The Department of Health has confirmed that soon NHS staff who transfer out of the NHS will be allowed to keep making contributions to their NHS pension scheme.

Under the current “Fair Deal” scheme, where public sector staff transfer out to a new provider of services, the new provider must offer such staff a “broadly comparable” pension scheme. It is argued that this puts independent sector providers at a disadvantage when bidding against public sector providers due to the potential costs of setting up and transferring staff to such a scheme.

No dates have been provided as yet but the policy is being finalized by HM Treasury, which has said the commencement dates for the new scheme may differ across different areas of the public sector.

However, once in place, the Treasury hopes that the new scheme will reduce costs for private providers who, instead of having to provide pension benefits in a separate scheme, will be able to transfer contributions to the public sector pension schemes of any public sector employees who transfer to them. As well as potentially providing a level playing field for independent sector providers, this also provide assurance to transferring staff that their pension arrangements will not change.