultation tell us that he does not, and that what has been proposed so far is insufficient. This is where it starts to get technical and the current forum, where slides and spreadsheet presentations are out of order, is not really conducive to a full explanation. Possibly it might be useful to have a meeting, but let us have a go at outlining the issues.

There are a number of problems, not least the lifetime allowance, but I want to focus in this debate on two issues that arise from the annual allowance: the limit on how much extra pension National Health Service employees can accrue each year, tax free. If you exceed the limit, there is a penal tax rate involved on the portion of growth of a member’s pension rights in excess of a defined amount, currently £40,000. It is a penal rate because tax is levied on the money as it goes into the scheme and then again when it is paid out as benefits. Effectively, that is a tax rate on pensions savings of up to 70%. While I am not against high earners paying more in income tax, it still needs to be applied equitably and fairly, and certainly not when people are doing the right thing by providing themselves with an adequate pension.

The growth in pension savings during a tax year, which is limited by the annual allowance, is referred to as the pension input amount. This is the increase in the value of the individual’s pension rights, starting from an opening value immediately before the beginning of the tax year and going to the closing value at its end. It consists of two parts: the increase in the pension that they had previously accrued and the additional pension that they earned during the current year. If, after allowing for inflation, an individual’s pension input amount is more than the annual allowance of £40,000, the individual is liable to pay tax on the excess, so the clear intention is that the pension input amount should consider only growth in pension savings above inflation. There are two major problems with how this works in practice. First, there is an index mismatch; secondly, there is the problem of negative pensions growth.

19:45

The mismatch is between the index used to increase the opening value of the PIA and that used to revalue the member’s actual benefits. For example, in the 2022-23 tax year, the September 2022 CPI of 10.1% is used to revalue the member’s pension. However, the increase in the CPI used to revalue the opening value of the PIA is based on the previous September’s increase of 3.1%. So while over a year there may have been no increase in the real value of a member’s accrued benefits, they will still have to pay tax—almost certainly at the rate of 40% or 45%—on 7% of the current value of their accrued pension. I hope people are following me there. The amount involved can be substantial, heading towards six figures in some cases.

The Government have acknowledged that there is a problem here and proposed a change. However, what they have proposed is administratively complex and requires changes to pension administration systems, as well as legislation. Scheme administrators are already faced with the considerable challenges of delivering the McCloud remedy, correcting historic age discrimination. It is clearly better to go back to the source of the problem and amend Section 235 of the Finance Act 2004.

The second point is the failure to do anything about the problem of what is called negative pension growth, where the value of a member’s accrued pension is actually falling in real terms. If the member has an accrued pension and its value increases by less than inflation, you get negative pension growth: at the end of the year, the pension is worth less in real terms that it was at its beginning. This problem is difficult to explain given the time available but the key point to understand is that most experienced clinicians, who we need to retain to solve the problems we face, have two pensions where the PIA is assessed separately for each scheme. They have a pre-Hutton reforms pension based on their final pay and a post-Hutton reforms pension based on their revalued average pay.

Without going into too much detail—maybe there is too much already—with current and expected pay increases of less than inflation, the value of the old pension they have accrued can actually reduce in real terms. It will go up in line with the pay increase but is tested against the PIA going up in line with inflation, which will be higher than their pay increase. In fact, over the year, that element of their pension will have fallen in real terms—and that is ignored for tax purposes. However, the value of the new pension that the member has accrued, plus their additional pension accrued during the year, will be a positive amount. In one scheme they have a negative amount, while in their more up-to-date scheme they have a positive amount which will be taxed at a penal rate, even though overall the amount of increase in the pension they have been paid by the National Health Service has not gone up by nearly as much, or might even have declined in total. As far as the member is concerned, it is all one pension, and it is difficult for them to understand why they are being taxed on a declining asset.

