The Pharmaceutical Journal
Vol 274 No 7337 p197
19 February 2005

This article
Reprint   Photocopy

  Acrobat Reader

News summary

Related websites
Contract 2005

Exit payments extended to the smallest contractors

Contractors whose pharmacies dispense fewer than 1,100 items will be able to take up exit payments under changes to the new community pharmacy contract, the Pharmaceutical Services Negotiating Committee announced this week.

All contractors now have the option of rejecting the new contract and taking an exit payment of either £10,000 or one equal to the professional allowance that was paid in 2004–05. Originally, contractors to relinquishing their NHS contracts were to be paid an exit payment equal to their professional allowance. Since contractors whose pharmacies dispense fewer than 1,100 items a month do not receive a professional allowance, they would have been ineligible for exit payments.

“The PSNC has continued to make assessments and evaluations and discuss arrangements for the new contract with the Department of Health. The new arrangement for exit payments is one of the things that has come out of those discussions,” Sue Sharpe, chief executive of the PSNC, said.

“We are pleased that we have been able to extend the option of exit payments to pharmacies dispensing fewer than 1,100 items, and to agree an increase in the minimum level of payment,” she added. “We expect that there will be a small number of pharmacies, particularly those with very low numbers of NHS prescriptions, that do not feel the new contract is for them. The number of pharmacies that decide to relinquish their NHS contracts will depend on individual pharmacies’ assessments of whether the new contract is appropriate for them,” she said.

John D’Arcy, chief executive of the National Pharmaceutical Association, said: “It is good news that the exit payment agreement has been extended, but the NPA is disappointed that payment cannot be made at the end of three years.”

However, some contractors believe that the exit payments do not take sufficient account of the costs that a pharmacist deciding to close would face. Jayvant Patel, a community pharmacist in Brentwood, Essex said: “The exit payments are still too little, when you think of the stock that pharmacies have to hold. Also, landlords will not release tenants from years-long leases for as little as £10,000 and redundancy for long-serving members of staff does not come cheap. The PSNC does not seem to appreciate the problems that community pharmacies face.”