26 February 2024
Following the news that 3,000 NHS professionals have opted to take advantage of the new partial retirement rules, Quilter is calling for NHS Trusts to apply the rules more fairly after reports that staff are often denied full access to the new rules.
The partial retirement rules were changed on 1 October 2023 for the 1995 NHS Pension Scheme allowing members aged 55 and over to take part or all of their pension benefits on one or two occasions and continue in NHS employment, as long as they reduce their pensionable pay by 10%, however NHS employers have stated that members do not necessarily have to reduce their hours.
This measure was already available to members of the 2008 and 2015 NHS Pension Scheme to try and keep experienced staff within the NHS workforce by offering greater retirement flexibility.
A recent poll of the ’NHS Pensions Member-led Discussion’ Facebook group, which has over 34,600 members, found that 10% had been declined partial retirement*
Similarly, of those that were accepted only 1% were allowed to keep working the same number of hours, whilst the majority had to reduce their hours demonstrating that the policy is not being adopted as intended by DHSC.
So far, the implementation of the partial retirement has been problematic, resulting in a postcode lottery where some employers have embraced the new policy and enabled workers to take their NHS pension benefits and kept them employed on the same hours.
However, other employers have not followed NHS Employer’s guidance, and have been denied access to partial retirement, or have forced a reduction in hours.
This prompted NHS Employers to update their guidance on 5 December, even giving specific instructions as to how an employer can simply adjust their employee administration systems to allow a member to take partial retirement and maintain their same hours.
Even after these updated instructions, many employers still do not follow the guidelines, leaving some members to either reduce their hours or retire entirely, depriving the NHS of a much-needed workforce.
Graham Crossley, NHS pension specialist at Quilter:
“It is good to see that more than 3,000 NHS staff have been able to remain at work, whilst taking their NHS pension. This demonstrates that DHSC’s great idea to retain healthcare workers after retirement can work, but unfortunately these numbers do not tell the whole story as there are many members who have been denied.
“The DHSC’s idea to extend partial retirement provisions to the 1995 section and allow members to take up to 100% pension benefits and continue to work was one of their best in recent history to retain healthcare workers. One of the key conditions is that members have to reduce their pensionable pay by 10%, however NHS Employers have pointed out this does not necessarily mean that members have to reduce their hours.
“Given the issues with waiting lists it makes sense that DHSC and NHS Employers have explained how a member can achieve a 10% reduction in pensionable pay by making some of the pay non-pensionable, enabling the member of staff to keep working the same hours.”
Sorcha Ford, Admin of the NHS Pensions Member-led Discussion Group on Facebook adds:
“Partial retirement is a frequently discussed topic by members in our group of 34,000 NHS pension scheme members. On introduction it seemed to tick a lot of boxes, enabling employees to have the choice of drawing benefits whilst remaining in employment and simultaneously supporting employers to retain staff.
“Unfortunately, the implementation of the policy has been fraught with problems. Some employees report that partial retirement requests are being refused on the grounds of inadequate staffing or due to managers lack of knowledge about the scheme despite the guidance issued by NHS Employers. Unfortunately, for many scheme members Partial Retirement is an illusion rather than a viable choice. There clearly needs to be more oversight in terms of how employers are rolling out the policy so that there is equity across the NHS.”
