NHS Pensions: Taxation

Debate between Elizabeth Truss and Andrew Selous

Monday 8th July 2019 Commons Chamber

[Andrew Selous (South West Bedfordshire) (Con)(Urgent Question]

To ask the Chief Secretary to the Treasury to make a statement on the implications for patients of the taxation of NHS pensions.

[The Chief Secretary to the Treasury (Elizabeth Truss)]

The Government keep public sector pay and pensions policy under constant review in the context of the wider public finances. For the majority of savers, pension contributions are tax-free. The annual allowance is a fiscal measure that operates across all registered pension schemes in both the public and private sectors, alongside the lifetime allowance. The measure is kept under review by the Government to ensure that the benefit of tax relief on pension schemes remains affordable.

Some senior clinicians face pension tax charges owing to the increase in the value of their pension accrual. I understand that the Secretary of State for Health and Social Care is currently engaged in discussions with senior representatives of the British Medical Association. The Government are taking this issue very seriously, and that is the right place for those discussions to be held. However, the House will recognise that the same tax rules must apply identically to everyone in the same situation, regardless of their employer. It is simply not possible for the tax rules applying to senior clinicians in the NHS to be different from those that apply everywhere else.

I understand that the Secretary of State for Health and Social Care is to publish a consultation on proposals for a new 50:50 scheme providing pension flexibility for clinicians in the NHS. The scheme will give senior clinicians in England and Wales more choice in respect of their pension accrual, and will thus control tax charges. Since last autumn, all members of the NHS scheme on the taper have been able to elect for the pension scheme to pay any tax charges now, and so avoid any impacts on take-home pay, in return for an actuarially fair reduction in their pensions.

I recognise the concerns that have been raised, and I assure the House that the Government will continue to monitor the impact of pensions policies on public service delivery.

[Andrew Selous]

The unforeseen consequences of recent pensions legislation, initially supported in all parts of the House, are now resulting in very worrying consequences for the NHS as hospital doctors who have regularly worked weekend overtime to get waiting lists down are understandably refusing to continue to do so because they are being made worse off as a result. Can we imagine a conversation between couples along the lines of, “So you are leaving me and the children again this weekend to go voluntarily to work to make our family worse off?” It is not going to happen, is it? The same applies for GPs, many of whom are now doing fewer sessions each week than they want to and their patients desperately need in order not to be made worse off by breaching their annual pension allowance.

We do not have conscription for healthcare staff; we cannot force them to do weekend overtime or more sessions than they want to, and it is not surprising that they choose not to if they are being made worse off as a result. For example, in The Guardian this morning we learned of one senior anaesthetist who worked 27 Saturdays last year in order to reduce waiting lists and has now said he cannot afford to work any extra Saturday shifts this year because it would give him a large tax bill he cannot afford to pay.

Very few doctors have earnings that exceed the adjusted income threshold of £150,000, but due to the inclusion of hypothetical pension growth as income, doctors are being affected by tapering. This is different from what the Chancellor said in Treasury questions on 21 May when he said that someone has to be earning over £150,000 a year before the tapered annual allowance affects them. Taxable income and adjusted income are very different as regards pensions taxation.

The Government should also be aware that members of the imposed 2015 pension scheme had no option but to become a member of multiple schemes including the GP CARE—career average revalued earnings—scheme and as a result incur significantly higher annual allowance tax bills than those members who are protected members in only the final salary scheme. This means that all full-time consultants who are a member of more than one NHS pension scheme will be affected by the tapered annual allowance and will need to reconsider how much work they do for the NHS to mitigate these tax charges. Furthermore, this punitive pensions tax penalty means that doctors are not just working less but are retiring earlier than they would like to in order to avoid significant additional tax charges. In a survey of more than 2,400 consultants, more than half cited pensions taxation as a reason for their decision to retire early.

I therefore have five questions for the Chief Secretary. As the 50:50 pensions accrual option proposed does not remove the unintended consequences that are forcing doctors to reduce the work they do, can this be included in the consultation so that this issue is raised? Once the scope of the consultation has been extended to cover this essential aspect, can it then be launched as quickly as possible? Can the consultation be brief as the issues are well-known and well-rehearsed, and can the Government then respond quickly to it and if necessary legislate given that there is likely to be cross-party support for these important measures to protect the NHS? Can timely pensions statements be provided to all NHS staff who are affected by these measures? Finally, can the Government confirm that they understand the urgency and importance of this issue and that they will act without delay to prevent a deteriorating situation from getting even more acute?

