NHS workforce fears as retirements surge to all-time high

The number of people claiming NHS pensions for the first time hit a record level in April - with early retirements also at an all-time high, in what experts warn is a 'worrying trend' for the NHS workforce.

Consulting room door
(Photo: Robert Johns/UNP)

A total of 8,902 people were awarded NHS pension benefits in April 2022 - up 28% from the same month in 2021 and the highest one-month figure on record.

Of these, 1,839 were pensions claimed early - before standard retirement age - a figure up 24% compared with the previous April.

The figures, obtained from the NHS Business Services Authority by financial advisers Quilter, suggest a sharp rise in numbers of doctors and nurses retiring amid intense pressure on the health service.

NHS workforce

Experts warn the figures could prove to be the 'tip of the iceberg' with record inflation set to drive a spike in GPs facing significant pension tax penalties that could persuade many to reduce their working hours or quit the health service.

Meanwhile, a further hit on the NHS workforce could come from October as rules put in place during the COVID-19 pandemic to prevent financial penalties for retired doctors who returned to the workforce come to an end.

The figures come after data from NHS Digital last week showed that numbers of full-time equivalent, fully qualified GPs are continuing to fall, and amid doubts over government claims that it is 'on track' to bring in 26,000 additional staff to support primary care by 2024.

NHS pension specialist at Quilter Graham Crossley said: 'Although our data does not delve into the specific reasons for the exodus from the NHS, we are hearing that healthcare workers are simply exhausted, feel undervalued and want out of the NHS for a better quality of life.

Pensions tax

'It has been said that chronic workforce shortages are seriously undermining efforts to recover from the pandemic. The situation could become significantly worse if the calls to address issues with NHS pensions go unheeded.

'We are already seeing the upward trends in the number of members retiring early or retiring at 60, when once they might have considered continuing to work past their original normal retirement age. The perverse rules, such as the upcoming disastrous tax bills due to inflation, serve to hasten decisions to leave the NHS.'

Mr Crossley urged the government and HMRC to review the 'whole taxation system', but said two steps could be taken immediately - the upcoming end of the suspension of 'abatement' rules for doctors who returned to the NHS workforce during the pandemic should be extended indefinitely and annual allowance calculations should be limited to 'growth above inflation' only.

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