Baroness Finlay of Llandaff
Main Page: Baroness Finlay of Llandaff (Crossbench - Life peer)Department Debates - View all Baroness Finlay of Llandaff's debates with the Cabinet Office
(5 years, 1 month ago)
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Lord Young of Cookham
It is important that noble Lords understand the background to the changes. One of the most expensive tax reliefs is pension tax relief. It costs £50 billion per year—roughly half the budget of the NHS. Two-thirds of that goes to additional, or higher-rate, taxpayers. The reforms introduced over the last two Parliaments were aimed at targeting the relief more effectively and saving £6 billion that could be redirected towards other priorities. Less than 1% of taxpayers will be affected by the taper of £40,000 that was introduced, and more than 95% of those approaching pension age will not be affected by the lifetime allowance.
Baroness Finlay of Llandaff (CB)
My Lords, I declare an interest as a past president of the BMA, and as someone with an NHS pension whose husband does not stand to gain particularly by my death; so be it. Do the Government recognise the seriousness of the situation, given the open letter from the BMA to the Prime Minister published in the Financial Times today? The 50:50 suggestion that came from the Secretary of State is not the solution to the problem. Clinical services are already being severely jeopardised by consultants who drop their additional sessions; waiting lists are therefore already rising and those facing retirement have decided to carry on with leaving the NHS, thereby worsening our workforce problems.
Lord Young of Cookham
We join the noble Baroness’s husband in wishing her a very long life. So far as the issue she raises is concerned, the BMA asked us to introduce this flexibility earlier this year. The chair of the BMA council said:
“This is a step in the right direction”.
The Secretary of State is willing to discuss other models for pension flexibility; we very much hope that, if we make these changes, high-earning clinicians will be able to attend to more patients while saving for their retirements without incurring significant tax charges.