The Secretary of State and the department have provided an example of how their proposals will work. I have been involved in that game for long enough to know that, when employers provide a single example, it is rarely an accurate reflection of everything that is happening; there is always an element of cherry picking. That example does not tell us, first, that it is an exceptional case and, secondly, that it is looking only at one year’s figures. To the extent that it is possible to reverse-engineer the figures we have been given, it appears that, because negative pensions growth will be excluded in future years, the individual concerned will still have to pay substantial amounts in tax, even though the total value of the benefits is declining. The likely effect is that the senior clinician involved will stop doing waiting list initiative work to avoid the tapering which will massively increase the tax they pay, despite that additional work not being pensionable.

We have a real problem here for getting the NHS back on track. We need to retain senior staff, and, unless the Government accede particularly on the need to have an effective and efficient system for dealing with the index mismatch—and, especially, on taking into account negative pensions growth—we will continue to have those difficulties.

[Baroness Altmann (Con)]

My Lords, I congratulate the noble Lord, Lord Davies, on highlighting a really serious issue in terms of the workforce situation within the National Health Service. I commend him on his clarity and ability to explain an incredibly complicated situation. I also congratulate my noble friend and welcome him to his position. I know that he is in listening mode and that the Government really want to sort out the problem; it has been hanging over the National Health Service for a number of years.

Small changes have been made to try to address different parts of the problem, but we are left with a situation where, partly because of the legacy of unexpected tax bills that hit senior staff and lowered morale at points over the past three or four years, we currently face a new problem that did not exist before and which has added to the difficulties faced by NHS staff: inflation. The NHS Pension Scheme, as with other public sector pension schemes, is an excellent scheme; the benefits provided for the majority of members are generous and of extremely high value relative to the salaries of most of the workforce. More than 1 million members are in that scheme, and the Government, in their new regulations, have commendably sought to widen the membership of the NHS Pension Scheme. Again, I commend the recent consultation measures that have been put forward; for example, bringing in more primary care network staff so that they do not have to keep opting in but can be automatically included.

I also welcome the attempts to attract back some of the people who have retired early from the NHS or left it for a number of reasons over the past few years. Were they to come back under the old rules, they would face extra penalties; however, those penalties are being removed. I again offer my noble friend and the Government my full support on trying to get people to come back flexibly, take partial pensions and make new contributions and to remove the limits on the number of hours worked—all of which is to be welcomed in allowing retired staff to rejoin the pension scheme.

There is also an attempt to address the inflation calculation problem, whereby the base for calculating the end-of-year inflation is being moved to 6 April so that it will take a base at a similar level of inflation to the previous year. However, that is a one-year fix, so it is not going to solve the long-term issue.

Given the cost to taxpayers of unfunded public sector pensions and, in my view, the right of public servants to expect good pensions, we need to recognise that there is a real problem for some groups of members for whom something which is supposed to be a brilliant workplace benefit has turned into a workplace penalty because of illogical tax rules. More senior and long-serving earners—and now even middle earners, not just the highest earners—are finding that their supposedly tax-free pension contributions are causing them to receive huge tax demands that can even exceed the extra earnings that they may make from taking on an extra shift or doing some overtime, so they are effectively paying to work for the NHS. That is not intentional; the rules in theory are having unintended consequences in practice. The tax system rules that the Treasury has devised are intended to limit the extra tax-exempt pensions so that taxpayers do not have uncapped, extra-large bills going forward, but, in practice, there is complexity, a lack of transparency and perhaps inappropriateness in applying rules that might work for defined contribution pension schemes to defined benefit pension schemes—as well as in trying to limit not only the amount of money going into the scheme each year but the amount built up over the long run. Surely, if you limit the amount that goes in on an annual basis, you should not need to punish people if they have a big pension at the end—is that not the point of building up pensions? I urge my noble friend perhaps to meet a group of interested Peers and representatives from the Treasury to try to work through how we can fix some of the illogical tax rules.

