Office of Public Sector Information
Section 134.
1 (1) In this Schedule—
“eligible persons”, in the case of any pension scheme, means—
any person who is an employee of—
(i) the Board or any subsidiary of the Board, or
(ii) a publicly owned railway company or a franchise company, and
(b) any other person whose membership of that scheme would not prejudice any approval of the scheme for the purposes of Chapter I of Part XIV of the [1988 c. 1.] Income and Corporation Taxes Act 1988 (retirement benefit schemes),
but does not include any such person as is mentioned in paragraph (a) above who participates in the Transport Police scheme;
“employment” means employment under a contract of service or apprenticeship (whether express or implied and, if express, whether oral or in writing), and cognate expressions shall be construed accordingly;
“existing scheme” means any occupational pension scheme (other than a new scheme)—
which is a scheme for the provision of pensions for or in respect of persons with service in the railway industry (whether or not pensions may also be provided under the scheme for or in respect of persons without such service); and
which the Secretary of State by order designates as an existing scheme for the purposes of this Schedule;
“the joint industry scheme” means such occupational pension scheme as the Secretary of State may by order designate as the joint industry scheme for the purposes of this Schedule;
“member”, in relation to a pension scheme, means—
any person who participates in that scheme;
any pensioner under that scheme; and
any other person who has pension rights under that scheme;
and “membership” shall be construed accordingly;
“new scheme” means an occupational pension scheme established under paragraph 2 below;
“occupational pension scheme” has the meaning given in section 1 of the [1993 c. 48.] Pension Schemes Act 1993;
“participant”, in relation to a pension scheme or a section of a pension scheme, means a person to whom pension rights are accruing under the scheme or section by virtue of his employment in a class or description of employment to which the scheme or section relates; and cognate expressions shall be construed accordingly;
“pension”, in relation to any person, means a pension of any kind payable to or in respect of him, and includes a lump sum, allowance or gratuity so payable and a return of contributions, with or without interest or any other addition;
“pension rights”, in relation to any person, includes—
all forms of right to or eligibility for the present or future payment of a pension to or in respect of him; and
a right of allocation in respect of the present or future payment of a pension;
“prescribed” means specified in, or determined in accordance with, an order made by the Secretary of State;
“protected person” has the meaning given by paragraph 5 below;
“the Transport Police scheme” means such one of the schemes for the provision of pensions for or in respect of persons with service as officers of the British Transport Police Force (whether or not pensions may also be provided under the scheme for or in respect of persons without such service) as the Secretary of State may by order designate as the Transport Police scheme for the purposes of this Schedule;
“trustees”, in relation to any pension scheme, includes a reference to any persons who, under the rules of the scheme, are under a liability to provide pensions or other benefits but who are not trustees of the scheme.
(2) Any reference in this Schedule to a pension scheme includes a reference to the scheme as amended under or by virtue of this Schedule.
(3) Any power to make an order under or by virtue of this Schedule in relation to an existing scheme, the joint industry scheme, a new scheme, the Transport Police scheme, or a designated scheme within the meaning of paragraph 10 below shall be exercisable notwithstanding that the occupational pension scheme in question only becomes such a scheme by virtue of its establishment or designation as such in the instrument which contains the order in question; and references to such schemes shall be construed accordingly.
(4) Subject to sub-paragraph (1) above, expressions used in this Schedule and in Part I or II of this Act have the same meaning in this Schedule as they have in that Part.
2 (1) The Secretary of State may by order provide for the establishment, administration and management of one or more occupational pension schemes for the provision of pensions and other benefits for or in respect of eligible persons.
(2) Without prejudice to the generality of sub-paragraph (1) above, an order under that sub-paragraph may make provision with respect to—
(a) the persons who may participate in, or otherwise be members of, the scheme;
(b) the making of contributions by persons participating in the scheme;
(c) the making of contributions by employers of persons who participate in the scheme;
(d) the amendment of the scheme;
(e) the winding up of the scheme, whether in whole or in part;
(f) the persons by whom any function under or relating to the scheme is to be exercisable.
