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‘National scandal’ that NHS pensions are forcing GPs to leave, say MPs

‘National scandal’ that NHS pensions are forcing GPs to leave, say MPs

It is a ‘national scandal’ that GPs are having to work less or leave their jobs altogether due to NHS pension rules, the House of Commons Health and Social Care Committee has said.

The committee of MPs has recommended a number of urgent actions the Government should take to prevent the ‘haemorrhage’ of staff.

To avoid losing GPs, NHS England should ‘develop a national NHS “retire and return” policy to replace ad hoc local schemes’, it concluded.

The report on workforce in health and social care, published today, said that the NHS ‘cannot afford to lose staff who are willing and able to work’.

The report recommended a ‘swift’ reform of the NHS pension scheme, as ‘clearly, the Government’s changes to tax regulations have not gone far enough to remedy this crisis’.

It said: ‘It is a national scandal that senior doctors are being forced to reduce their working contribution to the NHS or to leave it entirely because of NHS pension arrangements.’

The report added: ‘With mounting waiting lists and ever-increasing demands, the NHS cannot afford to lose staff who are willing and able to work, and urgent action is needed to reform NHS pensions and prevent the haemorrhage of senior staff. 

‘The Government must act swiftly to reform the NHS pension scheme to prevent senior staff from reducing their hours and retiring early from the NHS.’

The MPs also recommended:

  • An ‘overhaul of flexible working’ to encourage staff to stay in permanent NHS roles. The report said the NHS ‘should commit that within 12 months, all regular NHS staff should be able to opt for similar flexibilities to those enjoyed by locum or agency staff.’
  • No newly qualified doctor should do any full-time locum work ‘for two years after their qualification’ and ‘incentives’ should be used to slow the number of postgraduate doctors opting straight into locum work.
  • A ‘national menopause strategy’ looking at retaining staff who might leave due to a lack of menopause support.
  • The General Medical Council should start a ‘green list’ of countries where doctors are given ‘an automatic right to practise in the UK following the minimum necessary checks’.
  • There should also be ‘default visa extension for six months after the international medical graduate’s expected GP training completion date, to give them time to find an appropriate employer’.

Health and Social Care Committee chair Jeremy Hunt said: ‘Persistent understaffing in the NHS poses a serious risk to staff and patient safety, a situation compounded by the absence of a long term plan by the  government to tackle it.

‘We now face the greatest workforce crisis in history in the NHS and in social care with still no idea of the number of additional doctors, nurses and other professionals we actually need. 

‘NHS professionals know there is no silver bullet to solve this problem but we should at least be giving them comfort that a plan is in place. 

‘This must be a top priority for the new Prime Minister,’ he said.

Why pensions are pushing GPs into early retirement

Under the current NHS pension scheme, the highest-earning GPs pay at least 14.5% in contributions, but a tapered annual allowance limits the amount of money that can go into the pension pot each year without facing significant tax penalties. 

The Health and Social Care committee’s report said the target to solve the issue with doctors’ pension taper problem has ‘broadly been met’.

It said: ‘In the Department’s response to our request for evidence on the taper problem, it stated that from 6 of April 2020 the taper threshold was increased, which removed 96% of GPs and 98% of consultants from the scope of the taper.’

The pensions taxation rules, in particular around annual and lifetime allowances, push GPs to reduce their hours or retire early to avoid large tax bills.

In evidence by the BMA submitted to the workforce inquiry, Dr Vish Sharma explained that the key issue is the way the NHS pension interacts with taxation policy, and how as a result, a GP can be ‘financially worse off’ for working ‘for longer or by not reducing hours worked’, which creates a situation where GPs ‘are in effect prevented from contributing further or continuing to remain within the healthcare sector’.

Back in March 2021, the Government froze the lifetime allowance for GP pensions at £1,073,100 until at least 2025/26.

The lifetime allowance is the maximum amount you can put into a pension pot without triggering an extra tax charge. If a pension pot exceeds the allowance, it is then taxed heavily when you retire.

GP pension experts recently warned that an average GP could be hit by a ‘nightmare’ £33k tax bill due to the ‘unfair’ way inflation is applied to their pension.

But a Government minister said it would be ‘hard to justify’ another GP pensions tax compensation scheme like the one implemented in 2019/20.

And a Pulse survey which revealed that half of the existing GP workforce plans to retire at or before the age of 60 saw doctors quote problems around pensions as a significant reason.

Meanwhile, the BMA announced it has been granted a judicial review into the Government’s ‘unlawful’ handling of NHS pensions.

Dr Vishal Sharma, BMA pensions committee chair, said: ‘The Health and Social Care Select Committee findings are correct – it is indeed a “national scandal” that senior doctors are being driven to reduce their hours or retire early, just when the NHS is facing the ‘biggest workforce crisis in its history’. What is most scandalous is that this is a mess entirely the Government’s own doing through its absurd and unfair pension taxation policy – and it is entirely within its gift to solve, quickly. 

