Commenting on the announcement by the BMA’s Scottish GP committee, Pauline Hogg, Scottish board member for the Association of Independent Specialist Medical Accountants, said:

“The funding injection promised in the new contract should give GPs in Scotland a measure of financial stability for the next two years. There should be more winners in terms of income, although we will have to wait and see how the new funding formula will affect currently high and low earning practices and what the funding gap is for the practices losing out under the new formula.

“The contract is ambitious and extra resource is promised. This, however, will not be fully in place until 2021. During this time there will need to be major upskilling for GPs, practice managers, nurses and other healthcare staff.

“The new contract, however, will do nothing to address current workforce problems. There are simply not enough GPs in Scotland and many will continue to feel overloaded as they try to plug the gaps.

“The interest free loans for practice premises should help practices struggling to attract new partners, although going down this route appears to ultimately mean that practices will give up ownership of their premises.

“Phase two of the new contract will bring about big changes to the way in which GPs are paid. It will be very interesting to see how the impact of direct reimbursement of practice expenses plays out among GPs working to adopt innovative ways of delivering services.”

Yesterday’s announcement that inflation in the year ended September 2017 increased to 3% means higher earning GPs who are subject to annual allowance pension tax charges face increased tax bills in 2017/18.

The September inflation rate is used by the NHS pension scheme to set the revaluation rate each year which is inflation plus 1.5%. This means that the value of career earnings will be increased by 4.5% in 2017/18; a significant increase in the value of pension benefits.

Although the annual allowance calculation is meant to exclude inflationary rises, the inflation rate used in the calculation is that of September 2016 (which was only 1%), not the September 2017 rate of 3%.

Therefore, as benefits in 2017/18 will increase by 4.5%, and the allowance for inflation is only 1%, higher earners are going to be taxed on a 3% increase in their career earnings.

Luke Bennett, partner at PKF Francis Clark and Executive Committee member of the Association of Independent Specialist Medical Accountants, said: “This seems unjust, when in reality the uplift is only 1.5% above inflation. The position will correct itself if inflation falls back next year, but that’s no comfort to those facing high annual allowance tax charges in 2017/18.”

AISMA accountant Andrew Burwood has some ideas for practice managers on how to deal with the relentless squeeze on practice finances. Read his article in the latest issue of Practice Management magazine. Download the article here.

Letter to The Rt Hon Mel Stride MP
, Financial Secretary to the Treasury, reinforcing significant issues surrounding the recruitment and retention of senior health professionals within the NHS, which are being driven in part by the changes to the taxation of pension savings introduced in the 2015 Summer Budget.

Read the letter in full

In the second of a two-part guide to the practice accounts, AISMA accountant Hilary Lowe explains the different types of outgoings for GP practices and how to keep control of costs. Click here to download the full article

In the first of a two-part guide, AISMA accountant Hilary Lowe explains how practice income is made up and how practice managers can ensure their practice receives the maximum amount. Click here to download the full article

Writing in Practice Business magazine, AISMA accountant Andrew Pow offers five top tips for practices being asked to sign new lease terms with increased costs and considers how to stave off hefty rate hikes. To read the article in full visit the Practice Business website.

Specialist medical accountants often find practices struggling with fundamental management issues such as resource planning, increasing patient demand, what technologies to use and getting non-clinical staff to step up and take more responsibility. In this article Gaynor McIntyre, strategy consultant with AISMA accountants Condies Accountants and Advisers, offers some tips on getting your practice fit and ready to deal with every business challenge. Click here to download the full article

James Gransby, executive board member of the Association of Independent Specialist Medical Accountants, said: “Traditional GP practices are under threat from ‘last man standing’ syndrome because older partners are retiring and younger doctors are unwilling to take on the financial burden of partnership.” He continued: “To survive practices will need to adapt to working at scale, rather than as isolated units. The number of mergers and super partnerships being formed is a direct result of funding being directed towards these new scaled models, while traditional GP practices will continue to see their financial sustainability falter.”

ENDS

A record number of delegates attended the 22nd annual conference of the Association of Independent Specialist Medical Accountants (AISMA) last week. 210 accountants gathered in Daventry to hear an authoritative panel of speakers share opinions and expert knowledge about the current state of UK primary care.

Keynote speaker Dr Arvind Madan, Director of Primary Care, NHS England, opened the conference with an address on current issues in general practice, focusing on the progress of the General Practice Forward View.

The Pulse General Practitioner of the Year Dr Jonathan Cope told the conference how he and his colleagues developed the successful Beacon Medical Group super partnership in Devon, with a candid appraisal of the pitfalls and opportunities they experienced during the process.

Dr Paul Wilding, GP partner at the Slaithwaite Health Centre in West Yorkshire, gave an account of how, when his practice was under threat of closure due to a 44% budget cut following a PMS review, patients and the local community rallied to defend the practice and see off the cuts.

Other speakers during the two-day conference included Professor Rob Darracott, who spoke about how pharmacists can work with general practice to bring benefits to both; and Ben Gowland of Ockham Healthcare, who discussed the threats and opportunities for GP practices from working at scale.

The two-day conference programme provided several technical financial training sessions for delegates on topics including premises, pensions, Making Tax Digital and off-payroll workers’ legislation.

Andrew Pow, AISMA Executive Board member and joint conference organiser, said: “At a time of significant change in general practice, the conference allowed AISMA members to get together, keep updated with current issues and share ideas from around the UK so that we are all better placed to advice our clients through possible changes.”