CHAPTER 1Exercising the effective pension age option
Effective pension age option exercisable by member
25.—(1) This paragraph applies if an active member of this scheme in relation to a continuous period of pensionable service has a normal pension age above 65 years.
(2) Subject to sub-paragraphs (3) and (4), the member may opt to make periodical payments for an effective pension age of 1, 2 or 3 years below the member’s normal pension age (“effective pension age option”).
(3) An effective pension age option may not be exercised to achieve an effective pension age below 65 years.
(4) The member may opt to make periodical payments for an effective pension age of any period up to 3 years below the member’s normal pension age if that would achieve an effective pension age of 65 years.
(5) An effective pension age is—
(a)relative to normal pension age; and
(b)automatically adjusted to reflect any change in normal pension age.
Exercising the effective pension age option
26.—(1) A member may exercise an effective pension age option by notice to the scheme manager in any form the scheme manager may require (“the option notice”).
(2) The option notice must state the effective pension age which is to apply under the option.
(3) A member may exercise an effective pension age option more than once.
(4) A member may not exercise an effective pension age option during—
(a)a period of assumed pay; or
(b)any scheme year in which the member has reached the overall limit of extra pension for that year.
Payment of pension at effective pension age
27.—(1) For any part of a scheme year in which a member makes periodical payments for an effective pension age option, the member is entitled to payment of a full retirement earned pension or partial retirement earned pension attributable to the option at the effective pension age stated in the option without actuarial reduction.
(2) The amount of pension attributable to the option is reduced if the periodical payments are stopped before the end of the periodical payment period.
(3) For any period in which the periodical payments are stopped, an amount of standard earned pension is credited to the active member’s account instead of an amount of earned pension attributable to the option.
Member ceases to be in pensionable service under this scheme
28.—(1) An effective pension age option in relation to a continuous period of pensionable service under this scheme ceases to have effect when the member ceases to be in that pensionable service.
(2) Periodical payments cease to be payable from the member’s last day of pensionable service.
(3) In the circumstances provided for in regulation 139(2), the member is entitled to a refund under that regulation of the periodical payments.
(4) If the member re-enters pensionable service under this scheme after a gap in pensionable service not exceeding 5 years, the periodical payments resume in the first pay period after the member re-enters pensionable service unless—
(a)the periodical payments have been refunded to the member under regulation 139; or
(b)a transfer payment has been made to another scheme in respect of the member’s accrued rights under this scheme.
(5) The periodical payments resume under sub-paragraph (4) even if the member has reached the overall limit of extra pension for the scheme year in which the payments resume.
Cancellation of option
29.—(1) A member may, by notice to the scheme manager, cancel an effective pension age option at any time during the periodical payment period.
(2) If the member cancels the option, the periodical payments cease to be payable from the beginning of the next scheme year after the scheme manager receives notice of the cancellation.
(3) If the member exercises an effective pension age option again within a period not exceeding 5 years, the periodical payments resume from the first pay period of the next scheme year beginning after the date on which the member exercises the option again.
(4) The periodical payments resume under sub-paragraph (3) even if the member has reached the overall limit of extra pension for the scheme year in which the payments resume.
Value of an effective pension age option
30.—(1) The value of an effective pension age option at any time is a value determined by the scheme manager as at that time(1).
(2) A member who has exercised an effective pension age option—
(a)may at any time ask the scheme manager to provide a statement of the value of the effective pension age option; and
(b)must ask the scheme manager to provide a statement of the value of the effective pension age option before an added pension option may be exercised in relation to the member.
()Under paragraph 4(a) (limit on elections), a member may not exercise an added pension option if the value of an effective pension age option exceeds the overall limit of extra pension