NHS pension scheme members will see their contribution rate increase over the next two years starting on 1 October 2023. The increased rate is being introduced to maintain the correct level of funding in the NHS pension scheme.
The contribution rate increase and other changes are finally being introduced after delays caused by the COVID-19 pandemic and our calls for extensions to the consultation period on the changes. We felt that previous consultations did not give the health trade unions and members of the scheme sufficient opportunity to respond.
The RCN sits on the NHS Pension Scheme (Scotland) Advisory Board which provides advice to Scottish ministers on a broad range of policy matters relating to the pension scheme. However, the final decisions on changes to the scheme lie with ministers – the health trade unions are not able to negotiate on the NHS pension scheme.
Commenting on the increase in contribution rate and other changes, Philip Coghill, RCN Scotland Pay, Terms and Conditions Lead, said:
“In our response to the most recent consultation, which closed in August, we strongly urged a rethink. Our members told us were not in favour of increased contributions in a period when the cost of living crisis is inflicting significant financial harm on us all and NHS pay rates are still being eroded by inflation
“We believe that the changes are likely to encourage more members to opt out of the scheme. A freedom of information request we made to the SPPA showed that in 2022-23, 4,541 people opted out of the scheme, more than double the number in 2021-22. Increasing the rate now will only push that number up in the coming years. That is not a good trend either for the health of the scheme or for the future financial security of our members.”
From October the percentage of pension contributions scheme members will pay will be related to their actual earnings, rather than the full-time equivalent for the band and incremental point they are on. This approach is felt to be fairer approach and may result in reduced contribution for some part-time staff.
In addition, the NHS pension scheme contributions tiers will increase annually in line with the average Agenda for Change pay increase. This is intended to ensure that the annual cost of living increase alone can lead to any scheme member moving up a tier of pension contributions
RCN members are advised to seek independent financial advice about their individual circumstances and pension.
