Government to complete NHS pension tax review by February

A review of the NHS pension tax trap that has forced thousands of doctors to reduce their working hours could be complete by February, the government has suggested.

Downing Street (Photo: Dan Kitwood/Getty Images)
Downing Street (Photo: Dan Kitwood/Getty Images)

In a statement just two days after MPs' return to parliament following the 12 December general election, officials confirmed plans to begin 'an urgent review of the pensions annual allowance taper problem that has caused some doctors to turn down extra shifts for fear of high tax bills'.

The government said the review would 'report at budget' - and it has been widely reported that the next budget will be delivered in February 2020.

Government officials said ministers from the Treasury and DHSC would meet both the Academy of Medical Royal Colleges (AoMRC) and the BMA as part of the review, as well as taking evidence from other organisations.

The review fulfils a Conservative manifesto pledge to launch a review of the pension tax trap within 30 days of the general election.

Pension tax

However, during the election the BMA was critical of plans for a review. A BMA statement on manifesto promises from all political parties earlier this month said: 'A commitment to "review" is not new and not what is needed – we need urgent action from whoever forms the new government to scrap the damaging annual allowance and tapered annual allowance in defined benefit pension schemes to ensure that no doctor is penalised for going above and beyond for their patients.'

The BMA confirmed, however, that it would engage with the review - and that it would continue to demand removal of the taper and annual allowance for defined benefit schemes such as the NHS Pension scheme.

The government said its review formed 'part of a wider drive to ensure the NHS continues to have the staff it needs to meet demand and transform care' - announcing that nursing students on courses from September 2020 would be offered a '£5,000-a-year grant', with extra payments of up to £3,000 for 'students in regions or specialisms struggling to recruit or to help students cover childcare costs'.

NHS England announced last month that it would pay off doctors' pension tax bills for 2019/20 in a bid to encourage doctors to take on extra shifts ahead of winter.

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