Ticking Time Bomb: Inaccurate GP Pension Records

Capita took over dealing with the administration of GP pensions in September 2015. We have seen many problems with delays in contributions being collected and many inaccurate NHS pension records due to Capita’s failure to deal with the processes correctly and efficiently. Many practices have large sums of money owed to NHSE in respect of GP partners’ and salaried GPs’ superannuation contributions.

GP Partners’ Pensions Record (Type 1 Practitioners)

NHSE make monthly deductions for GP partners’ superannuation which is based on an estimate. A yearly end of year pension certificate should be completed and submitted to PCSE by 28^th February, following the end of the financial year, 31^st March. For example, the 2016/17 end of year certificate should have been submitted by 28^th February 2018 and normally, we would have expected the end of year adjustments to have been made in March 2018.

End of Year Certificates Not Being Processed

We are seeing so many GPs, whose pension certificates for various years do not appear to have been processed, resulting in incorrect pension records. This even includes GPs who are already in receipt of their NHS pension and so are receiving pension benefits based on estimated earnings.

So, how do you know if you have outstanding certificates? At RBP, we have changed the way we present our accounts in respect of superannuation so it is clearer as to which years’ pension certificates remain outstanding. If you look at the superannuation schedule of your practice accounts (usually page 12), you will see towards the bottom the list of shortfalls or refunds that are outstanding. 2017/18 should be the only year outstanding as these are the certificates that have not yet been submitted. All earlier years should have been processed. As these shortfalls or refunds have not been deducted by NHSE, this would indicate that the certificates have not been processed and so your pension record would be inaccurate. Therefore, you should resubmit these outstanding certificates to PCSE via their online portal. Once submitted, you should review the monthly NHSE statements and make sure the end of year (EOY) adjustment has been made.

For GP partners, it is easy to check if your pension record is accurate as your end of year certificate includes all your NHS income. You should obtain your dynamised earnings list from either the total reward statement website https://www.totalrewardstateme... or the NHS Pension Agency (NHSPA). Your pensionable earnings as a partner can be checked to your pension certificates to confirm your record is correct.

It is advisable that, in future, as soon as your pension certificates are uploaded to the PCSE, you or your Practice Manager reviews the monthly statements to ensure the EOY adjustment has been made. If not, this should be followed up with the PCSE regularly.

Impact of Delays in Certificates Being Processed

If your pension certificate is not processed in a timely manner, there is a delay in the tax relief on the shortfall resulting in you paying more tax. Only when the shortfall is paid will the tax relief be given.

The NHS Pension Agency send out Annual Allowance statements to those GPs who are affected and we assume that these are accurate statements. However, if certificates have not been processed for earlier years, these statements may not be accurate as the NHS Pension Agency will not know your actual pensionable pay for each year that is missing.

If you want to apply for Individual Protection 2016, you cannot do this until you know that your end of year pension certificate for 2016/17 has been processed. The NHS Pension Agency cannot give you a lifetime value of your pension at 5^th April 2016 until they have all your correct earnings for 2016/17.

Salaried GPs’ Pension Records (Type 2 Practitioners)

At RBP, when we are preparing our practices accounts, we will reconcile salaried GPs’ pensions and compare what is due to NHSE for each salaried GP employed at the practice to what has been deducted. We are seeing a lot of practices that owe large amounts of superannuation to NHSE, going back a number of years.

Capita will only reconcile salaried GPs’ records once they have received their end of year pension certificate, known as the Type 2 certificate. However, this problem is further escalated as many salaried GPs are unaware that they are required to submit a Type 2 certificate, resulting in many salaried GPs’ NHS Pension records being incorrect.

We recently dealt with a GP who was due to take her pension benefits and her NHS pension record was incomplete going back to 2012! The NHS Pension Agency told her to take it up with Capita as no information had been transferred to NHSPA regarding her salaried GP post.

Practices cannot complete the Type 2 certificates for their salaried GPs as these certificates need to be completed with details of all the GPs’ earnings, which only the GP will know. These certificates should be completed each year and submitted in the February.

Salaried GPs should obtain a copy of their dynamised earnings from the total reward statement website or the NHS Pension Agency and check if their income recorded for each year agrees to their income earned. For example, if you were only employed at one practice, looking at your March payslip for each year will give your pensionable pay this should agree to your pension record. If it does not, you will need to raise this with the PCSE.

These issues are not helped by the fact that, when GP partners or salaried GPs join a practice, the PCSE seem to take a long time to recognise that the GP works at the practice, resulting in no pension deductions being taken at all. The same applies when GP partners or salaried GPs leave a practice.

It is important that practices are reviewing the monthly NHSE statements and if there are no superannuation deductions for GP partners or salaried GPs who are in the practice, this should be queried with the PCSE immediately so it can be resolved quickly. The same applies if GP partners or salaried GPs have left and superannuation deductions continue to be taken.

GP Locums’ Pensions Records

GP locums are only required to submit the locum A and B forms, which are uploaded to the PCSE each month. If you are only a GP locum, there is no requirement for you to complete an end of year certificate. No doubt, most GP locums will assume their pension record is correct, however, we have heard that some GP locums’ records were missing details of income. GP locums need to keep copies of all forms submitted to NHSE and it is worth obtaining your dynamised earnings list from either the total reward statement website or the NHS Pension Agency and check that each year’s earnings agrees to the locum forms submitted.

What Should GPs Do Now?

It is important that GPs obtain details of their dynamised earnings from either the total rewards statement website https://www.totalrewardstateme... or the NHS Pension Agency and check this to their end of year pension certificates, payslips and locum A and B forms. For any GP who has GP solo income or officer status for board roles, this should be checked too.

For any salaried GP who has not submitted a Type 2 certificate, these will need to be completed. There is mention that there may be a Type 2 certificate issued to capture all years not submitted, but we have not heard anything definite about this yet. If your record is incorrect, you will need to contact the PCSE.

The NHS Pension Agency are aware of the problems and have said they are working with the PCSE and the BMA to resolve these issues, but are aware that this could take some time.