The Scottish Government has stepped in to mitigate pension changes in the NHS which have been blamed for fuelling a staffing crisis.

UK Government pension rules have been blamed for giving senior doctors and incentive to retire early or cut down on the number of hours they work.

Scottish Health Secretary Jean Freeman claimed a temporary policy would give higher earners an alternative option.

The move has been welcomed by doctor's bodies in Scotland, although it will only apply in the current financial year.

The measures being introduced will allow eligible NHS staff to have employer pension contributions paid to them as part of their basic pay, which Ms Freeman said would help ensure crucial services are maintained in the face of rising pressures on the health service.

Thanks to a combination of inflexibility in the NHS pension system and the way tax reliefs for higher earners are tapered, doctors earning over £110,000 who take on extra work face punitive tax bills.

Tapered allowances were designed to stop wealthy people from benefitting disproportionately from tax breaks. However the complexity of the system means that doctors have often ended up having to pay more in taxes than they were gaining in overtime pay – with the result that many refuse to take on extra shifts.

The new option will mean staff who are likely to breach the annual allowance in the 2108-20 financial year, and face a tax charge, can withdraw from the NHS Pension Scheme and receive employer contributions as an enhancement to their basic pay. The scheme will run until 31st March 2020.

Ms Freeman said: "Our hard-working staff should not face a financial penalty for working to provide vital servies for patients, and I have repeatedly called for action from the UK Government as this matter is reserved.

"This will make a significant contribution to supporting frontline services and medical specialities who are working round the clock to deliver the highest possible quality of care."

She said the option would help support recruitment and retention of staff, encouraging professionals to build their careers in Scotland.

The chair of the British Medical Association's Scottish Consultants Committee Graeme Eunson said the move was welcome, and he hoped it would provide some urgent short-term relief to some senior doctors who are facing "harsh punitive pension taxation charges".

"This scheme does not deliver everything we have asked for, but it is absolutely a step in the right direction," he said.“Most importantly, as we enter the crucial winter period it will help protect patient care, keep our emergency departments staffed and deal with challenging waiting lists. These are the vital NHS services that have been suffering as doctors are forced to cut their hours out of fear of a perverse tax system that essentially makes them pay to go to work."

However he said a more fundamental UK-wide tax reforms were needed before the end of this financial year to provide a long-term solution and stop doctors from being hit by bills again next year.

Professor Derek Bell, President of the Royal College of Physicians of Edinburgh, said the College had been calling for urgent action on pensions, and also welcomed the announcement. "We welcome any steps to make pension arrangements more flexible for doctors," he said. "We would ask the Scottish Government – and indeed the other devolved administrations – to continue dialogue with the UK Government about implementing flexible pension arrangements, which will give doctors the freedom to plan for their futures."

He added that it was important to point out that the financial circumstances of each doctor are unique. "We would encourage all individuals to get professional financial advice, to address their own circumstances.”

The UK Government is currently awaiting the outcome of a Treasury review of the impact of the annual allowance taper on doctors and other public sector workers.