Answers to common questions asked by locum GPs including how to pension locum earnings, opting out of the NHS scheme and how benefits are calculated.
I am a GP Locum. Can I join the NHS pension scheme?
You are able to contribute into the NHS pension scheme in relation to any GP locum work if you are on the Medical Performers List and you undertake the locum work directly for an NHS GMS, PMS, APMS practice or appraisal work.
The regulations define a locum as someone who deputises or assists temporarily in the provision of essential services, additional services, enhanced services, dispensing services, OOH services, commissioned services, certification services or collaborative services (or any combination thereof).
In England and Wales the NHS pension scheme used to define temporarily as deputising for up to six months at a given practice. In response to the concerns raised about annualising the Department of Health and Social Care announced in March 2018 that for the 2016/17 year the six month limit could be ignored. It continues to be the case that locums can pension beyond 6 months at one practice and choose whether to pension the income via the means of completing locum forms A and B or by being treated as a Salaried GP in pension terms. A benefit of pensioning as per the Salaried GP method is that 100% of income is pensionable (as opposed to 90%) and you are considered to be in the scheme for the duration that you are treated as such (and not just on days worked) for the purposes of death benefits and ill health retirement applications.
Northern Ireland continues to retain a six month limit.
In Scotland, it is expected that the locum period will be short term (undefined in length) but practices could make a case to the Health Board for a longer period if they face a difficulty in recruiting an assistant practitioner for the longer term.
Working for longer than 6 months at the same practice in Northern Ireland is treated as Type 2/assistant practitioner work rather than as GP locum work. Such work continues to be pensionable but the responsibility of collecting and forwarding the relevant pension contributions to the PCO will rest with the practice.
Since 1 April 2013 funding for the locum employer pension contribution in England and Wales has transferred from the PCO to the individual GP practices. Funding was made made available to GMS practices via the Global Sum and any locums employed by GMS, PMS or APMS practices in England and Wales will have the employer pension contribution paid to them by the practice, along with their fee.
How much do I need to pay into the scheme?
Your contribution to the NHS pension scheme is based on your anticipated annualised NHS GP earnings if you are a member of the 2015 Career Average Revalued Earnings scheme.
Annualised income is your total GP pensionable earnings (earned during the scheme year from 1 April to 31 March) divided by the number of days of pensionable service and multiplied by 365.
If you are a member of the 1995 or 2008 sections of the NHS pension scheme your contributions are based on your anticipated actual GP pensionable earnings.
Since April 2008 the scheme has introduced a tiered contribution structure for all members (1995/2008 sections and 2015 scheme). The percentage contribution required to be paid into the scheme will depend on what level of income you earn (annualised income where applicable).
You will need to pay the appropriate percentage against 90% of your gross locum earnings (10% is considered to represent expenses, which are not pensionable in the NHS pension scheme).
If you undertake other GP pensionable work as well as your locum work your contribution tier will be based on your total anticipated GP earnings (annualised income where applicable), as GP benefits on retirement are based on total career earnings.
If you have previously contracted to purchase added years or additional pension then you will also need to pay these contributions.
I have incorrectly assessed my tiered contribution. What happens now?
You will need to pay any arrears to your Primary Care Organisation/PCSE. Any overpayment made will be refunded by the PCO/PCSE.
Who pays my employer contribution?
Since 1 April 2013 locums working in England and Wales have the employer pension contribution paid to them by the practice. This amount (based on 14.3% plus a 0.08% administration fee of the 90% pensionable amount) needs to be forwarded to PCSE via forms A and B.Although the employer contribution has increased in England and Wales from 1 April 2019 to 20.68% for the 2019/2020 year locums need to continue to request only 14.38% from any employer as the remainder will be made up by the Treasury directly.
From 1 April 2019 the employer contribution has increased in Northern Ireland from 16.3% to 22.5%.
From 1 April 2019 the employer contribution has increased in Scotland to 22.5%.
In Scotland and Northern Ireland, the employer contribution, in respect of GP locum work, is still met by the Primary Care Organisation where you are registered on the performers list as long as you continue to satisfy the relevant scheme conditions for being a locum. These are that the period of locuming is no more than 6 months at a given practice in Northern Ireland and in Scotland requires that the Practitioner Services Division is satisfied that it is short term locum cover.
If the PCO has reason to doubt that the work was genuine locum work, in that it is not temporary or short term, they may refuse to accept your locum forms. Should this happen you will then be considered a type 2 practitioner and the practice that you have worked at will be expected to fund the employer contribution in respect of the work done.
In England PCSE has provided guidance on the payment method which includes BACS payment and we suggest you refer to the PCSE website.
In Wales cheques should be made payable to the local health board (in Wales).
If I am working less than whole-time at one practice does the six month rule apply?
Where the six month rule applies, it references the calendar length of time worked even if you only work one hour per week regularly at an individual practice.
How do I pension my GP locum earnings?
The NHS pensions agencies websites provide GP locum forms A and B which you will need to complete in order to pension your earnings. The forms provide guidance as to their completion. It is important to keep copies of the completed forms for your own records.
