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The Pension Protection Fund (Miscellaneous Amendments) Regulations (Northern Ireland) 2010

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Amendment of the Pension Protection Fund (Compensation) Regulations

This section has no associated Explanatory Memorandum

4.—(1) The Pension Protection Fund (Compensation) Regulations (Northern Ireland) 2005(1) are amended in accordance with paragraphs (2) to (4).

(2) In regulation 2 (circumstances where a person shall be entitled to early payment of compensation)—

(a)in paragraph (2) for sub-paragraph (b) substitute—

(b)that on the date on which the compensation is to become payable early—

(i)the person has attained the age of 55, or

(ii)paragraph 22(2) of Schedule 36 to the 2004 Act(3) (rights to take benefit before normal minimum benefit age) applies to the person and that person has attained—

(aa)the age of 50, and

(bb)the age referred to in paragraph 22(8) of that Schedule.;

(b)in paragraph (3)—

(i)in sub-paragraph (a)—

(aa)for head (ii) substitute—

(ii)the name of the scheme for which the Board has assumed responsibility (“the relevant scheme”), and;

(bb)in head (iii) for “(“the requested early payment date”);” substitute “, and”;

(ii)in sub-paragraph (b) for “scheme, and” substitute “scheme.”;

(iii)omit sub-paragraph (c);

(c)omit paragraph (4).

(3) In regulation 23 (cash balance schemes: modification of paragraphs 5, 15 and 19 of Schedule 6)—

(a)in paragraph (1) for “This regulation applies” substitute “Subject to paragraph (1A), this regulation applies”;

(b)after paragraph (1) insert—

(1A) This regulation does not apply to a cash balance scheme which is also a career average revalued earnings scheme within the meaning of regulation 24(1)..

(4) After Part 10 (cash balance schemes) add—

PART 11CAREER AVERAGE REVALUED EARNINGS SCHEMES

Career average revalued earnings schemes: modification of paragraphs 8, 10, 11 and 14 of Schedule 6

24.(1) This regulation applies to a career average revalued earnings scheme, that is to say an occupational pension scheme where the whole of the pension entitlement is determined by reference to the member’s earnings in each year of pensionable service, and where those earnings, or a proportion of those earnings accrued as a pension, may be revalued each year until the member attains normal pension age or the pension is put into payment.

(2) In their application to a career average revalued earnings scheme, paragraphs 8 and 11 of Schedule 6 shall have effect with the following modifications—

(a)as if for sub-paragraph (5) of those paragraphs there were substituted—

(5) Subject to sub-paragraph (5A), the accrued amount means an amount equal to such initial annual rate of pension to which the member would have been entitled under the admissible rules had the member attained normal pension age when the pensionable service relating to the pension ended.

(5A) In any case where the Board is satisfied that it is not possible to identify the initial annual rate of pension in sub-paragraph (5), the Board may, having regard to the admissible rules, determine the accrued amount., and

(b)as if sub-paragraphs (6) and (7) of those paragraphs were omitted.

(3) In their application to a career average revalued earnings scheme, paragraph 10 of Schedule 6 shall have effect with the following modifications—

(a)as if for sub-paragraph (4) there were substituted—

(4) Subject to sub-paragraph (4A), the accrued amount means an amount equal to such amount of scheme lump sum to which the member would have been entitled under the admissible rules had the member attained normal pension age when the pensionable service relating to the scheme lump sum ended.

(4A) In any case where the Board is satisfied that it is not possible to identify the amount of scheme lump sum in sub-paragraph (4), the Board may, having regard to the admissible rules, determine the accrued amount., and

(b)as if sub-paragraphs (5) and (6) were omitted.

(4) In their application to a career average revalued earnings scheme, paragraph 14 of Schedule 6 shall have effect with the following modifications—

(a)as if for sub-paragraph (5) there were substituted—

(5) Subject to paragraph (5A), the accrued amount means an amount equal to such amount of scheme lump sum to which the member would have been entitled under the admissible rules had the member attained normal pension age when the pensionable service relating to the scheme lump sum ended.

(5A) In any case where the Board is satisfied that it is not possible to identify the amount of scheme lump sum in sub-paragraph (5), the Board may, having regard to the admissible rules, determine the accrued amount., and

(b)as if sub-paragraphs (6) and (7) were omitted.

Schemes where part of pension entitlement is determined on a career average revalued earnings basis: modification of paragraphs 8, 10, 11 and 14 of Schedule 6

25.(1) This regulation applies to an occupational pension scheme where part of the pension entitlement is determined on a career average revalued earnings basis, that is to say by reference to the member’s earnings in each year of pensionable service applicable to that part, and where those earnings, or a proportion of those earnings accrued as a pension, may be revalued each year until the member attains normal pension age or the pension is put into payment.

(2) In their application to a scheme where part of the pension entitlement is determined on a career average revalued earnings basis, paragraphs 8 and 11 of Schedule 6 shall have effect with the following modifications—

(a)as if for sub-paragraph (5) of those paragraphs there were substituted—

(5) Subject to sub-paragraphs (6) and (7), the accrued amount is—

where—

X is an amount equal to such initial annual rate of that part of the pension which is determined on a career average revalued earnings basis to which the member would have been entitled under the admissible rules had the member attained normal pension age when the pensionable service relating to that part of the pension ended, or in any case where the Board is satisfied that it is not possible to identify the initial annual rate of pension, such amount as the Board may determine, having regard to the admissible rules, and

Y is AR x PE x PS.

