Scottish government presses chancellor on pension tax

In a letter published on Monday, Ms Freeman urged Sajid Javid to “take decisive action” to ensure pension and taxation rules stop having negative outcomes for senior clinicians across Scotland and other areas of the UK, and for a solution to be found before April.

The tapered allowance, which gradually reduces the annual allowance for those on high incomes, is causing doctors across the NHS to stop contributing to their pensions, cut their hours or retire early to avoid significant tax bills.

The Scottish government introduced a temporary opt-in policy whereby NHS staff have the option to get their employer pension contributions paid as part of their basic pay, while doctors in England were promised the government would cover their tax bills for the 2019-20 financial year. But this interim measure is due to cease on March 31 2020 and no permanent solution has been found.

In the letter, Ms Freeman called on the chancellor to find a lasting solution or the Scottish government would continue to find its own solutions.

She said: “Considerable effort has been expended to date in trying to offset the very real consequences for NHS staff and services of UK government tax policy.

“The Scottish government will continue to act to mitigate the harmful impact of pension taxation rules on NHSS staff and on frontline service delivery from April 2020 should this prove necessary. It is, however, clear that a permanent solution is urgently required and can only be offered by your department.”

Ms Freeman urged Mr Javid to use the Budget on March 11 to offer a solution.

She added: “It is incumbent upon you to take the opportunity of the March Budget to fully and finally remedy the situation, and allow our NHS staff to get on with delivering care without fear of the consequences. These concerns are echoed across the entire UK, and I urge you to act.”

This article originally appeared on ftadviser.com