NHS Employers to Increase Pension Contributions

The government has confirmed that GP practices will pay employers pension contributions at an increased rate of over 14% from April.

It had been reported last year that the Department of Health was already assessing the level of pension contributions made by employers as part of the NHS pension scheme.

The intention of this initiative is to ensure that £35 million in administration savings can be made, by shifting this requirement to provider organisations.

A similar process is already being undertaken in relation to the Care Quality Commission, with GP surgeries bearing the brunt of a seven-fold rise in fees over two years by 2017.

The response from the government follows a consultation on the proposed pension levy.

“The DH will proceed to introduce a levy of 0.08% of pensionable pay from 1 April 2017. Scheme regulations will be finalised and laid before parliament in March. The levy will be collected at the same time as the standard employer contribution. In practical terms this means the employer contribution rate will increase from 14.3% to 14.38% from 1 April 2017,” a statement noted.

The government argues that GP surgeries will not face additional costs as a result of this policy, as the cost of this pension levy has already been taken into consideration by the 2017/18 GP contract deal.

In order to account for this, the contract includes increases to cover rising expenses in this area.

GPC deputy chair Dr Richard Vautrey outlined British Medical Association position, which is that the cost should not have been directly transferred to surgeries.

But he also stated that the BMA was aware of the situation, and that provisions have been made for this eventuality.

“In terms of the impact on practices the extra cost will be recovered through [extra funding for] expenses. We were aware of the extra costs that were either going to hit practices or were already were hitting them, which is why we dealt with indemnity, CQC costs and even business levies as part of the contract deal.”

Vautrey compared the situation to the way that GP leaders have opposed plans to shift the costs of running the CQC to provider organisations.

Despite BMA opposition to the move, Vautrey is nonetheless confident that financial support for these increased practice costs can be maintained over time once initial funding has been adequately agreed.

“Once we have secured that funding it is embedded within global sum payments and will not be removed,” Vautrey stated.

 

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