Last updated:

Government ‘step forward’ on NHS pensions is down to tireless lobbying by BMA, says doctors’ union

The BMA has acknowledged the “step forward” by the Government over the NHS pensions crisis, after a year’s worth of tireless lobbying by the doctors’ union – but recognises more changes are needed in the shape of pension taxation reform.

The Secretary of State for Health and Social Care and the Chancellor have today announced1 a number of changes, including a new consultation on full pension flexibility, a commitment from the Treasury to review the impact of the Annual Allowance taper and guidance to be issued to employers setting out how existing flexibilities can be used to ensure doctors do not lose out.

The BMA has led the campaign against damaging tax legislation, including the annual allowance and tapered annual allowance, that means doctors are being forced to reduce their working commitments in the face of significant and often unexpected charges on their deemed pension growth.

Commenting on the announcement, Dr Chaand Nagpaul, BMA council chair, said:

“We acknowledge this step forward by the Government. After a year’s tireless lobbying by the BMA on the damaging effect that perverse and ill-thought out tax legislation is having on our NHS, its doctors and patients, it is good to see the Government finally sitting up, taking notice and proposing action.

“We said clearly when it launched that the earlier consultation on the 50:50 model – whereby doctors and employers halve what they put into their pension pots – was not fit-for-purpose and we are pleased that the Government has heeded the BMA’s concerns by ditching it. This method is overly restrictive and can leave doctors putting either too much or too little into their pensions.

“The Government has listened to us on offering full flexibility – meaning doctors can choose the amount they and their employer wish to put away – and we note the assurance that this will not mean doctors ‘losing out on the value of unused employer contributions’. This must mean full recycling of the entire employer’s contribution being paid back into doctors’ salaries.

“The new proposed flexibilities will provide short-term relief for many doctors, but they themselves do not tackle the core and underlying problem. This lies in tax reform, and as we have said before, it is the overhaul of the annual allowance and tapered annual allowance, that will make a difference to all doctors, including consultants, GPs and medics in the Armed Forces.

“It is positive that the Chancellor has committed to review the punitive tapered annual allowance – this marks an important step change from the Government, and comes as the direct result of the BMA’s campaigning. The BMA will be glad to take up the invitation to work with the Chancellor, but we will continue to argue that wider reform to the annual allowance itself is also needed to guarantee changes that will solve the problem for all doctors.

“This situation has arisen as a result of tax policy created by Treasury and it is now up to the new Chancellor to be bold in resolving it. We know that more than a third of doctors2 have already reduced their work commitments over pension tax charges, and of those who haven’t already, a third plan to. Without fundamental change to these rules, this situation will only worsen, leaving patients with fewer experienced medics to care for them and even longer waits for treatment.”

Ends

Notes to editors

The BMA is a trade union representing and negotiating on behalf of all doctors in the UK. A leading voice advocating for outstanding health care and a healthy population. An association providing members with excellent individual services and support throughout their lives.

  1. Please contact the Department of Health and Social Care for full details.
  2. More information on the BMA’s pensions survey here.
  3. Find more information on the BMA’s work around the annual allowance here.
 

For further information please contact:

British Medical Association, BMA House, Tavistock Square, London, WC1H 9JP
Telephone: 020 7383 6448 
Email: [email protected]
Media centre | Twitter | Youtube - BMA TV | Flickr