‘It’s good to see the Committee taking heed of the BMA’s warnings, and fully recognise that despite the changes to the taper in 2020, there remains an urgent and pressing need for Government to solve this issue in order to prevent a further exodus of doctors. It is also vital that there is reform of pension taxation rules so that doctors can maximise the amount of care they can provide to their patients.  

‘For those doctors who are left with no choice but to leave the pension scheme, the Committee highlights the necessity for employers to be mandated to “recycle” the full value of pension contributions back to the employee in their wages, a measure backed by the BMA and most recently the review body for doctors’ pay, the DDRB – as well as the outgoing Secretary of State for Health and Social Care. 

‘At the BMA we still believe that the long-term solution is a tax unregistered scheme, similar to the one implemented for judges to solve the retention crisis in the judiciary. Such a scheme would remove the disincentives from providing more care for patients and enable doctors to work for longer. It would also ensure that doctors paid the correct amount of tax on their pension savings and therefore is a fair solution for the taxpayer.

‘Whilst the Government argued that the situation for the judiciary was different as judges could not return to private practice, the BMA rejects this argument as the vast majority of doctors do not do private practice, and the BMA wants a solution that will retain doctors within the NHS. We also firmly believe that the introduction of ‘pension flexibility’ would not solve the problem and indeed this has been consulted on twice previously and rejected by both scheme members and the Government.’



Please note, only GPs are permitted to add comments to articles

John Glasspool 25 July, 2022 9:50 am

The govt response will be to reduce GP pensions or make them unavailable till age 70. GET OUT NOW, while you still can!

Cameron Wilson 25 July, 2022 10:40 am

Add in getting rid of the accreditation nonsense, add in getting rid of the CQC nonsense, add in sorting out the litigation cancer that afflicts this country, add in your pals in the media eating some humble pie after their abusive and ignorant campaign and perhaps I will think about it! Pity you didn’t appreciate just how valuable we are years ago and now it’s too late, and that’s despite the intervention of the menopause management!!

Jeremy Poland 25 July, 2022 11:19 am

The profession has allowed the government to include the pension employer contributions in a gp partners income/profit, so when comparing incomes with hospital colleagues of other paid employment (or reading about it in the Daily Mail) our “income” is 15% higher than it should be. Why do the bma allow them to get away with it?
Furthermore a partner pays up to 28% of their “income” to their nhs pension, paying twice as much for each pension pound than their hospital colleagues. If you have a career of investment growth in front of you, you are better off paying your 28% into a sipp. Gold plated? Tin at best.

Neil Tallant 25 July, 2022 11:19 am

Shame Jeremy Hunt didn’t practice what he now preaches 10years ago when he was in office; Pots, Kettles and Black! If he had then I and many others would probably still be at the coal face.

Dave Haddock 25 July, 2022 12:22 pm

Nothing to address the regulatory bullying by NHSE, CQC, GMC ?
Nothing to address the nonsensical bureaucracy drowning GP?
Nothing to address the multiple jeopardy of complaints?
Nothing to address the plethora of non-job jobs, whose occupant’s only function is to invent more work for clinicians?
Nothing to encourage GPs to see patients, and work full time?

Truth Finder 25 July, 2022 1:48 pm

If they think the pension tapering is the only problem, how out of touch and clueless are they? The over-regulation, GMC, CQC, NHSE etc. all mentioned above. People are not just retiring but emigrating. Pound is falling too due to the poor management of the country.

Patrufini Duffy 25 July, 2022 2:46 pm

The Americans are within the DoH. Back pockets of ministers. Until you expose their plan and their affiliations that want to dismantle you, you will keep going in circles. They have no care for stability. They thrive on chaos.
Then come and conquer.
Divide and rule.
The sad thing is, the NHS is sold off by its own politicians, and the old scapegoating trick doesn’t work anymore.

Keith Greenish 25 July, 2022 6:07 pm

And don’t forget the the £100,000 income limit for personal allowance. Thousands of GPs earn just under £100k with little hope of earning more than £125k, what incentive do they have to work harder when they are taxed at 60% for earning between £100,001 and £125,000? The threshold should be much higher. Do the Govt even think straight?

Patrufini Duffy 25 July, 2022 7:47 pm

The national scandal is the NHS itself.
Dishonest cover-up.

David jenkins 25 July, 2022 7:49 pm

don’t let them say they weren’t warned !

see letter from unnamed person in the treasury, dated 4/7/2022 (ref : TO2022/10940, in case you think i’m making it up) – which clearly says the government “is not minded” to change the rules !!

well perhaps we “are not minded” to put up with this crap anymore !!


note to government – WIGIG !!

when it’s gone, it’s gone !!!