Could Pension Reform Be The Key To Persuading Nurses To Stay In The NHS?

“When the cost of living is soaring, increasing people’s pension contribution will be another blow that some can really ill afford” Royal College of Nursing executive lead for pay, Colin Poolman

Could reforms to pension entitlements and contributions boost efforts to retain experienced nurses within the NHS?

Over twice as many nurses and other healthcare professionals withdrew from the NHS pension scheme over the past year when compared to the preceding year.

So Why are NHS Staff Currently Opting Out?

Over 66,000 NHS staff in England and Wales opted out of the NHS pension scheme in the past year. This is more than double the 30,270 who removed themselves from the pension scheme during the same period the previous year, according to new data from the NHS Business Services Authority (NHSBSA).

Is This Due To Affordability?

The NHSBSA data also showed that approximately 23,000 of the NHS staff who ceased contributing into their pensions between April and July did so because such contributions were no longer affordable. In the same period the year before, the number ceasing contributions who gave unaffordability as the reason was only around 11,500.

RCN general secretary Pat Cullen condemned the situation, saying ‘It is a sad day when the people who care for this country from cradle to grave don’t earn enough to provide for their own future’.

Should Action Be Taken?

Should the government and NHS management be concerned about increasing numbers of nurses having to halt contributions into their pensions? And if so, is this a part of the current argument over nursing pay that is being unfairly overlooked?

Changes to the NHS pension contributions came into force in October 2022.

The Impact of Recent Changes

The new system means fewer tiers in order to avoid an automatic increase in contributions if staff get a small pay rise.

However, the changes have resulted in a reduction in net pay for most full-time workers, with nurses in bands 5 to 7 among the worst affected.

At the time, unions warned changes to NHS pension contributions might be the ‘final straw’ for nurses facing a choice between having less money in the present or in retirement.

Unison head of health Sara Gorton warned that “Asking many demoralised NHS staff to shell out more for their pensions could prove a step too far”.

“Part-time staff will end up paying less…but the majority of full-time employees will be worse off. Some significantly so” she added.

When the cost of living is soaring, increasing people’s pension contribution will be another blow that some can really ill afford, states Royal College of Nursing executive lead for pay, Colin Poolman

Does The NHS Pension Directly Affect Retention?

Do you think increased pension contributions resulting in declining take-home pay will cause more nurses to leave full-time NHS employment to earn more pro-rata as a locum, or as a nurse in the private sector?

A spokesperson for the government maintained the NHS pension scheme offered ‘significant value’ on ‘some of the most generous terms’ for a pension scheme.

‘We have also just committed to the biggest state pension increase in history thanks to the triple lock – a 10.1% boost – which will also apply to pension credit for low-income pensioners, and pensioner households are receiving extra cost of living payments worth up to £600, with more for those on means-tested benefits’ they explained.

We Would Like To Hear From You?

Do you think improving pension affordability and provision could be a more sustainable method of ‘paying’ nurses more in order to retain them in the NHS, whilst at the same time avoiding a wage/price inflation spiral, thereby satisfying both government and nursing unions’ priorities?

Please let us know what you think in the comments, and Like the article if you found it interesting.

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