77.—(1) Regulation 256 (Interest on late payment of benefits and refunds of contributions) is amended as provided by paragraphs (2) to (6).
(2) In paragraph (2) after “interim” insert, “or substitute”.
(3) For paragraph (3), substitute—
“(3) The Department must pay interest on the amount of a pension, lump sum, refund of contributions or an interim or substitute award which is unpaid (“the unpaid amount”) to the person to whom it should have been paid unless the Department is satisfied that the unpaid amount was not paid on the due date because of some act or omission on the part of the member or other person to whom it should have been paid.”.
(4) In paragraph (5) after “unpaid amount”, insert “(other than an unpaid amount in respect of an interim or substitute award)”.
(5) For paragraph (6), substitute—
“(6) The due date for an unpaid amount—
(a)referred to in paragraph (5) in respect of which the Department was not in possession of all the information necessary for the calculation of the amount of the pension, lump sum or refund of contributions referred to in that paragraph on the date which would, in accordance with paragraph (5) be the due date;
(b)in respect of an interim or substitute award,
shall be the first day on which the Department was in possession of all the information necessary to calculate that pension, lump sum, refund of contributions or interim or substitute award.”.
(6) In paragraph (7)—
(a)for “interim award” substitute “interim or substitute award”;
(b)at the end of sub-paragraph (a), omit “and”;
(c)at the end of sub-paragraph (b), add—
“; and
(c)any amount paid that increases the amount of an earlier payment due to the payment of a tier 2 ill-health pension under regulation 182 paid to a member in substitution for a tier 1 ill-health pension under that regulation following a determination by the Department under regulation 183.”.