The government has rebutted BMA calls to reconsider its NHS pension reforms despite doctors overwhelmingly voting to reject the proposals.

Following a meeting of BMA council, the union has formally written to the government rejecting the offer and urging them to engage with the BMA and unions representing NHS staff to agree fairer changes.

Eighty four per cent of BMA members who responded to the survey said the latest proposals should be rejected. The survey received a 36% response rate representing the views of over 46,000 doctors. Nearly two-thirds said they would personally be prepared to take industrial action to pursue changes to the proposals.

As well as writing to the government, the BMA is working up detailed plans on taking industrial action.

The BMA received a swift rebuttal from the health secretary who responded that the NHS pension proposals are the “best possible deal available”.

In his letter to the BMA, Andrew Lansley said: “I should also, and particularly, emphasise again the point…there is no justification for industrial action. It would harm patients. No concessions on the issues you raised in your letter or on any other issues will be won through the threat or use of industrial action. Nor will the public accept, nor understand, how you can sign up to an excellent deal and walk away from it on the strength of an informal survey to which less than 36% of all your members responded.”

All attempts will be made to ensure that any plans for action would minimise any risk of harm to patients, the BMA says.

Dr Hamish Meldrum, chairman of BMA council said: “The strength and scale of feeling among doctors is abundantly clear - they feel let down and betrayed, and for many this is the final straw.

“Doctors are at the forefront of attempts to save the NHS £20 billion, while trying to protect patient care, are in the midst of huge system reform in England, which is causing chaos in many areas, and are about to enter a fourth successive year of a pay freeze. Now on top of this, they are facing wholesale changes to their pension scheme, which was radically overhauled less than four years ago and is actually delivering a positive cashflow to the Treasury.”

An emergency meeting of BMA Council will be held on 25 February to decide on the options for balloting on industrial action, should there not be a significant change in the government’s position.

Meldrum added: “Forcing doctors to work to almost 70 is one of our most serious concerns as it could put pressure on doctors to work beyond the age at which they feel competent and safe.

“Industrial action remains a last resort and the government must urgently reconsider its damaging plans. The action we are considering is unprecedented in recent decades. This demonstrates the current level of discontent among NHS staff.”

Thirty six per cent of doctors aged 50 and over say they intend to retire early if the changes go ahead.

Although there have been minor improvements on the government’s original offer through negotiation, all doctors still stand to be hit very hard. The retirement age would increase, with many having to work to 68 before being able to draw a full pension. The amount doctors have to pay into their pension would rise significantly, with those at the start of their careers facing the prospect of paying over £200,000 in additional lifetime contributions.

And the current final salary scheme would be replaced with a new career average scheme, which would leave most doctors with worse overall benefits.

Dean Royles, director of the NHS Employers, commented: “Talks are the best way to secure a final deal. The NHS scheme talks are complex involving over a dozen unions so it’s therefore welcome that, along with a number of other unions, the BMA will continue the discussions.

“It is essential that everyone now hammers out an agreement. Let’s concentrate on securing the best sustainable deal, not on industrial action which will always be damaging to patient care.”

Read a blog on the issue.

View the full survey results.

The BMA is asking members their views on the government’s pension proposals this week and want to know what form of industrial action, if any, they are willing to take.

Doctors should have received voting papers today that both explain the government’s proposals and their implications and offer the chance to say whether the changes are acceptable.

An initial ‘heads of agreement’ on reforming the NHS pension scheme was signed by the healthcare unions in December. However, this was just recognition by the unions that the proposals were the best deal they were currently going to get, and they wanted to ask members their views before giving the government their official response.

BMA negotiators were “disappointed” by the government’s final offer and if its membership vote to turn down the proposals it could trigger a formal ballot on industrial action.

The doctors’ union said the offer is “an improvement on some aspects of the original proposals, but will still hit doctors very hard”.

The offer ensures those less than ten years away from retirement would not face any change to their pensions, and those earning less than £26,000 would be protected from an increase in contributions next year.

But higher NHS earners will see their contributions increase significantly, they will have to work longer into old age, and will receive inferior benefits (see below).

Dr Hamish Meldrum, chairman of BMA council, said: “Throughout negotiations, the BMA and other health unions have repeatedly made the case that the NHS pension is already fair to both staff and taxpayers. The scheme was radically overhauled only three years ago, and is currently providing a positive cash flow to the Treasury.

“We are extremely disappointed that the government has refused to concede this. Despite some improvements to the original offer, doctors stand to be hit very hard by these changes. Junior doctors in their twenties would have to work until the age of 68 and pay over £200,000 more in additional pension contributions.”

Under the original proposals, 530,000 staff earning between £15,000 and £26,557 would be spared any rise in pension contributions next year. But higher-earning employees would be expected to contribute more - with consultants paying 9.9% - and the deal would only apply for one year.

According to the BMA, a 40-year-old consultant could have to pay an additional £140,000 in lifetime contributions and work an additional seven years, until the age of 67, to receive a full pension. While their annual pension (assuming they do not take a lump sum) could be slightly higher, at around £70,000, it will be based on career average earnings rather than final salary and will be received for fewer years, giving them less over the course of an average retirement.

Overall, a 40-year-old consultant could be paying twice as much into the scheme to get around 4% less over the course of their retirement, BMA modelling suggests.

Meldrum added: “We are seeking our members’ views on the offer, and - if they consider it unacceptable - on what action they would be prepared to take. It is crucial that all doctors and medical students tell us their views. It’s their future, their pension, and we want them to have their say.”

