Top doctors and nurses prevented from staying in NHS amid pension confusion
Experienced medical staff are leaving the NHS because health trusts are failing to follow rules designed to retain them, experts have warned.
New rules were brought in last October to allow experienced NHS staff over the age of 55 to take a combination of monthly pension income and an initial tax-free lump sum from their pension pot while still working.
It was part of moves by ministers to tackle staff shortages in the NHS – but many medics seeking to stay now face a postcode lottery.
The rules state that to stay, an employee must reduce their monthly “pensionable pay”, but some trusts have demanded they take a cut in their salaries instead.
More than 5,000 NHS staff including doctors, nurses and administrative staff have applied to take the option in the three months since it was launched, but a poll on an online discussion group for members of the NHS pension scheme found that one in 10 had been rejected.
Sarah Tennant, a consultant radiologist and pensions lead at the Hospital Consultants and Specialists Association (HCSA) told i she had heard from hospital staff who wanted to take the option but were being told the only way to do this was to reduce their overall pay, rather than just their pensionable pay.
“There’s a lot of confusion within trusts, some are getting it right, though others are giving the wrong information to their staff,” she said.
“We’re in a staffing crisis in the NHS and we’re only adding to that by putting for example very experienced consultant paediatric surgeons in a situation where they’re forced to choose between leaving the workforce, cutting a chunk of their hours, or facing a lengthy battle with their trust.
“In some cases these people are leaving or cutting their hours. This is bad news for the trust, as they will then have to pay for expensive locums to cover their work, adding to the staffing issues that already exist.”
A poll on an online discussion group for members of the NHS pension scheme found that one in 10 who had applied for partial retirement had been denied it.
Sorcha Ford, who runs the group, which has 34,000 members, said the policy “ticked a lot of boxes”, but its implementation had been “fraught with problems,” adding: “Unfortunately, for many scheme members partial retirement is an illusion rather than a viable choice. There clearly needs to be more oversight in terms of how employers are rolling out the policy so that there is equity across the NHS.”
Wealth management firm Quilter said the scheme appeared to have become a postcode lottery, with some employers embracing it and others not.
Graham Crossley, NHS pension specialist at the organisation, said while it was “great” that so many members were taking up the option, the figures alone did “not tell the whole story.”
The NHS pension scheme is a generous “defined benefit” programme, meaning that unlike most private-sector schemes, employees get a guaranteed fixed income for life in retirement, regardless of how long they live.
The pensions normally start paying when the member reaches 60 or later – depending on when they joined the NHS – but under the partial retirement policy, employees can take pension money earlier and while still working.
It means the staff member can take a minimum of 20 per cent of their pension benefits and up to a maximum of 100 per cent, but still continue to contribute to the pension pot.
This is similar to income drawdown, a way of getting pension income on retirement while allowing the pension fund to keep on growing.
Exactly how much NHS staff get in retirement depends on their salary, length of service, and when they joined the workforce.
For those in the 1995 section of the scheme, they get 1/80th of the best of the past three years’ of their pensionable pay for each year they have been a member in the scheme.
If they retired at 60, having worked in the NHS for 30 years, with their pay being £50,000 over those three years, they would get £18,750 per year in retirement.
The Department for Health and Social Care (DHSC) said partial retirement was not an “automatic right” and that employer agreement was needed for any change to employment terms.
A spokesperson added: “We have provided employers with a suite of pension flexibilities to enable older staff to stay in the workforce longer.
“Over 5,000 applications for partial retirement have been received by the pension scheme so far, indicating the growing number of employers considering this approach. The pension scheme rules on partial retirement do not override employment relationships and contracts.”
NHS Providers were also approached for comment.
Have you been denied partial retirement? Get in touch: [email protected]
