NHS: Pensions

(asked on 17th January 2020) - View Source

Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, what assessment has he made of the effect of the NHS pension scheme on staffing in the (a) NHS and (b) primary care sector.


Answered by
Edward Argar Portrait
Edward Argar
Minister of State (Ministry of Justice)
This question was answered on 22nd January 2020

The Department recognises that the annual allowance may contribute to decisions from National Health Service consultants to retire early or limit their NHS commitments, although a precise estimate of the change in staffing levels as a result of pension tax is not available. The Government is listening carefully to concerns raised by senior doctors and NHS employers about the tapered annual allowance.

In September 2019 guidance was issued by NHS Employers informing employers of the short-term approaches that they could take to mitigate the effect of pension tax on their workforce this tax year. The NHS has also implemented an immediate measure to preserve clinical capacity amid the increased pressure on services during the winter period. This will compensate NHS clinicians for the effect on their pensions of annual allowance charges incurred in 2019-20.

The Department has consulted on introducing flexibility within the NHS Pension Scheme from 2019/20 to allow clinicians affected by annual allowance tax charges to reduce their pension accrual in deciles in order to manage any potential annual allowance tax charges.

As part of a wider drive to ensure the NHS has the staff it needs to meet demand and transform care, the Government is carrying out an urgent review of the pensions annual allowance taper problem that has caused some doctors to turn down extra shifts for fear of high tax bills. On 13 January, Ministers held a roundtable with the Academy of Medical Royal Colleges, the British Medical Association and other representative organisations as part of this review to find a long-term solution.

The review will consider the findings from the Department’s consultation on pension flexibility and will report at the Budget on 11 March.

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