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PART IV continued CHAPTER I continued
(1) An eligible member of a qualifying scheme may by notice in writing require the trustees or managers of the scheme to use an amount equal to the cash equivalent of his pension credit benefit for such one or more of the authorised purposes as he may specify in the notice.
(2) In the case of a member of an occupational pension scheme, the authorised purposes are—
(a) to acquire rights allowed under the rules of an occupational pension scheme, or personal pension scheme, which is an eligible scheme,
(b) to purchase from one or more insurance companies such as are mentioned in section 19(4)(a), chosen by the member and willing to accept payment on account of the member from the trustees or managers, one or more annuities which satisfy the prescribed requirements, and
(c) in such circumstances as may be prescribed, to subscribe to other pension arrangements which satisfy prescribed requirements.
(3) In the case of a member of a personal pension scheme, the authorised purposes are—
(a) to acquire rights allowed under the rules of an occupational pension scheme, or personal pension scheme, which is an eligible scheme, and
(b) in such circumstances as may be prescribed, to subscribe to other pension arrangements which satisfy prescribed requirements.
(4) The cash equivalent for the purposes of subsection (1) shall—
(a) in the case of a salary related occupational pension scheme, be taken to be the amount shown in the relevant statement under section 101H, and
(b) in any other case, be determined by reference to the date the notice under that subsection is given.
(5) The requirements which may be prescribed under subsection (2) or (3) include, in particular, requirements of the Inland Revenue.
(6) In subsections (2) and (3), references to an eligible scheme are to a scheme—
(a) the trustees or managers of which are able and willing to accept payment in respect of the member’s pension credit rights, and
(b) which satisfies the prescribed requirements.
(7) In this Chapter, “transfer notice” means a notice under subsection (1).
(1) In the case of a salary related occupational pension scheme, the power to give a transfer notice may only be exercised if—
(a) the member has been provided with a statement under section 101H, and
(b) not more than 3 months have passed since the date by reference to which the amount shown in the statement is determined.
(2) The power to give a transfer notice may not be exercised in the case of an occupational pension scheme if—
(a) there is less than a year to go until the member reaches normal benefit age, or
(b) the pension to which the member is entitled by virtue of his pension credit rights, or benefit in lieu of that pension, or any part of it has become payable.
(3) Where an eligible member of a qualifying scheme—
(a) is entitled to make an application under section 95 to the trustees or managers of the scheme, or
(b) would be entitled to do so, but for the fact that he has not received a statement under section 93A in respect of which the guarantee date is sufficiently recent,
he may not, if the scheme so provides, exercise the power to give them a transfer notice unless he also makes an application to them under section 95.
(4) The power to give a transfer notice may not be exercised if a previous transfer notice given by the member to the trustees or managers of the scheme is outstanding.
(1) The trustees or managers of a qualifying scheme which is a salary related occupational pension scheme shall, on the application of an eligible member, provide him with a written statement of the amount of the cash equivalent of his pension credit benefit under the scheme.
(2) For the purposes of subsection (1), the amount of the cash equivalent shall be determined by reference to a date falling within—
(a) the prescribed period beginning with the date of the application, and
(b) the prescribed period ending with the date on which the statement under that subsection is provided to the applicant.
(3) Regulations may make provision in relation to applications under subsection (1) and may, in particular, restrict the making of successive applications.
(4) If trustees or managers to whom subsection (1) applies fail to perform an obligation under that subsection, section 10 of the [1995 c. 26.] Pensions Act 1995 (power of the Regulatory Authority to impose civil penalties) shall apply to any trustee or manager who has failed to take all such steps as are reasonable to secure that the obligation was performed.
Cash equivalents for the purposes of this Chapter shall be calculated and verified in the prescribed manner.
(1) Trustees or managers of a qualifying scheme who receive a transfer notice shall comply with the notice—
(a) in the case of an occupational pension scheme, within 6 months of the valuation date or, if earlier, by the date on which the member to whom the notice relates reaches normal benefit age, and
(b) in the case of a personal pension scheme, within 6 months of the date on which they receive the notice.
(2) The Regulatory Authority may, in prescribed circumstances, extend the period for complying with the notice.
