Waiting lists for routine surgery are reported to have risen by up to 50% in England because consultants have begun refusing to work beyond their planned hours after receiving unexpected tax bills, following new pension rules in 2016. In response, the Government has announced that it will be consulting on proposals to make pension saving more flexible for NHS clinicians. Our article explains the problem, its broader ramifications and the Government's proposed solution.
Although it is the NHSPS that has made the news, the problem with the pensions tax regime extends more widely and affects other public sector pension plans and many private sector plans. We have advised clients in both the public and private sector on "work-arounds" that have been adopted in the absence of Government action.
We now await the Government's proposals to solve the pensions tax issue in the NHS Pension Scheme, but hope that in crafting those proposals, it considers the applicability to other public and private sector pension plans.