Scottish Government to fill £50m NHS pension gap

Thursday 20th June 2019

The Scottish Government is to provide nearly £50m to the health service to fill a pensions black hole created by UK-wide employer contribution changes.

GPs, children’s hospices and NHS bodies had warned the cost of filling the gap themselves would harm frontline services.

It follows a dispute between the UK and Scottish governments over who would meet the additional costs.

In a parliamentary answer, Jeane Freeman, the Health Secretary, said: “The UK Government has taken decisions on pension costs and funding that result in a shortfall of £48.4 million for the NHS in Scotland.

This comes on top of a reduction to health funding of £55m applied through the UK Budget, and therefore a total future shortfall for Scotland of over £100m per year.

“I can confirm today that the Scottish Government will provide additional funding of £48.4m to meet the increased pension costs for the NHS in Scotland, including GPs and hospices that are members of the NHS pension scheme. By doing this we will continue to prioritise and protect frontline health services in Scotland.”

The British Medical Association (BMA) Scotland said it was "unfortunate" the Scottish Government had to fund the changes.

Andrew Buist, chair of the organisation's Scottish GP committee, said: "We welcome the successful resolution of this issue which means that GP practices will not be left out of pocket as a result of the 6% increase in employer superannuation payments.

"The BMA has been pushing for a permanent solution on employers’ contributions for a number of months now – however it is unfortunate that this substantial gap needs to be funded by the Scottish Government instead of the Treasury.”

Under the Treasury plans, NHS employer contributions will increase from 14.9% to 20.9%.

The scheme covers GP practices, as well as non-NHS organisations such as charities and hospices.

Children’s Hospices Across Scotland had said the cost of bearing the increase themselves was equivalent to nine full-time nurses.