(3) Any occupational pension scheme established under this paragraph shall be treated for all purposes as if it were a pension scheme established under an irrevocable trust.
3 (1) The Secretary of State may by order amend—
(a) the trust deed of any existing scheme;
(b) the rules of any such scheme; or
(c) any other instrument relating to the constitution, management or operation of any such scheme;
and any reference in this Schedule to amending an existing scheme accordingly includes a reference to amending any such trust deed, rules or other instrument.
(2) Without prejudice to the generality of sub-paragraph (1) above, an order under this paragraph may, in particular, amend an existing scheme so as to alter any provision, or so as to make provision, with respect to any of the matters specified in paragraphs (a) to (f) of paragraph 2(2) above.
(3) An order under this paragraph shall not make any amendment to a scheme—
(a) which would prejudice any approval of that scheme for the purposes of Chapter I of Part XIV of the [1988 c. 1.] Income and Corporation Taxes Act 1988 (retirement benefit schemes);
(b) which would prevent the scheme from being a contracted-out scheme for the purposes of Part III of the [1993 c. 48.] Pension Schemes Act 1993 or Part III of the [1993 c. 49.] Pension Schemes (Northern Ireland) Act 1993;
(c) which would to any extent deprive a member of the scheme of pension rights which accrued to him under the scheme before the coming into force of the amendment; or
(d) which would provide for persons who are not eligible persons to become members of the scheme.
(4) The Secretary of State shall not make an order under this paragraph except after consultation with the trustees of the occupational pension scheme to which the order relates.
4 (1) Where persons with pension rights under any existing or new scheme (“the transferor scheme”) are eligible to be members of another scheme (“the transferee scheme”) which is either—
(a) an existing or new scheme, or
(b) the Transport Police scheme,
the Secretary of State may by order make provision for those persons to be members of the transferee scheme instead of the transferor scheme and for their pension rights under the transferor scheme to be transferred so as to become pension rights under the transferee scheme.
(2) Where any pension rights are transferred under sub-paragraph (1) above, the Secretary of State may by order make provision for—
(a) such of the assets held for the purposes of the transferor scheme, and
(b) such of the liabilities under or in relation to that scheme of any employers or trustees,
as he may consider appropriate in consequence of that transfer to be correspondingly transferred so as to become assets or, as the case may be, liabilities in relation to the transferee scheme.
(3) Where any pension rights are transferred under sub-paragraph (1) above, the Secretary of State may by order—
(a) impose on the trustees of the transferee scheme, or on the employer (if any) of the person whose pension rights are transferred, duties with respect to—
(i) the participation of that person or that employer in the scheme, or
(ii) the payment of contributions by that employer under the scheme,
in accordance with the rules of the scheme; and
(b) make provision requiring any person whose approval or consent is necessary in connection with the doing of anything required to be done by virtue of an order under this paragraph to give that approval or consent.
(4) The Secretary of State may by order make provision for the winding up of the transferor scheme, whether in whole or in part, in connection with, or in consequence of, any transfers under this paragraph.
(5) The Secretary of State shall not make an order under this paragraph except after consultation with the trustees of the occupational pension schemes which are, or are to be, the transferor scheme and the transferee scheme.
5 In this Schedule “protected person” means—
(a) any person who immediately before the passing of this Act—
(i) is an employee of the Board or of a subsidiary of the Board; and
(ii) is participating in an existing scheme;
(b) any person not falling within paragraph (a) above—
(i) who either is, immediately before the passing of this Act, an employee of the Board or of a subsidiary of the Board or has at some earlier time been such an employee;
(ii) who has participated in an existing scheme before the passing of this Act; and
(iii) who fulfils prescribed conditions;
(c) any person who, immediately before the passing of this Act, has pension rights under an existing scheme but is not participating in that scheme;
(d) any person who, after the passing of this Act, acquires pension rights—
(i) in consequence of the death of a person falling within paragraph (a), (b) or (c) above, and
(ii) by virtue of the participation of that other person in an existing scheme, or in an occupational pension scheme from which pension rights of that person have been transferred, whether directly or indirectly, to an existing scheme.
