Pension waivers for NHS staff set to continue as tough winter looms

Concessions that allowed retired or semi-retired NHS staff to return to work during the coronavirus pandemic without affecting their pension benefits are set to be extended as the health service tries to fill 100,000 vacancies ahead of a difficult winter.

Since March 2020, certain “retire and return” rules in the pension scheme have been relaxed to allow retired, or partially retired, staff to return to work or increase their hours without having the payment of their pension benefits suspended.

The measures are due to expire at the end of October and the government has now launched a consultation on whether to extend them for a further year.

The Department of Health and Social Care suggested maintaining the changes would make it easier for retirees “to return to the workforce or to continue supporting the health system over winter”.

Around 6.7mn people are waiting for NHS care, a record, in part due to the backlogs built up at the height of the Covid crisis. Winter is expected to be even more difficult than usual as staff struggle with that backlog, along with a potential upsurge in Covid and flu cases.

Steve Barclay, health and social care secretary, said the winter would be “challenging and we are putting in place the necessary preparations to support the NHS while it continues to deliver first-rate care to patients”.

This included consulting over extending the temporary changes to the NHS pension scheme “which have so far allowed highly skilled retired staff to return to the workforce without having their pension benefits affected”, he said.

Matthew Taylor, chief executive of the NHS Confederation, said: “The NHS will need all of the help it can get this winter and so we are pleased the government will be consulting on ways to provide support to the NHS’s workforce by encouraging recent and partial retirees back to the frontline.”

While this was not the only action needed to respond to the rising demand for healthcare services, “leaders hope it will help”, he added.

Dr Vishal Sharma, BMA pensions committee chair, supported the move but said “the reality is that this policy only affects a small number of doctors seeking to return post-retirement — namely psychiatrists with ‘mental health officer’ status — and it does nothing to prevent the exodus of senior consultants and GPs who are retiring from the NHS due to absurd punitive pensions tax charges”. 

A report in the The Times on Saturday said that ministers were preparing to announce other changes to tax and pension rules in an attempt to stem the departures of senior staff. The report suggested that the government was also considering allowing staff at any level to exchange some of their pension for additional pay in the hope of retaining nurses and other lower paid workers amid a cost of living crisis.

Health bosses are understood to be concerned about growing numbers of NHS staff quitting their monthly pension contributions to help pay the bills.

Dr Tony Goldstone, BMA pensions committee deputy chair, said: “While it is encouraging that ministers appear to be listening to what the BMA and others have been saying to them for some years, we cannot influence our members to change their plans until we have had sight of all the detail to ensure they go far enough, and will provide a robust and long-lasting solution to the short-term and long-term consequences of these ill-informed taxes.”

The Treasury said it was unable to comment on tax matters outside fiscal events.

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