Doctors: Pensions

Department of Health and Social Care written question – answered on 11th June 2019.

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Photo of Philippa Whitford Philippa Whitford Shadow SNP Spokesperson (Health and Social Care)

To ask the Secretary of State for Health and Social Care, what assessment his Department has conducted of the effect of the tapered annual pension tax allowance on the retention of doctors in the NHS.

Photo of Stephen Hammond Stephen Hammond Minister of State (Department of Health and Social Care)

The 2015 NHS Pension Scheme is a generous and valuable part of staff reward packages and remains one of the best schemes available. Its introduction ensures that National Health Service staff receive financial security in retirement, and that the scheme is affordable to the taxpayer.

The Government recognises that NHS doctors have raised concerns about pension tax charges being a factor in their decisions to retire early or limit their NHS commitments.

We are listening to concerns raised that the tapered annual allowance is affecting the retention of doctors in the NHS. The Government is prepared to take action and will bring forward a public consultation on targeted proposals to make NHS pensions more flexible for senior clinicians by allowing them a 50% reduction in pension contributions for half the pension accrual.

The British Medical Association’s view this proposal as a step in the right direction. The Department will listen carefully during consultation to reach a final proposition that works for both staff and taxpayers. The consultation gives an opportunity for groups and individuals to put forward their views.

Additionally, the scope of the voluntary ‘Scheme Pays’ facility, implemented by the NHS Pension Scheme to allow scheme members to pay annual allowance charges from the value of their pension benefits rather than upfront, has been extended to cover the payment of tax charges from breaches of the tapered annual allowance. The Government keeps the impact of public sector pay and pensions policies under constant review.

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