News

Government 'clawback' on pensions

14-Aug-08

GP pensions will not be uprated to take account of increases in average incomes between 2006 and 2008, the BMA has revealed.

In April the High Court ruled that health secretary Patricia Hewitt acted unlawfully in 2006 when she retrospectively capped the ‘dynamising factor’, used to calculate inflationary increases in pensions, for the period 2003/06. It ordered the government to remove the cap, increasing the pensions of GPs who retired during these years.

The ruling does not apply to the dynamising factor for 2006/8, however.

Now the government looks set to clawback some of the increased dynamisation it has been forced to pay in earlier years.

In last week’s letter to the profession, GPC chairman Dr Laurence Buckman wrote that the health secretary plans set dynamisation at 1 for those years.

This replaces earlier calculations of a 14 per cent increase over the two-year period. As a result, the compound dynamisation for the years 2003/6 will be the same as that for 2003/8.

jonn.elledge@haymarket.com

Comment below and tell us what you think

Comments

Niall Finegan

14/08/2008

discgraceful, dishonest, lan diengenious. ld they do the same to their own pensions

call it aash and grab raid

david gregson

07/10/2008

My concern is the proposed capping of dynamisation factor to 1 for the years 2006-7 and 2007-2008.

My accountant tells me that profits have risen slightly during that period.

My contributions also rose during that time in line with profits and I paid those contributions with a reasonable expectation that the Government would honour their part of the contract ie increase pension in line with increased profits.

Although most GPs benefit from the overall settlement \(self included) and will if continuing in general practice will benefit from indexing in the future it leaves a small group of GPs with a relatively large loss of pension, no indexing since 2006 and dynamising factor of 1 only. This is in effect giving GPs a 2008 pension at 2006 levels..ie 2006 pension -minus inflation! \(having paid contributions at 2007/2008 levels)

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