18 October 2023
If you are covering how this morning’s inflation figure impacts NHS pensions, please see the following comment from Graham Crossley, NHS pension expert at Quilter:
"Today's Consumer Price Index figure (CPI) has profound implications for NHS pensions. With last year's September inflation figure at a staggering 10.1% and this year's figure hovering at 6.7%, the continued high inflation rates are eroding the real value of the 1995 NHS pension benefits for active members.
“While the CPI serves as a metric for adjusting pensions in retirement, and those in the 2008 or 2015 schemes, the rapid increases are causing concern for thousands of members in the 1995 scheme. The final salary link to pensionable pay, once seen as a beneficial tether to pay progression, is increasingly restrictive following many years of sub-inflationary pay awards. With rising inflation, its real value is diminishing and instead of offering a reliable safety net based on years of service, it’s becoming a leash, holding pension holders back from realising the value of their benefits amidst the cost of living crisis. NHS Pension scheme members, especially those eyeing retirement, must stay vigilant to these economic shifts and seek financial advice to help mitigate the impacts in whatever way possible.
“During a time when many in the NHS are already very concerned about their pay packets these kinds of issues in relation to pensions serve to pour fuel on the fire.”
