Government launches another NHS pension consultation

The government has launched another consultation with the current focus being pension contributions. This is part of the move for all scheme members to begin to build up benefits in the 2015 scheme from April 2022. The new scheme is a career average revalued earnings (CARE) pension unlike the former final-salary schemes of 1995 and 2008.

The proposals being considered suggest that doctors’ contribution rates would be based on pensionable pay rather than their notional whole-time equivalent pay. Part-time members would therefore pay reduced pension contribution sums in the future.

There would also be amended levels of contribution rates as the highest two tiers of 13.5 and 14.5 per cent would be reduced to a new maximum level of 12.5 per cent.

The government says the proposals are meant to ensure that the costs and benefits of the scheme are more ‘evenly shared’ among members. However, with so much uncertainty over the treatment of the McCloud remedy, the planned legal action from the BMA and the constant threat of punitive taxation levels within the confines of the lifetime and annual allowance, it could be difficult for most medics to see positivity above the complexity.

This current proposal is due to restructure member contributions over two years from 1 April 2022 but we still await full details on how the McCloud remedy will work in practice and that legislation is not due until late 2023.