I have identified four elements of the pension scheme that are not working: the annual allowance itself; the tapered annual allowance, on which the Government have gone quite a long way to try to ensure that the increased level at which that bites in the NHS has taken some of the sting out of what was a problem lower down the scale before; the lifetime allowance; and the 20-times pension calculation, regardless of whether you take early retirement. The latter means that it will be advisable for many people to retire in their 50s—as soon as they can—if they are just coming up to the lifetime allowance, because the 20-times calculation will be applied to the pension at that stage, rather than to stay on, work longer, wait until they have a bigger pension and slip over the limit.

There is the inflation calculation, as the noble Lord, Lord Davies, has mentioned, the index mismatch and the failure to have any offset for negative growth. Again, if we were to be able to change Sections 234 and 235 of the Finance Act 2004 to better allow the total pension calculation that accrues above inflation, that would at least address some of this issue.

A final element that I would like to highlight is that there is the possibility for members who face tax charges to have those charges paid by the pension scheme. It is called “scheme pays”, and effectively it means that you get a lower pension later on because the pension scheme has paid your tax bill today. But what we need to do is to take away the punitive interest rate charged for the calculation made for the “scheme pays” amount. Right now a member is charged CPI plus 2.4%, effectively 12.5% to borrow money from their pension scheme, meaning that they get a lower pension later on.

20:00

All these things are complicated, but each of them needs addressing if we are actually going to put a stop to the situation that we have ended up in—which is that the pension rules that were meant to be, and in most cases are, a really good benefit for staff, have ended up incentivising people not to work. That is obviously counterproductive from everybody’s perspective, certainly at a time when we need to attract and retain staff—and one might argue that the most senior and more experienced staff are the ones we least want to entice to leave. That is what is happening in the NHS today.

I urge my noble friend to look at the interaction between the pension schemes, the 1995 scheme and the post-Hutton reform schemes. One particular question that arises—and I wonder whether my noble friend could write to us if he cannot answer it today—is that I am conscious that the McCloud remedy is coming in, so people will be put back into the situation that they would have been in if they had been in the final salary scheme all the way through from 2015, as we go forward. What will happen to the tax bills that have already been levied, or any other bills that may be associated with that? Will that just be ignored, or will we have another complex series of tax negotiations that the Treasury needs to sort out?

I commend the Government on what they have done so far, but I also regret that there is not enough movement or radical change to allow the NHS Pension Scheme to stop discouraging senior and valuable staff from leaving and stop interfering with and undermining the morale of the staff that we have.

[Baroness Masham of Ilton (CB)]

I thank the noble Lord, Lord Davies of Brixton, for this regret Motion. This is an important matter, because we are losing some of our experienced consultant doctors because of this pension scheme system. We cannot afford to lose these doctors early—they are so valuable. Surely this is something that the Government can put right. This is urgent, and I hope that the Minister will have some good news tonight. If not, people will continue to be worried.

[Lord Allan of Hallam (LD)]

My Lords, regrettably I do not have an interest to declare in respect of the NHS Pension Scheme. I say regrettably because I was an NHS employee during much of my 20s but foolishly opted out of the pension scheme. Older me would have words to say to younger me about the lack of foresight in that decision, because the NHS pension was and is an excellent support in retirement, as the noble Baroness, Lady Altmann, has pointed out. If only I had had someone like her to advise me back then, I would be in a better position today.

Apart from that reminder of personal grief, I am grateful to the noble Lord, Lord Davies of Brixton, for enabling us to have this debate today, as it allows us to return to a key topic that we rightly discuss regularly in this House—the issue of staff shortages in the health and social care sector. He and the noble Baroness, Lady Altmann, have described some of the really quite profound structural challenges related to NHS pensions and taxation, and I hope that the Minister will agree to look at them in some detail.

On the narrower subject of the regulations themselves, the response to the consultation on this instrument is enlightening in describing the nature of the staffing pressures that the NHS faces, which brought around the original changes made in the Covid legislation that have then been prolonged in a series of statutory instruments, and especially in describing those that relate to staff sickness absence rates. I note that the consultation response was written last autumn but accurately predicted the fact that those staff sickness absence rates would continue through the winter. If anything, they have been worse than anyone anticipated, through the combination of Covid and flu. That makes the case for us not disincentivising experienced staff who are past retirement age from returning to help us out at a time of national crisis. It is of special note that, in this consultation, 98% of respondents said that, yes, this should go ahead and we should continue to offer some relief to those who are coming back into work, with only 2% against. That is quite a majority for any consultation.

