The Pension Sharing (Valuation) Regulations (Northern Ireland) 2000

Occupational pension schemes: manner of calculation and verification of cash equivalents

4.—(1) In a case to which, or to the extent to which, paragraph (2) or (5) does not apply, cash equivalents are to be calculated and verified in such manner as may be approved in a particular case by the scheme actuary or, in relation to a scheme to which Article 47(1)(b) (professional advisers) does not apply, by—

(a) a Fellow of the Institute of Actuaries;

(b) a Fellow of the Faculty of Actuaries(1); or

(c) a person with other actuarial qualifications who is approved by the Department, at the request of the trustees or managers of the scheme in question, as being a proper person to act for the purposes of these Regulations in connection with that scheme,

and, subject to paragraph (2), in the following paragraphs of this regulation and in regulation 5, “actuary” means the scheme actuary or, in relation to a scheme to which Article 47(1)(b) does not apply, the actuary referred to in sub-paragraph (a), (b) or (c).

(2) Where the transferor, in respect of whose rights a cash equivalent is to be calculated and verified, is a member of a scheme having particulars from time to time set out in regulations made under Article 9 of the Superannuation (Northern Ireland) Order 1972(2) (superannuation of persons employed in local government service, etc.), that cash equivalent shall be calculated and verified in such manner as may be approved by the Government Actuary or by an actuary authorised by the Government Actuary to act on his behalf for that purpose and in such a case “actuary” in this regulation and in regulation 5 means the Government Actuary or the actuary so authorised.

(3) Except in a case to which paragraph (5) applies, cash equivalents are to be calculated and verified by adopting methods and making assumptions which—

(a) if not determined by the trustees or managers of the scheme in question, are notified to them by the actuary, and

(b) are certified by the actuary to the trustees or managers of the scheme—

(i) as being consistent with “Retirement Benefit Schemes — Transfer Values (GN 11)”(3) published by the Institute of Actuaries and the Faculty of Actuaries and current on the valuation day;

(ii) as being consistent with the methods adopted and assumptions made, at the time when the certificate is issued, in calculating the benefits to which entitlement arises under the rules of the scheme in question for a person who is acquiring transfer credits under those rules, and

(iii) in the case of a scheme to which Article 56 (minimum funding requirement) applies as providing as a minimum an amount, consistent with the methods adopted and assumptions made in calculating, for the purposes of Article 57 (valuation and certification of assets and liabilities), the liabilities mentioned in Article 73(3)(a), (aa), (b), (c)(i) and (d)(4) (preferential liabilities on winding up), subject, in any case where the cash equivalent calculation is made on an individual and not a collective basis, to any adjustments which are appropriate to take account of that fact.

(4) If, by virtue of Schedule 5 to the Minimum Funding Requirement Regulations(5) (modifications), Article 56 applies to a section of a scheme as if that section were a separate scheme, paragraph (3)(b)(iii) shall apply as if that section were a separate scheme and as if the reference therein to a scheme were accordingly a reference to that section.

(5) Where a cash equivalent or any portion of a cash equivalent relates to money purchase benefits which do not fall to be valued in a manner which involves making estimates of the value of benefits, then that cash equivalent or that portion shall be calculated and verified in such manner as may be approved in a particular case by the trustees or managers of the scheme.

(1)

The Institute of Actuaries is at Staple Inn Hall, High Holborn, London WC1V 7QJ. The Faculty of Actuaries is at Maclaurin House, 18 Dublin Street, Edinburgh EH1 3PP

(2)

S.I. 1972/1073 (N.I. 10)

(3)

The publication “Retirement Benefit Schemes—Transfer Values (GN 11)” may be obtained from the Institute of Actuaries, Staple Inn Hall, High Holborn, London WC1V 7QJ and from the Faculties of Actuaries, Maclaurin House, 18 Dublin Street, Edinburgh EH1 3PP. The publication is also available on the following internet web-site: http://www.actuaries.org.uk

(4)

Article 73 was modified by regulation 3 of S.R. 1996 No. 621 (as amended by regulation 9 of S.R. 1999 No. 486) and amended by Article 35(1) of, and paragraph 44 of Schedule 9 to, the Welfare Reform and Pensions (Northern Ireland) Order 1999. See also Article 11 of S.R. 1997 No. 192 (C. 10)

(5)

Schedule 5 was amended by S.R. 1997 Nos. 160 and 544