This site is intended for health professionals only

At the heart of general practice since 1960

GP contract funding ‘not enough to solve staffing problems,’ warn financial experts

The overall increase to GP funding under contract changes announced last week does not go far enough to solve long-standing workforce problems in general practice, financial advisors have warned.

The 2020/21 deal for GPs in England, announced last week, falls short of tackling pension charges that are causing GPs to reduce sessions, and the £20,000 payment to attract new partners does not address how to keep existing partners in their roles, they said.

The 4% increase in global sum funding is also not enough to offset new minimum wage requirements and the loss of MPIG and seniority payments, the experts added - with some saying this could cause a ‘profit reduction year-on-year'.

While the financial experts welcomed the announcement that primary care networks (PCNs) will be reimbursed 100% of the cost for all extra PCN clinical roles hired – instead of only 70% in some cases – they also warned staff shortages in these roles would still cause problems.

The updated GP contract, negotiated between NHS England and the BMA, includes a 4% increase to the global sum, £20,000 golden handshakes to attract GPs into partnership, additional funding for the primary care networks to hire extra clinical roles and diluted network service requirements.

Andrew Pow, board member at the Association of Independent Specialist Medical Accountants (AISMA) and partner at Mazars UK, said the PCN investment was reassuring, but there was little investment in the core contract.

He said: 'A rise in the global sum to £93.46 – an increase of £3.58 on the face of it – looks positive.

‘However, practices will have lost all MPIG and seniority funding from April 2020 and have staff pay increases and new employment conditions to absorb. In many cases this may deliver a profit reduction year-on-year.'

James Gransby, partner at accountancy firm RSM, welcomed the increase in funding but stressed the golden handshake would only be given to partners if they complete five years, which may be off-putting to new recruits who don’t want to be tied for that period.

He said: ‘The £20,000 is given to new partners by way of a loan, which then gets released after five years.

‘Although at first it looks like a golden handshake, it merely is golden handcuffs.’

He added: ‘That £20,000 look good on paper but if you have to stay around five years before that money gets released then it’s making people stay for that five years.'

Mr Gransby also said the reimbursement for 100% of costs for additional network staff was reassuring, but underlined staff shortages.

He said: 'The fact that 100% of funding is available will help any GPs who were previously concerned about the 30% contributions they were having to make, but there is still going to be a workforce issue - the workforce still needs to be found.'

Michael Ogilvie, accountant at X5 Chartered Accountants, said the contract funding boost was welcome but would be ‘neutral’ to partners, once other costs had been factored in.

He said: ‘Overall it’s neutral if anything because of the cost of the minimum wage that doctors are now having to face because of the extra cost they’re going to incur.’

More needs to be done to keep existing partners in the workforce, by addressing pension tax problems, he said.

Mr Ogilvie said: ‘The financial support they’re getting from the new contract is great but, for example, they’re looking to give £20,000 to help bring in new doctors – while little is being done to actually retain partners.

‘That’s a real issue because doctors are being attacked on their pensions. The real issues aren’t being addressed.’

Graham Leyfield, financial expert at Wesleyan, also agreed the contract changes overlooked pension problems, which are deterring GPs from doing extra shifts – and if addressed could solve the workforce problems the contract is trying to clear up.

He told Pulse: 'When our financial consultants are talking to GPs, the single biggest issue they’re talking about in terms of their finances is the NHS pensions, particularly things like the tapered annual allowance and tax bills, which have a knock-on effect on their work.’

Readers' comments (6)

  • This contract is a failure and will not stop the collapse of primary care, but I am sure from the government side for exactly the same reasons it is a success.

    Unsuitable or offensive? Report this comment

  • Overall the BMA are the ones who have failed on so many levels.

    Unsuitable or offensive? Report this comment

  • Vinci Ho

    The fact that if those who earns more than £150,000 a year will have to expose themselves to the public eyes , is simply adding more adversity to the pension situation/annual personal allowance .
    As I wrote under the other article, why is the system punishing hard working , presumably middle-class , medical professionals while the government allows tech giants and business tycoons to get away free for tax evasion .

    Unsuitable or offensive? Report this comment

  • Vinci Ho,

    There's little emotional gain from being a doctor and now little financial gain.

    Unsuitable or offensive? Report this comment

  • its a pay cut.

    Unsuitable or offensive? Report this comment

  • Watch the further exodus as the 40% pensions relief becomes 20%. Joined up thinking between departments? No. A government of none of the talents.

    Unsuitable or offensive? Report this comment

Have your say