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Government’s review of doctors’ pension tax allowance begins



The Government’s review of doctors’ pensions is underway, with the findings due to be announced in March when the details of national spending are laid out in the budget.

The BMA confirmed yesterday that it had been invited to talks as part of the review, which will be led by the Chancellor’s economic secretary, John Glen.

Ahead of the election on 12 December, the Conservative party pledged it would begin a review of pensions arrangements within 30 days of the new government.

It said the ‘urgent’ review would deal with the pensions annual allowance taper problem, which has caused some doctors to turn down extra shifts for fear of high tax bills.

In a blog published yesterday, BMA pensions committee chair Dr Vishal Sharma said the BMA had been told by the Treasury that the review had started and its findings would be delivered in the budget on 11 March.

Dr Sharma said: ‘We have now received confirmation from the Chancellor that the review is underway, led by the economic secretary. The BMA will be meeting with him shortly.

‘The outcome of this review will be announced in the upcoming budget on 11 March and the BMA are clear that the necessary reforms need to be in place for the start of the next tax year.’

Over the winter, GPs and other doctors’ pension tax charges are being paid for by the NHS, under stop-gap proposals approved by the health secretary in November.

Health secretary Matt Hancock said the plans meant clinicians were ‘immediately able to take on additional shifts or sessions without worrying about an annual allowance charge on their pensions’.

Earlier on in the year, the Government had announced plans to allow GPs to choose their own percentage of pension contributions, in a new ‘flexible’ approach, due to come in from April.

This replaced its previous 50:50 proposal to deal with the high tax charge problem – which suggested doctors and employers halve what they put into their pension pots, but went on to be scrapped.

However, throughout the proposal announcements, the BMA has argued these have only offered ‘short term relief’ and that the root of the problem is the annual and lifetime limit placed on the tax-free pensions allowance – and rules around tapering the allowance for the highest earners.