General Information

NHS staff moving to employment in University Medical Schools, Hospices or other charities that provide services to, or supplements the care given by the NHS in Scotland, or who undertake short term voluntary work overseas may be able to retain their membership of the NHSSSS on transfer from previous NHS employment.

This is possible under the powers of Section 7 (paragraphs (1) and (2)) of the Superannuation (Miscellaneous Provisions) Act 1967, in which the Scottish Ministers have the discretion to make a "Direction" which extends membership of the NHSSSS to employees of non-NHS bodies engaged in the provision of Health Services.

In general, a Direction is made in respect of individual employees who leave employment in the NHS and within 12 months take up employment within the new body. A Direction allows the employee to be treated by the body concerned "as if" they were employed by an NHS employing authority but it does not make the body itself an employing authority for the purposes of the scheme.

A Direction gives access to the basic pension, retiring allowance, ill-health and death benefits but does not give access to other benefits which would incur employer's financial liability, for example enhanced early retirement pension due to redundancy.

It should also be noted that the Injury Benefits regulations, are not extended to those staff covered by a Direction.

Action by Employers

Employers who have been granted a Direction (except for those who hold Section 7(1) Directions) should always refer to the Direction issued by SPPA before allowing new staff to join the NHSSSS, as this will set out the criteria for allowing new joiners to the scheme.

This is because some Directions are open to all staff who have previously moved from NHS employment within the last 12 months, but other Directions are restricted to certain posts or individuals.

If the employer is satisfied the new member of staff is eligible then form SB115 must be completed and sent to SPPA. SPPA will then confirm to the employer by letter whether or not the employee can remain as a member of the NHSSSS whilst in the Direction Body's employment. In the case of a section 7(1) direction all staff are automatically joined in the scheme.


Pension contributions must be paid by both the employer and member. The employer's current contribution rate is 22.5%. This rate is set by the Scottish Ministers and can change depending on the outcome of the 4 yearly valuations of the scheme by the Scheme Actuary. Employee's contribution rates vary according to the member's whole time equivalent earnings for officer members (aggregated income for practitioners). Contribution tables are notified to employers by SPPA circular before the start of each financial year.

Application to become a Direction Body Employer

To request the setting up of a new Direction, the employer must firstly write to the Director of Policy Strategy and Development at SPPA explaining why this is necessary and giving details about the employing body itself. The Scottish Ministers will normally only allow a Direction if the employing body fulfils certain criteria i.e. the employing body must provide health services, hold charitable status, be non-profit making and have no suitable pension scheme of its own. Where there has been no previous precedent for the type of Direction sought then SPPA will also need to seek advice from HM Treasury before making a decision.

Types of employment covered By Directions

Sections 7(1) Direction

Generally speaking, Directions made under section 7(1) of the Superannuation (Miscellaneous Provisions) Act 1967 are used by Government departments to cover medical and nursing grades normally employed in the NHS but are instead working in Government departments or Government hospitals.

These Directions do not cover medical or dental practitioners, clerical or industrial civil servants.


The employment type (as explained above) is the only criteria. Generally speaking the employment establishments entitled to Section 7(1) Direction status will have already been granted it. The only new ones would probably be new establishments e.g. a new prison that was not run privately.

Prospective members can enter the scheme, via their Section 7(1) Direction employer, as a first time member. They are not required to have any previous pensionable NHS employment.


Under Section 7(1) Scheme membership is automatic providing the normal joining criteria is met. To read more about joining the Scheme go to Part 2, Joining the Scheme. The employee can opt out of the scheme in the same way as 'main scheme' members by completing an OPT OUT form.

Employer action

Employers are advised that scheme rules require all staff mentioned above to automatically become scheme members unless they complete an OPT OUT form.

Employers should issue all new employees in the groups mentioned above with a scheme Starter Pack at the earliest opportunity. To read more about what employers need to do for new employees, see part 2 of this guide, where it is not clear whether the employee is entitled to scheme membership, employers should deduct contributions and seek clarification from SPPA.

Joining the Scheme

SPPA should be notified of membership in the scheme. This should be done by completing and submitting form NSR01 (joiner form) through EDM or by automatic transmission of data via the Scottish Standard Payroll System (SSPS), or any other system currently used.

SPPA action

Once the joiner form has been accepted and processed, SPPA will issue a letter to the employer and the member confirming commencement in the scheme.

Section 7(2) Directions

Section 7(2) Directions are generally used by charitable organisations or voluntary bodies; medical schools; certain overseas and armed forces employments, care in the community projects and social enterprise projects to continue membership of the NHSSSS for someone who has previous scheme membership.

