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The BMA has been warning for over 18 months of the impending workforce crisis that could result as a direct consequence of the current pensions taxation policies. We have been warning that without urgent action from the government, patients will suffer. We have repeatedly written to the Secretary of State for Health and Social Care, we have written to the Chancellor on multiple occasions, hosted a briefing event at the House of Commons and our members have sent thousands of letters to their MPs.
We have spoken repeatedly to representatives from the DoHSC, HM Treasury, NHS Employers, NHS England, NHS Providers and offered to speak to any other bodies that were willing to listen. Our BMA colleagues in other nations of the UK have also lobbied extensively for doctors in their respective nations. We did this because the situation had to be effectively resolved before patient services started to be impacted – early action was imperative.
Our warning was not heeded, and the situation seems to be becoming critical. A recent BMA report showed that patients are being affected, with figures for cancer waiting times, routine care waiting times and A&E performance the worst since records began with the number of people on NHS waiting lists the highest on record, as doctors are forced to reduce the hours they work in order to avoid these punitive taxes.
Effective action was not taken, and we are now at the brink of a precipice. NHS England have tried to come up with a proposal to provide emergency mitigation to get us through winter. Details of this proposal have been leaked to the media recently and commented upon by consultants. The proposed short term ‘fix’, while potentially offering help to doctors affected by an annual allowance tax charge in the 19 -20 financial year, does not come close to solving solve the taxation problem.
The irony is that having taken on board the need for mitigation, there is a general election looming and government is no longer in a position to make substantial policy changes as we head into the busy winter period. The pre-election “purdah” period means that government must observe discretion in initiating new policy or action, meaning that by convention they do not announce new policies. Without the ability of the government to make any meaningful change, and deprived of other options, this proposal may be close to the limit of possible action for the time being.
They propose to effectively financially cover any loss in pension that may result from incurring an annual allowance tax charge arising from the 2019-20 tax year that doctors elect to pay from their pension using ‘scheme pays’. The BMA have seen the preliminary modelling and the commitment from NHS England seems to be a genuine one. However, the problem is that these payments may need to be made many years in the future, how do consultants trust the government that these payments will be honoured? Some consultants take the view that their trust in government has been squandered in the past - through denigration of their efforts, a failure to properly recognise their work through reward and consequent on the imposed introduction of a new pension scheme in 2015.
We are still talking to NHS England to see whether this offer can be improved and made watertight. The BMA strongly held view is that any potential mitigations apply to all of those NHS staff members affected by the annual allowance tax problem, that should include doctors working across public health, those in the armed forces and clinical academics. We have asked NHS England to look at other less complex alternatives, including simply writing off the scheme pays loan for this year or even a direct payment to HMRC. However, the issues of purdah precluded other such options being implemented. The lengths NHS England have gone to develop these emergency mitigations only serves to demonstrate that the pensions taxation system is broken.
This isn’t a case of us saying to government, “we told you so” but a case of us issuing another, but hopefully final call – for the next government, whichever party or parties they are made up of - to fix this situation before it is too late.
Whichever party is in power on 13 December 2019, they need to urgently reform these punitive pension taxation policies by scrapping the annual allowance in defined benefit pensions schemes, such as the NHS pension schemes. This call for action issued by the BMA is also one of the suggestions from government’s own advisory body on taxation, the Office for Tax Simplification. When our patients are ill we address the underlying cause and work to ‘Get It Right First Time’. We insist that the Government does the same.
Rob Harwood is the BMA consultants committee chair
Too little too late for many.
The solution needs to be retrospective going back 3 financial years since tapering was introduced.
We can not afford to pay such taxes
We are working for nothing.
I have a bill of 50 000 !!!
My pension is predicated as 42 000
How can this be right ???
It is the 18/19 tax year that has stung me. I have taken action for the 19/20 tax year to avoid the penalty. If gov pays 18/19 I might have increased trust for future years. Or f not, take retirement.
I am retiring in March 2020 at 60y. I have a pretty large annual allowance excess charge for 2018/19 and maybe another next year. Even this sticking plaster of an offer would seem to specifically disadvantage those with immediate retirement plans!
This is a truly disgraceful situation we find ourselves in. I am leaving the UK and hope to never have to return.
Dear Government- Thank you for destroying the NHS - or maybe this is what you really want so you can further privatise our health care system. If that is the case stop screwing us over and just do it already!
I have reduced my hours as a result of the pensions issue - and am rather enjoying it. Regardless of what happens next I plan to offer less time to the NHS...
Is very disappointing that we are working so hard to help others and that instead of us being rewarded we are now being penalised for helping the people.
This is forcing us to drop essential, very high qualified work at at time when we are needed the most...
This must be the only country in the world which screws hard working people who work week days, week ends, Bank holidays to serve the people and happily pays people who sit at home doing nothing drinking and smoking in our money. Hope these politicians rot in hell.
This government is a joke and the NHS has been squeezed to the point it will no longer be fit for purpose. Why this is not highlighted more in the current election campaigns is beyond me. Doctors have truly been left to fend for themselves.
Cameron and Osborne have ruined this country and will rot in hell!
HMG acknowledges the senior medics' tax system is broken. HMG (ever trustworthy) wants to rely on a later HMG to honour the grand idea of paying back the NHS the money it has to pay out to top up our pension pots once we've paid HMRC?
Jam Tomorrow: That worked so well for all the PFIs.
Winding down until this bolted down, not kicked down the road.
I was one of the earliest individuals to be affected when I retired almost 2years ago with an unexpected tax bill and reduction of expected pension. I’m pleased to hear of the BMA’s current actions but for me it’s too little too late - at the time I was greeted by a lack of interest and a sense that it was my fault, even though I had taken steps to protect my pension!
Utter nonsense by a completely incompetent set of politicians - or maybe a deliberate ploy to wreck the profession and the NHS??
Completely fed up. The number of hours i have spent on trying to understand the pension and work out my bill could have been better spent in patient care. I am totally disengaged with the whole process. My career was supposed to be about patients and medicine not pensions. I am going to to take my pension whatever that is and just go back to basic patient care!
I suggest we should organise a peaceful demonstration : all doctors who have or will retire earlier than planned as a result of this pension scandal to quietly demonstrate in front of the Houses of Parliament.
I think only when people physically see the amount of doctors who have already left the NHS or planning to do so, will realise the enormity of this scandal and appreciate the possible consequences for the NHS and their care.
May be now with a general election in sight we can get the attention ( and action) from politicians that this issue. deserves.