GP leaders warn pensions crackdown will set off retirement timebomb
By Ian Quinn
GP leaders have predicted a Government crackdown on GP pension benefits would ignite a retirement time bomb in the profession which could see thousands quit in protest.
The GPC issued a warning to the Department of Health, which is believed to be planning to pursue huge savings through the NHS Pensions scheme.
It comes as figures obtained by Pulse show the Government's bid to get GPs and other doctors to switch to new pension arrangements has met fierce resistance from the profession.
Financial experts have predicted the Government will use the new 2008 pension arrangements, which it is trying to get GPs to switch to, as a way towards slashing the cost of public sector pensions, with leading accountants warning it will be made compulsory for all future earnings.
However, the package, which includes a retirement age of 65 instead of 60, has been widely condemned as being nowhere near as attractive as the previous NHS pension arrangements, dating back to 1995.
Official figures show the NHS Pensions body has so far issued 372,000 documents aimed at encouraging those on the previous model to switch to the new terms and conditions.
But of the 33,141 which have been processed, only 2,014 people have decided to take up the offer.
GPC negotiator, Dr Peter Holden, said he believed many GPs would leave the profession if the Government tried to make them switch.
‘I have calculated it would take me 30 years to get back the sum I would have to put in between 60 and 65. I think I will be pushing up the daisies by then.'
With the Government likely to be blocked legally from making retrospective changes to pension pots already built up, he said if it tried to apply the new deal to all benefits earned in the future, GPs were likely to leave the NHS en masse.
‘There is a big cohort of us who became GPs around 1980,' he said. ‘The Government has to be very careful. If they make it too unattractive they may well take that and go and that will cause huge staffing difficulties.'
GPC chair, Dr Laurence Buckman said: ‘It would take a lot for GPs to leave but clearly if they are going to lose a lot of money or their pensions are going to be messed with that might happen.'
The controversial section of the 2008 pension is based on 1.87% of uprated earnings per year, as opposed to 1.4% in the 1995 version, but has a less lucrative lump sum as well as a higher retirement age.
But a spokeperson for NHS pensions said the Government was to ramp up its attempts to encourage GPs to switch with a major mail out exercise scheduled to start in January and last for nine months.
An interim report by Lord Hutton warned earlier this month that public-sector pension payouts were no longer affordable and GPs are among the biggest earners, many on pensions over £60,000 a year.
However, Dr Holden said GPs had already been through a three-year review of pension arrangements, which had resulted in higher contributions and added that the model was also a career average scheme, rather than the final salary payments paid to other doctors, a model which was singled out for particular criticism by Lord Hutton..Dr Peter Holden: Many GPs may quit NHS if pensions crackdown goes ahead Dr Peter Holden: Many GPs may quit NHS if pensions crackdown goes ahead pensions Compare pensions