This site is intended for health professionals only

Analysis: Practices facing up to larger pensions bills

There are many words that make GPs cringe but pensions might be the most unpopular one. As Torbay LMC subcommittee vice chair Dr Ian Morris put it at the annual LMC conference last month in Belfast, ‘it’s easier at the moment to understand quantum physics than get your head around pensions’.

But, unfortunately, it is not just the fact that pensions are baffling that are concerning GPs – it looks as though practices might be hit with huge bills.

Last month, the BMA met Capita over concerns that GP practices that have underpaid pension contributions could have large amounts of money deducted from their core payments as soon as May.

This came after recent guidance from Primary Care Support England (PCSE) – run by Capita – revealed that any under or overpayment in pension contributions will be automatically charged or repaid when PCSE adjusts pensions information around the end of this month.

Chair of GP Survival campaign group Dr Nicholas Grundy then warned that small practices might face huge pensions bills due to errors being rectified in pension records.

And this might have started sooner than planned. Pulse learnt that some practices across the country have already received their pension statement. One GP partner said their statement for March of this year showed an end-of-year adjustment superannuation amounting to £31,881 for their 18,000 patient practice. This, they said, compares to £11,288 in March 2017 and £13,918 in March 2018.

According to accountants, a large superannuation adjustement can be caused by various factors and it is not possible to explain such hike without knowing the circumstances.

Francis Clark partner Luke Bennett said: ‘There are many reasons why a practice might have a large end of year superannuation adjustment. It could be due to PCSE processing errors, but equally there could be other valid reasons why this might happen, e.g. estimated pensionable profit figures set too low at the beginning of the year, or an unexpected increase in profits.’

Michael Ogilvie, specialist healtcare team lead at OBC The Accountant, said he is aware of GPs whose superannuation has not been taken due to slow admin.

He said: ‘We are seeing issues where the admin is so slow that some doctors have been unable to even register their change of circumstances, so no superannuation is being deducted, so if something like that happened there could be an underpayment catch up. We are also seeing in some cases clients records disappearing completely due to computer glitches.’

The pension fiasco is nothing new. Back in September 2017, GP Survival began to highlight how pension data were mishandled, such as the submission of subject access requests on behalf of GPs.

The scale of the issues was further uncovered by the BMA in May after NHS England commissioned a report on the accuracy of pension records that found ‘significant issues with the sample of records they assessed dating back to 2004’

More than a decade later and history seems to repeats itself. In the past year alone, almost 400 GPs submitted subject access requests to NHS England in an attempt to confirm their pensions records are accurate. 

The current situation with PCSE and GP pensions is chaotic

Dr Nicholas Grundy

And the story does not end here. Dr Grundy said he is aware of people across the country who both owe money to NHS pensions via PCSE ‘going back years’ and who themselves are owed money.

He said: ‘The current situation with PCSE and GP pensions is chaotic. Over the last five years they have lost the trust of members, with the result that large numbers of doctors have left the scheme completely, and many more have disengaged.

‘This has happened because people have sent in the same forms dozens of times, and Capita have repeatedly lost them, or failed to acknowledge them. It has happened because GPs have no reliable way of reclaiming historical overpayments, nor of making up underpayments. It has happened because their contact centre is a shambles.’

‘They may well say that doctors haven’t filled in their end-of-year forms, and in some cases this will be true – but it’s a distraction from the real problem, which is the historical chaos since they took over the contract,’ he added.

Dr Ian Davis, senior partner at Rendcomb Surgery in Gloucestershire, said he has been battling with pension issues for the past three years.

He said: ‘The NHS pension scheme changed at the end of 2015 and that’s when Capita were given the contract to run NHS pensions for GPs. It’s been a huge disaster ever since. 

‘GPs up and down the country have totally lost faith in Capita and PCSE. They are making an absolute mess of our pensions so none of us trust them. It’s a national disgrace. If we all did our jobs as badly as this we would all get struck off.’

‘I’ve had problems with my pension for about three years’

moneyand nhsribbon alamy crop

NHS finance

NHS finance – money – NHS ribbon

Capita Primary Care Services England contacted my practice manager via email to say I had underpaid by £16,000 on my pension and that they were going to automatically deduct that from my practice this month. We checked with our accountants who, within a few minutes, sent us an email back saying ‘actually it’s £2,000, not £16,000’. The reason was because PCSE hadn’t seen or had missed payments we had paid this year. We contacted PCSE – they agreed it was right – who said they were still going to take £16,000 at the end of this month and we would have to claim the difference back from NHS England.

