‘This is a situation that cannot go on indefinitely’
STEVE FORD, EDITOR
17 February, 2022 By Gemma Mitchell
Source:  Shutterstock
Pension contributions for many full-time nurses are due to rise under new changes being introduced to the NHS Pension Scheme.
The plans will see the take-home pay of a nurse at the top of band 5 reduce by an additional £19 a month.
However, the proposals will benefit part-time workers, with a nurse at the same level working 60% of full-time hours set to pay £32 less a month in pension contributions.
“Asking many demoralised NHS staff to shell out more for their pensions could prove a step too far”
Sara Gorton
The changes, which have been informed by a consultation, were initially due to take effect from April 2022, however the government has now delayed this to October 2022 in response to concerns raised.
The system is being revamped to reflect the fact the NHS Pension Scheme has moved from a ‘final salary linked’ model to a ‘career average revalued earnings (CARE)’ model.
In a final salary model, the pension received is based on the person’s best salary within three years of retirement, whereas in a CARE scheme it is based on earnings right across the person’s career.
The consultation document described the NHS Pension Scheme as “one of the best available” providing “generous retirement and life assurance benefits”.
Members of the scheme are expected to collectively contribute 9.8% of the costs, however contribution rates are determined on a tiered basis according to salary.
One of the key changes being implemented is that pension contribution rates will, going forward, be based on actual pay rather than whole-time equivalent pay.
A tiered system will remain based on salary however the number of tiers will be reduced and the rates evened out, leading to “more members paying closer to the 9.8% yield”.
The government said the changes would benefit part-time workers because their contribution “will be lower for many and better reflective of the amount of pension that they are building”.
However, unions have raised concern that the reforms will leave the majority of full-time workers worse off.
“Increasing people’s pension contribution will be another blow that some can really ill afford”
Colin Poolman
Under the new tiers, when looking at full-time workers, a newly qualified nurse at the bottom of band 5 will see their pension contribution rate increase from 7.1% to 8.3%.
Those between the middle of band 5 and the start of band 7 will see their rate rise from 9.3% to 9.8%.
Nurses in the middle and top end of band 7 and start of band 8a will experience an increase of 9.3% to 10.7%
Senior nurses at the top of band 8a will see their contribution rate decrease from 12.5% to 10.7%, while for those at 8b and the bottom of 8c it will stay at 12.5%.
Meanwhile, nurse leaders between the top of 8c and band 9 will see their rate drop from 13.5% to 12.5%.
The tiers will be amended annually in line with Agenda for Change pay awards to avoid the “cliff edge issue” that sometimes occurs where a pay increase is cancelled out because the staff member is pushed into a higher pension contribution bracket.
Sara Gorton
Unsion head of health Sara Gorton warned that the changes could force some health workers to quit.
“Asking many demoralised NHS staff to shell out more for their pensions could prove a step too far,” she said.
“Even though the changes won’t kick in until later in the year, the cost of living crisis will be far from over by the autumn.”
She added: “Top earners in the NHS will be quids in under the changes. Part-time staff will end up paying less too, but the majority of full-time employees will be worse off. Some significantly so.”
She urged the government to implement an “inflation-busting” pay rise for NHS staff for 2022-23 to “soften the blow, or many will walk”.
Royal College of Nursing executive lead for pay, Colin Poolman, urged the government to ensure the impact of the “complex and significant” reforms were communicated clearly to nursing staff.
“When the cost of living is soaring, increasing people’s pension contribution will be another blow that some can really ill afford,” he said.
Mr Poolman added: “Ministers have to take all opportunities this year to take account of this economic turmoil when making decisions about the pay of nursing staff.”
A Department for Health and Social Care spokesperson said: “The NHS Pension Scheme is one of the best available, providing generous retirement benefits for hardworking staff after a lifetime of service looking after our nation’s health.
“Under our proposals, those in higher pay bands pay more per month on the scheme, ensuring lower earners and part-time workers pay reduced contribution rates – that applies to more than half of all pension scheme members. This will narrow the range between the lowest and highest contribution rates, ensuring that the costs and benefits of the scheme are more evenly shared.
“After listening carefully to people’s concerns about rising living costs, we have decided to postpone introducing the new member contribution structure until 1 October 2022.”
The changes to the NHS Pension Scheme tiers, which will now be rolled out from October 2022
I have been talking to people recently about how i struggle to pay so much into my pension, as there is no negotiation on contributions. All or nothing! Just another financial blow to the so called ‘heroes’.
“Royal College of Nursing executive lead for pay, Colin Poolman, urged the government to ensure the impact of the “complex and significant” reforms were communicated clearly…” Yes, so we know just how much blood we’ll be having taken, both now and after retirement. Ans as ever with tories, the better paid get it easier.
or a new account to join the discussion. 
The findings of a roundtable at which experts explored what needs to happen if care for plus-sized patients is to be optimised. Download free of charge.
More Sponsor focus
Sports Surgery Clinic
Newmedica
University of Roehampton
University of Roehampton
University of Roehampton
University of Roehampton
