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NHS facing exodus of leaders over additional pension taxation, report warns

There is likely to be an exodus of NHS leaders in the next two years over the extra pension taxation.

A report by NHS Providers indicates that almost half of all trust leaders (44%) plan to, or are considering, leaving the NHS because of the pensions crisis.

The findings reveal widespread concerns about the impact of restricting solutions to clinical, as opposed to non-clinical leaders, as the interim solution for the current tax year.

The survey highlights that there would be a significant adverse impact on morale, retention and the effective running of services if non-clinicians are exempted from the solution the government has said it will announce in the Budget on 11 March.

Nine in ten respondents to the survey said that they and their organisation were concerned that differential arrangements for different staff groups.

The findings also reveal:

  • Over a third (37%) of board-level directors said fewer staff in their trust are seeking or accepting promotions, while 60% said clinicians are now less willing to take on leadership roles.
  • Nearly 70% of clinical executives have turned down or would consider turning down promotions into roles required for the effective running of services or taking on additional leadership responsibilities.
  • There was a near-unanimous view (97%) that senior non-clinical staff should be eligible for any pension contribution flexibilities implemented by the government.

Leaders from 188 trusts (84% of the total) took part in the survey. And the findings come as a large number of consultants have been reducing their hours or number of additional sessions they are willing to do, in order to avoid punitive additional tax bills.

Despite attempts by the government to put in place a solution for 2019/20, only 7% of respondents have confidence it would be enough to encourage clinicians to pick up additional shifts again.

NHS Providers deputy chief executive Saffron Cordery said: “We welcome the efforts so far to try and address the impact of pension taxation rules on the clinical workforce. This is an urgent problem and requires an urgent, full and fair solution.

“But senior leaders on which the effective running of NHS services depends have widespread concerns about the effectiveness of proposals on the table, both to tackle the loss of clinicians and on the ongoing impact of pension problems for leaders and managers in the NHS.

“Without urgent action, we face the possibility of an exodus of NHS leaders, at a time when the need for their experience, skills and commitment has never been greater.”

Dr Vishal Sharma, BMA pensions committee chair, commented: “Increasing the threshold income, as has been reported as a proposal in recent weeks, is not the answer and does nothing to address many of the problems highlighted by this survey.

“Clinical and non-clinical leaders will still be severely affected and indeed the ’tax cliff’ that exists will potentially be made even steeper. The only options for the NHS’s most experienced staff will still be to reduce the work they do for the NHS and avoid promotion – which only serves to block progress and innovation.

“The only proper solution is to scrap the annual allowance in defined benefit schemes such as the NHS pension scheme, a position backed by the Government’s own advisors the Office of Tax Simplification.”

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