NHS Pensions: Frontline Patient Care

11:22:00

(Urgent Question): To ask the Secretary of State for Health and Social Care if he will make a statement on NHS pensions and the impact of administrative delays on frontline patient care.

As the House knows, the NHS pension scheme is administered by the NHS Business Services Authority, which is facing challenges, as are all public sector pension schemes, as a result of the coalition Government’s public sector pension reforms in 2015, which in 2018 were found to have been discriminatory—known as the McCloud remedy. The work to remedy that is complex, and much of that I have already detailed in a written ministerial statement on 31 March and a subsequent urgent question. It is complex, technical work, and as the NHSBSA began to produce individual statements, it became clear that its initial estimate of the time needed for each one was too low. My written statement of 1 July updated the House that the NHSBSA did not meet its deadline to deliver statements to certain classes of member by that date and set out the actions that I was taking. Let me be clear that this Government remain absolutely committed to providing affected members with their statements at the earliest opportunity, and that is what we are doing. The authority is developing a revised plan, and I will hold it to account against the new deadlines. I met the chief executive of the authority and was very clear about my disappointment in the progress, my expectation for the authority to remedy the situation for members, and the need to have a more robust assessment of the delivery plan. I also ensured that the independent chair of the NHS pension board is ready to set up an independent review of the delivery plans. I met her yesterday and was clear that I expect a thorough review of the process and a realistic assessment of delivery, and to hear her initial assessment. She will give her full report after the summer recess. I will set new deadlines, including for members who are expecting statements this month. I will update the House as soon as possible, of course, both on the progress with the assessment and on the revised deadlines. Let me be clear that members will not face further financial detriment as a consequence of remediable service statement delays, interest on related pension arrears will be paid at 8%, and my Department and the authority have already put in place compensation arrangements for direct financial losses that members may have incurred. People who have served in our NHS deserve their dues, and we will prioritise members based on need. Let me end by reassuring the House that there will be no direct impact on frontline care. I will continue to update the House.

I declare an interest, for myself and on behalf of the shadow Front-Bench team, as we all have NHS pensions. In April, Mr Speaker granted us an urgent question because the Government have no real plan for NHS pension statements. Today we return because the Government have now admitted in writing that a new plan is failing— deadlines were missed, then pushed back, and now we have no idea what they are. Just 1,359 statements have been issued out of a required total of 381,920—just 0.35%. Further still, there is no comment on the remediable pension savings statements. Has the Government’s own delayed deadline of July been met or discussed? This matters. Hundreds of thousands of frontline doctors are not getting their pension statements. The British Medical Association is clear that senior doctors are stepping back from extra work for fear of unexpected tax liabilities. In short, taking on extra work risks an extra tax bill of thousands of pounds. When I raised this in April, the Minister retorted that I could have asked about the impact on services of cancelling the strikes. Well, I will do so now, as the strikes are back on. It will be the senior doctors who have to pick up the slack—the very doctors who are avoiding extra shifts for fear of the tax. If they will not take on the extra work for fear of the heavy tax burden, we have a huge problem. This should be a priority for the Government, especially as we plan for winter pressures. What will the Minister do to remedy the situation with RSS? What will she do regarding RPSS? Ministers cannot just announce new deadlines and then miss them, so would she be kind enough to publish a delivery plan? Finally, she said that the Government have faith in the NHS Business Services Authority. Is that still the case? Will she demand that the Pensions Regulator steps up and expedites its investigation, given that the referral was made in December 2024? In the end, doctors are counting on her, and so are their patients.

As I outlined in my initial response and further to the written ministerial statement, we have asked for an independent review of the process and will report back as soon as possible with a realistic deadline for that. With regard to the strikes, we will continue to be open to discussing the avoidance of those strikes, and I hope that the Opposition will support us in that.

Given that the summer recess is imminent, will the Minister use this opportunity to update the House on the number of additional appointments and, more importantly, the number by which the NHS waiting lists have fallen under this Government? Does she agree that it would be very nice if the Conservative party addressed the crisis in which they left our NHS? It is a mess that this Labour Government are proud to be clearing up.

I thank my hon. Friend, who is a superb advocate for his constituents. I met him again yesterday as he advocated for services in his constituency—that is the focus of Labour Members. He is absolutely right; as I said in my statement, this is part of the overall mess that we inherited from the Conservatives. As I said in my previous response on this issue, the problems outlined by Lord Darzi are wide and deep. It is still shocking, after a year in government, to be faced with the level of disaster that was left to us after a complete abdication of responsibility for sorting out the problems. We will continue to focus on getting more of the appointments that people so need and on reducing waiting lists, which is what our constituents expect.

I call the Liberal Democrat spokesperson.

I thank the Minister for coming to the House to answer this urgent question. These administrative delays are deeply worrying. They make financial planning for those affected very difficult and, more importantly, stop doctors taking on additional work for the NHS as they could face large and unknown tax penalties. That was highlighted at the start of the year, when 4,000 NHS staff missed out on pension tax compensation after administrative failings. This is having a direct impact on patient care, so how will the Minister reassure NHS staff regarding their pension entitlements, and when can they expect to see the compensation the Minister mentioned to encourage them back into the workforce? Can she assure the House that the Government are taking steps to prevent doctors with missing pension records from being unfairly penalised? Can she tell us how the Government will address the 156,000 years of missing pension data for GPs? Finally, will the major reorganisation of the NHS—especially the 50% cut to the organisations that oversee local health services—potentially compound this problem?