If you work as a locum in more than one country you will need to be on the Performers List in each country worked.
Forms for locums working in England and Wales
Forms for locums working in Scotland
Forms for locums working in Northern Ireland
Are there any restrictions on my ability to pension genuine GP locum work?
You are only able to pension NHS earnings received directly from a practice. Locum work undertaken via a locum agency or deputising firm cannot be pensioned in the NHS pension scheme.
Additionally, you are not able to pension locum work that was carried out more than ten weeks ago.
It is important that you complete the A and B forms in a timely fashion and return them, with your contribution, to your host PCO no later than the 7th of the month following the month that the pay you are pensioning was received in.
For example payments received in July must be pensioned by 7th August. Form B relates to payments received in the month, rather than work undertaken in the month.
In order to be able to pension all earnings it is important that you receive payments from the practices you have worked at within ten weeks of undertaking the work.
I have worked for six months at a practice, how long before I can locum there again?
A break of one month is deemed to be fair. In England and Wales you can continue beyond six months and decide whether you wish to pension via locum forms A and B or to be treated as though you are a Salaried GP (in pension terms only).
Can I opt out of contributing to the NHS pension scheme?
You can opt out of NHS pension scheme membership and not pension your GP earnings should you wish. As this may a have detrimental impact on your final pension benefits you should discuss such a step with an independent financial adviser.
If you are working exclusively as a GP locum you can simply stop pensioning your GP locum earnings by not completing forms A and B.
England and Wales
If you are working as a GP locum concurrently with other GP work either as a Principal or Assistant GP, in England and Wales, then you may choose whether to opt out of pensioning your Type 1 and 2 work by completing an opt out form or opting out of your locum work (by not completing forms A and B) or both.
Scotland and NI
If you are working as a GP locum concurrently with other GP work, either as a Principal or Assistant GP in Scotland or Ireland, then you will have to opt out of pensioning all GP work. It is not possible for you to opt out of pensioning your locum work whilst still contributing as a Type 1 or Type 2 practitioner.
How will my benefits be calculated at retirement?
Your benefits at retirement will be based on your total career earnings.
If you are a member of the 1995 section of the NHS pension scheme your total earnings will be multiplied by an accrual factor of 1.4%, after the income has been brought up to date with current earnings by a mechanism known as dynamising.
If you are a member of the 2008 section of the NHS pension scheme your total earnings will be multiplied by an accrual factor of 1.87%, after the income has been brought up to date with current earnings by a mechanism known as dynamising.
If you are a member of the 2015 Career Average Revalued Earnings (CARE) scheme 1/54th of each year’s earnings goes towards your pension and is revalued by the Consumer Prices Index plus 1.5%.
If you have transitioned to the 2015 CARE scheme and have benefits in the 1995/2008 sections these will retain ‘final salary’ linking (i.e. continue to be increased in line with the Consumer Prices Index plus 1.5%) for so long as you do not have a break in pensionable service of 5 years or more. If you have a break in pensionable service of 5 years or more then your previous GP benefits will be increased in line with the Consumer Prices Index only.
Which is my host Primary Care Organisation?
In respect of GP Locum work this is the PCO that you are registered with.
PCO refers to Health Boards in Wales, Scotland and Northern Ireland, and to the PCSE in England.
I am a GP Partner. Can I pension my locum earnings?
You are able to pension locum earnings via forms A and B so long as it is not in respect of locum work undertaken in your own practice. Locuming at your own practice is pensionable in the same way as your main practitioner earnings and such income should be detailed on your End of Year Certificate. Locum work at other practices should be pensioned via the completion of locum forms A and B, detailed above.
I am a Salaried GP. Can I pension my locum earnings?
You are able to pension locum earnings, even in respect of locum work undertaken at your own practice.
This income should be pensioned via the completion of locum forms A and B, detailed above.
I am a GP locum but I also work as an appraiser. Can I pension these appraiser earnings?
Yes. From 1 April 2014, locum GPs who conduct appraisals are able to pension any income earned from doing so. Forms A and B have been updated to reflect this change. Locum GPs are able to choose whether or not they wish to pension any appraisal income.
I am a GP locum and have set myself up as a limited company. Can I pension my NHS earnings?
It will not be possible for you to pension your earnings in the NHS pension scheme if you have processed your earnings through a limited company.
As a locum can I pension any maternity break or other absence?
If you work exclusively as a locum you are only able to contribute into the scheme during periods when you are actually working. You are not able to make up contributions that you would otherwise have made had you not been on maternity, sickness or any other absence.
Am I eligible for death in service benefits?
If you work exclusively as a GP locum, you will only be covered for death in service benefits if you die whilst contributing to the scheme.
Even where death in service is not payable, the NHS pension scheme provides for another type of cover.
Instead you would be covered by the death in deferment rules applicable to those who are not in active pensionable service at the time of death.
Should my locum pension be recorded under the month worked or the month paid?
Your pension will be credited against the month the monies were paid rather than when you may have undertaken the locum work.