(5A) In sub-paragraph (5)—

“AR” is the active member’s annual accrual rate, under the admissible rules, in respect of that part of the pension which is not determined on a career average revalued earnings basis,

“PE” is the active member’s annual pensionable earnings, under the admissible rules, in respect of that part of the pension which is not determined on a career average revalued earnings basis, and

“PS” is the active member’s pensionable service, under the admissible rules, in years (including any fraction of a year) in respect of that part of the pension which is not determined on a career average revalued earnings basis.;

(b)as if in sub-paragraph (6) of those paragraphs—

(i)for “the pension” there were substituted “that part of the pension which is not determined on a career average revalued earnings basis”;

(ii)after “formula” there were inserted “Y is AR x PE x PS”, and

(iii)for “the accrued amount” there were substituted “Y”, and

(c)as if in sub-paragraph (7) of those paragraphs—

(i)after “formula” there were inserted “Y is AR x PE x PS”, and

(ii)for “the accrued amount” there were substituted “Y”.

(3) In their application to a scheme where part of the pension entitlement is determined on a career average revalued earnings basis, paragraph 10 of Schedule 6 shall have effect with the following modifications—

(a)as if for sub-paragraph (4) there were substituted—

(4) Subject to sub-paragraphs (5) and (6), the accrued amount is—

where—

X is an amount equal to such amount of the scheme lump sum that relates to that part of the pension which is determined on a career average revalued earnings basis, to which the member would have been entitled under the admissible rules had the member attained normal pension age when the pensionable service relating to that scheme lump sum ended, or in any case where the Board is satisfied that it is not possible to identify the amount of scheme lump sum, such amount as the Board may determine, having regard to the admissible rules, and

Y is AR x PE x PS.

(4A) In sub-paragraph (4)—

“AR” is the active member’s annual accrual rate, under the admissible rules, in respect of the scheme lump sum that relates to that part of the pension which is not determined on a career average revalued earnings basis,

“PE” is the active member’s annual pensionable earnings, under the admissible rules, in respect of the scheme lump sum that relates to that part of the pension which is not determined on a career average revalued earnings basis, and

“PS” is the active member’s pensionable service, under the admissible rules, in years (including any fraction of a year) in respect of the scheme lump sum that relates to that part of the pension which is not determined on a career average revalued earnings basis.;

(b)as if in sub-paragraph (5)—

(i)after “the scheme lump sum” there were inserted “that relates to that part of the pension which is not determined on a career average revalued earnings basis”;

(ii)after “formula” there were inserted “Y is AR x PE x PS”, and

(iii)for “the accrued amount” there were substituted “Y”, and

(c)as if in sub-paragraph (6)—

(i)after “formula” there were inserted “Y is AR x PE x PS”, and

(ii)for “the accrued amount” there were substituted “Y”.

(4) In their application to a scheme where part of the pension entitlement is determined on a career average revalued earnings basis, paragraph 14 of Schedule 6 shall have effect with the following modifications—

(a)as if for sub-paragraph (5) there were substituted—

(5) Subject to sub-paragraphs (6) and (7), the accrued amount is—

where—

X is an amount equal to such amount of the scheme lump sum that relates to that part of the pension which is determined on a career average revalued earnings basis, to which the member would have been entitled under the admissible rules had the member attained normal pension age when the pensionable service relating to that scheme lump sum ended, or in any case where the Board is satisfied that it is not possible to identify the amount of scheme lump sum, such amount as the Board may determine, having regard to the admissible rules, and

Y is AR x PE x PS.

(5A) In sub-paragraph (5)—

“AR” is the active member’s annual accrual rate, under the admissible rules, in respect of the scheme lump sum that relates to that part of the pension which is not determined on a career average revalued earnings basis,

“PE” is the active member’s annual pensionable earnings, under the admissible rules, in respect of the scheme lump sum that relates to that part of the pension which is not determined on a career average revalued earnings basis, and

“PS” is the active member’s pensionable service, under the admissible rules, in years (including any fraction of a year) in respect of the scheme lump sum that relates to that part of the pension which is not determined on a career average revalued earnings basis.;

(b)as if in sub-paragraph (6)—

(i)after “the scheme lump sum” there were inserted “that relates to that part of the pension which is not determined on a career average revalued earnings basis”;

(ii)after “formula” there were inserted “Y is AR x PE x PS”, and

(iii)for “the accrued amount” there were substituted “Y”, and

(c)as if in sub-paragraph (7)—

(i)after “formula” there were inserted “Y is AR x PE x PS”, and

(ii)for “the accrued amount” there were substituted “Y”..

(1)

S.R. 2005 No. 149; relevant amending Regulations are S.R. 2006 No. 155

(2)

Paragraph 22 was amended by paragraphs 54 and 55 of Schedule 10 to the Finance Act 2005 (c. 7) and paragraph 43 of Schedule 23 to the Finance Act 2006 (c. 25)

(3)

The definition of “the 2004 Act” in regulation 1(2) was inserted by regulation 22(2)(a) of S.R. 2006 No. 155

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