(3) If the Regulatory Authority are satisfied—
(a) that there has been a relevant change of circumstances since they granted an extension under subsection (2), or
(b) that they granted an extension under that subsection in ignorance of a material fact or on the basis of a mistake as to a material fact,
they may revoke or reduce the extension.
(4) Where the trustees or managers of an occupational pension scheme have failed to comply with a transfer notice before the end of the period for compliance—
(a) they shall, except in prescribed cases, notify the Regulatory Authority of that fact within the prescribed period, and
(b) section 10 of the [1995 c. 26.] Pensions Act 1995 (power of the Regulatory Authority to impose civil penalties) shall apply to any trustee or manager who has failed to take all such steps as are reasonable to ensure that the notice was complied with before the end of the period for compliance.
(5) If trustees or managers to whom subsection (4)(a) applies fail to perform the obligation imposed by that provision, section 10 of the Pensions Act 1995 shall apply to any trustee or manager who has failed to take all such steps as are reasonable to ensure that the obligation was performed.
(6) Regulations may—
(a) make provision in relation to applications under subsection (2), and
(b) provide that subsection (4) shall not apply in prescribed circumstances.
(7) In this section, “valuation date”, in relation to a transfer notice given to the trustees or managers of an occupational pension scheme, means—
(a) in the case of a salary related scheme, the date by reference to which the amount shown in the relevant statement under section 101H is determined, and
(b) in the case of any other scheme, the date the notice is given.
(1) Subject to subsections (2) and (3), a person who has given a transfer notice may withdraw it by giving the trustees or managers to whom it was given notice in writing that he no longer requires them to comply with it.
(2) A transfer notice may not be withdrawn if the trustees or managers have already entered into an agreement with a third party to use the whole or part of the amount they are required to use in accordance with the notice.
(3) If the giving of a transfer notice depended on the making of an application under section 95, the notice may only be withdrawn if the application is also withdrawn.
(1) Regulations may make provision for the amount required to be used under section 101F(1) to be increased or reduced in prescribed circumstances.
(2) Without prejudice to the generality of subsection (1), the circumstances which may be prescribed include—
(a) failure by the trustees or managers of a qualifying scheme to comply with a notice under section 101F(1) within 6 months of the date by reference to which the amount of the cash equivalent falls to be determined, and
(b) the state of funding of a qualifying scheme.
(3) Regulations under subsection (1) may have the effect of extinguishing an obligation under section 101F(1).
Compliance with a transfer notice shall have effect to discharge the trustees or managers of a qualifying scheme from any obligation to provide the pension credit benefit of the eligible member who gave the notice.
In making any calculation for the purposes of this Chapter—
(a) any charge or lien on, and
(b) any set-off against,
the whole or part of a pension shall be disregarded.
A notice under section 101F(1) or 101K(1) shall be taken to have been given if it is delivered to the trustees or managers personally or sent by post in a registered letter or by recorded delivery service.
(1) In this Chapter—
“eligible member”, in relation to a qualifying scheme, means a member who has pension credit rights under the scheme;
“normal benefit age”, in relation to an eligible member of a qualifying scheme, means the earliest age at which the member is entitled to receive a pension by virtue of his pension credit rights under the scheme (disregarding any scheme rule making special provision as to early payment of pension on grounds of ill-health or otherwise);
“pension credit benefit”, in relation to an eligible member of a qualifying scheme, means the benefits payable under the scheme to or in respect of the member by virtue of rights under the scheme attributable (directly or indirectly) to a pension credit;
“pension credit rights”, in relation to a qualifying scheme, means rights to future benefits under the scheme which are attributable (directly or indirectly) to a pension credit;
“qualifying scheme” means a funded occupational pension scheme and a personal pension scheme;
“transfer notice” has the meaning given by section 101F(7).
(2) For the purposes of this Chapter, an occupational pension scheme is salary related if—
(a) it is not a money purchase scheme, and
(b) it does not fall within a prescribed class.
(3) In this Chapter, references to the relevant statement under section 101H, in relation to a transfer notice given to the trustees or managers of a salary related occupational pension scheme, are to the statement under that section on which the giving of the notice depended.
(4) For the purposes of this section, an occupational pension scheme is funded if it meets its liabilities out of a fund accumulated for the purpose during the life of the scheme.
