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Independents' Day

Budget gives green light to increase GP retirement age

By Gareth Iacobucci

Chancellor George Osborne has given the Department of Health the go-ahead to look at plans to raise the GP retirement age after accepting recommendations from Lord Hutton's review on public sector pensions as part of a raft of measures aimed at slashing the deficit.

The Chancellor today revealed details of the coalition's budget for 2011/12, with a number of his key recommendations due to affect GPs.

The decision to accept Lord Hutton's recommendations ‘as a basis for consultation' comes as GPs continue to vent their fury over Government plans to raise their retirement age to 65, with a Pulse survey this week finding that a third of the profession plan to quit if the pension age is increased.

Accountants also warned that the review could have a ‘frightening' impact on GPs' income if they are forced to pay higher employee contributions.

In his Budget speech today, the Chancellor praised Lord Hutton's report as ‘a very impressive piece of work', adding: ‘I confirm today that the government accepts Hutton's recommendations as a basis for consultation with public sector workers, unions and others. There should be no cherry-picking on either side.'

The Treasury said the Government would set out proposals on pensions in the autumn that are ‘affordable, sustainable and fair to both the public sector workforce and the taxpayer.'

The Chancellor also confirmed that all NHS workers earning £21,000 a year or less would receive a pay increase of £250.

The Budget says the Government will set out proposals on pensions in the autumn that are ‘affordable, sustainable and fair to both the public sector workforce and the taxpayer.'

GPs could also be hit by the Chancellor's pledge to generate £1bn this year through a tax avoidance clampdown, which could target practices. It follows HM Revenue and Customs' ultimately unsuccessful bid to crack down on GPs via the Tax Health Plan last year, which yielded just £9m from around 1,500 disclosures.

Better news for GPs was the announcement that there will be no new regulation imposed on businesses with fewer than 10 staff for three years, which will cover many practices.

Mike Gilbert, medical partner at RMT Accountants in Newcastle, said changes to NHS pension scheme would be by far the biggest issue for GPs.

He said: ‘The Hutton Review could be frightening. If that report goes through, my guess is employees'contributions that the doctors pay themselves could go up 3-4%.'

George Osborne Click here to sign our petition No to 65

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