The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010

Amendment of regulation 17

8.  In regulation 17 (annual payments)—

(a) in each place it occurs omit “determined in accordance with Schedule 2”;

(b) in paragraph (1) for “Schedule 2 makes” substitute “Schedules 2, 3 and 4 make”;

(c) in paragraph (5A) after “a beneficiary” insert “entitled to an annual payment in accordance with Schedule 2”;

(d) after paragraph (7) add—

“(8) Subject to paragraphs (16) and (17), and until such time, if any, as regulation 17E applies, where a beneficiary is entitled to an annual payment in accordance with this regulation, that annual payment shall be determined in accordance with—

(a) Schedule 2, where none of sub-paragraphs (b) to (k) nor paragraph (16) or (17) applies;

(b) Schedule 3, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a qualifying member who was not receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(iii) the sum of—

(aa) the revalued notional pension in relation to the qualifying member; and

(bb) the total amount of any annual increases which the scheme manager considers could have been paid from the relevant date until the day on which the transfer notice is given, taking into account the determination under regulation 27(1)(d) and the revaluation amount determined in accordance with paragraph (11),

is higher than the amount of the annual payment to which that qualifying member would be entitled in accordance with Schedule 2 if that Schedule applied and sub-paragraphs (3A) to (3G) of paragraph 2 of that Schedule were omitted;

(c) Schedule 3, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant; and

(iii) the qualifying member in respect of the beneficiary was entitled to an annual payment in accordance with Schedule 3 immediately before the death of the member;

(d) Schedule 3, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant;

(iii) the qualifying member in respect of the beneficiary was not receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010;

(iv) the qualifying member died—

(aa) before becoming entitled to an annual payment; and

(bb) on or after the calculation date; and

(v) the sum of—

(aa) one half of the revalued notional pension in relation to the qualifying member;

(bb) one half of the total amount of any annual increases which the scheme manager considers could have been paid from the relevant date until the date on which the qualifying member died, taking into account the determination under regulation 27(1)(d) and the revaluation amount determined in accordance with paragraph (11); and

(cc) the total amount of any annual increases which the scheme manager considers could have been paid to a survivor from the day after the day on which the qualifying member died until the day on which the transfer notice is given, taking into account the determination under regulation 27(1)(d) and the revaluation amount determined in accordance with paragraph (11),

is higher than the amount of the annual payment to which a survivor would be entitled in accordance with Schedule 2 if that Schedule applied and paragraphs 2(3A) to (3G) and 5(6A) of that Schedule were omitted;

(e) Schedule 3, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant;

(iii) the qualifying member in respect of the beneficiary was not receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010;

(iv) the qualifying member died—

(aa) after becoming entitled to an annual payment; and

(bb) on or after the calculation date,

but before the day on which the transfer notice was given;

(v) the sum of—

(aa) one half of the revalued notional pension in relation to the qualifying member;

(bb) one half of the total amount of any annual increases which the scheme manager considers could have been paid from the relevant date until the date on which the qualifying member died, taking into account the determination under regulation 27(1)(d) and the revaluation amount determined in accordance with paragraph (11); and

(cc) the total amount of any annual increases which the scheme manager considers could have been paid to a survivor from the day after the day on which the qualifying member died until day on which the transfer notice is given, taking into account the determination under regulation 27(1)(d) and the revaluation amount determined in accordance with paragraph (11),

is higher than the amount of the annual payment to which a survivor would be entitled in accordance with Schedule 2 if that Schedule applied and paragraphs 2(3A) to (3G) and 5(6A) of that Schedule were omitted;

(f) Schedule 3, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant;

(iii) neither the qualifying member in respect of the beneficiary nor the beneficiary was receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010;

(iv) the qualifying member died before the calculation date; and

(v) the sum of—

(aa) the survivor notional pension determined in respect of the beneficiary; and

(bb) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the survivor notional pension from the relevant date until the day on which the transfer notice is given,

is higher than the amount of the annual payment to which the beneficiary would be entitled in accordance with Schedule 2 if that Schedule applied and paragraph 2(3A) to (3G) of that Schedule were omitted;

