Health Secretary speaks at PHE conference in Coventry

11 September 2019, 07:23

NHS uniform
NHS uniform. Picture: Getty

Plans to change pension rules to enable NHS consultants and GPs to work longer hours without big tax bills will be set out by Health Secretary Matt Hancock at the University of Warwick.

Health leaders in England have warned that NHS waiting lists are soaring because senior doctors are refusing to take on extra work.

The Department of Health and Social Care estimates that one third of consultants and GPs may be reluctant to take on extra shifts on top of their contracted hours because they risk breaching limits on tax relief.

It is launching a consultation on proposals that will allow senior clinicians to maximise the amount they can put towards their pension without becoming liable for large additional tax payments.

Mr Hancock said: "Today we're taking a decisive step in fixing this issue for good so patients can feel the impact in GP surgeries and hospitals across England and we are already helping hospitals ease the immediate burden with new advice on action which can be taken now."

Among the proposals is that senior doctors be allowed to choose a personalised pension growth level at the start of each tax year and pay correspondingly lower contributions.

A further option to fine-tune their pension growth towards the end of the tax year, when they are clearer on total earnings, would allow them to "top up" their pension pot to the maximum amount without hitting their tapered annual allowance limit, the department said.

The changes would have an impact on those earning more than £110,000 a year who were affected by the 2016 introduction of a tapered annual tax allowance.

The department said it wanted to introduce the proposals in time for the start of the new tax year, subject to the consultation response.

New NHS pension options welcome but scrapping tapered annual allowance remains the best option, says the NHS Confederation.

The NHS Confederation, which represents 85% of NHS providers and commissioners, welcomed the proposals but called for the 2016 tax changes to be reversed.

Niall Dickson, chief executive of the NHS Confederation, said: "Change cannot come quickly enough to the pension rules. We have seen senior clinicians cutting their hours, leading to cancelled operations and growing waiting lists.

"Today's revised consultation offers some hope, but we continue to urge the Government not just to add more flexibility, but to scrap the tapered allowance altogether.

"The repercussions for patients will only worsen without reform and the most effective way to do that would be to get rid of the taper."