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HCSA writes to Chancellor urging action on medical pensions taxation

HCSA has today written to Chancellor Jeremy Hunt calling for urgent action over medical pensions taxation to head off the senior doctor retention crisis.

In a joint letter, President Dr Naru Narayanan and Pensions Committee chair Dr Sarah Tennant urge him to heed the recommendations his own health select committee made in July, when he was chair, which branded the current situation “a national scandal”.

The impact of taxation is currently driving senior doctors out of the NHS, with the number taking early retirement tripling over around a decade.

The letter sets out measures the Chancellor could bring forward to alleviate the current situation, including the widely supported removal of annual allowance in defined benefit schemes and the restoration of lifetime allowance. It notes that Mr Hunt’s committee had also criticised the government’s prior rejection of another proposed solution, the creation of a tax unregistered pension scheme.

Stating that the NHS cannot afford to lose hundreds of decades of collective experience at a time when the health service is facing unprecedented demand, it warns: “The pernicious impact of pensions taxation on the retention of senior doctors will, in the long run, be far more costly to the public purse and public health than any short-term savings that may be made by inaction.”

Dr Narayanan said: “We know that the Chancellor has an intimate understanding of the tax issues which are driving hospital doctors from the NHS at the worst possible time.

“Our concern is that the price of failing to address this problem, in terms of growing waiting lists which mean more costly and complex cases and increased agency spend, will be far greater in the long run than the price of fixing the issue.

“At a time when the NHS needs our most experienced doctors more than ever, we need to see real solutions not just attempts to place a sticking plaster over the problem or, worse, to wish it away. I’m afraid it is not going away and attrition will only get worse if we don’t see action.” 

Read the letter in full (PDF)


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