Capita delays leave practices facing five-figure GP pension bills for former staff

Practices have been left out of pocket by tens of thousands of pounds because of delays in updating the GP performers list, run by outsourcing giant Capita.

GPs overcharged on pensions (Photo: Tim Grist Photography/Getty Images)
GPs overcharged on pensions (Photo: Tim Grist Photography/Getty Images)

GPs and accountants say Primary Care Support England (PCSE) - run by Capita since 2015 - has continued to claim pension contributions from practices for doctors who have long since moved on or retired.

Claims have continued because of delays in updating the performers list to reflect where GPs are currently working and have triggered huge cashflow problems for practices affected.

Accountants said the problem was common - with one estimating that one in 10 practices he worked with had been affected - and warned that partners at some practices had been forced to reduce their drawings to cope with tens of thousands of pounds in additional costs.

Pension contributions

Unfair pension charges are the latest in a long string of GP complaints over management of the performers list by Capita. The BMA warned in 2017 that some doctors had been unable to work for months and trainees had been left without pay because of delays in updating the list.

In one case brought to light by the pressure group GP Survival, a two-year delay in updating the performers list meant that a practice was charged more than £30,000 in pension contributions for a salaried GP who no longer worked there. The administrative failure meant that when the performers list was finally updated, her new practice faced a sudden bill for the full five-figure sum.

Accountants said practices had also faced ongoing pension claims for partners who had retired - and that some practices where more than one member of staff had left had been charged for multiple former members of their GP workforce simultaneously.

Specialist medical accountant Laurence Slavin warned that in addition to problems with overpayments for former staff, some GPs had been forced to pay additional tax because pension contributions had not started for a long time after they began a new job - denying them tax relief on the contributions.

Practices pay employer and employee pension contributions for doctors who work for them either as partners or in salaried roles. In 2018/19 the employer contribution rate was 14.38% - and practices pay tiered employee contributions on top, which can be as high as 14.5% for doctors earning over £111,000.

Rising costs

From April 2019, employer contributions rose to 20.68% - meaning that the financial implications for practices forced to pay pension contributions for former staff in future will be significantly greater. For the current financial year, NHS England will pay the extra employer fees directly, but from April 2020 the higher fees will be levied in full from GP practices - although the government has promised to increase funding to offset the extra costs.

In 2018/19 practices would have had to pay over £15,000 for a GP earning the average salaried GP income of £56,800, and nearly £30,000 for a partner earning the average income of £105,500. From 2019/20 total contributions would rise to around £18,000 for the average salaried GP and £36,000 for a partner.

London GP Dr Nicholas Grundy, who is leading a pensions campaign for GP Survival, told GPonline that the group was working on six cases currently in which practices faced problems of this type.

'It's a common issue. Delays to performers list updates are causing problems with pension payments. The practice that has been paying for a former employee should get a refund, and the new practice is then asked for a backdated payment for the whole period in one go - why is the system creating this bizarre situation?'

Cashflow crisis

He said that for practices that had not realised they needed to put aside money for pension contributions, a sudden backdated bill for tens of thousands of pounds could create huge problems.

Problems with the performers list have also led to GPs' end of year pension certificates being rejected because their status on the list does not match details on their certificate.

Dr Grundy said that, for example, salaried GPs had found that their status on the performers list had been changed to 'locum' - leading to the rejection of their pension certificate. Doctors in this situation had faced a bureaucratic headache to correct the error on the list and to resubmit their forms.

Specialist medical accountant Laurence Slavin, a partner at Ramsay Brown and Partners, said problems were cropping up 'all the time' with practices being forced to pay pension contributions for GPs who no longer worked for them.

'We see it all the time - deductions for partners who are no longer there, and no deductions for partners who are there and need their superannuation sorted out,' he said. 'It's probably one in 10 practices we deal with.

Partners' drawings

'The problem is that the amounts are significant - perhaps £30,000 or £35,000 a year overdeducted or underpaid. Unless the practice really knows what they are due or what is going on, they can end up with cashflow problems when all of a sudden a year's worth of deduction happens in one go. That can leave practices who aren't prepared having to reduce their drawings.'

He said there had also been problems with practices being overpaid - receiving for example seniority payments for GPs who were no longer at the practice - and with pension contributions not being claimed for a long period after a doctor started a new job. He said for a GP making a £30,000 pension contribution in the course of a year, if this was not collected their tax bill could be '£12,000 higher than it needs to be' because they are unable to claim tax relief on the pension payment.

A Capita spokesperson said: 'PCSE is working closely with NHS England and other parties who contribute to the performance of the end-to-end process for the national performers list. This is currently a lengthy process with a number of checks and approvals across multiple organisations.

'To streamline it, we are creating a secure, online system that will address a number of issues inherent in the current paper-based system. This will improve the time taken to process a change request and accuracy, and deliver better transparency around the progress of applications. The new system will ensure pension deductions taken from practices for GPs are updated faster.'

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