Regulations may apply this Chapter with prescribed modifications to occupational pension schemes—
(a) which are not money purchase schemes, but
(b) where some of the benefits that may be provided are money purchase benefits.”
(1) In section 73 of the [1995 c. 26.] Pensions Act 1995 (treatment of rights on winding up of an occupational pension scheme to which section 56 of that Act (minimum funding requirement) applies), in subsection (3) (classification of liabilities), in paragraph (c) (accrued rights), at the end of sub-paragraph (i) there shall be inserted—
“(ia) future pensions, or other future benefits, attributable (directly or indirectly) to pension credits (but excluding increases to pensions),”.
(2) In the case of an occupational pension scheme which is not a scheme to which section 56 of the Pensions Act 1995 applies, rights attributable (directly or indirectly) to a pension credit are to be accorded in a winding up the same treatment—
(a) if they have come into payment, as the rights of a pensioner member, and
(b) if they have not come into payment, as the rights of a deferred member.
(3) Subsection (2) overrides the provisions of a scheme to the extent that it conflicts with them, and the scheme has effect with such modifications as may be required in consequence.
(4) In subsection (2)—
(a) “deferred member” and “pensioner member” have the same meanings as in Part I of the Pensions Act 1995,
(b) “pension credit” includes a credit under Northern Ireland legislation corresponding to section 29(1)(b), and
(c) references to rights attributable to a pension credit having come into payment are to the person to whom the rights belong having become entitled by virtue of the rights to the present payment of pension or other benefits.
(1) The [1971 c. 56.] Pensions (Increase) Act 1971 shall be amended as follows.
(2) In section 3 (qualifying conditions), after subsection (2) there shall be inserted—
“(2A) A pension attributable to the pensioner having become entitled to a pension credit shall not be increased unless the pensioner has attained the age of fifty-five years.”
(3) In section 8, in subsection (1) (definition of “pension”), in paragraph (a), the words from “(either” to “person)” shall be omitted.
(4) In that section, in subsection (2) (when pension deemed for purposes of the Act to begin), after “pension”, in the first place, there shall be inserted “which is not attributable to a pension credit”, and after that subsection there shall be inserted—
“(2A) A pension which is attributable to a pension credit shall be deemed for purposes of this Act to begin on the day on which the order or provision on which the credit depends takes effect.”
(5) In section 17(1) (interpretation)—
(a) for the definitions of “derivative pension” and “principal pension” there shall be substituted—
““derivative pension” means a pension which—
(a) is not payable in respect of the pensioner’s own services, and
(b) is not attributable to the pensioner having become entitled to a pension credit;”,
(b) after the definition of “pension” there shall be inserted—
““pension credit” means a credit under section 29(1)(b) of the Welfare Reform and Pensions Act 1999 or under corresponding Northern Ireland legislation;
“principal pension” means a pension which—
(a) is payable in respect of the pensioner’s own services, or
(b) is attributable to the pensioner having become entitled to a pension credit;”, and
(c) for the definition of “widow’s pension” there shall be substituted—
““widow’s pension” means a pension payable—
(a) in respect of the services of the pensioner’s deceased husband, or
(b) by virtue of the pensioner’s deceased husband having become entitled to a pension credit.”
(1) The Secretary of State may by regulations make provision for a pension to which subsection (2) applies to be increased, as a minimum, by reference to increases in the retail prices index, so far as not exceeding 5% per annum.
(2) This subsection applies to—
(a) a pension provided to give effect to eligible pension credit rights of a member under a qualifying occupational pension scheme, and
(b) a pension provided to give effect to safeguarded rights of a member under a personal pension scheme.
(3) In this section—
“eligible”, in relation to pension credit rights, means of a description prescribed by regulations made by the Secretary of State;
“pension credit rights”, in relation to an occupational pension scheme, means rights to future benefits under the scheme which are attributable (directly or indirectly) to a credit under section 29(1)(b) or under corresponding Northern Ireland legislation;
“qualifying occupational pension scheme” means an occupational pension scheme which is not a public service pension scheme;
“safeguarded rights” has the meaning given in section 68A of the [1993 c. 48.] Pension Schemes Act 1993.
(1) The Secretary of State may by regulations make provision for the purpose of enabling the person responsible for a pension arrangement involved in pension sharing to recover from the parties to pension sharing prescribed charges in respect of prescribed descriptions of pension sharing activity.
