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Use fiscal statement to solve NHS workforce crisis, BMA tells Hunt

Use fiscal statement to solve NHS workforce crisis, BMA tells Hunt

The BMA has written to Jeremy Hunt to urge him to use the upcoming fiscal statement to solve the NHS workforce crisis.

Mr Hunt is due to set out a medium-term financial plan for the country next Monday (31 October), if he is still Chancellor.

The doctors’ union urged him to use his new position to put forward legislation for an NHS workforce plan – something that Mr Hunt himself has repeatedly called for in recent years.

In a letter to Mr Hunt, BMA council chair Professor Philip Banfield said: ‘From the backbenches you not only supported proposals to legislate for such a workforce plan but led efforts to force a narrowly defeated amendment on the issue earlier this year.

‘We hope you will now use your position as Chancellor to ensure that the long-term, comprehensive workforce plan is published in full and subsequently the NHS is provided with the requisite funding for the staff numbers identified.’

The BMA also said Mr Hunt must adhere to his own recommendation – as chair of the House of Commons Health and Social Care Committee – to ‘find a long-term solution to the ongoing pension taxation trap forcing doctors out of the NHS’. 

Last month, health secretary Dr Thérèse Coffey pledged to ‘correct’ GP pension rules around inflation so that GPs are not taxed unnecessarily.

She also set out plans to create ‘additional pension flexibilities’ such as an option to retire on a partial basis.

But Professor Banfield said: ‘The health secretary has recognised the problem and announced some measures to help address it, but these must go much further if they are to have any real impact. A logical and fiscally sound solution would be to amend the Finance Act to address the impact of inflation, including negative growth, and introducing a tax unregistered scheme.’

What is the issue around GP pensions and inflation?

The issue relates to tax-free annual allowance (AA) charges, which apply when an individual’s pension grows by more than the maximum amount of tax-free growth in one year – the standard AA currently stands at £40,000, but this is adjusted based on total income. 

However, an ‘anomaly’ in the legislation means that the way HMRC calculates the increase in the value of an individual’s pension is based on ‘pseudo-growth’ – meaning that doctors are potentially going to be charged on ‘a benefit they will never actually receive’, as the BMA put it.

The pension can only increase by inflation as measured in the September preceding the relevant tax year (3.1% in September 2021) before testing against the Annual Allowance. But the pension is increased by the inflation as measured in September of the tax year (i.e. September 2022).

Given the rapid rise in inflation, this means that GPs will face significant AA tax charges simply as a result of these two different measures of inflation being used. Worst of all, assuming inflation falls again next year, the value of the GP’s 1995 pension will fall in real terms but this fall in pension growth in the 1995 scheme cannot be offset against any pension growth in the 2015 scheme.

Dr Banfield further urged Mr Hunt to protect the overall NHS budget against the pressure of inflation.

‘If the fiscal statement on 31 October goes ahead, it must protect NHS funding and state that previously promised budgets will rise above inflation to avoid cuts by stealth,’ the letter said.

And it urged Mr Hunt to ‘lead from the front’ by working to ‘restore’ junior doctor pay, with the BMA currently on course to prepare a strike ballot for January, and the health secretary ignoring requests for meetings.

Whether Mr Hunt remains in his post by next Monday will be up to the new Prime Minister, following Liz Truss’s resignation last week.

This afternoon, it became clear that this will be former Chancellor Rishi Sunak, who will also determine whether Ms Coffey will stay in the post as health secretary.

The health secretary has already made herself unpopular with GPs by suggesting there was now a two-week target for non-urgent GP appointments, while later backtracking and admitting it was merely an expectation.

Most recently, NHS England’s primary care director Dr Amanda Doyle said that while it is ‘reasonable’ for patients to expect to see a GP within two weeks, delivering this is impossible for GPs under the current circumstances.

Upon being appointed as Chancellor earlier this month, Mr Hunt reversed almost all tax cuts that had been announced in his predecessor Kwasi Kwarteng’s infamous mini budget.



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

Bonglim Bong 25 October, 2022 9:01 am

I think he has made clear that t here will be no funding increases – and they are unlikely to fund pay increases with funding increases.
The best he/ they can do would be to be absolutely clear with the public that services are going to get worse not better. I’m fed up of them referring to cuts as efficiency savings. So don’t cut funding and promise the moon on a stick. Do something about demand. Make it clear that GPs will have to offer a certain number of appointments, then that is it.

John Evans 25 October, 2022 9:55 am

Spot on – UK is out of money and tax rises only affordable to upper middle income and above. They are too small a proportion to fund significant increases in NHS budgets. That is why the 1% NIC was dropped – lower earners need that money for food and heating.

Fossil fuel taxation may be introduced though will need to fund utilities benefits.

The public will need to get used to less.

Either a sensible reeducation of expectations or chaotically due to burnt out professionals being less able to perform or exiting the service.

Based upon 30years of working in the health service I hold little hope of the former strategy. Good luck.

Patrufini Duffy 25 October, 2022 8:21 pm

The thing is, you keep covering up for the system. They ain’t got a clue how much you’re saving them. Refer it all, stop doing non-GP stuff, like cleaning an ear and being a sexual health and surrogate psychology clinic and optician, and bailout for outpatients, and let them smell them roses. You do realise they’re holding £90 billion to potentially sort out the maternity scandal. £90 billion.

Esmat Bhimani 25 October, 2022 9:18 pm

Patients will be seen in OOH. So it is not a concern for the government. OOH has become a continuation a continuation of GP service. It is a scheduled care, not unscheduled care.