Patients will face longer waits for operations this winter as surgeons refuse to work overtime because of a pensions “tax trap,” senior doctors have warned.
More than two thirds of consultant surgeons say they have cut their hours, in a bid to protect their earnings
A combination of tax and pensions rules mean doctors can be hit with tax rates of more than 90 per cent on their earnings – including their pension contributions – if they earn more than £110,000 a year.
It means consultants are substantially cutting back on any overtime or weekend work as they can be taxed thousands for earning a penny over the threshold.
A poll of almost 2,000 doctors reveals that 69 per cent of surgeons have reduced the amount of time they have spent working in the NHS as a direct result of pension rules.
Almost as many are considering early retirment, the YouGov survey commissioned by the Royal College of Surgeons (RCS) found.
NHS pensions changes brought in in 2016 have impacted upon doctors earning more than £110,000 a year due to the introduction of a tapered annual allowance.
This is a taxation threshold which restricts the amount of pension growth individuals are allowed each year before tax charges apply.
It gradually reduces the allowance for those on high incomes, meaning they are more likely to suffer an annual tax charge on contributions and a lifetime allowance tax charge on their benefits.
The tapered annual allowance means that for every £2 of income above £150,000 a year, £1 of annual allowance is lost.
Health leaders say the rules mean the NHS’s most senior and experienced staff are being pushed to leave, work part-time or refuse extra shifts.
Boris Johnson has pledged to “fix” the crisis, with the Treasury to review the rules affecting high-earners, and changes to be introduced from next April.
But the college says more urgent action is needed, to prevent a crisis this winter.
Professor Derek Alderson, president of the RCS, said: “As our survey findings emphasise, the impact of pension tax rule changes on waiting times for surgery are devastating.
“Surgeons who have previously done many hours of extra work to help reduce waits are cutting back their hours. Many are considering early retirement.
“Patients already face overly long waits for operations.
“Persisting with a tax system that punishes clinicians for taking on extra work will undoubtedly lead to a further deterioration in waiting times.”
RCS council member Stella Vig, a clinical director at Croydon University Hospital, added: “The NHS pensions scheme has created a ‘tax trap’, where accepting an extra shift can lead to a large and entirely unpredictable tax bill landing in the post many months later.
“The Government has published a consultation that looks set to last many more months, rather than taking decisive action. We need them to sort this out before winter takes hold.”
One surgeon said their waiting list had risen from five months to nine months overnight, after they dropped one session a week, in a bid to protect their earnings.