The number of NHS staff claiming retirement benefits has reached its highest level in nearly a decade, figures seen by HSJ have revealed.
Data obtained from the NHS Business Service Authority showed NHS staff made an average of 3,864 claims per month to access their pensions in the 12 months to November 2022.
This is the highest the 12-month rolling average has been since March 2015, which is the date HSJ’s freedom of information request went back to. It had fallen back slightly to 3,716 by February 2023, the most recent data HSJ was able to obtain.
The figures come amid both long-running issues with how NHS pensions are taxed and signs staff are leaving the health service following the pandemic. Earlier data has revealed more than 42,000 staff voluntarily resigned in the NHS in quarter two of 2022-23 – the highest number recorded for any equivalent quarter across the last decade – with more than 7,000 citing “work-life balance” as their reason for leaving.
August 2022 saw the highest number of claims per month for the near-decade period, with 5,329 claims made in that month. The second highest number of claims for a single month was 4,837 in December 2018 and the third-highest was July 2022, with 4,394.
However, when HSJ asked NHSBSA about the December 2018 spike, it explained that a change in its systems had led to all pension awards which were open or awaiting classification being logged as December 2018, rather than the actual date the claim was made.
The 12-month average for pension claims has been climbing since March 2021, having plateaued at an average of just under 3,000 claims during the pandemic.
The number had been growing between December 2018 and November 2019, when it reached 3,164 before dropping to 3,001 in December 2019, although some of this growth would have been down to the December 2018 systems change described above. Prior to this, the 12-month average had been falling.
Voluntary early retirement was the most common reason for staff to claim their pension earlier than retirement age. Other common reasons included ill-health retirement claims and redundancy.
Non-clinical staff, such as administrators, secretaries and receptionists, submitted the most claims, followed by nurses, hospital doctors and GPs.
NHSBSA did not provide figures by pay band. The data also does not include how many of the claims were awarded.
Saffron Cordery, NHS Providers’ deputy chief executive, described the figures as “deeply concerning, although not altogether surprising”.
She said: “With the spectre of unresolved pay disputes and further industrial action hanging over the health service, trust leaders are understandably worried this could act as a further catalyst in encouraging more staff to leave.
“The government must act fast to tackle the fundamental problems which are pushing staff into taking early retirement, including understaffing and burnout.”
In March, chancellor Jeremy Hunt abolished the pensions lifetime allowance and increased the annual allowance – from £40,000 to £60,000 – during the Spring Budget, in moves aimed at preventing experienced doctors from leaving due to punitive pension tax charges. Senior managers have also been impacted by the charges.
Graham Crossley, an NHS pension specialist at wealth management firm Quilter, said: “Whether we see similar numbers of people taking their pension benefits next year – now that some of the problems that were causing retention issues have been fixed – is yet to be seen.
“If the numbers continue to climb this will be a real concern as it will lead to even more pressures on the NHS workforce, unless government takes steps to resolve the various issues still plaguing the NHS.”
NHSBSA, which administers the NHS pension scheme, told HSJ the figures should be considered against the scheme’s “growing” membership. The scheme had more than 1.8 million active members by the end of March 2023 and a further 709,000 deferred members, a spokeswoman said.
The Department of Health and Social Care said the number of NHS staff aged 55 and above increased by 57 per cent between September 2012 and December 2022, and therefore, more staff are claiming their retirement benefits.
A spokeswoman added: “The decision to claim pension benefits is a personal one… staff may choose to do so for a number of reasons, and it is not possible to isolate the impact of a single factor on retirement rates.
“In order to retain the most experienced NHS staff, we are changing NHS pension scheme rules to make retirement more flexible and encourage retired staff to return.”