Quilter has warned there could be an exodus of NHS staff in March as Covid rules, which protected returning workers from receiving a pension penalty, come to an end.
Data obtained by Quilter has found more than 7,000 doctors and nurses may be affected by certain pension protections coming to an end and may choose to retire as a result.
In March 2020, the government introduced measures to allow recently retired NHS staff to return to work and tackle the pandemic without suffering a penalty on their pension.
But this temporary suspension comes to an end on March 24 with thousands set to be affected.
Some members of the NHS pension scheme are allowed to retire at age 55 without any reduction to their pension, including nurses with ‘special class’ status and psychiatrists with ‘mental health officer’ (MHO) status.
But in normal circumstances, retired doctors or nurses returning to work could see their NHS pension reduced under a process known as abatement.
Data from the NHS Business Services Authority (NHSBSA) showed it had mailed 10,729 NHS pension scheme members in relation to the upcoming legislative changes, of which 7,470 could be adversely impacted by the return of abatement.
There are three groups which will be affected: those who were abated before the rules were frozen but have since turned 60 and won’t be affected when the regulations are reinstated, those who were abated before and will be abated again and those who retired after the rules changed and will now be caught out by abatement.
Graham Crossley, NHS pension specialist at Quilter, said: “There is a real risk of thousands of doctors and nurses leaving the NHS unless urgent action is taken.
“Although recent headlines about pandemic have been more positive, there are still significant pressures on the NHS and the prospect of thousands of NHS staff leaving in March to understandably avoid a financial penalty will add to an already challenging situation.”
The problem was brought up in Parliament last week (January 10) when Labour MP, Gill Furniss asked whether changes to the abatement rules were being considered.
In response the Minister of State for Health of UK, Edward Argar said: “The department will keep this under review.”
Crossley said the Coronavirus Act 2020 included provisions to allow the extension to any of the powers contained within the bill and this issue should be raised urgently in government.
He added: “While it is good to see that this problem is being debated in the House of Commons, Edward Argar’s comment that the department will keep it under review is not good enough as time is running short. Many workers have already received their letters and will need to make their decisions now as to whether they will keep working after 25th March.
“This should be the least that is done to help hard working doctors and nurses continue to battle Covid during one of the worst health crises in a generation.”
The department of health and social care has been approached for comment.
amy.austin@ft.com
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