Labour’s manifesto is now out and as reported by the Financial Times earlier this week, it does not include a pledge to reintroduce the tax-free lifetime allowance on pensions, despite previous announcements that it would.
For doctors, patients and the NHS, this is very welcome news as reintroducing the LTA, particularly without any detail about how to protect doctors, would have sunk any future Labour government’s plans to improve the NHS before they had even taken office.
Labour’s key health policies include delivering an extra 2mn operations, appointments and scans a year to bring down near-record high waiting times, by committing to 40,000 extra a week, delivered out of hours.
To do this they need to retain doctors and remove barriers that prevent doctors from taking on more work. Bringing back the LTA without ensuring the NHS would be protected would undoubtedly have caused senior doctors to retire early and this would not only undermine any pledges to tackle the backlog but would risk making things even worse.
Following years of campaigning and lobbying by the British Medical Association, in 2022 the health select committee, which was then chaired by Jeremy Hunt, described the situation where NHS pensions arrangements prevented doctors from working as a “national scandal”.
Hunt then as chancellor finally went on to remove the LTA in the following year’s Budget.
Labour’s immediate response to this Budget was to say that in government it would reverse the policy, albeit adding that it would introduce a targeted scheme that would protect doctors.
The problem was that the longer time went on, the lack of detail or commitment around any kind of carve out for doctors began to cause real concern that this protection would never materialise.
This concern was so stark that in a snap survey of more than 5,000 BMA members last week, more than one in 10 doctors (13.3 per cent) stated that they would retire immediately after the election if the outcome meant that the LTA would be reintroduced with no protection for public sector workers.
A further five in 10 (53.7 per cent) told us they would retire earlier, although not immediately.
Following last weekend’s reports of a rethink, a Labour source said that the shadow chancellor’s priority was “stability and certainty”, which is exactly what doctors want when it comes to their pensions.
The NHS pensions scheme is a highly valued part of doctors’ remuneration, but navigating it is complex, even without the threat of huge, unexpected tax bills that punish doctors for working.
However, pensions planning is done over the long term and while it's very welcome that Labour have dropped the plans to reinstate the LTA in its manifesto, and made it clear they will not reintroduce it right now in their statements to the media, doctors need clarity that this is not something that they will change their mind on again down the line.
