DHSC to extend NHS pension easements; further consultation expected in autumn

The Department for Health and Social Care (DHSC) has confirmed plans to extend amendments to the NHS Pension Scheme, with plans for a further consultation on "a package of new retirement flexibilities" expected in autumn 2022.

The DHSC explained that the ongoing pandemic response presented a clear rationale for continuing the easements over the winter period, confirming that it will continue the easements beyond 31 October 2022, via an extension to the existing temporary modifications to NHS Pension Scheme regulations.

The government response to the DHSC's recent consultation revealed that the proposals to extend the easements had received “overwhelmingly positive support”, as 98 per cent of respondents agreed that the easements should continue.

However, the suggested date for the continuation of the easements of 31 March 2023 received a more mixed response, with 32 per cent of respondents agreeing with the proposed duration of the continuation, while 68 per cent disagreed.

The NHS Pension Scheme Advisory Board (SAB) for instance, disagreed with the proposed length of the extension, arguing that the 16-hour rule should be permanently removed on the basis that it serves "little practical purpose" for staff, employers, or the pension scheme.

SAB also argued that extending the easements for a duration of longer than 6 months would provide greater certainty for employers in workforce planning and for staff in making decisions regarding their retirement work-life balance.

NHS Employers also agreed that the 16-hour rule should be permanently removed.

As a result of consultation feedback, DHSC confirmed that the suspension of abatement for special class status (SCS) members will be extended for a longer period than originally planned, with the suspension of SCS abatement to be extended to 31 March 2025.

It stated: "While these easements were initially introduced to help the NHS respond to the demands of the coronavirus pandemic, there is now unprecedented pressure on the NHS during the period of elective recovery.

"In addition to this, the government is committed to support the NHS to have the staff it needs to deal with treatment backlogs, and recognises the vital increased capacity provided by SCS members since March 2020."

In addition to this, DHSC has confirmed plans to launch a public consultation in autumn 2022 on a "package of new retirement flexibilities".

This will include proposed amendments to the regulations to allow members of the 1995 section to partially retire but continue working and building up further pension, and provision for pensionable re-employment for those who have already retired and then returned to work.

The consultation will also propose the permanent removal of the 16-hour rule from the 1995 section from 1 April 2023, with the government intending to continue with plans to extend the suspension of the 16-hour rule to 31 March 2023, ahead of its proposed permanent removal the following day.

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