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In August when the Government announced its decision to scrap its ill-advised consultation on their so-called solution to the ongoing pensions taxation crisis impacting doctors and the NHS, the BMA described it as a “step forward”.
After a year’s tireless lobbying by the BMA and its members Ministers and officials had finally taken notice of the damaging effect that perverse and ill-thought out legislation was having and will continue to have unless a permanent fix is found.
Their reissued consultation – which the BMA has now formally responded to – on full flexibility remains a tentative step in the right direction but is overall a disappointment that does not go far enough.
While the proposals set out in the consultation offer short-term mitigations, they are merely a sticking plaster that fail to address the crux of the problem. In ignoring the full impact of pension taxation on doctors in the NHS, the Government have made a serious error in judgement.
For too long these perverse rules have meant that doctors are being forced to turn down vital extra shifts caring for patients in our under-pressure hospitals and GP surgeries because they would be literally paying to go to work. Doctors are trapped in a dilemma between wanting to care for patients and not wanting to end up financially worse off.
Furthermore, any flexibilities without insisting that employers fully recycle their contributions back to the employee is worthless. During their career, a doctor’s pension forms a vital part of their reward package, and we cannot support what is effectively a pay cut for our colleagues.
The consultation is also misleading and unhelpful in its continued suggestion that the BMA has proposed a 50:50 pension flexibility. This is repeated several times in the document and yet remains untrue. We have been consistent in our view that 50:50 is not the answer.
The more the Government fails to address this problem and the more it delays in taking firm and decisive action the worse the situation is likely to become. The BMA’s own research suggests that 31% of GPs and hospital doctors have already reduced their work commitment, while a worrying 37% of those who haven’t plan to do so in the coming 12 months.
Only by scrapping the damaging Annual and Tapered Annual Allowance will the Government stem the flow of doctors refusing additional work or considering leaving the profession over the issue. This lies with the Treasury.
We are urging the Government to get a grip on this issue immediately. As we approach Brexit day and the onset of winter – themselves presenting their own threats to the NHS and its patients – we cannot afford to be without the skills and expertise of our most experienced doctors.
Let us hope that in the coming weeks they stop and listen.
Paul Youngs is chair of the BMA pensions committee
It is important that as members you also have your say on the Government’s consultation. To help we have provided a template response to this complex and detailed consultation. As well as outlining the BMA’s key asks, the template allows you to outline your own experiences of being impacted by the taper and how these taxation policies may impact your future and the future of your work in the NHS if they remain unaddressed.
So far 800 BMA members have added their voice. With the consultation closing on 1 November it is vital that you add yours.
You can find out more about Annual Allowance, the BMA’s campaign so far and practical support including guidance and member-only access to the BMA Goldstone Pension Modeller on the BMA website.
The office for tax simplification has suggested that the annual allowance is scrapped for the NHS pension scheme. See conclusions in section 3.
It is not worth working above a certain income which varies for each GP depending from their lenghth of service due to the punitive tax which sets in from a varying threshold. I have therefore put extra work on hold as it is not worthwhile for me, and I know many other colleagues who are doing the same. We find it now virtually impossible to find locum GPs to help us out and the local out of hours service providers are really struggling as well.
The service cannot run on pharmacists and Nurse Practitioners alone.
I feel that the only way around the issue is to scrap the Annual Allowance tax and ideally also to increase the Lifetime Allowance.
I feel caught in a trap. Managers threaten to give work away if targets are not met with potentially disastrous consequences to my service which has worked hard over the years to build its reputation. We would all like to support the patients and undertake additional work to meet demand but the tax situation has meant that the only alternative is to do work for free or pay a punitive tax ourselves for the privilege of delivering high quality patient care.
After almost 38yrs full time working in the NHS by reducing my hours I just missed triggering the annual allowance but was caught by the lifetime allowance which triggered a £42,000 tax demand as a retirement thank you. What annoys me most is that this is mine and my wife's pension she gave up work to look after our children she has no pension and now our joint income is permanently reduced. There is no partner allowance. It's a retirement kick in the teeth and an encouragement to retire early.
Having said that we still have a good pension we can live on and enjoy life which we intend doing for many years to come.
I expect it is true or certainly has been that more full time NHS doctors are male. Why then is the BMA not making a covert discrimination case that the pension tax changes are discriminatory against male doctors and their partners over female doctors who are/were more likely to be part time?
All the efforts by the government and local trusts are to to retain the extra work that consultants are doing. No real effort is made to address the pension, Unless we all stop doing extra work nobody will take us seriously. And it is perfectly legal to work only for what you are paid for,,....10 PAs.
I was once a BMA member , but I am not any longer . This is because the BMA is completely ineffective . Pensions are worsening , pay and conditions are worsening , burnout is increasing and the BMA achieves nothing .
In relation to sexism, the pension deductions are based on what a full time equivalent salary is, so this recent ‘pay rise’ has tipped many doctors, including those less than full time into the next pension bracket and even those of us on maternity leave have had pension arrears deducted as a result and will end up financially worse off, even when back working full time. I would have thought there was more of a sexism angle in this sense in relation to pensions, although I appreciate the focus of this point was in relation to tax.
Thank you for persevering with this - much appreciated by us all. Ultimately this is for patient care and to allow senior (experienced) colleagues to continue to work to not only offer their dedication and expertise to patients but also to support less senior colleagues coming through the ranks. If you lop the top off a tree it will often falter or die. The uppermost layers of any organisation are so important. The current situation is beyond ridiculous.
