NHS pension changes that allow retired healthcare staff to return to work while keeping their retirement benefits could be extended, as part of government plans to boost the winter workforce.
Since March 2020, retired or partially retired NHS staff have been able to return to work or increase their hours without having their pension benefits suspended.
However, this temporary change to the NHS pension scheme’s retire and return rules is set to expire on 31 October 2022, and with the government expecting a “challenging” winter for the NHS, it has launched a consultation on whether to extend the measures for another six months.
Health and social care secretary Steve Barclay said: “We are putting in place the necessary preparations to support the NHS while it continues to deliver first-rate care to patients.
“As part of this we are now consulting on extending temporary changes to the NHS pension scheme, which have so far allowed highly-skilled retired staff to return to the workforce without having their pension benefits affected.”
NHS workforce crisis
Matthew Taylor, chief executive of the NHS Confederation, said: “The NHS will need all of the help it can get this winter and so, we are pleased the government will be consulting on ways to provide support to the NHS’s workforce by encouraging recent and partial retirees back to the frontline.
“This is not the only action that it is needed to respond to the rising demand for healthcare services but leaders hope it will help. On behalf of our members, we look forward to providing views in the consultation.”
If the changes proposed in the NHS pension scheme consultation are taken forward, they would be extended to 31 March 2023.
The Department of Health and Social Care said it was hoping to bolster NHS capacity by recruiting more nurses, doctors and NHS 111 and 999 call centres, and driving further international recruitment of staff in critical roles.
However, professional bodies have been critical of the government’s plans to address NHS backlogs and boost staff numbers.
Dr Vishal Sharma, chair of the British Medical Association’s pensions committee, said the change to the pension scheme policy only affected a small number of doctors looking to take on work post-retirement, and did nothing to prevent senior doctors from retiring due to “punitive” pension tax charges.
To suggest that the small changes proposed in this consultation on their own will have any meaningful effect on waiting times and patient experience, without addressing punitive taxation rules, is completely disingenuous” – Dr Vishal Sharma, BMA
“Pension taxation is a far, far greater issue impacting the most experienced NHS professionals, and it is a long-term solution to this that will have the greatest impact on tackling the record waiting list and bolstering the NHS for what looks set to be another horrific winter for the health service,” he said.
“To suggest that the small changes proposed in this consultation on their own will have any meaningful effect on waiting times and patient experience, without addressing punitive taxation rules, is completely disingenuous.”
He called on the government to introduce a tax unregistered pension scheme for senior NHS staff, similiar to that introduced for judges.
NHS Employers has written to chancellor Nadhim Zahawi with concerns about the impact of current high levels of inflation are having on pension taxation calculations.
The value of pension savings is based on the growth in the member’s pension over the tax year. This is calculated by subtracting the value of the member’s pension at the start of the year from the value of the member’s pension at the end of the tax year. If the member’s pension growth exceeds the annual allowance, excess benefits may be subject to a tax charge.
NHS Employers chief executive Danny Mortimer said earlier this month: “The pension tax issue with the taper was fixed for most staff but there is a toxicity around the annual allowance that continues and this latest inflation issue is deterring doctors from taking on the extra work needed to clear backlogs.
“We are going to need doctors to do extra shifts in the evenings and weekends and to do this for years to come. Thousands of doctors could potentially be impacted by the inflation issue.”