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One in three consultants and GPs may be hit by tax rules which are fuelling soaring waiting lists

Matt Hancock pledged to listen to doctors  - PA
Matt Hancock pledged to listen to doctors - PA

 

ONE in three senior medics could be hit by NHS pensions rules which are fuelling soaring waiting lists, health officials have warned.

Today ministers opened a consultation on changes to the operation of the scheme, amid a growing crisis as doctors refuse to work overtime.

Treasury rules means that high earners can end up paying tax rates of more than 90 per cent on earnings over £110,000 a year - which include rises in the value of pensions.

The problem has arisen as a combination of two Government policies.

One is a taper on annual earnings, which means doctors can end up paying more tax than they earn, on income of more than £110,000 a year, including rises in value of their pensions.

The other is the reduction in tax relief on pensions, meaning tax is paid on pots worth more than £1.055m - down from a high of £1.8m in 2012.

Boris Johnson has promised to “fix” the latter problem, but many doctors have raised more concern about the way the taper on annual earnings is limiting the hours they can work.

Matt Hancock, the Health Secretary, last night pledge to listen to the concerns of medics, in a bid to find a solution.

A consultation will propose a 50:50 solution - which means doctors can halve their pension contributions in exchange for halving the rate of pension growth.

However, the British Medical Association (BMA) has already said that this does not sufficiently respond to the concerns of doctors, as it will simply reduce the value of their pensions.

The consultation will say other proposals will be considered, such as giving doctors the option to choose the size of their pension contribution, in a bid to avoid  tax thresholds.

The proposals will also look at ways to make it easier for medics to defer tax bills, so they come out of their pension.

The document warns that the current situation is causing “significant financial concern” to a number of doctors, causing many to consider retiring or cutting their hours.

“Around a third of NHS consultants and GP practice partners have earnings from the NHS that could potentially lead to them being affected by the tapering annual allowance,” officials warn.

However, making any changes to tax rules would require action from the Treasury, officials warn, with no such changes proposed.

Mr Hancock said: “I love the NHS and the people who dedicate their lives to caring for patients. Each and every one of them is crucial to our Long Term Plan for the NHS, yet too many of our most experienced clinicians are reducing their hours, or leaving the NHS early because of frustration over their pension.

“I want them to know that I am listening and I want to work with them to fix it for the sake of patients.”

“We want to make it easier for our hardworking senior doctors to balance their workload, their pension pot and their tax bill - with more flexibility, more choice, and less need to pay upfront,” he said.

Earlier this month, NHS managers warned that waiting lists have soared by 50 per cent in three months in some parts of the country, because so many doctors are refusing to work overtime.

And last week medics warned that NHS cancer scans are being left unread for up to six weeks amid a growing pensions crisis.

On Friday a leading hospital chief executive raised fears that his trust could lose the equivalent of 60 consultants, because of medics’ refusal to work overtime.

In a report on the matter by the Hospital Consultants and Specialists Association, one medic warns of “unacceptable” delays of five or six weeks for scans of some cancer patients to be read.