BMA 'Assured' Over Pre-election Pensions Fix

Nicky Broyd

December 09, 2019

The British Medical Association (BMA) said it was 'assured' that a short-term fix to the NHS pensions crisis will ensure doctors doing extra work this winter won’t be financially worse off.

Health and Social Care Secretary for England, Matt Hancock, is supporting the plan under which employers make binding contractual commitments to affected doctors.

Long-term Solution Still Needed

Some higher-earning doctors have been reducing their hours to escape punitive tax bills as their pension pots exceed tax-free allowances caused by a 'taper' to their pensions. That withdrawal of goodwill to cover shifts was set to add to NHS winter pressures.

In a statement, Mr Hancock said: "Clinicians are therefore now immediately able to take on additional shifts or sessions without worrying about an annual allowance charge on their pensions."

However, the BMA said both it and NHS England and Improvement (NHSEI) "are clear that a long-term solution to the pension taxation crisis is desperately needed once the next government comes into power".

Contractual Commitment

In his statement, Mr Hancock said the agreement was a contractual commitment that requires affected doctors to make “a scheme pays election in relation to the tax charge for 2019/20 only relating to accrual in the NHS Pension Scheme excluding 2019/20 additional voluntary contributions (AVCs) that is accepted by the NHS Business Service Authority".

Under the arrangement, payment is to be made when doctors take their pension, at which point the employer (or any successor) will be liable for the payment.

Mr Hancock continued: "These payments will be honoured even if the NHS body no longer exists in the future. In order to provide the same level of assurance to clinicians who are TUPE [Transfer of Undertakings (Protection of Employment) regulations]-transferred outside the NHS, NHS England undertakes to ensure that the financial responsibility for meeting any employer’s liabilities in relation to this commitment is transferred or remains with an NHS body as part of a future transfer process."

The BMA has been given further assurances that the arrangement covers primary care, saying: "NHSEI have committed to ensure that is the case and the BMA will work with them to ensure a solution is found to provide similar guarantees for GPs. The BMA believe that a solution must be available for all doctors across the UK, including medical academics, public health doctors and those in the armed forces as well as for non-clinical NHS staff."

This arrangement only applies to England, and the BMA said on Twitter that "we need urgent solutions in all four nations for all affected staff & there remains a need for urgent tax reform".

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