6 (1) The Secretary of State may by order make provision for the purpose of protecting the interests of protected persons in respect of their pension rights.
(2) Without prejudice to the generality of sub-paragraph (1) above, an order under that sub-paragraph may make provision for the purpose of securing—
(a) that the relevant pension rights of protected persons are no less favourable as a result of—
(i) any amendment of an occupational pension scheme,
(ii) any transfer of pension rights, or
(iii) any winding up of an occupational pension scheme, in whole or in part,
than they would have been apart from the amendment, transfer or winding up, as the case may be;
(b) that a person who is a protected person by virtue of paragraph (a) or (b) of paragraph 5 above is not prevented, otherwise than by reason of either of the following events, that is to say—
(i) the continuity of his period of employment is broken, or
(ii) he voluntarily withdraws from an occupational pension scheme,
from participating in some occupational pension scheme and acquiring pension rights under that scheme which are no less favourable than those which would have been provided under his former scheme in accordance with the rules of that scheme as in force immediately before the coming into force of the order; or
(c) that the employer of a person falling within paragraph (b) above is required to provide an occupational pension scheme in which the person may participate and to which pension rights of his, and assets and liabilities relating to, or representative of, those pension rights, may be transferred;
and in paragraph (b) above “former scheme”, in relation to a protected person, means the existing scheme mentioned in paragraph (a) or (b), as the case may be, of paragraph 5 above.
(3) For the purposes of this paragraph, the “relevant pension rights” of a protected person are so much of his pension rights as consist of or otherwise represent—
(a) in the case of a person who is a protected person by virtue of paragraph (a), (b) or (c) of paragraph 5 above, any pension rights which, immediately before the passing of this Act, he had under the existing scheme mentioned in the paragraph in question;
(b) in the case of a person who is a protected person by virtue of paragraph 5(a) or (b) above, any pension rights which he acquires, or has acquired, by virtue of his participation in an occupational pension scheme during the protected period in his case; and
(c) in the case of a person who is a protected person by virtue of paragraph (d) of paragraph 5 above, any pension rights which he acquires, or has acquired, after the passing of this Act and in consequence of the death of the other person mentioned in the said paragraph (d) (“the deceased”), being—
(i) pension rights under the existing scheme mentioned in that paragraph, so far as referable to pension rights which the deceased had under that scheme before the passing of this Act;
(ii) pension rights under any occupational pension scheme, so far as referable to pension rights which, before the passing of this Act, the deceased had under the existing scheme mentioned in the said paragraph (d) and which have been transferred from that existing scheme, whether directly or indirectly; or
(iii) pension rights under any occupational pension scheme, so far as referable to the participation of the deceased in that or any other occupational pension scheme during the protected period.
(4) For the purposes of sub-paragraph (3) above, “the protected period” means—
(a) in the case of a person who is a protected person by virtue of paragraph (a) of paragraph 5 above, the period beginning with the passing of this Act and ending with whichever of the following events first occurs, that is to say—
(i) the continuity of the person’s period of employment is broken; or
(ii) he voluntarily withdraws from an occupational pension scheme;
(b) in the case of a person who is a protected person by virtue of paragraph (b) of paragraph 5 above, a period beginning at such time as may be prescribed and ending with whichever of the following events first occurs, that is to say—
(i) the continuity of the person’s period of employment is broken; or
(ii) he voluntarily withdraws from an occupational pension scheme; and
(c) in the case of a person who is a protected person by virtue of paragraph (d) of paragraph 5 above, the period (if any) which is the protected period in the case of the other person mentioned in the said paragraph (d).