(2) Regulations under subsection (1) may include—
(a) provision for the start of the implementation period for a pension credit to be postponed in prescribed circumstances;
(b) provision, in relation to payments in respect of charges recoverable under the regulations, for reimbursement as between the parties to pension sharing;
(c) provision, in relation to the recovery of charges by deduction from a pension credit, for the modification of Schedule 5;
(d) provision for the recovery in prescribed circumstances of such additional amounts as may be determined in accordance with the regulations.
(3) For the purposes of regulations under subsection (1), the question of how much of a charge recoverable under the regulations is attributable to a party to pension sharing is to be determined as follows—
(a) where the relevant order or provision includes provision about the apportionment of charges under this section, there is attributable to the party so much of the charge as is apportioned to him by that provision;
(b) where the relevant order or provision does not include such provision, the charge is attributable to the transferor.
(4) For the purposes of subsection (1), a pension arrangement is involved in pension sharing if section 29 applies by virtue of an order or provision which relates to the arrangement.
(5) In that subsection, the reference to pension sharing activity is to activity attributable (directly or indirectly) to the involvement in pension sharing.
(6) In subsection (3)—
(a) the reference to the relevant order or provision is to the order or provision which gives rise to the pension sharing, and
(b) the reference to the transferor is to the person to whose rights that order or provision relates.
(7) In this section “prescribed” means prescribed in regulations under subsection (1).
(1) Power under an Act to establish a pension scheme shall include power to make provision for the provision, by reference to pension credits which derive from rights under—
(a) the scheme, or
(b) a scheme in relation to which the scheme is specified as an alternative for the purposes of paragraph 2 of Schedule 5,
of benefits to or in respect of those entitled to the credits.
(2) Subsection (1) is without prejudice to any other power.
(3) Subsection (1) shall apply in relation to Acts whenever passed.
(4) No obligation to consult shall apply in relation to the making, in exercise of a power under an Act to establish a pension scheme, of provision of a kind authorised by subsection (1).
(5) Any provision of, or under, an Act which makes benefits under a pension scheme established under an Act a charge on, or payable out of—
(a) the Consolidated Fund,
(b) the Scottish Consolidated Fund, or
(c) the Consolidated Fund of Northern Ireland,
shall be treated as including any benefits under the scheme which are attributable (directly or indirectly) to a pension credit which derives from rights to benefits charged on, or payable out of, that fund.
(6) In this section—
“pension credit” includes a credit under Northern Ireland legislation corresponding to section 29(1)(b);
“pension scheme” means a scheme or arrangement providing benefits, in the form of pensions or otherwise, payable on termination of service, or on death or retirement, to or in respect of persons to whom the scheme or arrangement applies.
(1) The appropriate minister may by regulations amend the [1961 c. 42.] Sheriffs' Pensions (Scotland) Act 1961, the [1981 c. 20.] Judicial Pensions Act 1981 or the [1993 c. 8.] Judicial Pensions and Retirement Act 1993 for the purpose of—
(a) extending a pension scheme under the Act to include the provision, by reference to pension credits which derive from rights under—
(i) the scheme, or
(ii) a scheme in relation to which the scheme is specified as an alternative for the purposes of paragraph 2 of Schedule 5,
of benefits to or in respect of those entitled to the credits, or
(b) restricting the power of the appropriate minister to accept payments into a pension scheme under the Act, where the payments represent the cash equivalent of rights under another pension scheme which are attributable (directly or indirectly) to a pension credit.
(2) Regulations under subsection (1)—
(a) may make benefits provided by virtue of paragraph (a) of that subsection a charge on, and payable out of, the Consolidated Fund;
(b) may confer power to make subordinate legislation, including subordinate legislation which provides for calculation of the value of rights in accordance with guidance from time to time prepared by a person specified in the subordinate legislation.
(3) The appropriate minister for the purposes of subsection (1) is—
(a) in relation to a pension scheme whose ordinary members are limited to those who hold judicial office whose jurisdiction is exercised exclusively in relation to Scotland, the Secretary of State, and
(b) in relation to any other pension scheme, the Lord Chancellor.
