Examining what the Chancellor’s Summer Statement 2020 means for dentistry

Michael Lansdell is a founding partner at specialist dental and medical accountants Lansdell & Rose and a chartered accountant. Here, he discusses the main points from the Chancellor’s Summer Statement delivered on 8 July, which outlined new measures to support business and workers.

Rishi Sunak’s Spring Budget was on 11 March, just two weeks before large parts of the economy were shut down completely. Now, four months later, your practice may have reopened and hopefully you are feeling positive, proactive, and prepared for whatever might come your way. Here’s a brief guide to the Summer Statement and which of the interventions could be of particular interest to practice owners and dental professionals.

Furloughed workers

If you are a dental practice owner who has furloughed staff, you will probably already know that the Coronavirus Job Retention Scheme (CJRS) is being phased down starting from August, when more of the cost of furloughing will be passed onto the employer. The CJRS has already been extended twice, but the Chancellor confirmed he still intends for it to finish in October, as planned.

What is new is a Job Retention Bonus in the form of a one-off £1,000 payment, for every employee you bring back and who remains continuously employed until the end of January 2021 (you’ll get your bonus from February onwards). Any furloughed individual you return to work must earn more than £520 a month, on average between the end of the CJRS and the 31 January.

Work placements, trainees, and apprentices

There are to be new payment bonuses attached to employers who offer the above, which could all certainly be of interest to practice owners and enrich your workplace for a multitude of reasons. First is the Kickstart Scheme, which aims to provide new, six-month, quality work placements for young people aged 16-24. Government funding for each job will cover employers’ costs, including 100% of the relevant National Minimum Wage for 25 hours a week, plus employer NICs and minimum automatic enrolment contributions.

There will also be bonuses for employers who offer traineeships/work placements for 16-24-year olds and for those who hire new apprentices – for every new apprenticeship, you could receive up to £2,000.

A Stamp Duty showstopper

This announcement was the headline grabber; the UK housing market had – unsurprisingly – ground to a near-halt in the first half of the year. So, as had been widely expected, from 8 July – 31 March 2021, there is to be a temporary cut on Stamp Duty Land Tax (SDLT) on residential property in England and Northern Ireland, increasing the zero-rate band to £500,000 with all bands being revised. For additional properties, or corporate residential properties of over £40,000 though, you’ll still need to add 3% to the relevant SDLT rates.

To sum up…

Generally, we’re all now wanting to regain lost ground from lockdown and, of course, the current picture will also look different from wherever you are in the UK. We might feel that we’re facing the great unknown, but although things might “seem” different, a successful business is always one that has been built on sensible and solid practises, protocols and processes, and is able to adapt and respond intelligently to changing and challenging circumstances.

What I do know is that at Lansdell & Rose, our dental clients are very happy to be back at work! We offer a full portfolio of accountancy services and will also give you specialist, quality advice with business support and planning for now and the future.

From the very start of the pandemic, those who adopted a confident and decisive approach have stood out from the rest and this is what every dental practice owner and dental professional who wants to gain the maximum benefit from their business and optimise their personal finance, should be aiming to achieve.

For more information please visit www.lansdellrose.co.uk.

Stephen Price promoted to Managing Director of Takara Belmont (UK) Ltd

Stephen Price has been appointed Managing Director of Takara Belmont (UK) Ltd and will take up the role from 1st July 2020 as current MD Takashi Hoshina returns to Japan to take on an International role within the corporation.  Stephen has held the position of Director at Takara Belmont since 2006.

“During my tenure here at TBUK, we have achieved many things. We have enhanced the Dental product range with tbCompass and Voyager 111, which are now two main products in the UK market,” Takashi commented. “We have had to adjust our strategy for Brexit and today we are facing huge challenges with the Coronavirus, but we will come through this together and my new job in Takara Belmont is to integrate our international business in USA and Europe, which I am optimistic towards because of what I have learned from the UK in the past 8 years.

“We are fortunate to have someone of Stephen’s calibre and experience to lead Takara Belmont UK. Stephen has a solid understanding of our products and markets, a proven track record and is a strong communicator with deep leadership capabilities. ”

Stephen added: “We are at a critical moment and we need renewed leadership to successfully implement our strategy and take advantage of the market opportunities ahead.”

Upon his return to Japan, Takashi will be responsible for the business expansion in both Europe and the USA.

BDA responds to resignation of Tony Kilcoyne

The British Dental Association has thanked Tony Kilcoyne for his significant contribution, following his resignation from its board of directors (Principal Executive Committee).