(5) In determining a person’s relevant pension rights for the purposes of this paragraph, where the rules of a pension scheme make provision requiring pension rights which have accrued to a person to be enhanced in consequence of increases in remuneration after the accrual of the pension rights, that provision, and any enhancement resulting from it, shall be treated, so far as relating to any enhancement in consequence of increases in remuneration after the passing of this Act, as pension rights accruing at the time of the increase in remuneration in question.
(6) An order under this paragraph may make provision for and in connection with the making of elections in a prescribed manner by protected persons for orders under this paragraph (other than orders by virtue of this sub-paragraph) not to have effect with respect to them or their surviving dependants except to such extent (if any) as may be specified in the election or subject to such conditions (if any) as may be so specified.
(7) In sub-paragraph (6) above “surviving dependant”, in relation to a protected person, means any person who may acquire, in consequence of the death of the protected person, pension rights referable to relevant pension rights of the protected person.
(8) An order under this paragraph may make provision for such orders to cease to have effect in relation to a protected person if—
(a) the continuity of his period of employment is broken,
(b) he voluntarily withdraws from an occupational pension scheme, or
(c) he requests that his pension rights be transferred from an occupational pension scheme,
except in such circumstances or to such extent as may be prescribed.
(9) Circumstances may be prescribed in which—
(a) a break in the continuity of a person’s period of employment, or
(b) a person’s voluntary withdrawal from an occupational pension scheme,
shall be disregarded for prescribed purposes of this paragraph.
(10) Apart from paragraph 18, so much of Schedule 13 to the [1978 c. 44.] Employment Protection (Consolidation) Act 1978 as has effect for the purpose of ascertaining whether any period of employment is continuous shall apply for the purposes of this paragraph as it applies for the purposes of that Act, except that, in the case of an employee—
(a) who is employed for less than sixteen hours, but for at least one hour, in any week, or
(b) whose relations with the employer are governed during the whole or part of a week by a contract of employment which normally involves employment for less than sixteen hours, but for at least one hour, weekly,
that Schedule shall so apply in relation to that employee and that week with the modifications in sub-paragraph (11) below.
(11) Those modifications are that the said Schedule 13 shall have effect—
(a) as if paragraph 3 provided for any week—
(i) during the whole or part of which the employee’s relations with the employer are governed otherwise than by a contract of employment which requires him to be employed for a minimum number of hours weekly, and
(ii) in which the employee is employed for one hour or more,
to count in computing a period of employment;
(b) as if paragraph 4 provided for any week during the whole or part of which the employee’s relations with the employer are governed by a contract of employment which normally involves employment for at least one hour, but for less than sixteen hours, weekly to count in computing a period of employment; and
(c) as if paragraphs 5 to 7 and, in paragraphs 9, 10 and 15, the references to paragraph 5, were omitted.
(12) Expressions used in sub-paragraph (10) or (11) above and in Schedule 13 to the [1978 c. 44.] Employment Protection (Consolidation) Act 1978 have the same meaning in that sub-paragraph as they have in that Schedule.
7 (1) Without prejudice to the generality of paragraph 6 above, an order under that paragraph may impose on any person falling within sub-paragraph (2) below duties with respect to—
(a) the provision of a pension scheme,
(b) the terms of any pension scheme required to be provided by virtue of paragraph (a) above,
(c) the amendment, or the preservation from amendment, of a pension scheme,
(d) the acceptance of protected persons as members of a pension scheme,
(e) the acceptance (so as to become included among the property, rights and liabilities held for the purposes of a pension scheme or to which a pension scheme is subject) of property, rights and liabilities relating to, or representative of, pension rights of protected persons,
(f) the making or refunding of contributions,
(g) the purchase of annuities,
(h) the winding up of a pension scheme, in whole or in part,
and may make provision requiring any person whose approval or consent is necessary in connection with the doing of anything required to be done by virtue of such an order, so far as relating to matters specified in paragraphs (a) to (h) above, to give that approval or consent.