I’ve had an ongoing problem with pension agency for about three years now. I asked for a pension statement a year and a half ago and Capita said they couldn’t give it to me because there were three years’ worth of pension certificates my accountants hadn’t submitted, but we submit them every year. I contacted Capita numerous times and after a year of pestering them they sent a message through saying ‘we found them but it will take another six months to update your pension’.

I ended up threatening them with legal action via the LMC because it was getting really silly, as I had proof that we had submitted the pension certificates and they kept saying we hadn’t. It took them about a year and a half to update it.

Now I’ve got a tax liability for three years in my pension. Because it was only updated at Christmas – I’ve only just been able to send them to my accountants to work out what tax liability I might have on those three years and because I haven’t been able to pay the tax as I didn’t know what the pension was – I’m going to get a fine on that as well.

The other problem I’ve got with my pension is that I did a hospital job alongside my GP job for 14 years and they won’t let me see my hospital payments. I can see my GP payments, which actually don’t look right as one year is completely missing contributions even though I know I contributed. I had to write a letter giving a good reason for them to send them to me so I can see my hospital contributions and make sure they are there and have actually gone into my pension or not because I can’t see them on my total reward scheme at the moment.

Dr Ian Davis is a GP Partner in Gloucestershire

In Dr Richard Fieldhouse’s case, Capita errors have left him with no access to his online statements for two years, which could potentially leave him faced with a ‘massive tax bill’ in the foreseeable future.

The National Association of Sessional GPs chair said: ‘I’ve been trying to access my online statements for two years and I’ve been trying to get through to Capita and they haven’t reply to many of the emails I’ve been sending. I phoned them on Wednesday and they said “we know why your statements aren’t showing it’s because you missed having pension for a year”. That’s when I was in Australia 20 years ago.

‘But actually, I had my total reward statement two years ago so I know it had been working. Capita then said “we won’t fix the problem, we don’t look into individual cases, we just try as much as we can to get as many people online but we’ll just just calculate it manually. So something’s happened but I don’t know what.’

He added: ‘I’m 53, do I need to pay more or less? I have no idea at the moment what my retirement will be like. Not being able to get a statement for the past two years might imply I might be facing a massive tax bill, which would make me go bankrupt.’

This is probably the last nail in the coffin for so many doctors

Dr Richard Fieldhouse

A survey carried out by Pulse in November revealed that 80% of more than 200 GPs nearing their retirement age said they were either ‘very concerned’ or ‘quite concerned’ about receiving less pension money than they are entitled to.

Among the 157 GPs who detailed the problems they had encountered, the two most common reasons – both accounting for 25% – were inaccurate records (25%) and the fact that getting information or help from Capita was near impossible.

Dr Davis said: ‘I’ve seen lots of examples. There are GPs, even though they’ve got to 60 and would like to retire, who still have to work for months after their official retirement age because PCSE cannot update their pensions. They are working because I don’t think they can pull their pension out because the pension agency cannot give them an accurate picture of what their pension is worth at the time they retire.’

In September, NHS England announced a review of all GP pension data in light of ‘discrepancies’ discovered between the data held for pensionable earnings and those for pension contributions

While GPs await the outcomes of the review, NHS England’s acting director for primary care Dr Nikita Kanani hinted last month that current pension problems are on the track to being addressed. She told Pulse: ‘We’re trying to work more closely with Capita and NHS Pensions to achieve more straightforward processes.’

But will it be enough so that GPs can finally see the light at the end of the tunnel? The optimists might say yes but, as Dr Grundy pointed out, there are still many historical issues that need to be addressed, particularly around tax.

Dr Fieldhouse said: ‘In the NHS we really need doctors to carry on working beyond retirement to help with things like locuming in practices and hospital to keep them afloat but nobody is going to want to do that because of the Capita catastrophe.

‘I think in 10-20 years’ time they’re probably going to be called the “Capita catastrophe” because this is probably the last nail in the coffin for so many doctors.’ 

Maximise your practice's financial potential and compare your performance with peers with Pulse Intelligence. Register for a 30 day free trial.

Complete relevant Practice business and finance CPD modules on Pulse Learning by registering for free, or upgrade to a premium membership for full access at only £89 a year.