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Pensions (Increase) Act 1971

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This is the original version (as it was originally enacted).

Part IGeneral Provisions

1Present increases

(1)Subject to the provisions of this Act, the annual rate of an official pension may, if any qualifying condition is satisfied, be increased by the pension authority in respect of any period beginning on or after 1st September 1971, as follows:—

(a)a pension beginning before the year 1969 may be increased by the amount necessary to bring the rate up to the 1969 standard, that is to say, to the rate arrived at by applying to the basic rate of pension the multiplier given in Schedule 1 for the year in which the pension began, and by a further 18 per cent, of the rate as so increased;

(b)a pension beginning on or before 1st April 1969 but not earlier than that year may be increased by 18 per cent, of the basic rate ;

(c)a pension beginning in the six months following 1st April 1969 may be increased by 16 per cent, of the basic rate;

(d)a pension beginning in the six months following 1st October 1969 may be increased by 14 per cent, of the basic rate;

(e)a pension beginning in the six months following 1st April 1970 may be increased by 10 per cent, of the basic rate;

(f)a pension beginning in the six months following 1st October 1970 may be increased by 6 per cent, of the basic rate.

(2)In the case of a pension beginning before the year 1969 the increase authorised by subsection (1)(a) above shall take the place of those authorised by the Pensions (Increase) Acts 1920 to 1969, but in the cases provided for by section 6 below shall be of the larger amount there specified by reference to increases that might have been made under those Acts.

2Future reviews and increases

(1)Subject to the provisions of this section, the Minister for the Civil Service, as soon as may be after 31st March in the year 1973 and every second year thereafter, shall review the rates of official pensions against any rise there may have been in the cost of living during the review period, that is to say, the two years ending with that date ; and if it is found that in the review period the cost of living has risen by four per cent, or more, then the Minister shall by order provide that the annual rate of an official pension may, if a qualifying condition is satisfied, be increased in accordance with the order in respect of any period beginning on or after 1st September next following the review period.

(2)Subject to subsection (3) below, the increases to be provided for by an order under this section shall be as follows:—

(a)for pensions beginning on or before the first day of the review period the increase shall be in the proportion (to the nearest one-tenth of one per cent.) in which the cost of living has risen during the review period; and

(b)for pensions beginning in the half year following that day or in any of the succeeding half years up to that ending with the day after the end of the review period, the increases shall be in the proportion (to the nearest one-tenth of one per cent.) in which the cost of living is found to have risen between the basis period for that half year and the end of the review period, if the cost of living in the basis period is taken as the mean of the monthly figures. For purposes of paragraph (b) above, the basis period for any half year is the six months ending with the first month of the half year or, if the cost of living is lower in the half year than in those six months, is the half year itself.

(3)Where the rise referred to in subsection (2)(b) above is less for any half year than four per cent., there shall only be an increase for pensions beginning in that half year if there is one for pensions beginning in a later half year, and the increase (if there is one) shall be four per cent.; but where this subsection prevents there being an increase for pensions beginning in any half year, then the order made in respect of the next review period shall for those pensions authorise, instead of an increase calculated in accordance with subsection (2)(a) above, such increase as would result if that prevented by this subsection had been made and were followed by one calculated in accordance with subsection (2)(a) by reference to the rate as so increased.

(4)Where on any review under this section (including a review made by virtue of this subsection) it is not found that the cost of living has risen by four per cent, or more in the review period, then there shall be a further review in the next year for the same review period extended by twelve months ; and if on a review made by virtue of this subsection it is found that the cost of living has risen by four per cent, or more in the (extended) review period, the provisions of this section shall apply accordingly, and later reviews shall be made at intervals of two years thereafter until this subsection again applies.

(5)On any review under this section the cost of living shall be assessed by such means as the Minister thinks appropriate.

(6)The increases in the rate of a pension that may be provided for by an order under this section are to be calculated, except as otherwise stated in this Part of this Act, by reference to the basic rate of the pension as authorised to be increased by section 1 above or by any earlier order under this section ; but an order under this section may be made so as to incorporate the effect, in whole or in part, of section 1 above or of any earlier order under this section, and may repeal or amend any provision of that section or of any such order accordingly.

