Dr Julius Parker looks at the rules around this scheme to retire early
Twenty-four-hour retirement is an opportunity to negotiate a new workload arrangement and gives you flexibility in terms of your future professional commitments. There are two important rules GPs must abide by to take 24-hour retirement. They must:
• retire from their NHS contracts for not less than 24 hours
• not work more than 16 hours per week in the first calendar month after retirement.
This article will look at what these rules mean in practice.1
GP partners or single-handed contractors must resign from any primary medical service contract they hold and salaried GPs must resign their NHS contract of employment with their practice or primary care organisation.
GPs are unable to undertake NHS locum or out-of-hours work, or other salaried primary medical practice, for at least 24 hours. Any private practice is unaffected by these arrangements.
Single-handed and two-partner GMS practices and PMS practices, where resignation represents a variation in the PMS contract, are strongly recommended to discuss their proposed plans with their LMC and primary care organisation's director of primary care at an early stage.
Single-handed and two-partner GMS contractors can, by following the GMS regulations, secure their contract – but only if a single-handed GP is willing to take on a new partner. Larger PMS practices will normally encounter no difficulties, but technically any such PMS contract variation under which a PMS contractor resigns and then recommences work as a contractor is at the PCO's discretion. Smaller PMS practices often encounter strategic policies that discourage the continuation of smaller practices, unless there are good reasons to do so, and an early informal discussion with the PCO is essential. No final decision should be made until the PCO's agreement is secured in writing.
Many partnership agreements do not mention 24-hour retirement or provide for a return to the practice by a partner. This can create difficulties, as there is no automatic right for a partner to be re-admitted to a practice under their pre-retirement working arrangements. In lieu of such an agreement, a legal deed may be signed by all partners setting out the agreed arrangements for a partner's return to the practice following 24-hour retirement.
Salaried GPs who are returning after 24-hour retirement can be re-employed under mutually agreed terms, and again this requires individual negotiation.
The 16-hour limit
GPs with other part-time pensionable officer posts (such as hospital clinical assistant or practitioner posts) are not required to resign these posts if they involve working less than 16 hours per week. However, following retirement they must stop paying all pension contributions related to these posts.
This work and any locum employment also counts towards the maximum 16 hours per week that may be worked in the first month following 24-hour retirement. If the 16-hour rule is exceeded, pension payments could be stopped and any benefits already received may have to be repaid.
Simple steps, such as only logging on to the practice computer for limited periods, may be used as evidence, but during this month you should be at home more than at work. After the first month following 24-hour retirement there are no restrictions on the hours that can be worked.
Twenty-four-hour retirement is an option for GPs qualifying for normal and voluntary early retirement pensions. However, if you retire before the normal pension age – normally 60 under the 1995 version of the NHS Pension Scheme – your pension and lump sum will be actuarially reduced to reflect your younger age and anticipated longer pensionable period.
Once a GP has taken 24-hour retirement and returned to work, under the current NHS Pension Scheme they will no longer make any NHS superannuation contributions. Practices need to decide how the partnership will treat the superannuation contributions previously made by a partner who rejoins that partnership. There are no NHS Pension Scheme rules on this procedure.
This can be a contentious issue, and practices should agree on these arrangements beforehand. A GP's NHS superannuable sum represents their NHS superannuable proportion of the practice's gross NHS superannuable profits, and is deducted according to their share of the profits. If a partner is no longer contributing to the NHS Pension Scheme, this deduction cannot be made.
It therefore follows that a partner who has taken 24-hour retirement is entitled to receive their normal profit share, which will be greater by the identified personal superannuable sum that they are not paying. Other partners will still be making superannuable contributions. As the GP superannuation contribution rate is expected to rise, the financial implications of 24-hour retirement will become more significant and all practices should have a written agreement to cover these arrangements.
Dr Julius Parker is chief executive of Surrey and Sussex LMCs and a GP in Slough
1. NHS Pensions newsletter (www.nhsbsa.nhs.uk/Pensions/Documents/Pensions/TN14_2006.pdf)