NHS pension payments delayed as retirements surge 50% – Law & Regulation

Statistics from NHS Digital showed that there were 9,737 retirements in the three months to April 2022, per a story unearthed by the Health Services Journal. This is 50 per cent higher than the same three months in any of the past five years.

The NHSBSA has a statutory target to pay NHS pensions on retirement within 30 days of the payable date or within 30 days of receipt of all information required to make payments, and must make interest payments if that target is missed.

We are now starting to see exactly what we have been warning of — doctors and their colleagues being left with no option but to retire early to avoid both being financially disadvantaged or burning out

Vishal Sharma, BMA

The administrative load created by the 50 per cent jump in retirements led to 1,115 of the 6,580 cases being processed beyond the 30-day timeframes.

An NHSBSA spokesperson told Pensions Expert: “We continue to process the majority of retirement applications within the usual 30 days but due to increases in workload over the last couple of months and it being our busiest time of year, we are experiencing some temporary delays to some of the more complex cases.

“We apologize to those affected and have introduced several measures to improve timescales, including increasing the number of staff we have available to support processing”

The spokesperson stressed that 83 per cent of cases had still been processed within the 30-day limit, and added: “With the additional measures we have put in place and the increased resource… these delays will be resolved by the end of August and all cases will be processed within the 30-day timeframes”.

‘You ain’t seen nothing yet’

Dr Tony Goldstone, national clinical adviser on pay and pensions at the British Medical Association, warned on Twitter that, absent urgent fixes to the pension tax regime, record high inflation could lead to a further surge in resignations and retirements.

“You ain’t seen nothing yet,” he tweeted.

The British Medical Association has been campaigning for some time on the issue of NHS pensions and staff retention, criticizing claims made by NHS England and NHS Improvement in May that delaying retirement could have beneficial pension implications.

NHSEI published an infographic purporting to show that someone who retires at aged 60 without breaching the LTA limit would have an annual pension income of £46,630 and a lump sum at retirement of £139,891.

Meanwhile, someone retiring at 61 and breaching the LTA limit would take home £48,306 — a figure of £1,676 more than retiring at 60 — and £146,762 as a lump sum, an increase of £6,871.

This prompted the BMA to issue a press release and write to NHSEI expressing its “serious concerns” over “inaccurate and misleading information”, arguing that, contrary to the suggestion that NHS staff would benefit from working longer, the actual operation of the pension tax regime means doctors would be worse off for delaying retirement — in some cases by as much as £100,000 over a typical 30-year retirement if they continued working to 61.

Besides changes to the tax regime, the BMA has called for the introduction of late-retirement factors into the 1995 NHS scheme, and for the creation of a new, tax-unregistered scheme such as that introduced by the government to tackle retention issues in the judiciary.

Commenting on the delay to pension payments, Dr Vishal Sharma, BMA consultants committee chair and pensions committee chair, said: “This should be a real warning sign to the next prime minister that without putting retention of our most experienced NHS staff at the top of their in-tray, the very future of the health service is at risk.

“This surge in retirements means a loss to patients and to the NHS of highly skilled doctors, nurses and other healthcare professionals at a time when the NHS is facing the greatest workforce crisis in its history. In the context of the pandemic and record-high waiting lists, losing staff like this is disastrous for patient care and the health of the nation.”

He reiterated that the BMA had been warning of this crisis for several years without sufficient action by the government to mitigate it, despite MPs describing pension taxation rules as “a national scandal” in a Health and Social Care Committee report.

BMA issues stinging rebuke of ‘misleading’ NHS pension claims

The British Medical Association has rebuked NHS England and NHS Improvement for what it calls “misleading” information about “punitive pension taxation” and its impact on staff retention.

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“We are now starting to see exactly what we have been warning of — doctors and their colleagues being left with no option but to retire early to avoid both being financially disadvantaged or burning out,” he said.

“That NHSBSA cannot keep up with demand not only underlines the scale of the crisis, but it is also causing unacceptable delays for those scheme members who are relying on accessing their pensions.”


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