If the consultees had any criticism, it was that the easements did not go far enough. I note that the Government have agreed to remove the 16-hour rule permanently from 1 April this year, and I hope that the Minister will confirm that this is the case. It was the pension scheme board itself that said that there was no rationale for requiring people who agreed to work past retirement to stick to a 16-hour limit.

The response also goes into some detail about the position of special class status members who can retire at 55, and what happens if they return to work before the age of 60. It included a graph that showed how much a nurse in this category could work before abatement applied. I understand that the word “abatement” in this case means that there is a limit to the number of additional hours that a nurse could work before losing, pound for pound, some of their pension entitlement. In other words, if they work past that amount of time, effectively they are working for free. The Minister may correct me if I have misunderstood, but the chart implied that there would be a straightforward loss.

The chart tells us that the most experienced nurses, those with 35 years of pension entitlement, would be able to work around 0.5 of a full-time equivalent before the pension ceiling kicked in. The Government in their consultation, because they were not lifting the abatement permanently, put a glass-half-full spin on it, saying, “Look, these people can come back and work half time”. But of course there is a glass-half-empty angle on it as well, which is that we are potentially losing half the time that those experienced staff could give to us if they did not feel that, by working those extra hours, they would lose out on their pension entitlement. I note that the abatement for this group has been extended to 2025, acknowledging that concern, but that there is still no permanent solution. Again, I hope that the Minister today has some ideas for how we may go further and ensure that the NHS can persuade retired staff of all classes to put in as many hours as they feel fit to do. We do not want to be in the position whereby someone is willing to work more but, purely for financial reasons, feels unable to do so.

I am sure that we will return to the theme of the impact of NHS Pension Scheme rules on staffing levels over the coming months. As the noble Baroness, Lady Altmann, pointed out, it is clear that there are unforeseen and unwelcome consequences of some of these rules, which I suspect is because they were crafted in a different climate for NHS staffing, at a time when people would retire and plenty more people were coming in. Today we are in quite a different situation where, frankly, we are desperate for those people who can still work, who are at retirement age, to postpone in many cases well-earned retirements to come back and assist us. In that climate, it is essential that the Government commit to revising rules where that would make a material difference to staffing levels and therefore to the health of the nation.

[Baroness Merron (Lab)]

My Lords, I thank my noble friend Lord Davies for tabling this regret Motion and for comprehensively setting out the issues before us this evening. As the noble Baroness, Lady Altmann, said, this is a real problem because we see workplace penalties incentivising staff not to work, which cannot be a state of affairs that is allowed to continue.

I will start by making a general point of context. I have great concerns at how many regret Motions concerning regulations produced by the Department for Health and Social Care have been tabled in recent months, with more to come. Is this a concern that the Minister also shares? If so, I wonder whether he has a view on what action needs to be taken within the department in order to stem this flow. I suggest to your Lordships’ House that perhaps the reasons for justified dissatisfaction with a number of regulations that are being brought forward have roots in both procedure and policy that are falling short. I will return to that point later. I hope that the Minister will act swiftly and systematically to deal with this continuing problem.

As we heard in contributions from across the House, inadequate numbers of staff underscore the crisis in the National Health Service, which is creating a situation of irrevocable damage being done to the lives of people who experience record delays across the whole of the system. We have a crisis of failure in getting and keeping a workforce in place to provide the services that we need. This has not just happened by accident. It is evidenced as predating the pandemic and it is the result of nearly 13 years of very particular choices that have been made by this Government.

