(1)Where a person has been in receipt of an official pension in respect of any service, and in consequence of any further service rendered by him the pension falls to be recalculated as to its basic rate and to be treated for purposes of this Act as beginning at a later date, then the rate of the pension as recalculated, with any increase under this Part apart from this section, may be further increased up to the rate, if it is higher, at which the pension would have been payable with any such increase if—
(a)the further service had not been rendered; and
(b)where the pension is one of those specified in subsection (4) and the recalculation is on the basis there mentioned, the length of the previous service had been increased by the length of the further service.
(2)Where a person has terminated his service in circumstances such that he is or may[F2 (without rendering further reckonable service)] become eligible for an official pension, but has not been in receipt of that pension before rendering further service in consequence of which the pension falls to be recalculated or to be calculated on a different basis, subsection (1) shall apply as it would apply if he had been in receipt of the pension before rendering the further service.
[F2(2A)In subsection (2) “reckonable service”, in relation to a person and his official pension, means service which falls to be taken into account in calulating the basic rate of the pension.]
(3)Where the basic rate of a derivative pension, not being a substituted pension, falls to be calculated
[F2(a)]by reference to that of a principal pension which is authorised to be increased under subsection (1) or (2) (or which would have been, if the further service had been terminated by retirement)[F2 or]
[F2(b)by reference to a rate of emoluments (whether actual emoluments or not and whether final or average emoluments) and a period of service of the person who was or, had he survived, would have been the pensioner in relation to such a principal pension,]
, the derivative pension may be increased in the way in which subsection (1) authorises (or would have authorised) the principal pension to be increased; and for this purpose the reference in subsection (1)( b) to the pension is to be taken as a reference to the principal pension, not the derivative pension.
(4)Subsection (1)( b) shall apply to pensions specified in paragraphs 2, 3, [F3 3A, 5( b) and ( c) and 7A] of Schedule 2, but shall apply only in a case where the recalculation falls to be made by reference—
(a)to the aggregate of the further service and the previous service; and
(b)to emoluments attributed to a period immediately preceding the termination of the further service not lower than the emoluments by reference to which the pension was to be calculated before the further service.