DAYLIGHT ROBBERY

Sickening perks handed out by our broke NHS ...to its pension pot millionaires

HUNDREDS of NHS managers have amassed million-pound pension pots while presiding over the worst financial crisis in the history of the health service, a Mail on Sunday investigation has uncovered.

As patients face crippling delays for treatment, A&E closures and overcrowded wards, bureaucrats have quietly been building up huge taxpayer-funded pensions.

They will be handed tax-free sixfigure lump sums on retirement, and annual payouts from the age of 60 of at least £55,000 – guaranteed for life. By contrast, the average British worker on a private pension can expect just £1,200 a year.

Critics said ordinary people would find the amounts NHS executives were building up ‘sickening’ when they were struggling to get cataract operations or see their GP. The Mail on Sunday’s investigation found:

Nearly 300 directors on NHS trust boards have accrued pension pots valued at £1million or more;

At least 36 are sitting on pots in excess of £1.5million – with three topping a staggering £2million;

The NHS pays a staggering 14.3 per cent on top of employees’ salary towards their pension – almost five times the average of 3 per cent paid in the private sector;

Some executives have seen the value of their pension grow by more than £400,000 in 12 months – ten times the size of the pot the average Briton will build up in a lifetime;

Experts revealed a £1million pension would give an NHS executive an annuity of £55,000 a year – far in excess of a private £1million pension fund annuity of £20,750;

About 500 earn more than the Prime Minister – after Health Secretary Jeremy Hunt ordered them to ‘show restraint’ on executive pay.

Despite this, and the contributions NHS workers make, the scheme every year pays retired staff £10 billion more than it takes in. That black hole has to be filled by the taxpayer. The subsidies enable NHS executives – including managers, human resources bosses and directors of ‘corporate administration’ – to build up vast pensions, at minimal personal expense.

The biggest single beneficiary is Professor Tricia Hart, who retired as chief executive of South Tees Hospitals NHS Foundation Trust in January with a £2.6million pension.

That figure entitled her to a lump sum of at least £335,000 on retirement, plus an inflation-proof annual pension of £110-115,000.

The Trust has defended her pension, which she built up over 42 years, saying she helped kick-start a ‘challenging’ recovery and slash its deficit from £7million to £5million.

But she was criticised by Unison for leaving behind an organisation ‘decimated’ by job cuts. Last year the Care Quality Commission (CQC), found ‘nursing shortages across departments’ at the Trust and rated it as ‘Requires Improvement’.

Two other NHS executives have built up pension pots exceeding £2 million – Dr Peter Homa (£2.066million), chief executive of Nottingham University Hospitals, and Dr Tony Berendt (£2.005 million), medical director of Oxford University Hospitals. Both will receive annual pensions of more than £90,000 plus tax-free lump sums exceeding £270,000 on retirement.

Both run organisations rated ‘Good’ by the CQC, but other executives have accrued seven-figure pension pots while leading struggling hospitals or services.

Professor Mark O’Donnell, medical director of Blackpool Teaching Hospitals NHS Foundation Trust, has a pension worth £1.956million. In January the CQC said the Trust ‘Requires Improvement’, found ‘basic equipment shortages’ in A&E and said the service needed to be better led. And, while the NHS struggles for cash, at least four HR directors have amassed million- pound pensions. They include Margot Johnson, of Central Manchester University Hospitals NHS Foundation Trust – which ran up an £18.5million operating deficit in 2015/16. Meanwhile, the NHS must make around £20billion of ‘efficiency savings’ a year by 2020, with the resultant cuts forcing up waiting times.

Almost four million people are

That black hole has to be filled by the taxpayer

now waiting for cataract surgery, hip and knee replacements and other routine operations. The number of people forced to wait more than four hours in A&E has doubled in two years. And wards are full of elderly people who cannot be discharged – because there are no care home places for them. Last night Eamonn Butler, of the Adam Smith Institute think-tank, said: ‘It is sickening that anyone in the public sector can clock up multimillion-pound pensions and fringe benefits when ordinary people have no hope of saving anything like that amount – particularly with interest rates virtually zero.’ He added: ‘People struggling to look after their families and manage their finances will be justly outraged they are having to pay higher taxes to keep others in retirement luxury.’ Danny Cox, of pensions firm Har- greaves Lansdown, said an NHS pension with a nominal value of £1 million would provide the holder with an annual income of £55,000 to £60,000 for life, plus a tax-free lump sum of around £165,000.

And he pointed out that after the same lump sum had been taken out of a private pension fund which had been built up through the stock market, the remaining £835,000 would buy an annuity of only £20,750.

He said the size of the average UK private pension pot on retirement is £40,000, generating an annuity worth a mere £1,200. And he pointed out that only one major company – John Lewis – still offers a scheme comparable to the NHS pension, known as a ‘defined benefit’ plan. All other similar schemes were shut down as they threatened to blow an ‘enormous hole’ in firms’ finances.

The Mail on Sunday researched pensions and salaries of executives by looking at NHS trust annual reports for the 2015-16 financial year, which ended in March.

So far 168 of 236 NHS trusts in England have published reports for 2015-16, including detailed figures on executive remuneration.

In those 168, the MoS identified 199 individuals with pension pots with a ‘cash equivalent transfer value’ (CETV) of £1million or more. If these are representative of all trusts, then 279 executives will have built up seven-figure pots in total.

Of the 199, 36 have pensions of more than £1.5 million, including three exceeding £2million. In addition, the MoS identified 361 earning at least £145,000 – more than the Prime Minister – meaning around 500 in total can be expected to be exceeding the PM’s salary.

CETV is the ‘capital value of the pension scheme benefits accrued by a member at a particular point in time,’ according to NHS documents. This increases every time employees gets a pay rise – leading to some NHS executives seeing their pensions rise in value by hundreds of thousands of pounds in one year.

However, a spokesman for NHS Pensions stressed that CETV was ‘just a theoretical value’. The amounts individuals accrued were a result of the ‘rules and regulations’ of the NHS scheme. ‘What people get paid is a matter for NHS trusts,’ he added. Additional reporting: Mark Wood

and Peter Henn