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I want to extend my thanks to the 1000 plus doctors who took the time to use our pension template tool to submit their own consultation response, highlighting how these punitive pension charges are impacting them, their patients and their NHS.
High profile cases such as the Dean of the Royal College of Psychiatry receiving a tax bill for more than her annual earnings, and newly released surveys from both the Royal College of Surgeons and the Royal College of Physicians demonstrate that this issue continues to grow in prominence and severity.
The response from BMA members to the consultation demonstrates the depth of feeling across the NHS, and the breadth of the impact being felt by doctors on the ground. A BMA report this week showed that patients are already being affected, with waiting times for routine procedures at an all-time high and access to GP appointments falling as doctors are forced to cut down PAs, turn down awards and reduce the training they lead. We are no longer talking about what will happen when doctors take stock of the situation but are in the midst of experiencing the understandable consequences of an ill thought out and poorly executed pension taxation policy.
Patients, doctors and the NHS need an immediate fix to this problem, which is not of our creation.
While we are encouraged by the Department of Health consultation on flexibilities and await a response, it can never be the ultimate cure the NHS needs. The General Election presents an opportunity for doctors to push for the new government to make a solid, non-negotiable commitment to resolve the NHS Pensions crisis by promising to reform pensions policy by scrapping both the taper and the annual allowance.
The BMA’s newly released General Election manifesto calls on all parties to adopt this approach and I would ask you that wherever possible, you find out from candidates what they would do to end this crisis should they become your representative in parliament.
The prominence this issue has received so far both in Westminster and across the media is due to the BMA and its members standing together. I have been overwhelmed by the response to MP letters and the NHS Pension consultation from you and hope that we can continue to work together to put this issue at the forefront of any new Government’s agenda.
Rob Harwood is chair of the BMA consultants committee
My pay increases over the last 35 years have been under those recommended, justified by the DDRB as the pension (as deferred pay) is so good. Now the rate at which we contribute is going to reduce, in order to avoid large tax bills. All the proposed solutions from the government mean a lower pension in retirement. We are being penalised at least twice over, three times if 'scheme pays' is used due to the interest on the 'loan' to pay the pension tax.
It's a bit rich for the tories to be saying today how we are out of austerity and pay is rising - not for doctors!
Kate Lovetts story is awful but sadly not unique. Women who have previously worked part time and hoped when going full time to make up their pension are massively penalised now - it’s very expensive to be awarded ceas or to take on mnanagement roles or even to increase pas. Gender current pay gap and future pension gender gap essentially guaranteed by these tax policies
How about a legal opinion & look at potential for firm collective action?
The judges & firefighters case is well known.
This situation is crazy. I retire in five weeks and have recently taken unpaid leave to reduce income for this tax year. . I will have to delay return for four months to ensure income for this year is under the trigger.
Whilst I am away my Trust needs locum cover an expense which could have been avoided. But the bigger problem is that the organisation doesn’t have the infrastructure to cope with the number of colleagues in this unprecedented wave of retirees.
The other issue is that most consultants wish to return to better conditions if they return at all. There are not enough doctors available to cover the losses this exodus will cause.
That the NHS will not collapse is due to the fact most of us RACB rather than locum. The reasons are complex but it should be noted that if we didn’t do this the costs would be massively more. Locuming would mean working six months for the same pay and no politics . There would be someone else fighting to get the fees whilst paying you on time! In the past three years I have been paid 6-9m in arrears three times! It’s a paradox that locum fees get paid far more quickly.
Legal fight is the best option to solve the crisis. Definitely all the BMA members will support this action. Best Wishes
I believe “scheme pays” is the correct way to pay this “tax”. Paying up front comes out of taxed income. “Scheme pays” comes out of pre tax money.
Anyone thinking of voting Lib Dem in the election should check out their conference pledge to reduce all pension lump sums to £40,000 max. They almost voted to make it retrospective but this was overturned. This could be enacted if they form a majority or in coalition.
A few years ago this tax did not exist. We were encouraged to buy added years and invest in private pensions. Now I’m advised I’ll never see the latter. ‘Leave it in Trust to your children’ I’m told.
Doctors work hard and pay tax. These charges are based on theoretical calculations on money not yet ‘earned’. How is that fair?
Surely the pension scheme is liable for the tax bill, not the contributors? Can the BMA not challenge this in court? We contribute to a fixed payment scheme so how can we be liable for overpayments personally? Surely it is the scheme that is liable?
Money worries both doing the job and in retirement weren’t something a lot of doctors worried about before this pensions crisis but the lack of certainty over whether you would get a tax bill or not and how badly your pension would be affected are on most doctors worry list most of the time. The delays in getting the right information through adds to this. I have only just got 17/18 data through. There were mistakes on both 16/17and 17/18 as arrears for a CEA award got paid in the wrong pension year from NHS pensions and my TRS is still inaccurate due to not including added years. It feels like a dangerous gamble making uninformed decisions. The only light is the Goldstones pension calculator empowering doctors to be better informed.
The pension tax is unconstitutional and illegal.
Being able to take unpaid leave / reduce Pa's does of course depend on whether your hospital will let you. If you do not have a supportive MD then you are in a stranglehold with no escape( unless you drop out of the superannuation for a while with all its implications) Does anyone know our legal rights in terms of requesting reduced PA's / going part time , unpaid leave??
In despair for our future ( and our patients).
I am 60 and waiting to see till the end of tax year to decide whether to carry on working or to retire completely. I like to work but no point of paying extra tax. I have offer from Australia, Newzeland and Singapore. There are lot of doctors like me.
In a universal health care system with a relatively low investment in health (as a % of GDP) there has been a reliance on Professionals and others to work way beyond their contracted hours.
We have all throughout our careers worked onerous rotas (now considered illegal) and done additional duties with the implicit understanding that we would be rewarded in a certain way as we age - one might call this the Doctors Covenant with Society. We knew (or believed we knew) at 25 that we could retire at 60 with a package of assured benefits. We all gave up evenings, weekends, relationships, family time etc on this understanding.
Over the past 10 years we have seen a number of actions that together have got us to the point where this covenant is being actively broken. Below inflation / no pay rise, Increase in Pension contributions to 14 %, reduction in lifetime allowance, reduction in the Value of CEA points and now the annual allowance taper.
This leads one to believe that the system nor longer values our contribution at anywhere near the level it once did and by repeatedly punishing senior professionals it is difficult to come to any other conclusion that we are being shown the door.
I believe it is time that the BMA made the following clear to government as to our needs -
1. Reversal of the enforced change to the 2015 Pension scheme with members having benefits made up. Similar occurrence already in place for Firefighters and Judges.
2. Reversal of the changes to CEA awards
3. Removal of the annual taper for NHS staff and repayment of monies already taken.
4. An understanding from the government that they have acted in an incompetent manner with respect to senior NHS staff.
I have been charged £35000 in pension tax this yer . This is 1/3 of my basic salary . The charges were a result of a pension contribution spike secondary to being awarded a clinical excellence award ( the entire value of which I have had to pay back in tax) . It is incredibly demotivating and I have had to leave the pension scheme and will be trying to reduce my hours next year to enable me to return to the scheme .I have only ever worked for the NHS as an acute clinician and feel increasingly undervalued and am demotivated to continue all the extended roles/work I undertake in the NHS currently . The BMA must use its collective voice more effectively to stop this happening.