General practitioner Pensions

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FAQs for GPs who employ staff

Important information archive

Contribution rates from 1 April 2015

GP employers - locums, retired GPs returning and more (this page)


How does a GP practice deal with pension contributions to a retired GP who has returned to the practice?

What are the requirements for locum GP pension contributions? 

What are the new rules on NHS pension auto enrolment and what is my duty as an employer?


How does a GP practice deal with pension contributions to a retired GP who has returned to the practice? 

We get a lot of queries about this. In the same way as we are unable to advise members on how partners should be allocated profit share, we cannot give you definitive guidance on how the funding for the employer’s pension scheme contribution should be allocated.

We would suggest though that this matter is incorporated in to your practice agreement. There is no statutory guidance on this issue nor is there a regulation in the NHS pension scheme regulations covering it; essentially the employer’s contribution funding is just another component of pay.

At the time of the agreement on the nGMS contract the GPC negotiators intentionally negotiated a flexible method for funding the employer's contribution for individual GPs. This was agreed in order to respond to a variety of scenarios. The information provided below reflects the negotiators’ intentions in respect of this issue.

  • A relatively high earning GP who is some distance from retirement may breach the HMRC lifetime allowance (LTA) and as such may not wish to contribute to a pension scheme given the high rate of tax applied to the excess over the LTA. In this scenario the GP in question would be able to use the funding for the employer’s pension scheme contribution to invest in some other way; ISAs, property etc.
  • Some GPs may not want to contribute to the NHS pension scheme for particular reasons; they would therefore be free to invest the funding for the employer’s pension scheme contribution in a private pension or similar investment.
  • GPs who return to work after retirement may wish to contribute to a private pension or after 2 years can join the new (post 1 April 2008) NHS pension scheme.

Bearing in mind the intentions of the BMA negotiators and following on from the examples given above, there are a number of possible problems with the stance that some practices have taken on this issue. If they were to deny a GP the funding for the employer’s pension scheme contribution then it would be difficult for them to be able to benefit from the situation themselves, if and when it applies to them.

Furthermore if they were to deny a GP the funding for the employer’s pension scheme contribution and then subsequently change the partnership agreement in the future to allow themselves to benefit from it then they could potentially face a claim for discrimination.


What are the requirements for locum GP pension contributions?

A GP Locum is defined under the statutory NHS Pension Scheme as a GP who deputises temporarily at a GP Practice, usually to cover for an absent GP. Such cover should last for no more than 6 months. Employer contributions for locums are met by the practice in England and Wales (from 1 April 2013) and by the Primary Care Organisation in Scotland and Northern Ireland. GP Locums are afforded 'Locum Practitioner’ Scheme status.

From April 1st 2013, it is the practice’s responsibility in law, in England and Wales, to pay the employer pension contribution along with the agreed fee to the GP locum who will then forward this (along with the employee contributions) to the Primary Care Organisation.
More information for practices and individual locums.

However, if a GP practice employs or engages a GP on a regular basis (e.g. 1 session per week, for more than 6 months) the GP is regarded as a ‘Type 2 Practitioner’ under the statutory NHS Pension Scheme Regulations. They would then be treated in the same way as a salaried GP for pension purposes. This applies in Scotland and Northern Ireland, as well as England and Wales.  

It is not for a practice to determine if a GP working at the practice is a GP Locum or a Type 2 practitioner. Only the Secretary of State (i.e. the NHS Pensions Division) can determine this in accordance with the statutory NHS Pension Scheme Regulations. The fact that a GP may not have a contract of employment with a practice will not prevent them from being viewed as a Type 2 practitioner and not as a locum.

It is important that practices are made aware of the following:
Where a practice withholds contributions it is acting in breach of the statutory NHS Pension Scheme Regulations and section 49 of the Pensions Act 1995.

If that practice is a GMS practice it is also acting in breach of the statutory GMS SFE (Statement of Financial Entitlement). The SFE has penalty clauses including giving the PCO powers to withhold monies it pays to the practice if any part of the SFE has not been complied with.

Until April 1st 2013, the budget agreed between the commissioner (i.e. the PCO) and the practice included all scheme contributions except those in respect of GP Locums. However, in England and Wales, since 1 April 2013 funding is provided for all contributions, including those of GP locums. This is because it is now the responsibility of practices in England and Wales to pay the employer’s contribution for locums (see above).

If a practice is not forwarding contributions on to the NHS Pensions Division, the Pensions Division has to consider if any foul play has occurred, especially if the Providers are increasing their own profits and therefore their own pensionable pay. There are provisions under NHS Pension Scheme regulations T5 and T6 to withhold monies from a GP Provider’s pension benefits if there has been an act of crime, negligence, or fraud.

Section 48 of the 1995 Pensions Act and section 70 of the 2004 Pensions Act states that the NHS Pensions Division has a legal duty to report any 'breaches of pensions law’ to the Pensions Regulator. If an individual is found guilty of a breach they may be subject to a heavy fine of up to £50,000.00 per offence.

The NHS Pensions Division also have a duty to inform the Business Services Authority, at NHS Counter Fraud Services, if they believe that fraud may have taken place in the NHS. NHS Counter Fraud has already investigated several Practices who are allegedly breaking the law.

GP locum 10 week rule on payments
GP locums are required to pay over their pension contributions, to their PCO, within 10 weeks of having completed the locum work. If payments are made outside of this period the PCO is able to decline the payment and the GP locum will not be able to pension the period of work in question.

We would, therefore, like to focus attention on the need for practices to administer and process payments for locums in as efficient a manner as possible. Payments made toward the end of the 10 week limit do not allow the GP locum sufficient time to forward the forms and payment to the PCO, particularly if the locum happens to be away.

We would like to ask that practices attempt to apply a 28 days turnaround on GP locum payments so that any risk to the pensionable status of their work is avoided.


What are the rules on NHS pension auto enrolment and what is my duty as an employer?

This scheme requires all employers to automatically enrol some or all members of their workforce (depending on age and salary level) into a pension scheme that meets certain minimum standards.

See our full guidance on auto enrolment