I understand your concerns on this matter, and I know that retaining and encouraging experienced, valued and hardworking consultants and GPs is absolutely a priority for the Government.
For the majority of savers, pension contributions are tax-free. This makes pensions tax relief one of the most expensive reliefs in the personal tax system. The reforms to the lifetime and annual allowance made in the previous two Parliaments are expected to save over £6 billion per year, and are necessary to deliver a fair system and to protect public finances. Less than 1 per cent of savers will have to reduce their saving or face an annual allowance charge as a result of the tapered annual allowance.
NHS doctors are impacted by these reforms like all other individuals. However, the Government recognises they have limited flexibility over their pay and pension arrangements compared to those in the private sector and this is impacting decisions on workload.
The Government is listening to concerns raised by doctors that pension tax charges are driving decisions to retire early or limit their NHS commitments. The Department of Health and Social Care will shortly bring forward a public consultation on targeted proposals to make NHS pensions make flexible for senior clinicians. Clinicians express concerns that members of the NHS pension scheme have no control over the amount they pay into their pension. So as a first proposal the consultation will set out a potential 50:50 option, offering a 50 per cent pension accrual and halved contributions. The BMA requested a 50:50 option earlier this year, and they have welcomed this as a step in the right direction.
I will continue to follow this matter closely.
Last updated July 2019