(2) The persons mentioned in sub-paragraph (1) above are—
(a) any person who is or has been the employer of a protected person;
(b) any person who contributes to a pension scheme as an employer, whether or not he is or has been the employer of a protected person;
(c) the trustees of any pension scheme of which a protected person is a member or to which pension rights of a protected person may be transferred;
(d) any person who has power to amend or wind up a pension scheme under which a protected person has pension rights.
(3) An order under paragraph 5 or 6 above may include provision—
(a) for disputes arising under the order to be referred to arbitration; or
(b) for provisions of the order to be enforceable on an application made to a prescribed court by the Secretary of State or by a prescribed person or a person of a prescribed description.
8 (1) The Secretary of State may by order make provision conferring upon any person to whom this paragraph applies—
(a) who is participating, or who at or after the making of the order begins to participate, in the joint industry scheme, and
(b) who fulfils the qualifying conditions,
the right to continue to participate in the joint industry scheme, in accordance with the rules of that scheme, unless and until the termination conditions become fulfilled in the case of that person.
(2) The persons to whom this paragraph applies are—
(a) any person who immediately before the passing of this Act—
(i) is an employee of the Board or of a subsidiary of the Board; and
(ii) is participating in an existing scheme; and
(b) any person not falling within paragraph (a) above—
(i) who either is, immediately before the passing of this Act, an employee of the Board or of a subsidiary of the Board or has at some earlier time been such an employee;
(ii) who has participated in an existing scheme before the passing of this Act; and
(iii) who fulfils prescribed conditions.
(3) For the purposes of this paragraph a person fulfils the “qualifying conditions” if—
(a) the continuity of his period of employment has not been broken during the intervening period;
(b) he has not withdrawn voluntarily from an occupational pension scheme during that period; and
(c) he has at all times during that period been in the employment of an employer engaged in the railway industry.
(4) In sub-paragraph (3) above, the “intervening period” means the period which begins at the passing of this Act and ends—
(a) at the time when the person in question begins to participate in the joint industry scheme, or
(b) at the coming into force of the order under this paragraph which confers upon that person the right mentioned in sub-paragraph (1) above (or which would have conferred that right upon him, had he satisfied the qualifying conditions),
whichever is the later.
(5) The “termination conditions” become fulfilled for the purposes of this paragraph in the case of any person if—
(a) the continuity of his period of employment is broken;
(b) he withdraws voluntarily from the joint industry scheme; or
(c) he is not in the employment of any employer engaged in the railway industry.
(6) Circumstances may be prescribed in which—
(a) a break in the continuity of a person’s period of employment,
(b) a person’s voluntary withdrawal from an occupational pension scheme, or
(c) a period during which a person is not in the employment of an employer engaged in the railway industry,
shall be disregarded for the purpose of determining whether the person fulfils the qualifying conditions or whether the termination conditions have become fulfilled in his case.
(7) The employers who are to be regarded for the purposes of this paragraph as “engaged in the railway industry” are those who carry on activities of a class or description specified for the purposes of this sub-paragraph by the Secretary of State in an order under this paragraph; and the Secretary of State may so specify any class or description of activity which, in his opinion, falls within, or is related to or connected with, the railway industry.
(8) An order under this paragraph may—
(a) impose on the trustees of the joint industry scheme, or on the employer (if any) of a person for the time being entitled to the right conferred by virtue of sub-paragraph (1) above, duties with respect to—
(i) the participation of that person or that employer in the scheme, or
(ii) the payment of contributions by that employer under the scheme,
in accordance with the rules of the scheme; and
(b) make provision requiring any person whose approval or consent is necessary in connection with the doing of anything required to be done by virtue of an order under this paragraph to give that approval or consent.
(9) An order under this paragraph may make provision for the purpose of preventing a person who would otherwise be entitled to the right conferred by virtue of sub-paragraph (1) above from continuing to participate in the joint industry scheme in circumstances where his continued participation in that scheme would in the opinion of a prescribed person—
(a) prejudice any approval of that scheme for the purposes of Chapter I of Part XIV of the [1988 c. 1.] Income and Corporation Taxes Act 1988 (retirement benefit schemes); or
(b) prevent the scheme from being a contracted-out scheme for the purposes of Part III of the [1993 c. 48.] Pension Schemes Act 1993 or Part III of the [1993 c. 49.] Pension Schemes (Northern Ireland) Act 1993.