[Elizabeth Truss]

The answer to my hon. Friend’s first question is that the Health Secretary is currently in discussions with the British Medical Association and other health representatives about precisely what can be done, and of course the consultation will come out shortly. Some of the issues he mentioned in terms of legislation will clearly be a matter for the new Prime Minister and Administration, but the fact that my hon. Friend has raised this urgent question today will draw to people’s attention the urgency of this issue and one would expect it to be considered very early on by a new Administration. The point I was trying to make earlier is that there is a fundamental distinction between how we deal with the issues in the NHS, on which the Health Secretary is leading, and the broader issue of our pension system, which is there to encourage people to save. That has to be considered in a holistic manner so we cannot just design it around one workforce. It has to be designed to work for everybody in both the public and private sectors. That takes time of course, and we are working through some of the conclusions of the reforms that took place a few years ago.

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Tuesday 11th December 2018 Commons Chamber

[Elizabeth Truss]

What is important is that we are achieving better results for 16 to 18-year-olds. We are seeing more young people from disadvantaged backgrounds going to university and improvements in the quality of apprenticeships that are being taken up by young people. We are also putting extra money into the new T-levels, which are due to improve technical education.

[Andrew Selous (South West Bedfordshire) (Con)]

Our FE colleges are great poverty-fighting institutions that provide vital ladders of opportunity for our constituents. Given that school pay rises have been fully funded and FE has only had 0.1%, is there not a case for parity of esteem for teachers in FE colleges?

[Elizabeth Truss]

It was indeed very good that we were able to give teachers, particularly those on the lowest wages, a 3.5% pay rise this year—the highest pay rise seen for a decade. FE colleges are set up differently. They are independent institutions that have the wherewithal to change the pay for lecturers who work within them.

--- Later in debate ---

[Elizabeth Truss]

We are doing city deals right across Scotland and they are having huge benefits for the local economy. We have also announced in the Budget a freeze in whisky duty. The question now is how the Scottish Government will respond to that in their budget tomorrow. Will they cut income tax, and will they also cut business rates?

[Andrew Selous (South West Bedfordshire) (Con)]

How many more trees will be planted as a result of investment announced in the recent Budget?

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Tuesday 3rd July 2018 Commons Chamber

[Andrew Selous (South West Bedfordshire) (Con)]

T4. Only 15% of people who start their working lives in entry-level jobs in this country manage to rise above that level. This country would be more prosperous and socially just, and would have a bigger tax base, if we could help them. What more can we do to help that segment of the population?

[The Chief Secretary to the Treasury (Elizabeth Truss)]

My hon. Friend is absolutely right. The way in which we will get higher wages is by improving productivity and skills, which is why we are investing in a record level of apprenticeships and the national training partnership.

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Tuesday 25th April 2017 Commons Chamber

[Elizabeth Truss]

The Prime Minister is absolutely right to call a general election. We need strong and stable leadership of this country, and we need to ensure that the Prime Minister has a mandate to deliver for Brexit and beyond.

[Andrew Selous (South West Bedfordshire) (Con)]

The all-party group on preventing modern slavery, chaired in an excellent manner by the sadly departing right hon. Member for Slough (Fiona Mactaggart), heard from the parents of a young man who had been imprisoned for 15 years as a slave. The culprits were sent to prison for only two and a half years. Will the Justice Secretary agree to speak to the Sentencing Council about the severity of sentences for those who imprison our fellow citizens as slaves?

[Elizabeth Truss]

First, I echo my hon. Friend in paying tribute to the right hon. Member for Slough (Fiona Mactaggart) for her work on modern slavery. I also pay tribute to our Prime Minister, who has made huge strides in putting people away for these heinous crimes. We are doing more, and I am working closely with the Home Secretary to make sure that we crack down on this further.

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Tuesday 7th March 2017 Commons Chamber

[Elizabeth Truss]

The hon. Lady is absolutely right that, as we have got better at dealing with issues of domestic violence, there is more we can do. That is why I am leading a joint taskforce with the Home Secretary to look at the law around domestic violence. We are also ensuring that domestic violence victims are protected in the family court. Under the Prisons and Courts Bill, abusers will no longer be able to cross-examine domestic violence victims, and that is an important step forward.