Discussions were ongoing between Tony and the other BDA board members over how to manage his new business interest involving a dental screening company, an area of activity relating to the Covid-19 pandemic. The responsibilities of company directors are specific and sometimes restrictive. All company directors have fiduciary obligations to their organisations and one of those is to seek to manage potential conflicts of interest.

Tony was first elected as the UK-wide member of the BDA’s board in 2016, and was re-elected for a three year term in December 2019. A by-election for the UK-wide seat will be held shortly.

BDA Chair Mick Armstrong said: “We are sorry Tony Kilcoyne has decided to resign from the Principal Executive Committee. Tony has made an enormous contribution to the board’s work and his enthusiasm and devotion to the profession have always shone through. As the BDA’s statutory board of directors and principal decision making body, all members of the PEC have a duty to account for and manage perceived conflicts of interest. In that spirit Tony’s colleagues on the board had asked him to agree to a number of conditions for his continued financial interest in and advocacy of a screening company, to seek to ensure that separation of roles was clear.

“Dialogue was ongoing to seek an agreed resolution, so it is disappointing that we now won’t have the opportunity to conclude discussions to find a mutually agreeable way forward. We wish Tony all the best and hope that he continues to act as a powerful advocate for the dental profession.”

CODE completes acquisition of Isopharm

CODE has completed the acquisition of Isopharm, which brings together the market-leading compliance platform with the largest provider of online CPD for dental practitioners into a single entity.

Established for over 20 years, Isopharm is the leading provider of online CPD with over 60% of all dental practitioners using their innovative solutions to meet the mandatory requirements for continuous development. The business also provides software and services for validation and testing to a broad range of healthcare providers.

Neil Laycock, COO of the CODE Group, highlighted the significance of the acquisition, saying: “The addition of Isopharm represents the next step in creating the dental industry’s leading solution for practice operations. The breadth and reach of the combined company is unmatched in the industry and creates an exciting platform for innovative services.”

Karen Penfold, Managing Director of CODE, who will head up the new combined business, said: “CODE’s iComply is already the most widely used solution for compliance management for dental practices in the UK. The acquisition of Isopharm will be a major addition to our recently launched solutions for people management in dental practices. The integrated solution will bring major benefits to our clients; from attracting new staff, improving staff engagement and retention, and ensuring skills and process compliance in a single solution”.

Founder of Isopharm Andrew Kemp joins the CODE management team, commenting: “CODE is the perfect platform for the next stage of innovative solutions we had planned at Isopharm, we are delighted to be joining forces”.

August Equity invested in CODE in 2019 and have been instrumental in the acquisition of Isopharm. “August Equity’s market knowledge, broad network in the dental and healthcare sector and prior experience in creating industry leaders has been very important in getting to this stage of CODE’s development, we continue to be excited about building on this start and extending the reach of the Group into more healthcare segments,” said Dr Sati Sian, Chairman of CODE Group.

Jeremy Hunt pledges to reopen dentistry inquiry following BDA evidence

Health and Social Care Committee Chair Jeremy Hunt has promised to reopen an inquiry into dentistry that was abruptly closed by December’s snap General Election. His pledge followed oral evidence from the British Dental Association today.

BDA Chair Mick Armstrong told the committee the effects of the pandemic on oral health have been “catastrophic”.

“Dentistry was not in a great place when we started. We’ve got access problems which have been raised in both Houses, and also in the previous Health Select Committee, with widening inequalities, rock-bottom morale and retention problems, so the pandemic has just made that that much worse,” he said. “The effects on general practice, NHS and private, has been devastating and is probably existential. The effect on oral health has been catastrophic.”

Armstrong outlined how inadequate government support, and a combination of higher costs and lower patient numbers has fatally undermined the very model on which the service operates. He told the Committee that for aerosol-generating procedures – where droplets could be transmitted from the patient – personal protective equipment similar to that worn by critical care health workers was currently required.

“It is hugely expensive. We are a business, we have to buy it,” he told MPs. “Pre-Covid, you could protect patients for £2, £3, it’s now over £40 per patient.”

The BDA Chair, who works as a frontline clinician in West Yorkshire, stressed that access problems that were common in his region, were likely to become the norm across the country: “We’ve cancelled eight million courses of treatment nationally” he added. “Our practice alone has cancelled 6,000 appointments and we will be cancelling another 3,000 until September just to deal with the urgent case backlog. So 12,000 dentist practices in the country have been effectively replaced by a few hundred urgent care centres, they’ve done a sterling job in treating the most urgent, but it’s clearly no replacement.”

