- NHS Improvement has called for hospital chiefs in England to follow guidance
- Pension reforms mean extra income will trigger hefty tax charges
- Senior doctors refuse overtime in fear of extra income causing more tax
- Patients are already facing delayed or cancelled operations, expected to worsen
Hospitals are being urged by NHS Improvement to immediately offer senior doctors salary top-ups to ease pension reform tension before a winter crisis
Hospitals are being urged to urgently offer senior doctors salary top-ups to avoid an NHS crisis this winter.
NHS Improvement, which oversees how NHS trusts are run, wants hospitals chiefs in England to adhere to guidance brought in amid the pensions fiasco.
It says all hospitals should be giving cash to doctors who have quit the retirement scheme out of fear of high tax rates on their pensions.
The arrangement would mean doctors don’t lose out on employer’s contributions, which are worth 20.6 per cent of the pensionable salary.
But data obtained through Freedom of Information requests show the majority of hospitals are not offering the flexible pension policy.
The Hospital Consultants and Specialists Association (HCSA) sent a request to all 153 acute trusts and foundation trusts.
Of the 108 which responded, just 10 trusts had a pension recycling policy, reports the Financial Times.
The HCSA has now said hospitals should be forced to offer cash payments, which are currently a voluntary policy.
This would be in lieu of employer pension contributions that they are no longer receiving – currently worth 20.6 per cent of their salary.
Claudia Paoloni, president of the HCSA, said: ‘We have long warned that Treasury inaction on the pension crisis will fuel a winter crisis.
‘And it seems that this is now dawning on the NHS at the highest level.’
Pauline Philip, NHS Improvement’s director of urgent and emergency care, said: ‘We are now signalling our expectation that trusts that have not done so already should make immediate use of the flexibilities available.
Doctors are being hit by unexpected tax bills – some of five or six-figure sums – for working shifts that boost a pension pot they might still be years away from drawing.
They don’t necessarily have large sums on hand to pay tax, and some have reportedly been forced to remortgage their homes.
The annual allowance is the amount most people can put in a pension and get tax relief – including their own and their employer’s contributions, and tax relief from the Government – and is £40,000.
But a complicated addition, commonly referred to as ‘the taper’, was introduced by former Chancellor George Osborne in the 2016/2017 tax year.
This means the annual allowance is gradually reduced from £40,000 to £10,000 for those whose total income, including any growth in their ‘pension rights’ over the year, is between £150,000 and £210,000.
However, tax charges can kick in if your income is over £110,000 a year because of the way pension rights are calculated, and these are especially difficult for workers to keep track of in salary-related schemes like the NHS one.
High earning doctors who work unpredictable overtime shifts to reduce waiting lists find it hard to work out how close they are to the £110,000 threshold.
Meanwhile the lifetime allowance, the total you can put in your pension and get tax relief, currently stands at £1,055,000 for everyone.
That also creates a headache if you go over the limit, because you face a tax charge of 55 per cent on any lump sum you take from retirement savings in excess of it, or 25 per cent if you are taking an income. Read more here.
‘Our most significant shared challenge relates to workforce availability — particularly nursing, and also the continuing impact of pensions taxes on doctors.’
Tens of thousands of staff have refused extra shifts out of fear the extra income will trigger hefty pension tax charges.
Patients across the country are already facing delayed, or even cancelled operations, because of crippling staff shortages in the NHS.
And waiting times are expected to get worse – the British Medical Association (BMA) warned yesterday the NHS will face its worst winter ever.
Ministers promised to reform the flawed pensions scheme in August. Under the existing system, introduced in 2016, anyone on more than £110,000 a year faces being hit by punitive tax bills.
GPs and surgeons earning six-figure salaries are among the hardest hit. Many have cut down on their hours to reduce the payments.
In fact, many senior doctors have stopped working extra shifts, including filling gaps on staff rotas.
The NHS Confederation, a body which represents leaders across the entire health system, has repeatedly called for the tapered annual allowance to be scrapped.
However, it did not intend to issue any further instructions to employers on the guidance.
