Quarter of a million NHS staff have opted out of pension scheme – as many might not be able to afford to pay into it
- Opt outs over past 3 years are around 16% of the NHS’ total membership
- More than 245,000 staff opted out – around 30,000 of them aged 26 to 35
A quarter of a million NHS staff have shunned its lucrative pension scheme, with fears growing that many cannot afford to pay into it.
The opt-outs over the past three years are around 16 per cent of the total membership, says insurer Royal London.
It comes after NHS staff faced a freeze on pay for several years and the Government reduced the amount of tax relief available for savers.
The pension opt-outs over the past three years are around 16 per cent of the total membership
Overall more than 245,000 staff opted out, around 30,000 of them aged 26 to 35.
Jon Restell, chief executive of union Managers In Practice, told Health Service Journal that younger staff on lower salaries are under particular pressure.
A typical nurse on £25,000 per year saves £1,420 by opting out of the NHS pension scheme, but could miss out on £13,000 a year in retirement.
NHS pensions are far more lucrative than those in the private sector, where retirement benefits have been slashed to save money.
Steve Webb, director of policy at Royal London, said: ‘The NHS as an employer needs to take urgent action to tackle this epidemic of opt-outs.
‘All public sector workers have faced a squeeze on take-home pay in recent years, but it is in the NHS where this has translated into shockingly high numbers of people leaving the scheme.’
A Department of Health spokesman said: ‘The NHS pension scheme is among the very best available, providing deservedly generous retirement benefits for NHS staff.
‘Around nine in ten nurses, midwives and health visitors participate in the scheme.’