[Andrew Selous (South West Bedfordshire) (Con)]

I am sure the Secretary of State will welcome the fact that companies such as Boots, Barclays, Carillion, Land Securities, Ricoh and many others have “banned the box” to improve the chances of ex-offenders getting jobs. However, does she share my concern that some quite big household names have not yet stepped up to the plate? Will she do her bit to get them over the line alongside those other good employers?

[Elizabeth Truss]

I congratulate my hon. Friend on the work he did to get more employers involved in this when he was a Minister. We are following on from his good work by setting up an organisation called the New Futures Network, which will comprise businesses and charities. The network will encourage more employers to take on ex-offenders, who are often very loyal and hard-working employees, and who can help to address some of the skills shortages we face.

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Tuesday 24th January 2017 Commons Chamber

[Elizabeth Truss]

The hon. Gentleman is absolutely right. We know that when somebody gets into work on leaving prison, they are much less likely to reoffend. We are going to launch an employment strategy later this year to encourage more employers like Timpsons, which already does a fantastic job, to participate. We also want to get the third sector involved in that rehabilitation programme. We will also announce reforms to the probation system, and one key focus will be on how the probation service gets people into employment.

[Andrew Selous (South West Bedfordshire) (Con)]

Has there been progress on getting accurate job vacancy data from the Department for Work and Pensions in the areas to which prisoners will be released, to focus work preparation in prisons as effectively as possible?

[Elizabeth Truss]

We are working with the Department for Work and Pensions to get the data and make sure that they are much more linked up. By giving governors more power we will enable them to work with local employers in making sure that jobs are available. We are training people in prison and getting them into apprenticeships so that they can continue those apprenticeships and that work when they leave prison.

Prison Officers Association: Protest Action

Debate between Elizabeth Truss and Andrew Selous

Tuesday 15th November 2016 Commons Chamber

[Elizabeth Truss]

I support prison officers, who do a fantastic job. The people I am attacking are those in the Prison Officers Association who have called this illegal action, despite the fact that we were in talks with them and there was an offer on the table, which has not been responded to. I wholeheartedly support the good work of prison officers across the country, and I want them to benefit from the improvements we are making on the frontline and to safety. We are launching a new apprenticeship programme to recruit more people, and we have a new programme encouraging the brightest and best graduates to become prison officers. Of course these things will take time, but I have also talked today about the measures we are taking in the short term to stabilise the situation in our prisons.

[Andrew Selous (South West Bedfordshire) (Con)]

Testing for psychoactive substances has the potential to be a game changer, so has there been an increase in the number of charges for possession? Has the message finally got through to people that if they take Spice, we will know they are doing it, they will be charged and they will take the consequences?

[Elizabeth Truss]

My hon. Friend clearly has much experience in this area and what he says is absolutely right. The prisons and probation ombudsman described psychoactive substances a game changer in our prison estate, and they are one of the reasons why we face the current situation. We rolled out testing in September, and we have trained 300 sniffer dogs to detect those substances. That will have an impact, and we are already beginning to see it in some of our prisons.

Prison Safety and Reform

Debate between Elizabeth Truss and Andrew Selous

Thursday 3rd November 2016 Commons Chamber

[Elizabeth Truss]

I can confirm we are developing the idea of women’s community prisons, which will be smaller-scale prisons specifically designed to address the needs of women. We will outline more about that in due course, and look at overall reform in respect of women offenders in the new year.

[Andrew Selous (South West Bedfordshire) (Con)]

A little while ago a former prisoner said to me that when he left prison he could mop a floor very well but that was not going to pay the bills. In the recent Dame Glenys Stacey in-depth look at 86 prisoners, not one left to go to a job, so may I urge in particular a focus on construction skills from day one of a sentence, given that we need 300,000 construction workers to build the houses this country needs and the infrastructure for our economy?

[Elizabeth Truss]

I commend my hon. Friend for the work he did as prisons Minister in promoting employment. I have seen some excellent schemes in prison. For example, Costa Coffee is offering jobs and training people as baristas, and I have mentioned Land Securities looking for scaffolding and dry-lining workers and training them in prison. I completely agree with my hon. Friend that rather than doing work in prisons and then seeing what jobs are available on the outside, we need to look the opposite way round; we need to see what is available on the outside and make sure those are the skills we are training up in prisons, preferably with the employers who are then going to take those offenders on.