Question 2 of the BMA questionnaire asks: What action would you personally be prepared to take in pursuit of changes to the pension proposals? 1. I would be prepared to take any kind of industrial action, including strike action (complete withdrawal of labour) 2. I would be prepared to take industrial action short of strike action (e.g. emergency service only) 3. I would be unlikely to take any kind of industrial action, but would like to take some action to protest against the changes. 4. I would be unlikely to take any form of action at all.

The Treasury confirmed that the enhanced cost ceilings set on 2 November remain unchanged and no additional money has been made available. It claimed that while most workers will still have to work longer and pay more, most low and middle earners working a full career will receive pension benefits at least as good, if not better, than they get now.

In all schemes the accrual rate has been improved, the Treasury said. This has been offset by lower revaluation of accruals prior to retirement linked to prices rather than earnings as in the government’s preferred design. This will result in no extra costs to the taxpayer.

The Treasury has never acknowledged, however, that the NHS pension scheme is in surplus.

Chief secretary to the Treasury, Danny Alexander, said: “We and the unions agree that this is the best outcome that can be achieved through negotiation. For our workforce, it means they will continue to receive the best quality pensions available in this country. This is a proper reward for a lifetime’s commitment to serving the public.

“These agreements deliver the government’s key objectives in full…these reforms will save the taxpayer tens of billions of pounds over the next few decades and significantly improve the long-term fiscal sustainability of this country.”

Hospital Dr blogger, and consultant radiologist, Dr Tom Goodfellow said in his blog: “I am astounded that the current pension proposals have not roused the profession to utter fury. Since every penny of the huge increase in contributions will go simply to pay off the government deficits, it is in effect an additional super-tax on doctors. It is not even a stealth tax, it is quite blatant!”

Read more of Tom’s blog.

The government’s proposals at a glance:

- a switch from a final salary scheme to a career average revalued earnings (CARE) scheme for hospital doctors

- the accrual rate offered is 1/54th of pay, so your pension would be based on 1/54th of your pension able earnings in every year of your career. This is an improvement on the previous offer of 1/60th.

- pension benefits that you have built up so far (‘accrued rights’) will be protected in full and paid from the Normal Pension Age at the time you joined the scheme.

- the Normal Pension Age for the new scheme would increase in line with the State Pension Age, with many doctors having to work to the age of 68 to be able to draw a full pension.

- contributions would also increase from April 2012, with the highest earners contributing over 14% of salary by 2014.

- doctors within ten years of retirement on 1 April 2012 would not have to work longer or receive worse pensions as a result of the changes, although they would still pay more in contributions.

- a degree of protection for those within 13 and a half years of retirement would also apply.

The government’s latest offer on NHS pensions has received a cool reception from doctors’ representatives who have accused it of being “un-negotiated”.

Under the proposals, 530,000 staff earning between £15,000 and £26,557 would be spared any rise in pension contributions next year. But higher-earning employees would be expected to contribute more - with consultants paying 9.9% - and the deal would apply for only one year.

Commenting on the offer, Dr Hamish Meldrum, chair of BMA council said the “majority of staff would be even worse off under this change”.

The move follows last week’s public sector strikes which unions say saw up to two million workers walk out in protest at pension plans.

Despite the NHS pension being in surplus, the government wants its staff to pay more towards their pension schemes, retire later and accept a pension based on a “career average” rather than “final salary” as proposed in the Hutton review.

Meldrum said: “It is inconceivable that the government can claim to have come up with this idea ‘having listened to staff’. Thousands of doctors and medical students, along with other NHS workers, responded to consultation urging the government against further contribution increases. The announcement of an even steeper hike will intensify the anger they are already feeling.

“There is already a system of tiered contributions in the NHS pension scheme, with the highest paid staff paying  most. Doctors contribute up to 8.5% of their pay for their pensions - among the highest in the public sector. That figure could be as high as 14.5% by 2014. There is no justification for this, particularly when the final salary pension is to be replaced with a career average scheme.”

Under the initial Treasury offer published in July last year all NHS workers earning under £15,000, equating to about 100,000 staff, were protected from raised pension contributions. The revised proposals would see this ceiling raised to £26,557 - affecting an additional 530,000 staff - for one year.

Health Secretary Andrew Lansley said the proposed changes would “protect low-paid” staff in the health service.

“Having listened to staff and stakeholders, we have improved our proposals so that an extra 630,000 NHS staff will not pay any more into their pensions next year.”

Higher paid staff would be expected to contribute more. Those earning between £26,558 and £48,982 would be expected to contribute 8% of their monthly salary next year, up from 6.5% now. This would rise to 8.9% for those on salaries between £48,983 and £69,931 and to 9.9% for those in a pay band of £69,932 to £110,273.

Stephen Campion, chief executive of HCSA, said: “The significant proposed increases to contribution adds insult to injury for senior hospital doctors, coming as they do in addition to a pay freeze of three years and the promise of only a 1% increase in the next two years after that. Our members are now being asked to pay an additional 2.4% on average as from next April. More increases look likely to follow in 2013 and 2014, that would take some doctors up to nearly 15%.

“Ironically none of these increases will be fed into the NHS pension scheme itself. Where is the Government’s fairness in these proposals?”

The BMA’s Meldrum added: “The government claims to want to reach a solution via dialogue. If that’s the case it’s ridiculous that it can announce a proposal like this without raising it in negotiations.”

At the conclusion of negotiations, the BMA will seek its members’ views on whether or not they think the offer available is acceptable and, if not, what action they would be prepared to take.