Labour’s tax break for consultants leaves £2.5bn NHS funding blackhole

Wes Streeting offers special tax scheme for consultants

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A row has broken out over Labour plans to give tax breaks to doctors with Conservative ministers claiming that the NHS can’t afford it. But Labour claims that the move is aimed to persuade retired doctors to work again with some Tory MPs backing the proposal and asking Jeremy Hunt to include it in his Budget next week.

The row has broken out over remarks made by shadow Health Secretary Wes Streeting in a debate last week in the Commons (in the above video).

Responding to a question from Conservative MP Dr Luke Evans, Mr Streeting told his fellow MPs: “I actually had a very good meeting with the BMA pensions committee recently.”

He outlined that Labour has identified “ways in which this could be resolved, one of which might be a tax unregistered scheme”. Streeting added that “I’m perfectly fine with having a tax unregistered scheme”.

But according to sources close to Health Secretary Steve Barclay, internal Government estimates show that implementation of the scheme would cost at least £500millon a year in lost Treasury revenues – amounting to a £2.5billion gap in the public finances over the course of a Parliament.

The Conservatives alleged that the £2.5billion black would come on top of an estimated £15billion cost to suggestions that Labour might nationalise GP surgeries.

A Conservative spokesman said: “Labour’s policies on health and care are in a total mess. First, they announce they will nationalise general practice, then they backtrack when they realise it will cost £15billion.

“Now they announce an expensive pensions policy without pointing to how they would fund it.

“Rather than trying to blag his way through debates, Streeting should focus on getting across the detail on pensions and think about the impact of the public finances before he announces policies.”

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But the debate appears to be a reversal of normal politics with Labour offering tax breaks and the Tories opposing them.

A Labour spokesman said: “The claims are as false as Tory promises to fix the NHS. Unlike the Conservatives who crashed the economy with unfunded spending commitments, Labour will respect every pound of taxpayer money with fully costed plans to clear up their mess.

“Labour is determined to end the perverse pensions rules which are forcing doctors into early retirement, at a time when the NHS needs them more than ever.”

A source close to Mr Streeting: “Wes has said, I think in the debate, the scale of the crisis in the NHS means we need to pull every lever at our disposal to tackle the crisis- including using the private sector and tax breaks for rich doctors!”

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