I recently stuck my neck on the lock to save our practice .in the year prior to this we had lost 2 partners and survived by employing salaries who do not want partnership . As a result our profits rose considerably but we earnt it! The other factor that hit me is the change in earnings ,having been a part timer for many years bringing up family stepping up to mega full time senior partner overnight has changed income significantly. I wonder if this applies to many female drs increasing commitment towards the End of their career. As a result of this jump I risk a tax penalty for exceeding the annual allowance ( which no one can calculate which seems bizarre) although this depends on what I might earn this year and that no one can forecast in the light of many staff changes and the new go contract. Also I cannot get a pension statement beyond 2016/17 which is just bonkers ( a system that does not allow for the many female drs that work under a maiden name and have formal ID under. Married name)
I have talked to a the BMA ,my accountant and a financial advisor and it seems that not surprisingly no one can advise when so many parts
of the equation are missing
I do not have the luxury of choosing to do less work. I can’t get anyone else to do what I do and infact can’t even employ more salarieds . I can’t chose how much I put into my pension as I don’t know what impact it will have and the crazy thing is the more you earn the more pension you have to pay so you reach the threshold earlier
If the resolution is to chose to hop in and out of the scheme this choice should be offered retrospectively when we are In full possession of the contributions that we would be eligible to pay. If PHSE are operating 3 years behind then we should have 3 years to decide if we wish to opt I or out of the scheme.
I do find myself wondering why I should go on struggling in a system that punishes you
I am one of the senior gps affected by this debacle, have just been informed by my financial adviser that I have a enormous bill awaiting me for breaching personal allowance ( due to the taper - we had a "good year" - by no means high earning practice - and I had foolishly taken some gpea shifts( one or 2 a month) to "help pay for " my 3 children at university - but have ended up facing a bill for much more than I earnt and impact on breaching my lifetime allowance also
so obviously ive cancelled all future shifts ! My advice has been that I can either suck it up and pay this" fine for working", come out of nhs scheme and then id have to look at life cover to protect my family , or go down shifts in my "day job"
so am looking to do the latter probably .
This system is so unfair and worsened for gps as we work several years behind in terms of accounts / taxation so cant even predict and make decisions on what tax might be . In addition the multiplier used by government is unpredictable and pretty hard to even find out until 18 m after the event ! ( i asked and was given run around but my advisor found out ) so Its basically a guessing game - you cant get under the line for annual allowance because of these variables .
Its really stressful - makes you want to just give up and retire early ! 50% of gps have accessed the bma counsellors anyway - isn't that correct ? Pretty soon there wont be a workforce at all - or maybe that was the plan all along?
This important issue is unrelated to Brexit.
Please desist from BMA "Europhiliac" Metropolitan Group Think.
Look for opportunities.
Members over 55 who have purchased added years must now be in a similar situation to mine, where despite reducing hours and giving up the added years purchase, were still caught by the annual allowance charge, an unpredictable tax shock, and possibly by the lifetime allowance barrier too, making not retiring and expensive choice. I've retired early and don't regret it.
Never before we have seen such a clever move to dismantle the NHS. Our doctors are now paying to work. Only yesterday a colleague of ours with only 7 years of service as a Consultant in Medicine, has to pay £20,000, which equals to almost half his annual net pay. How is this family going to be able with their current expenses? How can a national tax service take 40% of someone's salary and then take a extra 40% of the net pay too? That is in reality close to 70% of someone's work.
The doctors are now forced not just to reduce work significantly, but they lose their incentive for all improvement as any extra contribution and or CEA's are financially punishable actions.
They will reduce their work - and their income - joining the long ques of the ''zero hours'' generation and enjoying the benefits of the people who are extremely highly skilled, but so much that they cannot find a normal job easily.
They will be forced to resign and move abroad where they can find a more democratic ad less of a totalitarian establishment that continues to violate basic working rights and principles.
The NHS Management is already outsourcing services to cover the gaps and they do not support their doctors in their struggle par hypocritical and unhelpful financial seminars.
There is minimum information of the public and the press is practically silent. While Rome is burning BMA and the Government are focusing on tightening the strings of their lyres.
What the BMA - and the people who allowed this injustice to materialize and destroy people's lives and families - do not want to grasp, is the level of despair it has brought to the doctors.
I accuse the BMA of being a accomplish to this injustice, as its actions not only are not proportional to this preposterously surreal taxation, but plays a suspicious role in defusing the social and financial bomb that such a taxation has created.
I live in fear for the implications to my family. I am not allowed to work more so to be able to earn more and that is also unfair. I am not allowed to improve the quality of care for my patients as any such actions of mine are now being penalized.
1. I condemn this injustice and I propose that doctors in unity, [ without waiting for BMA's support - which in any case is consumed in mild pressure to the Government and insulting us by issuing ''modellers for pension tax charges'' and advising us to work less and destroy the NHS faster (!) ] approach an experienced law firm and take legal actions against the HMRC, not only to stop this injustice but to claim reimbursement in arrears for all the colleagues who have already been victims of this unfair and undemocratic taxation.
2. Inform the public of the gravity of the risk to the NHS, which has become a crisis.
3. Consider taking industrial action/s.
4. Protest of the inadequate BMA actions by canceling our subscriptions to the BMA.