NHS chief demands 'significant further action' over pension tax crisis

Simon Stevens has called on the government to take 'significant further action' to stop heavy tax on pensions undermining the NHS workforce.

NHS England chief executive Simon Stevens (Photo: Alex Deverill)
NHS England chief executive Simon Stevens (Photo: Alex Deverill)

Speaking at the NHS Innovation Expo in Manchester, the NHS England chief executive highlighted concerns over retention of experienced family doctors in the health service and singled out tax rules that have forced doctors to reduce their working hours to avoid heavy financial penalties as a key factor.

He welcomed 'flexibilities’ proposed by the government in updated plans to tackle the problem, but urged the government to take further action.

Mr Stevens added that rising numbers of GP trainees, although good news, could not solve the capacity issue alone.

GP workforce

'Yes, we are succeeding in recruiting the highest number of GP students ever,' he told the conference. 'But we have not been able to hold onto the more experienced GPs, who have been retiring early, partly because of the pensions crisis brought about by the tax treatment of pensions.’

'It is very welcome that we are seeing flexibility now being consulted on by the government. But we are going to need to see significant further action on the way the annual allowance works in order to ensure that hospital clinicians and primary care clinicians are able to continue to sustain a range of services that patients want,’ he added.

The GP workforce - along with the wider NHS medical workforce - has been hit hard across the country by concerns about tax penalties.

Across England, just over three quarters of GPs have already reduced their working hours or plan to because of rules that can leave doctors paying more in tax on pension contributions than they earn for taking on extra work.

Early retirement

Increased tax has also led to doctors considering early retirement, reducing the numbers of experienced clinicians in the workforce.

In June, health and social care secretary Matt Hancock announced the government would consult on plans for a 50:50 pension option that would allow doctors to halve the rate at which their pensions grow.

The government has since set out plans to consult on further flexibility on pension contributions and has pledged to review the tapered annual allowance mechanism that has triggered heavy pension tax bills.

Mr Stevens said NHS England as a whole needed to take better care of its current staff, admitting it had to do more to offer its staff more training opportunities and on-the-job support.

The NHS chief executive welcomed the appointment of Dr Nikita Kanani as permanent national director of primary care. He said a review co-led by Dr Kanani to explore the possibility of pharmacists being able to offer high dose statins over the counter could reduce GP workload, but insisted the primary aim of the review was to cut heart attacks and strokes.

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