Consultation launched on plans to amend NHS pension rules to bolster NHS workforce

The government has launched a consultation on proposed amendments to NHS pension rules in a bid to bolster the NHS workforce.

The proposals, if adopted, would enable staff to work more flexibly up to and beyond retirement age ensuring skills are retained and barriers are removed to staff returning from retirement.

The proposed reforms include:

• a new partial retirement option to support older staff who want to work more flexibly and enable them to access part of their pension while continuing to contribute to their pension pot. This would allow NHS staff to partially retire, or for those that have retired to return to the workforce, to either claim all or a portion of their pension but continue working and building more pension benefits.
• removing limits on hours recently retired staff can work giving them control over the hours they work in the first calendar month after returning.
• allowing retired staff to re-join the pension scheme making returning to work in the NHS more attractive by ensuring senior clinicians and NHS staff can continue to contribute to their pensions from their NHS work.
• flexing the annual tax charge, fixing the interaction between the pension tax system and inflation to ensure senior clinicians have more headroom against the £40,000 pension tax annual allowance. This means senior doctors are either less likely to receive a tax charge, or will receive a smaller tax charge, reducing the likelihood of early retirement
• wider access to NHS Pension Scheme - allowing staff working in primary care networks (PCNs), such as GPs and general practice staff, to access the NHS Pension Scheme. Previously they have had to apply for time-limited access on an ad hoc basis.

The government has already committed to publishing a comprehensive workforce plan in 2023. However, no doubt NHS employers will be hoping that more immediate action can be taken given the current staffing crisis (latest data shows that NHS England is operating at a vacancy rate of circa 10%) and winter pressures. Therefore, any measures aimed at increasing workforce capacity will surely be welcomed.

The consultation is open until 30 January 2023 and reforms are expected to be implemented in late spring 2023.

The consultation can be read in full HERE.