Niall Dickson, chief executive of the NHS Confederation, said: ‘As the NHS hurtles towards another monumentally busy winter period, we are facing a ticking timebomb where vital shifts might not be filled because of the ongoing pensions crisis.
‘We welcome the Department of Health and Social Care’s commitment to introduce changes to the NHS pensions scheme for senior doctors but we cannot afford to wait until April for these to be rolled out.’
Last month, the Royal College of Surgeons found 68 per cent of consultant surgeons they surveyed are considering early retirement because of the pensions tax rules.
The BMA yesterday warned that more than one million patients are expected to face four-hour waits in A&E over the colder months.
It said 300,000 patients could also end up stranded on trolleys in corridors as they wait for treatment.
Experts say at least another 10,000 beds are needed to give hospitals in England and Wales a chance over the coming months.
Nursing crisis could affect patient care
As of October 2018, there were around 41,000 nurse vacancies in NHS England.
This is predicted to reach 70,000 by 2024 at the current rate, according to a major joint report in March by the King’s Fund, Nuffield Trust and Health Foundation.
Experts say low pay and long hours are two of the main factors which make finding nursing staff difficult. This, paired with student debt, makes the profession unappealing for young people.
A Royal College of Nursing poll, of 1,692 Britons, found 71 per cent think there are not enough nurses to provide safe care to patients.
Of 1,408 people polled in England, 37 per cent said their top priority for any extra NHS funding was the recruitment of more nurses.
Ageing population means more care needed
Longer lives are costing the cash-strapped NHS more money each year.
One in six of the UK population is aged 65 and over, and by 2050 it will be one in four, according to NHS England.
This group of people are at the highest risk of adverse outcomes such as falls, disability, admission to hospital, or the need for long-term care.
The King’s Fund reports that over 15million people in the UK have a chronic condition, many of whom will be elderly.
The number of patients aged 75 or over needing an NHS operation in England has doubled since 1999, a study by Queen Mary University found.
Some 1,012,000 people had surgery in 2015, a sharp rise from the 545,000 recorded before the turn of the millennium.
Bed shortages causing procedure cancellations
A record 4.4million people are waiting to go into hospital in England for a planned procedure, according to NHS England.
In comparison, a year ago there were 4.09million people on the list, and two years earlier it was 3.81million.
A&E departments are also feeling the strain as backed-up hospital beds make it harder for them to find places to put new patients, so leave them waiting on temporary beds known as ‘trolleys’.
NHS England revealed in July that the number of A&E patients stuck on trolleys waiting for an inpatient bed has increased by 70 per cent in a year.
The figure is almost treble that from four years ago.
GP surgeries closing due to doctors leaving NHS
Over the last six years, 585 practices have closed, covering a population of nearly 1.9million, according to data obtained by Pulse magazine
Experts believe the rate of surgery closures is accelerating because rising numbers of under-pressure doctors are opting for early retirement – or deciding to abandon their careers.
Despite the Government’s pledge to hire 5,000 extra GPs between by 2020, the NHS has lost almost 600 GPs in the last year.
Almost as many family doctors left the health service between June 2018 and June 2019 as did in the entire three years to March, according to NHS figures.
On top of this, a poll in February found 42 per cent of NHS GPs said they intended to leave or retire within five years, up from less than a third (32 per cent) in 2014.
The research by the University of Warwick found almost a fifth (18 per cent) said they would leave within two years.
Data from winter 2018/2019 reveals the NHS once again under intense pressure over the winter months.
A&E attendances and emergency admissions rise, there is dangerously high bed occupancy, and staff working over time – causing loss of morale.
Total attendances at A&E rose to 6.2million last winter – a six per cent increase from the year before. Just over 85 per cent of patients were admitted, transferred or discharged within four hours – the second worst performance on record.
The average bed occupancy rate last winter remained very high, at 93.5 per cent, comparable to the previous year’s figure of 94.4 per cent.
NHS bosses have been urged to step up anti-flu preparations earlier this year after a stark rise in the number of virus cases during winter in Australia.
Top British doctors said the increase in Australia could be a sign of what is to come in the UK this winter.
Despite the looming winter months, figures suggest the NHS is now in a year-long crisis.