A rule change giving longstanding NHS staff the option of ‘partial retirement’ in an effort to boost retention has seen more than 3,200 medical professionals apply in its first three months.
According to a Freedom of Information request by Wesleyan Financial Services, 3,266 members of the NHS Pension Scheme have applied for partial retirement since the rules were changed on October 1, 2023.
Partial retirement allows NHS Pension Scheme members aged 55 and over to take part, or all, of their pension benefits in one or two occasions and continue in NHS employment.
This measure was already available to members of the 2008 and 2015 NHS Pension Scheme.
But it was extended to members of the 1995 section of the scheme in October 2023 in an effort to keep some of the most experienced staff within the NHS workforce by offering greater retirement and pension access flexibility.
Jonathan Halberda, specialist financial adviser at Wesleyan Financial Services, said: “This is a positive response to a policy designed to solve a specific problem - keep medical talent within the public sector.
“This data does not mean ‘mission accomplished’. But it does show the extent of demand there is for this kind of flexibility.”
It comes as last year, the government proposed to permanently remove abatement rules for members of the NHS Pension Scheme.
This was outlined in a consultation by the Department of Health and Social Care aimed at retaining staff in the NHS to clear backlogs.
Abatement is the process by which NHS workers’ pensions are reduced pound for pound if their earnings plus the ‘unearned’ element of their NHS pension exceed their pre-retirement NHS pensionable earnings.
It was suspended during the Covid-19 pandemic to encourage recently retired NHS staff to return to work and to tackle the crisis without suffering a penalty on their pension but the suspension is due to expire at the end of March 2025.
But as part of the 2023-24 pay deal, the government outlined its intention to permanently remove abatement from April.
Wesleyan’s FOI revealed the largest single monthly take up was in October, the month the extension took effect, when 1,215 successfully applied for partial retirement, suggesting there was pent-up demand among members.
“Like many people these days, fewer and fewer medical professionals view retirement as a ‘cliff-edge’,” Halberda said.
"Before these changes were announced, many of the most experienced medical professionals faced a stark choice– stay or go.
“The rule change gives them a third option, and will no doubt help some stay in jobs that they love.”
However, Halberda said it was a complex area and partial retirement won’t be the answer for all NHS staff.
“Anyone considering this should think about how they’re going to cover any immediate income shortfall, for example, and consider reviewing their retirement income plan to ensure it continues to meet their needs,” he added.
sonia.rach@ft.com
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Have your say in the comments section below or email us: ftadviser.newsdesk@ft.com
According to a Freedom of Information request by Wesleyan Financial Services, 3,266 members of the NHS Pension Scheme have applied for partial retirement since the rules were changed on October 1, 2023.
Partial retirement allows NHS Pension Scheme members aged 55 and over to take part, or all, of their pension benefits in one or two occasions and continue in NHS employment.
This measure was already available to members of the 2008 and 2015 NHS Pension Scheme.
But it was extended to members of the 1995 section of the scheme in October 2023 in an effort to keep some of the most experienced staff within the NHS workforce by offering greater retirement and pension access flexibility.
Jonathan Halberda, specialist financial adviser at Wesleyan Financial Services, said: “This is a positive response to a policy designed to solve a specific problem - keep medical talent within the public sector.
“This data does not mean ‘mission accomplished’. But it does show the extent of demand there is for this kind of flexibility.”
It comes as last year, the government proposed to permanently remove abatement rules for members of the NHS Pension Scheme.
This was outlined in a consultation by the Department of Health and Social Care aimed at retaining staff in the NHS to clear backlogs.
Abatement is the process by which NHS workers’ pensions are reduced pound for pound if their earnings plus the ‘unearned’ element of their NHS pension exceed their pre-retirement NHS pensionable earnings.
It was suspended during the Covid-19 pandemic to encourage recently retired NHS staff to return to work and to tackle the crisis without suffering a penalty on their pension but the suspension is due to expire at the end of March 2025.
But as part of the 2023-24 pay deal, the government outlined its intention to permanently remove abatement from April.
Wesleyan’s FOI revealed the largest single monthly take up was in October, the month the extension took effect, when 1,215 successfully applied for partial retirement, suggesting there was pent-up demand among members.
“Like many people these days, fewer and fewer medical professionals view retirement as a ‘cliff-edge’,” Halberda said.
"Before these changes were announced, many of the most experienced medical professionals faced a stark choice– stay or go.
“The rule change gives them a third option, and will no doubt help some stay in jobs that they love.”
However, Halberda said it was a complex area and partial retirement won’t be the answer for all NHS staff.
“Anyone considering this should think about how they’re going to cover any immediate income shortfall, for example, and consider reviewing their retirement income plan to ensure it continues to meet their needs,” he added.
sonia.rach@ft.com
What's your view?
Have your say in the comments section below or email us: ftadviser.newsdesk@ft.com
