Update and survey on new LCEA scheme
The BMA have been in discussions with NHS Employers and the Department of Health and Social Care for several years on the future of an excellence scheme for consultants.
These discussions were prompted by the threat from Government of the existing CEA scheme (including existing awards held by consultants) being removed and replaced by a whole new performance scheme.
Following action on behalf of members, the BMA was able to protect the financial value of CEAs including the right for existing awards to be retained subject to ongoing review. This has led to the interim arrangement that was originally in place until April 2021 but due to the impacts of COVID-19 has been extended to 2022
This arrangement is not perfect and in particular it has been noted that female and BAME (black, Asian and minority ethnic) consultants tend to be less likely to hold CEAs.
It has therefore been the intention to try and design a new excellence scheme to take effect from April 2022 onwards.
Key features of a new scheme
The BMA has done a lot of work in the past, including engagement events with members, to try and establish what the key principles for a new scheme should be. The key features of a new scheme that we believe are important are:
- it must reward excellence and not just 'productivity' ie it shouldn’t simply reward those doing the most numbers
- it must be equitable in terms of access, and not disadvantage those with protected characteristics
- it must provide equal opportunities for all, regardless of the specialty in which they work and whether they work in a teaching hospital, district general hospital or are employed by a university
- it must reward excellence across a wide range of an individual’s scope of work and not be limited to only areas that the trust wishes to incentivise
- it shouldn't have a system that is overly onerous for either the applicant, or those scoring/assessing applications
- any system of automatic assessment (rather than one based on application) must be able to recognise and reward various forms of excellence without expecting excellence to be achieved in every possible domain.
What happens now?
We will be having further consultations with our members to assess your views on what you would like to see in a new excellence scheme shortly.
NHS Employers have launched a survey to assess the views of employers on this issue. They have asked trust CEOs and medical directors to liaise with their consultant body so you may wish to discuss this locally.
We will continue to represent consultants on this important issue and will do everything that we can to ensure that any future scheme is both fair and appropriately incentivises excellence. If you have any comments on a CEA scheme please do feed through your LNC.
The existing agreement on the future of LCEAs in England
The BMA, Department of Health and Social Care and NHS Employers have made an agreement on the future of the local clinical excellence awards in England.
While negotiations on a long-term replacement for the scheme continue, this agreement will provide clarity for consultants and employers.
This guidance is intended to be read along with the Local clinical excellence awards joint FAQs. The joint FAQs give employers and consultants a shared understanding of the agreement and its practical implications for consultants.
Background on the negotiations
During negotiations around the national consultant contract, the Government indicated that it could remove the CEA scheme and/or withdraw future funding.
The BMA subsequently undertook a legal challenge against the Secretary of State for Health. This legal action was conducted on a number of grounds.
The BMA, NHS Employers and Department of Health and Social Care reached an agreement on the local clinical excellence awards (CEA) scheme. This is an out-of-court settlement arising from the BMA’s continuing legal action around the contractual status of these awards.
The agreement will secure the overall value of consultant awards (~£300m) for the future. This is a large proportion of the total consultant pay bill which the Government had threatened to remove.
Furthermore, we have secured an increase in the minimum investment in the local awards from 0.2 per FTE to 0.3. This is met partly through the reinvestment of employer pension contributions.
If your employer won't implement the deal
This agreement has been incorporated into the 2003 consultant contract. It clarifies that access to LCEAs, and the right to retain existing LCEAs in accordance with the terms of the settlement, are a contractual entitlement.
If an employer who employs consultants on the 2003 contract deviates from these terms they will be in breach of contract. In such an instance the BMA would support its members in bringing a claim against them.
If your employer says they can’t afford it - trusts will simply be spending the amount that they always should have on the LCEA scheme and this is not an additional cost pressure.
If your trust didn't run awards before
The BMA believes that the CEA scheme was contractual. It was potentially a breach of contract if trusts had not run rounds prior to the agreement.
However, further legal action would be required on behalf of the individual consultants against their employer directly. This would potentially be challenging as consultants would need to prove that they would have been successful if an award round had been run.
For these reasons, the settlement focuses on ensuring that awards rounds are run and that this issue is not allowed to recur.
The impact on your pension
- If you are in receipt of a pensionable award (made prior to April 2018) there will be no change to your pension status as a result of this agreement – you should keep in mind your lifetime and annual allowance.
- If a pensionable award is reviewed after 2021 and reduced or removed it will be possible for those in the 1995/2008 sections, or then transitioned to the 2015 scheme, to apply for pay protection.
- If successful, this would mean that your benefits would not be calculated with reference to your reduced pensionable pay but the previous higher pensionable earnings.
- If you have yet to receive an award and receive a non-pensionable award after 2018, pension contributions will not be deducted from this money - although it will still be taken into account for assessing your annual allowance.
- If you lose an award that was previously pensionable you are able to protect your 1995/2008 section pension by applying for pay protection.
- You can’t apply for pay protection on the 2015 scheme as it looks at each year’s pensionable earnings and does not base benefits on final salary.
- The loss of an award will mean that each year’s accrual after loss of the award will be based on your pensionable earnings (without the award).
Giving up employers' contributions
The BMA has been carefully considering tax implications for those whose awards are pensionable and the old mantra of ‘pensionable = good’ no longer applies. We have heard from some members who are unhappy that the awards were pensionable and have triggered large tax bills. This is part of the reason to the change for new awards, on the basis that all the money is reinvested in the scheme, and any new money.
The increased funding for the awards from 0.2 to 0.3 per consultant has been secured in this way, which increases the chance of a consultant getting an award.
Greater flexibility is being looked at on a national level as part of the review of member pension contributions. The ability to choose how much income is treated as pensionable is being explored. Some trusts already have schemes where those who opt out of the scheme for tax reasons are able to keep the employer contributions.
Given the reduction in both lifetime and annual allowances it is not necessarily in consultants’ interest to have all of their income pensionable.