07.08.19

Government launch new proposals over doctors’ pensions row

Government ministers have drafted up new proposals for England and Wales, aimed at ending the row with doctors over pensions.

Doctors had started refusing to work overtime shifts because changes to the amount that can be accrued tax-free meant they were being landed with significant bills.

Ministers had originally ruled out reviewing the rules, but now just weeks later have gone back on that decision with the launch of these new proposals aimed at ending the ongoing dispute.

A consultation launched by Theresa May’s government offering to introduce more pension flexibility is now set to be replaced by more radical solutions. The previous consultation was only published on 22 July.

The current pensions row has been linked to a rise in waiting times for routine surgery, caused by medics refusing to work beyond their planned hours.

Under the new proposals, the government said it would now be putting forward a plan to allow doctors complete flexibility when it comes to scaling down their pension contributions to avoid breaching the annual tax-free allowance.

The allowance has been reduced from £255,000 a year in 2010-11 to £40,000 - and drops still further for the highest earners.

This tends to affect those earning more than £110,000, around a third of senior doctors and GPs

Previously the government had said it favoured a 50:50 option whereby public sector staff could forsake half the amount paid into their pension.

But now ministers have said they will publish a consultation in the coming weeks which favours giving public sector staff the ability to reduce contributions to zero. It will also allow doctors to be given the contributions the employer would have made, meaning their pay packets could be boosted by thousands of pounds a year.

The plans will be set out in a consultation published during the summer with a view to introducing them from April.

Health secretary Matt Hancock said: "NHS doctors do extraordinary life-saving work every day - they should not have to worry about the tax impacts if they choose to go the extra mile by taking on additional work to help patients."

Dr Chaand Nagpaul, of the British Medical Association, said: "We acknowledge this step forward by the government."

"After tireless lobbying 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 and taking notice and proposing action."

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