In 2021 alone, 2,000 dentists and over 7,000 nurses quit the NHS. There are more than 46,000 empty nursing posts across hospitals, mental health, community care and other services, which means that around one in 10 nursing roles is unfilled across the service overall. That is the context in which we are discussing this regret Motion. As noble Lords on all sides of the House have asked repeatedly—as the noble Lord, Lord Allan, rightly reminded us, and as I and other noble Lords asked on yesterday’s Statement—where is the comprehensive and detailed workforce plan to retain, recruit and train the doctors, nurses and other health professionals whom the NHS so desperately needs? Will this plan take account of NHS pension arrangements?

With specific reference to NHS pensions, we have long been calling for the Government to sort them out and to remove the deterrents in the system to NHS staff staying in post or returning to work. This includes, for example, the cap on doctors’ pensions as, under the current rules, many experienced doctors are deterred from working later into their career because they are unable to opt out of paying into their NHS pension even if they have reached the cap. The result is that GPs are taking early retirement, which they would not have done otherwise, as the noble Baroness, Lady Masham, referred to.

We also know that record numbers of GPs are indicating that they will retire or leave the profession, with burnout and low morale at an all-time high. Can the Minister say how the numbers will stack up, when 4,700 GPs have been cut over the past decade and the long-promised 6,000 GPs are not on course to be delivered? How will the current pension arrangements assist in keeping GPs from wanting to retire and leave the profession? What action will be taken?

I turn to the specific comments of the Secondary Legislation Scrutiny Committee that form the basis of this regret Motion. I understand why my noble friend Lord Davies has seen fit to table this Motion. The committee’s report on this statutory instrument laments the short-term approach taken by the Government. The SLSC has drawn these regulations to the special attention of the House because

“some of the extensions proposed are quite short term and may not give re-employed retired staff or their employers the certainty first to encourage and then to retain staff to deal with the current NHS backlogs.”

20:15

With this in mind, I was surprised that a full impact assessment had not been produced. The Explanatory Memorandum says that the reason is that

“no, or no significant, impact”

is foreseen. In light of the criticisms by the SLSC, does the Minister feel that it was the right course of action to not produce an impact assessment? If so, I would be interested to know what assessment the Minister has made of the contribution of these regulations to dealing with the NHS workforce crisis. As we have heard this evening and on many other occasions, one of the many contributors will be getting in place the right terms and conditions—including pensions—if the NHS is to have the workforce that it and we need. I look forward to the Minister’s response.

[The Parliamentary Under-Secretary of State, Department of Health and Social Care (Lord Markham) (Con)]

My Lords, I thank noble Lords, particularly the noble Lord, Lord Davies, for bringing this debate today and for reminding me, quite rightly, about learning lessons. I must admit that I have found learning the health brief—which I still continue to try to learn—pretty challenging. Learning the intricacies of tax and pension matters is another dimension that I was not quite expecting in all this—but I will try to repeat what I have learned so far.

The main thing, and a serious point behind the comments from both the noble Lord, Lord Davies, and my noble friend Lady Altmann, is that, to me, it is a sign of the Lords working well that we have this sort of expertise at our disposal. I said in my maiden speech that I wanted to be a different kind of Minister. We have clear expertise tonight, with people all wanting the same thing: to retain doctors, as the noble Baronesses, Lady Masham and Lady Merron, said; and to address the staff shortages that we have, as the noble Lord, Lord Allan, said. These are things that we have to address, and pensions should definitely be part of that workforce analysis.

I would therefore absolutely like to offer that round table that we have talked about. Again, something that I said in my maiden speech was that I have always found it quite strange that we talk across a Chamber; surely, a more productive way is to talk around a table with a cup of tea or coffee and have an exchange of views. So I would definitely like to offer that opportunity to the noble Lords who are interested, so that we can learn from them. I again thank the noble Lord, Lord Davies, for bringing this up, so that we have that opportunity to learn and to try to get it right.

I will tell noble Lords what I think is the premise of what we are trying to do and I will then read my speech, which will probably answer some of the detailed points. I will also endeavour to write with a proper detailed response. As we all have said, we know that what we need to fix is the fact that doctors are voting with their feet. That clearly is the problem and, if we do not try to sort it out, it will just carry on. I am not going to pretend that we have fixed that to date, but we do all understand the problem and I know enough about this subject to understand that a marginal rate of tax of 70% is a clear disincentive to work in that situation.