(7)An order under this section shall be made by statutory instrument, which shall be laid before Parliament after it is made.

3Qualifying conditions

(1)A pension shall not be increased under this Part of this Act unless one of the conditions laid down by this section (in this Act referred to as " qualifying conditions ") is satisfied.

(2)A pension payable in respect of the pensioner's own services shall not be increased unless the pensioner—

(a)has attained the age of sixty years ; or

(b)has retired on account of physical or mental infirmity from the office or employment in respect of which, or on retirement from which, the pension is payable; or

(c)is a woman who has at least one dependant; or the pension authority are satisfied that the pensioner is disabled by physical or mental infirmity.

(3)A pension payable in respect of the services of any person other than the pensioner, not being the pensioner's deceased husband, shall not be increased unless the pensioner—

(a)has attained the age of sixty years ; or

(b)has not attained the age of sixteen years ; or

(c)is receiving full-time instruction at an educational establishment; or

(d)is undergoing training for a trade, profession or vocation in such circumstances that he is required to devote the whole of his time to that training for a period of not less than two years ; or

(e)is a woman who has at least one dependant;

or the pension authority are satisfied that the pensioner is disabled by physical or mental infirmity.

(4)A pension payable in respect of the services of the pensioner's deceased husband shall not be increased unless the pensioner—

(a)has attained the age of forty years ; or

(b)has at least one dependant;

or the pension authority are satisfied that the pensioner is disabled by physical or mental infirmity.

(5)For the purposes of this section, a pensioner shall be deemed to be disabled by physical or mental infirmity if he is permanently incapacitated by such infirmity from engaging in any regular full-time employment.

(6)Subject to subsection (7) below, " dependant" in this section means, in relation to a pensioner, a person who the pension authority are satisfied is wholly or mainly supported by the pensioner and who either has not attained the age of sixteen years or is receiving full-time instruction at an educational establishment or is undergoing training as mentioned in subsection (3)(d) above.

(7)Where a pension payable to a woman at 31st August 1971 is then payable at a rate increased under the Pensions (Increase) Acts 1920 to 1969 by reason only that she is, and has since 1st April 1956 been, wholly or mainly supporting another person, being either—

(a)her, or her deceased husband's, father, mother, brother, sister, child, uncle or aunt; or

(b)the child of any such person as is mentioned in paragraph (a) above; or

(c)her step-father or step-mother; or

(d)a person undergoing training for any trade, profession or vocation;

then so long as the pension authority are satisfied that she continues wholly or mainly to support that person and, if this subsection applies only by virtue of paragraph (d), that person continues to undergo training for a trade, profession or vocation, that person shall be deemed for purposes of this section to be the woman's dependant. In this subsection " child" includes a step-child and an illegitimate child, and includes also a child adopted in pursuance of an order made by any court in the United Kingdom or adopted in accordance with the law of the place where the adopter was domiciled at the time of the adoption.

(8)The Minister for the Civil Service may by order made by statutory instrument provide for reducing (or further reducing) the age sixty in subsection (2)(a) or (3)(a) above, or in both, to any age not less than fifty-five, and this section shall have effect subject to any such order for the time being in force; but a statutory instrument under this subsection shall be subject to annulment in pursuance of a resolution of either House of Parliament.

4Effect of re-employment

(1)Where a person has been in receipt of an official pension in respect of any service, and in consequence of any further service rendered by him the pension falls to be recalculated as to its basic rate and to be treated for purposes of this Act as beginning at a later date, then the rate of the pension as recalculated, with any increase under this Part of this Act apart from this section, may be further increased up to the rate, if it is higher, at which the pension would have been payable with any such increase if—

(a)the further service had not been rendered; and

(b)where the pension is one of those specified in subsection (4) below and the recalculation is on the basis there mentioned, the length of the previous service had been increased by the length of the further service.

(2)Where a person has terminated his service in circumstances such that he is or may become eligible for an official pension, but has not been in receipt of that pension before rendering further service in consequence of which the pension falls to be recalculated or to be calculated on a different basis, subsection (1) above shall apply as it would apply if he had been in receipt of the pension before rendering the further service.

