Soaring inflation could see GPs caught in the pension trap that has affected many consultants, the British Medical Association has warned.

The risk of high pension tax penalties could increase the flow of doctors seeking to leave general practice, the BMA said. The BMA’s concern is that just one measure of inflation, the consumer prices index, has increased dramatically and is now showing a 9% increase. This could lead to a temporary big increase in projections of the value of GP pension funds, it said.

It fears that many doctors will suddenly find themselves exceeding the tax free annual allowance, facing huge charges. It said inflation could stabilise next year and the project growth in future pensions might never materialise. Recent BMA surveys have suggested that the prospect of extra pension taxes could influence the decisions of as many as two thirds of GPs about their future. The BMA has now launched a calculator to help doctors assess the financial risks they face.

Pensions committee chair Dr Vishal Sharma said: “Punitive pension tax rules that leave senior doctors facing large and unexpected penalties for staying in work, are a huge disincentive for them to continue in the NHS, providing much-needed care for patients, even if they want to. And the system is not only unfair, but incredibly complex, meaning doctors will not realise they have a large bill coming their way until they receive it. This creates a great deal of uncertainty and anxiety for hard-working doctors when they are already dealing with unprecedented pressures.

“With current rises in inflation, this can result in further punitive tax charges. We cannot tell doctors what these decisions should be, and some may well continue to work regardless of the impact on their pensions. However, with a long-standing GP workforce crisis, the Government must urgently act to prevent hard-working doctors from taking what they might feel is the only option of either reducing their hours or retiring entirely to prevent being unfairly penalised for their dedication to the health service and their patients.”