Dental Protection welcomes ‘No Appeal’ decision on pension suspension ruling

Dental Protection has welcomed the Court of Appeal decision to deny the Government permission to appeal the ruling which overturned regulations allowing the health secretary to suspend the payment of pensions to NHS professionals who had been charged with certain criminal offences but not yet convicted.  

This ruling follows the High Court decision in January this year that it was unlawful for the Government to suspend doctors’ pensions, after a judicial review brought by the British Medical Association (BMA). Public sector pension schemes contain provisions for the suspension of a person’s benefits but only after the point of conviction. The Department for Health and Social Care changed NHS pension rules last year, which meant that NHS professionals would be the only public sector workers to have a threat to their pensions at any time from the charges being made.

Dental Protection wrote to the Secretary of State last year setting out serious concerns about this policy, arguing that it went against the principles of natural justice which assumes that one is innocent until proven guilty. The changes also run the risk of dentists and their families experiencing an additional psychological and potentially economic strain from what is already a stressful investigation process.

Raj Rattan, Dental Director at Dental Protection, said: “In 2019, I wrote to the Secretary of State setting out our opposition to the proposals and we were very pleased that the judicial review brought by the BMA was successful. We now welcome the decision by the Court of Appeal to reject the Government’s application to appeal the case. Dentists facing unproven allegations should not find their pension rights put at risk prior to any conviction being made. This change went against the principle of natural justice which assumes that one is innocent until proven guilty.

“Dentists are increasingly working under pressure and if things go wrong they can face complaints and claims from patients, reputational damage in the media and restrictions on their license to practice by the regulator. These changes to pension arrangements only added to the profession’s fear of being exposed to excessively punitive consequences.”

NASDAL offers clarification on SEISS

The National Association of Specialist Dental Accountants and Lawyers (NASDAL) have welcomed clarification on the potential issues that may arise when dentists were eligible to claim the Self-Employment Income Support Scheme (SEISS) grant whilst also receiving their usual level of NHS income. It was highlighted that the amount of grant received may exceed the reduction of private income.

The eligibility criteria for the SEISS grant requires that you have been adversely affected by Covid-19 and that your average self-employed earnings (from all sources) over the last three tax years have not exceeded £50k pa. HMRC have confirmed that if part of a dental practitioners’ income (private income) reduces, but another part remains the same (NHS income), it is legitimate for a claim to be made in full and retained.

Alan Suggett, specialist dental accountant partner in UNW LLP and NASDAL Media Officer, said, “We have received communication from the BDA following discussions with NHS England on this matter and they confirmed that receiving both NHS income and the SEISS grant does not constitute a duplication of wider government support and therefore does not breach any of the terms of the NHS contract payment arrangements.”

Fellow NASDAL accountant Johnny Minford of Minford & Co, who has a number of clients in Northern Ireland, added, “However, our Principal colleagues in Northern Ireland still have a problem as the mechanism there does not permit a double claim and the choice is in the hands of associates. There could be practices where the associate has chosen to claim SEISS, so the practice gets NONE of the IOS payment due for the associates’ proportion of the healthcare.”

BDA urges FCA to consider the plight of dentists in its legal process to assess the validity of business interruption insurance policies

The British Dental Association (BDA) urges the Financial Conduct Authority (FCA) to consider the plight of dentists in its legal process to assess the validity of business interruption insurance policies.

As limited face-to-face dental care resumes this week in England the BDA, which represents dental practices across the country, has made a formal request to the FCA to give specific consideration to the unique challenges facing the sector before the FCA takes forward a test case on insurers’ non-payment of Business Interruption claims.

The FCA had stated on 15 April that most policies with basic cover would not cover Covid-19 but is now seeking “legal clarity” on business interruption insurance in an attempt to provide greater clarity for businesses and insurers.

The BDA instructed law firm Brown Rudnick LLP to review the wide range of business interruption policies held by our members and provide tailored legal advice for the dental sector and has set out in detail to the FCA the issues faced by the profession, asking the FCA to adequately reflect these in its own legal challenge.

As stated in the letter to the FCA: “The BDA welcomes the opportunity to give representations in the Test Case given the number of dental professionals it represents and given the industry-specific impact Covid-19 and the associated public authority measures have had and will continue to affect the dental profession.”