(3)Where the basic rate of a derivative pension, not being a substituted pension, falls to be calculated by reference to that of a principal pension which is authorised to be increased under subsection (1) or (2) above (or which would have been, if the further service had been terminated by retirement), the derivative pension may be increased in the way in which subsection (1) above authorises (or would have authorised) the principal pension to be increased ; and for this purpose the reference in subsection (1)(b) to the pension is to be taken as a reference to the principal pension, not the derivative pension.

(4)Subsection (1)(b) above shall apply to pensions specified in paragraphs 4, 18 to 21 and 50 of Schedule 2 to this Act, and also to those specified in paragraphs 22(b) and 23 if computed under the Superannuation Acts 1834 to 1949, but shall apply only in a case where the recalculation falls to be made by reference—

(a)to the aggregate of the further service and the previous service; and

(b)to emoluments attributed to a period immediately preceding the termination of the further service not lower than the emoluments by reference to which the pension was to be calculated before the further service.

5Scope of Act, and general powers to extend and adapt increases

(1)For purposes of this Act " official pension " means, subject to subsection (2) below, any of the pensions specified in Schedule 2; and in the case of a pension specified in Part II of the Schedule it shall be the duty of a pension authority, except as otherwise provided by section 9(7) below, to increase the pension in accordance with this Act.

(2)The Minister for the Civil Service may by regulations provide that this Act shall have effect in relation to any pensions not specified in Schedule 2 as if they were specified in such Part of that Schedule as may be directed by the regulations; and regulations under this subsection—

(a)may include such incidental, consequential and supplemental provisions as appear to the Minister to be expedient; and

(b)may in particular make provision for securing that the cost of increasing any pension is borne by the appropriate authority.

(3)The Minister for the Civil Service, if satisfied in the case of any official pension that it is proper so to do, may by regulations direct (either generally or in relation to a particular review under section 2 above) that the provisions of this Act shall apply in relation to that pension subject to such modifications, adaptations and exceptions as may be specified in the regulations. The power conferred by this subsection on the Minister for the Civil Service may be exercised also, with his consent, by the Lord Chancellor or the Secretary of State.

(4)Any regulations under this section may provide for increases to take effect from a date before the making of the regulations.

6Preservation for certain purposes of benefit of previous Acts

(1)If in the case of an official pension beginning before the year 1969 the 1969 standard is less than the 1971 rate of the pension with the addition (if any) to be made to that rate under subsection (5) below, then the increase that may be made in the pension under section 1(1)(a) above shall be of the amount necessary to bring the annual rate up to 118 per cent, of the 1971 rate or, if subsection (5) below applies, to 118 per cent, of the 1971 rate with the addition under that subsection.

(2)For any pension that qualified for an increase under the Pensions (Increase) Act 1920, the 1971 rate shall be taken to be the annual rate at which it is being paid on 31st August 1971 (or, if payment is then suspended, was last paid before that date).

(3)Where an official pension not falling within subsection (2) above is being paid on 31st August 1971 at a rate which includes any relevant increases, then the annual rate at which it is then being paid shall be taken as the 1971 rate, unless it is shown that the rate should have been revised or there is a change of circumstances that would affect the 1971 rate if ascertained under subsection (4) below.

(4)Subject to the provisions of this section, the Minister for the Civil Service shall by order prescribe tables and rules for ascertaining, for any pension to which subsection (1) above may apply (other than a pension falling within subsection (2) above), the annual rate at which it would be payable if paid with any relevant increases; and the rate so ascertained shall be taken to be the 1971 rate, unless subsection (3) above applies.

(5)Where a pension beginning on or before 1st April 1961 is one that (but for this Act) might have been increased under section 1 of the Pensions (Increase) Act 1962, and any of the qualifying conditions other than those specified in section 3(3)(b), (c) and (d) above is satisfied, then there shall for purposes of this section be made to the 1971 rate as ascertained under subsection (4) above an addition of the amount prescribed by order of the Minister for the Civil Service as corresponding to that of the increase provided for by section 2 of that Act (additional increase for pensioners over 70); and where subsection (3) above applies, the like addition shall be made to the 1971 rate given by that subsection, unless the pensioner had attained the age of 70 on or before 31st August 1971.

