NHS Pensions: Taxation

Baroness Finlay of Llandaff Excerpts

Tuesday 9th July 2019 Lords Chamber

Asked by

[Baroness Finlay of Llandaff]

To ask Her Majesty’s Government what action they are taking to tackle the 50% increase in waiting times for NHS patients due to the changes in rules on pension contributions for consultants which affect the number of clinical hours they are able to work.

[Baroness Finlay of Llandaff (CB)]

My Lords, I beg leave to ask a Question of which I have given private notice.

[The Parliamentary Under-Secretary of State, Department of Health and Social Care (Baroness Blackwood of North Oxford) (Con)]

My Lords, we will be consulting shortly on proposals to make NHS pensions more flexible for senior clinicians in response to evidence that shows that pension tax charges as a result of the tapered annual allowance are having a direct impact on retention and front-line service delivery. These proposals aim to maximise the contribution of our highly skilled workforce, who are crucial to delivering the NHS long- term plan.

[Baroness Finlay of Llandaff]

My Lords, I declare my interest as a past president of the BMA. Can the Government state exactly when the consultation will begin, how long it will run for, how it will be organised and when it will report? Do they recognise that, of 4,000 consultants recently surveyed, 60% said that they would retire at or before 60 years of age, and over half of those cite the sudden unexpected tax bills as a reason? This is particularly urgent because in August we have new graduates starting, who need additional supervision as they begin to get used to working in the clinical arena, yet we are already seeing consultants dropping sessions, which will adversely impact on clinical services. Doctors seem to have only two options now: to retire or to leave the NHS pension scheme, and until they can do that, they are financially penalised for working. One paediatric intensivist I was talking to said that he is £300-plus out of pocket by working a weekend.

[Baroness Blackwood of North Oxford]

I thank the noble Baroness for her important Question, which she has asked before. Retaining and maximising the contribution of our highly skilled clinical workforce is crucial to the delivery of patient care. We are preparing to provide pension flexibility that appropriately balances the benefit of new flexibilities with their affordability. We have listened, and we are discussing the issue with the Treasury. As a first proposal, the consultation will set out a potential 50:50 option, offering 50% pension accrual and halved contributions. The BMA requested this as an option earlier this year and has welcomed it as a step in the right direction. The consultation will be an opportunity to listen to a range of views and will be genuinely flexible and open; we will bring it forward as a matter of urgency. I hope that that is a reassuring answer for the noble Baroness.