(4) In this section—
“pension credit” includes a credit under Northern Ireland legislation corresponding to section 29(1)(b);
“pension scheme” means a scheme or arrangement providing benefits, in the form of pensions or otherwise, payable on termination of service, or on death or retirement, to or in respect of persons to whom the scheme or arrangement applies.
(1) Nothing in any of the following provisions (restrictions on alienation of pension rights) applies in relation to any order or provision falling within section 28(1)—
(a) section 203(1) and (2) of the [1955 c. 18.] Army Act 1955, section 203(1) and (2) of the [1955 c. 19.] Air Force Act 1955, section 128G(1) and (2) of the [1957 c. 53.] Naval Discipline Act 1957 and section 159(4) and (4A) of the [1993 c. 48.] Pension Schemes Act 1993,
(b) section 91 of the [1995 c. 26.] Pensions Act 1995,
(c) any provision of any enactment (whether passed or made before or after this Act is passed) corresponding to any of the enactments mentioned in paragraphs (a) and (b), and
(d) any provision of a pension arrangement corresponding to any of those enactments.
(2) In this section, “enactment” includes an enactment comprised in subordinate legislation (within the meaning of the [1978 c. 30.] Interpretation Act 1978).
(1) The Secretary of State may by regulations require the person responsible for a pension arrangement involved in pension sharing to supply to such persons as he may specify in the regulations such information relating to anything which follows from the application of section 29 as he may so specify.
(2) Section 168 of the [1993 c. 48.] Pension Schemes Act 1993 (breach of regulations) shall apply as if this section were contained in that Act (otherwise than in Chapter II of Part VII).
(3) For the purposes of this section, a pension arrangement is involved in pension sharing if section 29 applies by virtue of an order or provision which relates to the arrangement.
(1) In this Chapter—
“implementation period”, in relation to a pension credit, has the meaning given by section 34;
“occupational pension scheme” has the meaning given by section 1 of the Pension Schemes Act 1993;
“pension arrangement” means—
an occupational pension scheme,
a personal pension scheme,
a retirement annuity contract,
an annuity or insurance policy purchased, or transferred, for the purpose of giving effect to rights under an occupational pension scheme or a personal pension scheme, and
an annuity purchased, or entered into, for the purpose of discharging liability in respect of a credit under section 29(1)(b) or under corresponding Northern Ireland legislation;
“pension credit” means a credit under section 29(1)(b);
“pension debit” means a debit under section 29(1)(a);
“pensionable service”, in relation to a member of an occupational pension scheme, means service in any description or category of employment to which the scheme relates which qualifies the member (on the assumption that it continues for the appropriate period) for pension or other benefits under the scheme;
“personal pension scheme” has the meaning given by section 1 of the Pension Schemes Act 1993;
“retirement annuity contract” means a contract or scheme approved under Chapter III of Part XIV of the [1988 c. 1.] Income and Corporation Taxes Act 1988;
“shareable rights” has the meaning given by section 27(2);
“trustees or managers”, in relation to an occupational pension scheme or a personal pension scheme means—
in the case of a scheme established under a trust, the trustees of the scheme, and
in any other case, the managers of the scheme.
(2) In this Chapter, references to the person responsible for a pension arrangement are—
(a) in the case of an occupational pension scheme or a personal pension scheme, to the trustees or managers of the scheme,
(b) in the case of a retirement annuity contract or an annuity falling within paragraph (d) or (e) of the definition of “pension arrangement” in subsection (1), to the provider of the annuity, and
(c) in the case of an insurance policy falling within paragraph (d) of the definition of that expression, to the insurer.
(3) In determining what is “pensionable service” for the purposes of this Chapter—
(a) service notionally attributable for any purpose of the scheme is to be disregarded, and
(b) no account is to be taken of any rules of the scheme by which a period of service can be treated for any purpose as being longer or shorter than it actually is.
(1) Pension sharing is available under this Chapter in relation to a person’s shareable state scheme rights.
(2) For the purposes of this Chapter, a person’s shareable state scheme rights are—
(a) his entitlement, or prospective entitlement, to a Category A retirement pension by virtue of section 44(3)(b) of the Contributions and Benefits Act (earnings-related additional pension), and
(b) his entitlement, or prospective entitlement, to a pension under section 55A of that Act (shared additional pension).
Welfare Reform and Pensions Act 1999