Consultation response: the National Health Service pension ...

1 Consultation Response The National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment) Regulations 2019. Published March 2019. National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment). Regulations 2019. Contents 1. Introduction .. 4. 2. Consultation process .. 6. 3. Member contribution 8. Background and Consultation 8. Consultation findings .. 9. Response .. 10. 4. Employer Contribution Rate .. 13. Background and Consultation 13. Consultation findings .. 15. Response .. 16. 5. Entitlement of survivors of civil partners and same-sex spouses .. 19. Background and Consultation 19. Consultation findings .. 19.

2 Response .. 20. 6. Forfeiture of pension benefits .. 21. Background and Consultation 21. Consultation findings .. 22. Response .. 22. 7. Contracting out .. 24. Background and Consultation 24. Consultation findings .. 24. 8. Exempting Agenda for Change pay increases from Final Pay Control charges .. 25. Background and Consultation 25. Consultation findings .. 26. Response .. 27. 9. Amendments presented in an earlier 28. Background and Consultation 28. Consultation findings .. 31. Response .. 32. 10. Miscellaneous and consequential 33. Background and Consultation 33. 2. National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment). Regulations 2019. Consultation findings.

3 34. Response .. 34. 3. National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment). Regulations 2019. 1. Introduction The Department published for Consultation a draft statutory instrument titled: the National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment) Regulations 2019. The instrument proposed amendments to the Regulations which set out the rules for the NHS pension Schemes in England & Wales and associated schemes. The amendments are for the following main purposes: (a) Implement a new contribution rate of for employers from 1 April 2019. (see paragraph below for further information on funding of the increase).

4 And renew current employee contribution rates so that the same rates continue to apply beyond 31 March 2019;. (b) Following the Supreme Court judgment in the case of Walker v Innospec Ltd ([2017] UKSC 47), civil partners and same sex spouses will have the same survivor pension rights as widows;. (c) Extend existing forfeiture rules so that the Secretary of State may suspend pension benefits if a member or other beneficiary is charged or convicted with an offence that may lead to all or part of those benefits being forfeited;. (d) Update provisions relating to 'contracting-out' from the second state pension so that these are in line with revised HM Revenue & Customs and Department for Work & Pensions legislation.

5 (e) Exempt from controls on final pensionable pay, any pay increases which result from a nationally agreed Agenda for Change pay award;. (f) Make miscellaneous and consequential amendments to scheme rules, in particular relating to the provision of a statement of estimated pensionable income/contributions; and (g) Make other changes that were presented in a previous Consultation in November 2017, including: (i) removing the nomination requirement to nominate unmarried co-habiting partners for survivor benefits; and (ii) Miscellaneous corrections and refinements to improve the operation of scheme rules. 4. National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment).

6 Regulations 2019. This document sets out the Department's response to comments received through Consultation . The Department will produce informal full consolidations of the NHS pension Scheme regulations incorporating the changes implemented by the final instrument. These will be available on the scheme administrator's website after 1. April 2019: 5. National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment). Regulations 2019. 2. Consultation process The proposals and draft regulations were subject to public Consultation which began on 18 December 2018 and ended on 28 January 2019. A document describing the proposals and draft regulations was published on the website and Consultation platform, with responses invited through the Consultation platform or post.

7 The major NHS trade unions, a number of NHS employers and other interested parties were formally notified of the Consultation , as part of governance arrangements for the NHS pension Scheme. Prior to publication of the Consultation document, the proposals were shared and discussed with the NHS. pension Scheme Advisory Board (SAB) in October. This a statutory board, comprising NHS Trade Union and employer representatives, that advises the Secretary of State for Health and Social Care on the merits of making changes to the scheme. The Department welcomed any comments or views on the proposals and draft regulations. Almost 1,500 responses were received through the Consultation platform, by post and by email.

8 The majority of these were from individuals. GP surgeries, medical centres and other primary care providers were the main respondents on behalf of organisations. Other organisations included: (a) Association of Independent Specialist Medical Accountants;. (b) The British Dental Association;. (c) The British Medical Association;. (d) Charitable or not-for-profit organisations;. (e) Hospice organisations;. (f) The Independent Healthcare Providers network;. (g) NHS Clinical Commissioners (h) NHS Directions Group;. (i) NHS Employers;. (j) NHS Foundation Trusts;. 6. National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment). Regulations 2019. (k) NHS Trade Unions - joint response.

9 (l) Private providers;. (m) Social Enterprise organisations, including Community Interest Companies and Social Enterprise UK; and (n) Universities and representative organisations. Some respondents took the opportunity to express views on topics related to the NHS pension Scheme but outside of the scope of the Consultation . The Department is grateful for the suggestions respondents made to improve the format and response methods. These comments will be considered for future public Consultation exercises. 7. National Health Service pension Scheme, Additional Voluntary Contributions and Injury Benefits (Amendment). Regulations 2019. 3. Member contribution rates The Consultation proposed the removal of the time limit on current member contribution rates so the scheme can continue to collect contributions at those rates until such time that new rates are introduced.

10 Background and Consultation proposal The current contribution rates were set for the four-year period 1 April 2015 to 31. March 2019. This means unless these rates are renewed or substituted with new rates, the NHS pension Scheme will be unable to collect contributions from members from 1 April 2019 onwards. This is because the current rates expire on 31 March 2019. The current member contribution rates are: Whole time equivalent pensionable pay Contribution rate (before tax used to determine contribution rate relief) (gross) to 31 March 2019. Up to 5%. 15, to 21, 21, to 26, 26, to 47, 47, to 70, 70, to 111, 111, and over The Consultation document described how the SAB has undertaken a review of member contributions.