(g) Schedule 4, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a qualifying member who was receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(iii) the sum of—

(aa) the notional pension in relation to that qualifying member; and

(bb) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the day on which the transfer notice is given,

is higher than the amount of the annual payment to which the beneficiary would be entitled in accordance with Schedule 2 if that Schedule applied and paragraph 2(3A) to (3E) of that Schedule were omitted;

(h) Schedule 4, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant;

(iii) the qualifying member in respect of the beneficiary—

(aa) was receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(bb) died before the calculation date; and

(iv) the sum of—

(aa) the survivor notional pension determined in respect of the beneficiary; and

(bb) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the survivor notional pension from the relevant date until the day on which the transfer notice is given,

is higher than the amount of the annual payment to which the beneficiary would be entitled in accordance with Schedule 2 if that Schedule applied and paragraph 2(3A) to (3E) of that Schedule were omitted;

(i) Schedule 4, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant who was receiving a present payment from the qualifying pension scheme under scheme rules as a result of the death of a qualifying member before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(iii) the sum of—

(aa) the survivor notional pension determined in respect of the beneficiary; and

(bb) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the survivor notional pension from the relevant date until the day on which the transfer notice is given,

is higher than the amount of the annual payment to which the beneficiary would be entitled in accordance with Schedule 2 if that Schedule applied and paragraph 2(3A) to (3E) of that Schedule were omitted;

(j) Schedule 4, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant;

(iii) the qualifying member in respect of the beneficiary—

(aa) was receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(bb) died on or after the calculation date, but before the day on which the transfer notice was given; and

(iv) the sum of—

(aa) the proportion of the notional pension which relates to the beneficiary;

(bb) the relevant proportion of the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the date on which the qualifying member died; and

(cc) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the relevant proportion of the notional pension from the day after the qualifying member died until the day on which the transfer notice is given,

is higher than the amount of the annual payment to which the beneficiary would be entitled in accordance with Schedule 2 if that Schedule applied and paragraph 2(3A) to (3E) of that Schedule were omitted; or

(k) Schedule 4, where—

(i) a transfer notice has been given in respect of the qualifying pension scheme;

(ii) the beneficiary is a survivor or surviving dependant;

(iii) the qualifying member in respect of the beneficiary—

(aa) was receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(bb) died on or after the day on which the transfer notice was given; and

(iv) the sum of—

(aa) the proportion of the notional pension which relates to the beneficiary;

(bb) the relevant proportion of the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the day on which the transfer notice was given; and

(cc) the relevant proportion of the total amount of any annual increases to which the qualifying member was entitled on the day on which the qualifying member died,

is higher than the amount of the annual payment to which the beneficiary would be entitled in accordance with Schedule 2 if that Schedule applied and paragraph 2(3A) to (3E) of that Schedule were omitted.

(9) For the purposes of paragraphs (8), (16) and (17)—

(a) a qualifying member is treated as receiving a present payment from a pension scheme before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010, notwithstanding that no payment has been received, if, prior to the coming into force of those Regulations—

(i) the qualifying member was entitled to a payment under the scheme rules; and

(ii) the trustees or managers of the scheme received confirmation from the qualifying member that payment should commence; and

(iii) the qualifying member’s entitlement became payable, as a result of paragraphs (i) and (ii) being satisfied.

(b) a survivor or surviving dependant is treated as receiving a present payment from a pension scheme before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010, notwithstanding that no payment has been received, if, prior to the coming into force of those Regulations, the beneficiary was entitled to ongoing payments as a result of the death of the qualifying member.

(10) In paragraph (8)(b)(iii), (d)(v) and (e)(v), “the revalued notional pension” means the aggregate of—

(a) the notional pension; and

(b) the revaluation amount for the period—

(i) beginning on the calculation date; and

(ii) ending on the earliest of—

(aa) the day on which the beneficiary becomes entitled to an annual payment;

(bb) the day on which the beneficiary began to receive a present payment from the scheme; or

(cc) the day on which the qualifying member died.

