Pensions Tax Relief: Employment and Retention

Lord Tunnicliffe Excerpts

Tuesday 1st November 2022 Lords Chamber

[Viscount Younger of Leckie (Con)]

Indeed. The subject of the question was to do with higher earners, but I will broaden my response a little. Public service pensions are a key part of the overall renumeration in the public sector and I acknowledge that it is important to get this right for retention. Reference has been made to nurses. A typical NHS nurse will retire after 30 years with a pension worth over £24,000 per year in today’s money. This compares quite favourably to a private sector employee with similar earnings receiving less than £10,000. As I have said, there is more to do, and we will keep this under review.

[Lord Tunnicliffe (Lab)]

My Lords, it is no good the Minister trying to persuade us that this is an attractive package. We know that senior doctors are retiring early, and we should be pragmatic about this. These people represent a very expensive investment—they are assets, and we should sweat our assets. They should not be leaving at the age of 58, 59 or 60, when realistically they should continue into their mid-60s or later, yielding their skills to our society.

[Viscount Younger of Leckie (Con)]

Indeed, it is very important that we look after those at the senior end of the NHS; much has been made of that in the previous Question and this one. As the noble Lord has alluded to, tax relief offered on pension contributions is expensive, costing the Exchequer £67.3 billion in 2020-21, with around 58% relieved at the higher and additional rates. As I mentioned earlier, there are a number of other aspects on which we have taken action, and perhaps there is more to do to be sure that we can retain our very best doctors and senior clinicians.