(10) An order under this paragraph may include provision—
(a) for disputes arising under the order to be referred to arbitration; or
(b) for provisions of the order to be enforceable on an application made to a prescribed court by the Secretary of State or by a prescribed person or a person of a prescribed description.
(11) An order under this paragraph may make provision for and in connection with the making of elections in a prescribed manner by persons who would otherwise be entitled by virtue of sub-paragraph (1) above to the right there mentioned for orders under this paragraph (other than orders by virtue of this sub-paragraph) not to have effect with respect to them.
(12) Sub-paragraph (10) of paragraph 6 above shall have effect for the purposes of this paragraph as it has effect for the purposes of that paragraph.
9 (1) In section 52 of the [1980 c. 34.] Transport Act 1980, in subsection (1) (which requires the Secretary of State to make payments each year to B.R. pension schemes in respect of unfunded pension obligations owed by the Board), for the words “Subject to the provisions of this section and section 58,” there shall be substituted the words “Subject to the provisions of this section and sections 52A to 52D and 58,”.
(2) After that section there shall be inserted—
(1) If the Minister is desirous of making to the persons administering a B.R. pension scheme one or more payments by way of final discharge of his liability to make payments to them under section 52(1) in relation to that scheme, to the extent that that liability relates to so much of the relevant pension obligations as are owed in respect of—
(a) all pension rights under the scheme,
(b) pension rights of some particular class or description under the scheme, or
(c) pension rights of persons of some particular class or description under the scheme,
he may give to the persons administering the scheme a notice identifying the pension rights in question and specifying in relation to those pension rights the matters set out in subsection (2), as determined in accordance with the following provisions of this section.
(2) The matters mentioned in subsection (1) are—
(a) the capital value of the attributable unfunded obligations in question, as at the beginning of the next financial year;
(b) the amount or amounts, or the method of determining the amount or amounts, of the payment or payments to be made under this section by way of final discharge of the Minister’s liability to make payments under section 52(1), so far as relating to the pension rights identified in the notice under subsection (1); and
(c) the date or dates on which that payment or those payments are to be made.
(3) In making any determination for the purposes of paragraph (b) of subsection (2), the amount or, as the case may be, the aggregate of the amounts mentioned in that paragraph shall be such as to include—
(a) a sum equal to the capital value determined under paragraph (a) of that subsection; and
(b) interest, payable at such rate as may be determined by the Minister, on so much (if any) of that sum as may from time to time be outstanding after the beginning of the financial year mentioned in the said paragraph (a).
(4) For the purposes of this section, the capital value mentioned in paragraph (a) of subsection (2) shall either—
(a) be determined by the Minister, or
(b) if the Minister so requires in the particular case, be determined by the actuary to the scheme in question and approved by the Minister,
and it shall be for the Minister to determine the matters mentioned in paragraphs (b) and (c) of that subsection.
(5) Notice under subsection (1) above shall only be given after consultation—
(a) with the persons administering the scheme in question; and
(b) with the actuary to that scheme, except in a case where the capital value mentioned in subsection (2)(a) is determined by that actuary pursuant to subsection (4)(b);
and any such notice must be given not less than one month before the beginning of the financial year mentioned in subsection (2)(a).
(6) The giving of a notice under subsection (1) shall—
(a) terminate the liability of the Minister to make payments under section 52(1), so far as relating to the pension rights identified in the notice, for financial years beginning after the giving of the notice; and
(b) impose upon the Minister a duty—
(i) to make to the persons administering the scheme in question the payment or payments mentioned in subsection (2)(b); and
(ii) to do so at the time or times specified in pursuance of subsection (2)(c).
Railways Act 1993