Distinction Award Scheme (National Health Service Pensions)
Scottish Executive Question Time — Health and Wellbeing
2:15 pm

Ian McKee (Scottish National Party)

To ask the Scottish Government what the added cost to NHS pensions was of the distinction award scheme for hospital consultants in the most recent year for which information is available. (S3O-12616)

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Nicola Sturgeon (Scottish National Party)

The total budget for the distinction award scheme for 2009-10 was £28 million. That budget covered the cost of the actual awards and included a contribution to employers' costs, such as national insurance and superannuation. Therefore, any additional pension cost is largely included in that £28 million budget.

However, the fact that distinction awards are currently consolidated and pensionable is one of the aspects of the scheme that I consider needs to be revised. The Scottish Government's evidence to the Doctors and Dentists Review Body asks it specifically to consider that.

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Ian McKee (Scottish National Party)

I share the cabinet secretary's disquiet that what may be a temporary contribution to health care over and above what is normally expected from a consultant may be rewarded not only with a distinction award for the rest of that consultant's working life, but with an inflation-proof pension addition of up to £38,000 until death. I accept that she has drawn the situation to the attention of the Doctors and Dentists Review Body inquiry. Does she reserve the right to take action to remedy it even if the resulting report fails to tackle the issue?

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Nicola Sturgeon (Scottish National Party)

I hope that the DDRB will come up with a good set of proposals, and I look forward to that happening.

The member has been at the forefront of the campaign on this issue and I congratulate him on that. However, if the Scottish Government's budget for next year is passed, I believe that I will be the first health secretary in the lifetime of devolution to reduce the budget for distinction awards. That is a step in the right direction.

When we are having this debate, it is important to stress the fact that I and everyone else in the chamber values highly the work that consultants do. However, I do not believe that a rewards scheme that rewards only about 3 per cent of the NHS workforce when we have a multidisciplinary workforce is sustainable for the future. That is why I argued for the review. The previous Labour UK Government resisted the idea of that review and, although I do not agree with the current UK Government on everything, it is a welcome step in the right direction that it agreed to the review, which is now under way.

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Murdo Fraser (Conservative)

It was reported in the Sunday Herald at the weekend that, in addition to distinction awards, some consultants are rewarded with additional salary points. What action is the cabinet secretary taking to address that system of additional reward?

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Nicola Sturgeon (Scottish National Party)

Murdo Fraser refers to an article in the Sunday Herald about what are called discretionary points. I should say that, in addition to the distinction awards, discretionary points are the subject of the DDRB review, so in the longer term, I look forward to the DDRB's recommendations.

Looking forward again to next year's budget, I have made a proposal, which is currently out to consultation; that consultation will end in mid-February. The proposal is that, as we are doing with distinction awards, for next year and pending the DDRB recommendations for the longer term, we should freeze the discretionary points system. Once the consultation concludes and I have made a final decision on that, I will share it with Parliament.

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