The BDA is advising members to await the outcome of the FCA process before considering whether to pursue class action litigation, which appears premature at this stage and will not help to solve the cash crisis that members are facing now. 

BDA Chair Mick Armstrong said: “We have set out to get the best possible holistic advice on the dozens of policies serving the dental sector and will be sharing the lessons from that with our members. The FCA needs to appreciate the unique challenges faced by dental practices.

“Lengthy litigation should remain a last resort, and won’t keep practices afloat today. Our aim is to give our members the best possible understanding of their legal position and the FCA the best understanding of the dental sector.

“We want to see the FCA process lead to speedy resolution but for that to happen, the Authority needs to appreciate and consider the particular impact of the pandemic on dentistry. We hope our submission achieves that in unequivocal terms.”

The BDA and Brown Rudnick will be hosting a members-only webinar on 17 June for dentists to discuss the review conducted by Brown Rudnick, the BDA’s letter to the FCA and what next steps are likely to look like.

BDA surveys indicate as little as a third of practices reopened this week, most at less than a quarter of their former capacity, leading to on-running risks to the sustainability of the sector. 

Only 8% of respondent practices estimated they will be able to maintain their viability on the basis of lower patient numbers and sky-high costs. Costs for personal protective equipment (PPE) alone for treating a single patient have increased by up to 6,000%. 

Commenting on the re-opening of dental practices this week,  Armstrong added: “The skeleton service now operating remains hugely vulnerable, operating a fraction of its former capacity while facing sky-high costs. The country and policymakers will be faced with a national dental health crisis if dentists do not receive the urgent support that they need now including the speedy resolution of whether or not the insurance companies will payout.”

Mishcon Advances Group Claim for Dental Practices

Dental practices with business interruption (BI) insurance policies underwritten by QBE today are offered a viable collective route to litigation in circumstances where their Covid-19-related claims have been rejected by their insurer.

Leading law firm, Mishcon de Reya LLP, announces it has received agreement in principle from an experienced and well-capitalised litigation funder to fund a group claim against QBE for dental practices who have suffered business interruption losses relating to the Covid-19 pandemic. 

Mishcon’s litigation offering to dentists comes on the back of similar group claims on which it is currently advising: the Hiscox Action Group and hospitality sector-focused claims against Aviva and QBE). Mishcon is working with a specialist insurance Leading Counsel, Jeffrey Gruder QC of Essex Court Chambers; they believe that claims under the QBE dental practice policies are ripe for challenge.

Sonia Campbell, Partner and Head of the Insurance Disputes Practice at Mishcon de Reya LLP, commented: “The issue for dentists is similar in many ways to that experienced by the other businesses whom we also advise.  Dental practice owners responsibly insured themselves against the risk of financial losses, including from notifiable diseases and yet, just like those in other trades, soon learned that their claims have been rejected.  Practice owners provide an invaluable service to patients in their local communities.  We hope by supporting dental practices we can help them restore their vital businesses to full health.” 

To express interest in joining a dental group claim against QBE, dental practice owners with Business Interruption insurance policies insured by QBE (Office Insurance Policy) should email dentalclaims@mishcon.com by no later than 19 June 2020 to be included in the potential claim.

GDC: Dental Care Professionals’ Annual Renewal now open

The Annual Renewal period for UK registered dental care professionals (DCPs) is now open and the deadline for completion is 31 July 2020. To renew their registration, DCPs need to:

  • Make their annual or end-of-cycle CPD statement
  • Declare they have, or will have, appropriate indemnity in place
  • Pay their Annual Retention Fee (ARF)

The quickest and easiest way to complete the Annual Renewal is through eGDC, and it takes only five minutes to register to use the service if not already set up.

GDC Executive Director, Registration and Corporate Resources, Gurvinder Soomal, said: “We are very aware that Annual Renewal comes at a difficult time this year for DCPs, when many have been unable to work or have had difficulty accessing CPD. Our records indicate that four out of five DCPs have already met the CPD requirements, but it is entirely possible that COVID-19 has prevented many DCPs from completing the required amount of CPD.

“While an essential part of Annual Renewal is to make an annual or end-of-cycles CPD statement, we have been clear that if professionals have a shortfall of completed CPD hours due to COVID-19, they will not be penalised for this. For anyone in this position, you still need to make the statement and we’ll then be in touch to talk about next steps.”

The GDC provides further guidance and information about Annual Renewal on its website.