7. After regulation 97A (Cost sharing) insert—
97B.—(1) This regulation applies if the whole or part of an amount to which this regulation applies is not paid by the end of the period of one month beginning with the due date.
(2) This regulation applies to any amount payable by way of a pension, lump sum or refund of contributions under this Section of the Scheme (other than any amount due under regulation 11) or interim or substitute award.
(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) The interest on the unpaid amount is calculated at the base rate on a day to day basis from the due date for the amount to the date of its payment and compounded with three-monthly rests.
(5) For the purposes of this regulation, except where paragraph (6) applies, “due date”, in relation to an unpaid amount (other than an unpaid amount in respect of an interim or substitute award), means—
(a)in the case of an amount in respect of a pension or lump sum payable to a member under Part III (Benefits), the day immediately following that of the member’s retirement from superannuable employment,
(b)in the case of an amount in respect of a pension payable on a member’s death, the day after the date of death,
(c)in the case of an amount in respect of a lump sum under Part III (Lump sum on death) that is payable to the member’s personal representatives, the earlier of—
(i)the date on which probate or letters of administration were produced to the Department, and
(ii)the date on which the Department was satisfied that the lump sum may be paid as provided in regulation 22(10), and
(d)in the case of an amount in respect of any other lump sum under Part III, the day after the date of the member’s death, and
(e)in the case of an amount in respect of a refund of contributions, the day after that on which the Department received from Her Majesty’s Commissioners of Revenue and Customs the information required for the purposes of calculating the amount to be subtracted under regulation 50(4) or (5).
(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.
(7) In this regulation—
(a)“interim or substitute award” means—
(i)any amount paid by way of an interim payment calculated by reference to an expected benefit under this Section of the Scheme pending final calculation of the full value of that benefit,
(ii)any amount paid that increases the amount of an earlier payment due to a backdated or subsequent increase in superannuable pay, and
(iii)any amount paid that increases the amount of an earlier payment due to the payment of a tier 2 ill-health pension under regulation 13A paid to a member in substitution for a tier 1 ill-health pension under that regulation following a determination by the Department under regulation 13B;
(b)“base rate” means the Bank of England base rate—
(i)announced from time to time by the Monetary Policy Committee of the Bank of England as the official dealing rate, being the rate at which the Bank is willing to enter into transactions for providing short term liquidity in the money markets, or
(ii)where an order under section 19 of the Bank of England Act 1998(1) is in force, any equivalent rate determined by the Treasury under that section.”.