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Pension opt-out scheme slammed by nurse leaders

Trust offers high pay in return for pension opt-out

Jo Carlowe

Monday, 12 September 2016

Nurse leaders have condemned a scheme that will see staff offered a higher rate of pay, provided they opt out of the NHS Pension Scheme. 

East and North Hertfordshire NHS Trust today offered Band 5 and 6 nursing staff a higher rate of pay if they opt out of the NHS Pension Scheme.

Under the terms of this offer, nursing staff who are not members of the NHS Pension scheme will keep their employee contributions and receive a higher rate of pay than Agenda for Change rates. The higher rate also includes the value of the employer’s pension contribution, which is approximately 12%.

But the Royal College of Nursing has described the proposal as “deeply concerning”, and says it has the potential to impact on the “long-term financial security of hardworking nursing staff”. 

The RCN is campaigning for the offer to be withdrawn and has made its opposition known to the Trust.

Commenting, Janet Davies, RCN Chief Executive and General Secretary, said:

“Like so many others, East and North Hertfordshire NHS Trust is facing a harsh financial reality and struggling to reduce its reliance on agency staff. 

“Nurses at the Trust are no different to the thousands of other nurses across the country who are having to work additional hours for agencies in order to make ends meet.

“Now the Trust is suggesting these nurses forgo their pension contributions as a way of increasing their salaries to try to attract them away from agency work.”

She added: “This ill-thought-out move asks people to neglect their future and will stop them from making retirement plans. It could put nurses into poverty when they retire and lead to an even greater reliance on state support.”

She also suggested the scheme could potentially have “serious consequences for the long-term viability of the NHS Pension Scheme.”

“Making nurses bear the brunt of the Government’s failure to properly fund the NHS is not fair and not sustainable. This scheme risks a great deal for very little gain. The solution is simple: pay nurses enough. Nurses won’t then be forced to work additional hours for agencies, hospitals will not be left short staffed and patients will get better quality care. This must be reconsidered.”

Thomas Simons, East and North Hertfordshire NHS Trust’s director of workforce, says the opt-out scheme was launched as part of a major recruitment campaign aimed at encouraging band five and six nurses, midwives and operating department practitioners (ODPs) to take up “substantive roles” at the Trust’s hospitals, rather than working solely for agencies. 

He explained: “From research that we have undertaken, some nurses choose to work for agencies only as they believe that this gives them greater flexibility over how and when they work, as well as higher rates of pay … one of the options that we are now making available to band five and six nurses, midwives and ODPs relates to their pension arrangements. Given that people working for agencies do not have access to the NHS Pension scheme, we are piloting allowing band five and six nursing and midwifery staff options scheme that allow them receive the contributions that the Trust would have made on their behalf had they joined either the NHS Pension or choose the NEST scheme.” 

Mr Simons continued: “The impact for those taking up the option to opt out of the NHS Pension is the equivalent of around a 12.5% rise in their salary… For staff choosing to join a NEST scheme, the uplift will be some 7.5%. People are, of course, free to choose the NHS Pension scheme should they wish to, with staff opting out auto-enrolled back in every 12 months unless they chose actively otherwise.”

He said the Trust had been “very sensitive” to how the scheme might be viewed and had undertaken an extensive briefing, which included sharing the plans with “local, regional and national trade union partners representing nursing staff”. 

The initiative is to be formally reviewed in a year’s time. 

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