PART 6Retirement benefits

CHAPTER 5Payment options

F1Option to partially buy out early payment reduction82A

1

 This regulation applies if—

a

a member of this scheme becomes entitled under Chapter 2 to the immediate payment of a full retirement pension; and

b

the member has not reached—

i

normal pension age under this scheme; or

ii

if applicable, the member’s effective pension age.

2

The member may, with the consent of the Department, opt under this regulation to buy out a proportion of the early payment reduction that would otherwise apply to the calculation of the annual rate of retirement pension.

3

The cost must be met by way of a special payment to this scheme made by—

a

the member;

b

the member’s employer (“the employer”); or

c

both the member and the employer.

4

The employer may make a special payment using a lump sum payable to the member under a compensation scheme.

5

Any special payment by the employer must be made—

a

in accordance with the compensation scheme; or

b

with the consent of the Department.

6

If the employer makes a special payment under paragraph (5)(a), the lump sum payable to the member under the compensation scheme is reduced by the amount of the special payment.

7

The scheme manager, after consulting the scheme actuary, must determine the actuarial reduction that would apply if a member exercises the option under this regulation.

8

Where a member exercises the option under this regulation, references in these Regulations to the early payment reduction apply as if the reference were to the actuarial reduction determined under this regulation.