I thank the hon. Lady for those questions. She highlights a number of important issues regarding the complexity for the NHS Business Services Authority of dealing with this. There is a large number of high earners in this scheme. With regard to tax liabilities, that makes the system complex, as does the movement of doctors throughout the system in their career. One issue I discussed with the independent reviewer yesterday is the need to ensure there is a technical look at solutions to issues such as missing years. The hon. Lady is right to highlight that changes make a difference to following people’s careers through the system. There are wider lessons, which I have already started to discuss with the reviewer, about how we make the best use of technology so that we can track people through their careers and give confidence to the current workforce that we are addressing this not just for the cohort who have immediate issues but for the future. That is the sort of action this Government are taking. We do not do sticking plasters. We are looking at this very seriously.

I declare an interest, as a trustee of the parliamentary contributory pension fund.. Many people in the public sector receive a significant pension contribution, but they are not aware of its value. The Pension Schemes Bill currently going through Parliament presents an opportunity to place on someone’s pay cheque and pay offer the annual value of that incredibly important contribution to a public sector pension fund. That is something that very few people in the private sector are now able to enjoy, and it feels like it is undervalued by those who benefit from it. Will she consider taking that opportunity?

I thank the hon. Lady for that really constructive suggestion. In my discussions with the NHSBSA, the reviewer and officials at the Department, I have raised similar issues. I am a member of the NHS pension scheme and the parliamentary pension scheme. I tell my young people that this is a really valuable asset, and I encourage my constituents who are looking for jobs in the NHS to consider the pension scheme, because people sometimes do not look at it immediately. We should look at ways to encourage people to take part in the pension scheme—particularly for lower earners, it is a really valuable and stable contribution—and the value of it from the public purse should be well known. I am not across the detail of the hon. Lady’s point on the Pension Schemes Bill, but I will talk with my colleagues across Government about how we can look to do that and come back to her, because I agree that it is a really valuable thing—it rewards the contribution of public service, and we should make the most of it.

I would like to take this opportunity to put my thanks on the record to the Minister. I have spoken to her outside this place about the money we have secured for removing reinforced autoclaved aerated concrete at Harrogate district hospital, which I have been campaigning on for years. It is great having state-of-the-art hospital facilities, but if we do not have the staff there, it is all a bit moot. I want to press the Minister on the concerns raised by colleagues that people might not come back or take on additional hours in the NHS as a result of this issue. Will she commit to updating Members throughout the recess on progress on this matter?

I congratulate the hon. Gentleman on, yet again, shoehorning in a reference to his local hospital, for which he does a great job. People are determined to work in and support the national health service. We take remedying confidence in pensions seriously. I will not give further deadlines before we hear from the assessor. I have asked her to come back and make a very clear statement as soon as possible after the summer recess. I will then be happy to update the House. Coming forward to work in the NHS is a matter of choice for individuals, and we particularly want to work with consultants to ensure that their career progression is the best it can be. We very much value their work in the service.

With the British Medical Association set to strike, and with the Health Secretary reduced to pleading with it not to, thousands of patients are set to have their appointments cancelled. Can the Minister assure the House that she will grip this issue so that senior doctors do not also reduce their hours? And will she rule out bonuses for NHS Business Services Authority executives?

We are working very closely to ensure that resident doctors do not go on strike. We are very clear that we cannot negotiate on pay this year, but we will work with everybody to improve conditions. Some of those conditions are shocking, and we want to work constructively with them to avoid disruptive strike action.

The Daily Telegraph reported in April that a quarter of doctors have reduced their overtime to avoid potential five-figure tax bills, and NHS capacity has been reduced by about 10% as a result. This has been raised many times when I have been out and about door-knocking across Keighley and Ilkley. What steps will the Government take to rectify this absurd situation, which is preventing doctors from working more to reduce waiting lists?

The hon. Gentleman highlights yet another mess that we inherited due to his party’s lack of proper engagement with the workforce over the last decade to resolve the disincentives to making the system work more effectively. Making the system work more efficiently and more effectively is a key part of our 10-year plan announced, I think, only last week—the days keep rolling by. We not only involved the public in those conversations but had valuable conversations and received insights from all staff groups. There is a real spirit of optimism that everyone wants to pull together to ensure that the incentives are right for staff at all levels—over 1.5 million of them—to make the NHS fit for the future, and that is what we are focused on.

The Minister knows that I have a keen interest in NHS reorganisation and the impact on frontline services, particularly in Mid Bedfordshire. Given the failures of NHSBSA, has consideration been given to reorganising that authority? I also repeat the question asked by my hon. Friend the Member for North West Norfolk (James Wild): given the failures, will the Minister rule out bonuses for the NHSBSA’s leadership?

I am totally focused on remedying this situation and learning from the mistakes. If further action is required, I will happily update the House at that point. My absolute focus at the moment is on getting everybody in that organisation and the independent review focused on sorting out the pension situation for those who have already lost out.

As always, I thank the Minister very much for her answers. I recently read an article that referred to the mechanism of the NHS pension scheme as a “Ponzi scheme”, which gives me great concern about the scheme’s ability to cope in 20 years’ time. How do the Government and the Minister intend to convert the transitional arrangement in place since 2019—of topping up pensions from another source—into permanent and transparent arrangements so that we can stop robbing Peter to pay Paul and ensure that those who are working 70 hours a week in 2025 have a real pension and retirement fund in 2065?

The hon. Gentleman tempts me to stray further from the urgent question, but he raises an important point, further to the one raised by the hon. Member for West Worcestershire (Dame Harriett Baldwin), who is a trustee of the parliamentary contributory pension fund. The NHS pension scheme is an extremely important part of the reward package that NHS staff at all levels absolutely deserve. We want to ensure that it, like the rest of the NHS, is fit for the future. If hon. Members have suggestions for how to make it work better, as part of ongoing discussions, I am happy to hear them.