Who the Direction covers

Section 7(2) Directions vary; one may cover every employee of the establishment but another may only cover certain employees of the establishment.

The Direction document issued by the SPPA on behalf of the Scottish Ministers will give precise details. If an employment is covered by the Direction because of the employer status, the member will still have to apply to SPPA to remain in the NHSSSS.


Unlike Section 7(1) Directions, Scheme membership is not automatic to employees of a Section 7(2) Direction.

The main criteria for continued scheme membership under a Section 7(2) Direction are: the employer must, first of all, have 'Direction' status; and the employee must make application to remain in the scheme within 3 months of the employment starting; and the applicant must have contributed to the NHSSSS at some time during the 12 months prior to the Direction employment starting.


SPPA is responsible for determining eligibility for continued scheme membership in line with the specific criteria (outlined above) within each Direction and will notify the employer of application acceptance or rejection as appropriate.

Employer action

Application from a new employee to an employer who had not been granted Section 7(2) Direction status

Employers in the groups mentioned above who have not claimed or been awarded Section 7(2) Direction status may get enquiries from new employees to remain in the NHSSSS.

Before considering any individual application further, the employer will need to make application for Direction status by writing to the Director of Policy Strategy and Development at SPPA. If the application for Direction status is granted, the application made by the individual to remain in the scheme may be processed.

Information to be provided to employees

All new employees in the employment types mentioned above should be informed, by the employer, of the possibility of remaining in the NHSSSS in their new employment.

Employee indicates they wish to remain in the Scheme

The employer should send the completed form SB115 together with the joiner notification.

Overseas Employments

Some overseas posts may be covered by a Direction to enable the member to continue their scheme membership for a limited period of time whilst they are working abroad.


Members must, as with all Section 7(2) Directions, apply to remain in the scheme within 3 months of starting their new job and have contributed to the NHSSSS at some time during the previous 12 months.

In certain circumstances SPPA, on behalf of the Scottish Ministers may exercise discretion to extend the normal 3 month time limit for applying. Each case will be judged on its individual circumstances.


Organisations such as the Voluntary Services Overseas (VSO) and British Red Cross hold their own Section 7(2) Direction. Therefore, any member going to work abroad with these organisations may apply to remain in the NHSSSS.

SPPA will also consider continued NHSSSS membership for any overseas employments in developing or war torn countries.

From time to time there may be other UK or Scottish Government initiatives to encourage workers to lend their skills to developing countries for limited periods. These schemes may provide remuneration to cover pension payments in different ways and therefore a direction may not be required in these circumstances.

Further information about those schemes can be obtained by contacting the Policy Branch of SPPA.

Application for continued Scheme membership

Voluntary Services Overseas (VSO) will apply for scheme membership on the member's behalf. British Red Cross will ask their employees to complete a form SB115.

Any members who are going to work abroad for any other overseas employer will have to make their own application to remain in the NHSSSS.

This can be done by sending a letter of application and a copy of the contract of employment to SPPA.

Payment of contributions

Members employed by the British Red Cross will have their contributions deducted from their salaries in the usual way. Members employed by VSO do not receive a salary and VSO will pay both the employee and employer contributions based on the member's voluntary allowance. Any additional service contracts in force will also be paid by VSO

Most other overseas workers will have to pay both the employee and employer contributions based on the salary they were earning when they left the NHS. Section 7(2) Direction employers are advised to inform employees of this.

SPPA will calculate the amounts owing quarterly and the member may pay their contributions by cheque or standing order.

Redundancy and Voluntary Early Retirement

Scheme benefits available to Direction employment contributors

As a general rule, a Direction will provide cover under the NHSSSS regulations only. It will not provide cover under the NHS Injury Benefit Scheme, which provides benefits for those who are injured or who contract a disease as a result of their NHS employment or under the NHS (Compensation for Premature Retirement) Regulations.

Redundancy Enhancements

Any member employed by a Direction employer will not be eligible to receive enhancements on their benefits. This is because the NHS Compensation for Premature Retirement Scheme is governed by a separate set of regulations and is not part of the NHSSSS.

It is not funded by pension contributions and the cost of these benefits is recovered in full from the employer responsible for the managerial decision which led to redundancy or premature retirement.

For these reasons the Scottish Ministers cannot guarantee payment of compensation benefits on behalf of a Direction employer over whom they have no control, financial or otherwise.

Employers are not charged for the cost of early payment, this cost is met by the 'Fund'.

No Direction employee is covered under the NHS Injury Benefit Scheme.
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