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BMA warns pension amendments are not enough

The government's amendments to the controversial pension legislation do not go far enough to address BMA concerns about sweeping retrospective powers, the association has warned.

In a briefing to peers before the Public Service Pensions Bill’s report stage today, the BMA says it is disappointing that there has been little significant improvement to the bill during its legislative stages so far.

Doctors leaders believe the bill still requires urgent changes to avoid it entrenching unfairness across and within the different public sector pension schemes. In particular, the BMA is strongly urging the Lords to consider:

  • Stronger amendments to curtail sweeping new powers that would allow successive UK governments to make unilateral and retrospective changes to accrued benefits in public sector pension schemes, utterly undermining the ‘settlement for a generation’ the government has said it wanted
  • Amendments to allow the Working Longer Review to complete its work before there is a final legislative change linking the normal pension age to the state pension age.

Lords committee concern

The BMA describes the so-called Henry VIII clause that would allow future governments to make retrospective changes to pension rules as ‘breathtakingly wide-reaching’. Similar concerns were expressed by a Lords select committee, the delegated powers and regulatory reform committee, which examines bills and reports on the powers proposed for ministers.

The government has acknowleged such concerns and has tabled amendments it says provide better safeguards. But its proposed amendments do not go far enough to meet recommendations from the delegated powers and regulatory reform committee and do not address the BMA’s concerns, the association says. The BMA wants the clause removed or, if this is not an option, further safeguards added.

On the clause relating to pension age, the BMA briefing says: ‘The Working Longer Review … should be allowed to make genuinely evidence-based recommendations as to whether all or some frontline NHS staff have roles that are particularly physically, mentally and/or emotionally demanding and so should have their normal pension age capped at a lower age. The review was a key component of the scheme-specific discussions between [the] government and trade unions which appears to have been ignored by this clause.’

Fair deal sought

The BMA has a place on the review that is examining the impact of the proposed increased retirement age.

The BMA accepts that the NHS pension scheme must offer a fair deal for taxpayers as well as to staff but it has been deeply concerned about the government’s approach to the pension changes from the outset.

Its analysis Public Sector Pension Reform: Challenging Unfairness highlights:

  • The overall approach that puts too much reliance on pension changes as a way of improving public finances
  • The unfairness across public sector schemes that means NHS staff have to fund almost double the proportion of their scheme’s future benefits compared with civil servants
  • The unfairness to higher earners within the NHS pension scheme, if contribution tiers remain steep, which will mean accruing £1 of pension benefit will cost a doctor significantly more than lower paid staff.

Health secretary Jeremy Hunt has acknowledged the BMA’s arguments that flatter contribution tiers are fairer once there is a move to a career average pension scheme in 2015, and the BMA is currently in discussions with other health unions about this.

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