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Tuesday 6th September 2016 Commons Chamber

[Elizabeth Truss]

There are many factors driving prison violence and self-harm. I am looking at the evidence about what will work and what steps we can take, but I am determined to tackle this. I am very clear that the current levels of violence are unacceptable.

[Andrew Selous (South West Bedfordshire) (Con)]

May I also warmly congratulate the Secretary of State and the new ministerial team on their appointments? Of course we need more prison officers in prisons, but may I urge the Secretary of State and her Ministers to consider the greater use of prisoners as mentors? Wandsworth is leading the way, with 50 mentors providing teaching and education, but that could also be used in employment, for therapeutic purposes and to cut down the use of drugs.

[Elizabeth Truss]

As a Prisons Minister, my hon. Friend did tremendous work in this area; we are very much learning from the work that he carried out in the Department. He makes an important point, and I think we need to look at the overall culture in some of our best prisons. We have exemplary work going on, such as mentoring, and we need to make sure that that is happening right across our prison estate.

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Monday 11th November 2013 Commons Chamber

[Andrew Selous (South West Bedfordshire) (Con)]

6. What assessment he has made of the potential role of massive open online courses in schools.

[The Parliamentary Under-Secretary of State for Education (Elizabeth Truss)]

MOOCs present a huge opportunity for this country and are part of a technological revolution that we are seeing around the world. A student in Newcastle can now watch a lecture online from a physics professor at the Massachusetts Institute of Technology for free. I think that helps democratise education and open up knowledge.

[Andrew Selous]

Does the Minister agree that MOOCs are a way of ensuring that all children, from whatever background, can get an outstanding education from world-class communicators, thus freeing up teachers to help children with their online exercises?

[Elizabeth Truss]

My hon. Friend makes an excellent point. Thanks to our new national curriculum and qualifications, which are much more flexible, we are seeing a rise in the number of MOOCs in this country. Cambridge university is developing a new MOOC for physics and there are online courses, such as our new core maths course for 16 to 18-year-olds, which is enabling students to study international baccalaureate maths online in their schools.

Oral Answers to Questions

Debate between Elizabeth Truss and Andrew Selous

Monday 21st January 2013 Commons Chamber

[Elizabeth Truss]

I am not sure, but I will certainly undertake to get back to the right hon. Gentleman. He raises a very important point, and schools should be vigilant about it.

[Andrew Selous (South West Bedfordshire) (Con)]

5. How many children went missing from local authority care in each of the last three years.

General matters

Debate between Elizabeth Truss and Andrew Selous

Tuesday 21st December 2010 Commons Chamber

[Elizabeth Truss (South West Norfolk) (Con)]

I realise that many colleagues’ minds will not be on the business of the House, but on their Christmas lunch. If they are still in search of provisions, may I suggest that they head to Norfolk, where they can find their entire lunch? If they should be stuck in Norfolk, because of the inclement weather—

[Andrew Selous]

Or because they do not have winter tyres.

[Elizabeth Truss]

Indeed. If hon. Members are stuck in Norfolk, may I suggest that they will be catered for? Not only will they be able to purchase their turkey, potatoes, Brussels sprouts and a mountain of vegetables; we also have the world’s biggest sugar factory, so dessert is catered for. A by-product of the sugar factory is the heat that it generates, and tomatoes are produced in the greenhouses there. There is cheese—the Binham Blue and the Wells Alpine—for the cheeseboard, and, for those after-dinner drinks, we also have the only English whisky distillery.

Norfolk is indeed a county of bounty, with 80% of the land used for food and farming. It often strikes me that if Martians were to come to Earth and watch prime-time TV programmes such as “Come Dine with Me” and “River Cottage”, they would think that we were all obsessed with food. They would imagine that we spent all day thinking about where our food came from and how it was produced. They would also believe Norfolk to be a dominant part of the British economy, with its strong food and farming industry. There have been excellent developments at local level. An example is the development of the Norfolk food hub, which I am assured will have goats grazing on the grass roof of its exciting new building, but there has not been a growth of food exports in relation to food imports. In fact, over the past 10 years, we have imported nearly twice as much food, relative to exports, as we used to do.