(11) The revaluation amount for the period referred to in paragraph (10) is—

(a) where—

(i) that period is less than one month; or

(ii) the qualifying member became entitled to an annual payment or began to receive present payment from the scheme prior to the calculation date,

nil; and

(b) in any other case, the revaluation percentage of the notional pension.

(12) In paragraph (11), “the revaluation percentage” means the lesser of—

(a) the percentage increase in the general level of prices in Great Britain during the revaluation period determined in accordance with paragraph (10); and

(b) the maximum revaluation rate.

(13) The method for determining the percentage increase in the general level of prices in Great Britain during the revaluation period determined in accordance with paragraph (10) is—

where—

(a)

A is the level of the retail prices index for the month which falls two months before the month in which the last day of the revaluation period falls; and

(b)

B is the level of the retail prices index for the month which falls two months before the month in which the calculation date falls.

(14) In paragraph (12)(b), “the maximum revaluation rate” is—

(a) if that period is a period of 12 months, 5%; or

(b) in any other case, the percentage that would be the percentage mentioned in paragraph (12)(a) had the general level of prices in Great Britain increased at the rate of 5% compound per annum during that period.

(15) In paragraph (8), “relevant date” means—

(a) where the beneficiary began to receive a payment from the scheme after the calculation date and prior to becoming entitled to an annual payment under these Regulations, the date on which the beneficiary began to receive a present payment from the scheme;

(b) where the beneficiary is a qualifying member to whom sub-paragraph (a) does not apply, but to whom paragraph (3) or (3C) applies, the date on which the qualifying member became entitled to an annual payment under that paragraph; and

(c) in all other cases, the date from which the notional pension or survivor notional pension could have been payable as determined in accordance with regulation 27(3) and (4).

(16) Where a qualifying member entitled to an annual payment in accordance with this regulation is a qualifying member to whom regulation 17H applied, the annual payment shall be determined in accordance with—

(a) Schedule 3, where—

(i) the qualifying member was not receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(ii) the payment which was payable to the qualifying member under Schedule 7, taking into account any reduction made to that payment under paragraph 1(2) or (5) of that Schedule, immediately before the qualifying member became entitled to an annual payment under this regulation is higher than the amount of the annual payment to which the qualifying member would be entitled in accordance with Schedule 2 if that Schedule applied; and

(b) Schedule 4, where—

(i) the qualifying member was receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(ii) the payment which was payable to the qualifying member under Schedule 7, taking into account any reduction made to that payment under paragraph 1(2) or (5) of that Schedule, immediately before the qualifying member became entitled to an annual payment under this regulation is higher than the amount of the annual payment to which the member would be entitled in accordance with Schedule 2 if that Schedule applied.

(17) Where a beneficiary is entitled to an annual payment in accordance with this regulation because they are the survivor or surviving dependant of a qualifying member to whom, immediately before the qualifying member’s death, regulation 17H applied, the annual payment shall be determined in accordance with—

(a) Schedule 3, where—

(i) the qualifying member was not receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(ii) one half of the payment which was payable to the qualifying member under Schedule 7, disregarding any reduction made to that payment under paragraph 1(2) or (5) of that Schedule, on the day on which the qualifying member died is higher than the amount of the annual payment to which a survivor would be entitled in accordance with Schedule 2 if that Schedule applied and paragraph 5(6A) of that Schedule were omitted; and

(b) Schedule 4, where—

(i) the qualifying member was receiving a present payment from the qualifying pension scheme under scheme rules before the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010; and

(ii) the relevant proportion of the payment which was payable to the qualifying member in accordance with Schedule 7, disregarding any reduction made to that payment under paragraph 1(2) or (5) of that Schedule, on the day on which the qualifying member died is higher than the amount of the annual payment to which the beneficiary would be entitled in accordance with Schedule 2 if that Schedule applied.

(18) In paragraph (8) and paragraph (17), “relevant proportion” means the proportion of the notional pension which relates to the beneficiary.”.