I have tried to understand ways to address this. The problem is that we know that if we try to address this by changing the whole tax system, it becomes very expensive to change the pension rules for everyone. Understandably, the Treasury has a difficulty about changing the rules for one sector of society and the challenge that might result: the cost of trying to solve the doctors’ situation by changing all the tax rules would be incredibly expensive. The judges’ situation is often used. I believe that the way they get round it is by employers effectively paying them the gross amount, to make sure that they get the same net amount as a result. I appreciate that we would then be paying people who are some of the best-paid workers in the NHS an even larger sum, which, I have to say, sits uncomfortably with me personally, particularly when we are having the understandable pay conversations, disputes and strike actions at the moment.

What we are trying to do in all of this—we are not there yet—is at least get to a situation whereby if it is penal for someone to be receiving this as part of their pension, they can receive it as part of their pay instead, at which point they will be paying the marginal rate of tax, be it 40% or 45%. There will be flexibility and choice: I can either have it in my pension pot, or my personal circumstances mean that if I trip over one of the many different allowances rules and it starts to penalise me and I am disincentivised to work, I can at least get it back in my salary, my pay packet, and get it back that way round instead. That is the principle of what we are trying to do in all of this, so when we come to our round table, that is the approach I plan to bring.

On the statutory instrument itself and the regret Motion, I take on board the point made by the noble Baroness, Lady Merron, and I will take that away. I believe that in this circumstance, the regret Motion is less about this per se—because if we were to vote this down, it would make the problem even worse, because all it is doing is extending the situation to March 2023—and really saying that we do not think it goes far enough. That is slightly different; correct me if I am wrong, but I do not believe noble Lords are actually saying here that they disagree with the SI per se and want it to fall. So, it is not a regret Motion, but we are using this as an opportunity, absolutely in the right way because it means that we brought it to the Floor and had a debate, we got a proper conversation and dialogue and a round table to try to fix the problem. This SI in itself helps but definitely does not fix the whole problem.

So that is the direction we are trying to come from. The proposals I have had the officials explain to me are trying to increase flexibility so that people can dip in and dip out, they can step out completely for a while and then start working again if that suits their lifestyle, and restart the clock in terms of their pension and everything else like that. They can take some of their pension and come back to it afterwards. They are trying to solve those sorts of problems, obviously removing the hour cap and trying to solve things about the abatement hours, all on the principle that we know it is a very valuable pension scheme that many of us wish we had the opportunity to be part of, but it is not quite working properly in the way we need it to. The CPI disconnect, as I understand it, is one of the clear issues there. I understand the issues around what the scheme pays: I must admit it was an education for me to hear that, if we are talking about interest rates of 12.5%, clearly that needs to be understood further as well.

I hope noble Lords can see from my response tonight that I very much appreciate the noble Lord, Lord Davies, tabling his Motion because it allows us to discuss this properly. At the department, we know that this is an issue we need to face, because otherwise doctors will continue to vote with their feet and it can be only to our detriment and the health service’s detriment if we do not fix it. With that in mind, I hope I have picked up most of the questions and, as I say, I will write in detail and offer that round table. I hope noble Lords understand why I do not support the regret Motion and I hope, on the basis of the conversation we have had tonight, that while I very much appreciate that this has been brought for us to talk about and set up the round table, the noble Lord will feel able to withdraw.

[Lord Davies of Brixton (Lab)]

My Lords, I thank the Minister for his response. I am sure everyone will be relieved that I am not going to push the Motion to a vote and say that my main intention this evening was to ensure that we took this opportunity for the relevant department and the Minister to understand the issues involved. The solution has to be one which is acceptable to the doctors. It goes without saying, really, that we can discuss this as much as we like, but it is the doctors who have to say, ultimately, “Yes, this solves the problem; we are not being forced to retire.” In that light, I beg leave to withdraw.

Motion withdrawn.