The Department of Health has said community service social enterprises should not exploit a loophole that would allow them to give new staff access to the NHS pension scheme.

Anxiety over future pension terms is a stumbling block for staff wanting to join any kind of employer independent of the NHS. Although staff transferring into a social enterprise at its start can keep their NHS pensions, new recruits cannot.

But NHS Kingston’s provider arm recently became a social enterprise and retained access to the scheme. They secured a hybrid community service contract with elements of the alternative provider medical services pension arrangement, drawn up with lawyers Capsticks.

The APMS contract was designed for GP services only and a spokeswoman for the DH told HSJ it “didn’t recommend” this path, as the APMS contract was designed for GP services.

She said: “The department remains very keen to support further social enterprises, but they must be developed in a way which is consistent with national policies, including on pensions.”

The DH has given primary care trusts and strategic health authorities until the end of September to draw up plans for separating PCT provider arms. The deadline for applications to the final wave of the right to request to become a social enterprise scheme is also 30 September.

On Monday, it emerged that staff at Middlebrough and Redcar and Cleveland PCTs had rejected becoming a social enterprise and voted to be absorbed by a foundation trust.

In a ballot, 66 per cent of staff voted to be “hosted by a local foundation trust” - with North Tees and Hartlepool Foundation Trust the most likely contender.

This month the three Tyneside PCTs abandoned their plans to turn their provider arms into a social enterprise after the DH confirmed GP consortia would not have to honour the three to five-year contracts social enterprises were originally guaranteed under the scheme (news, page 8, 2 September).