(6)The annual rate of official pensions beginning after the year 1968 may, if any qualifying condition is satisfied, be increased by the pension authority in respect of any period beginning on or after 1st September 1971 by such amounts as may be prescribed by order of the Minister for the Civil Service as corresponding to those of any increases that might (but for this Act) have been made in the case of those pensions under the Pensions (Increase) Acts 1944 and 1947 or the Pensions (Increase) Act 1956; and where the rate of a pension may be increased under this subsection, any increase under section 1 or 2 above shall be calculated by reference to the rate as so increased as if it were the basic rate.

(7)Orders made for the purposes of this section shall include such provision as may be necessary to enable the pensions to which subsections (1), (5) and (6) relate to be identified without reference to the Pensions (Increase) Acts 1920 to 1969, except that pensions which qualified for an increase under the Pensions (Increase) Act 1920 need not be otherwise identified.

(8)This section shall have effect subject to any provision made in the exercise of the powers conferred by section 5(3) above; and accordingly an order under this section may disregard any provision made in the exercise of corresponding powers conferred by the Pensions (Increase) Acts 1920 to 1969 or of powers conferred by section 17 of the Ministerial Salaries and Members' Pensions Act 1965 (past Prime Ministers), and may also disregard section 7(1) of the Judicial Pensions Act 1959.

(9)An order under this section shall take no account of any provision of the Pensions (Increase) Acts 1920 to 1969 whereby a fraction of a pound was to be treated as a whole pound and may make such other departures from the effect of those Acts as in the opinion of the Minister will, without materially reducing the rate of any pension, simplify the tables or rules or make for ease of calculation.

(10)For purposes of this section, " relevant increase " means, in relation to any pension, any increase that might (but for this Act) have been made in the annual rate of the pension under section 1 of any of the following Acts, that is to say the Pensions (Increase) Act 1944, the Pensions (Increase) Act 1952, the Pensions (Increase) Act 1956, the Pensions (Increase) Act 1959, the Pensions (Increase) Act 1962, the Pensions (Increase) Act 1965 and the Pensions (Increase) Act 1969; but an order under this section may for purposes of subsection (4) treat as a relevant increase any increase authorised by or under any enactment by reference to a relevant increase, and may repeal or amend the provision authorising it accordingly.

(11)An order made (or purporting to be made) under this section shall have effect notwithstanding any error or omission in reproducing the effect of any Act or instrument, but may be amended by a further order for the purpose of correcting any such error or omission; and any such amendment may be made so as to have effect from such date as may be specified in the further order (including a date before the making of that order), and with such savings and transitional provisions as the Minister thinks proper.

(12)An order under this section shall be made by statutory instrument; and if an order made by virtue of subsection (11) above has the effect of reducing the rate of any pension, the statutory instrument shall be subject to annulment in pursuance of a resolution of either House of Parliament.

7Administrative provisions

(1)In this Act " pension authority " means, except as otherwise provided in Part III of Schedule 2 to this Act, the authority by whom the pension is payable; but the Minister for the Civil Service or, with his approval, the Secretary of State may by regulations provide that, in relation to any class of pensions specified in the regulations, all or any of the functions of the pension authority under this Act shall be performed on behalf of the pension authority by such other authority as may be so specified.

(2)The provisions of Schedule 3 to this Act shall have effect with regard to the manner in which the cost of increases under this Act is to be borne in the cases there mentioned and with regard to other incidental and consequential matters.

(3)Subject to the provisions of this Act, any provision made by or under any enactment shall, in so far as it relates to the apportionment of the cost of a pension between two or more authorities or funds, or to the manner in which a pension is to be paid or borne, or to the proof of title to sums payable on account of a pension, or in so far as it prohibits or restricts the assignment or charging of a pension or its application towards the payment of debts, have effect in relation to any increase of the pension under this Act as it has effect in relation to the pension:

Provided that this subsection, in so far as it relates to the apportionment of the cost of an increase under this Act, shall have effect subject to any agreement between the authorities concerned.

(4)Except as provided by subsection (3) above or by Schedule 3 to this Act, an increase of a pension under this Act shall not be treated as part of the pension for the purposes of any provision made by or under any enactment; and in calculating the rate of a derivative pension, any increase under this Act of the principal pension shall be disregarded.

8Meaning of " pension", and other supplementary provisions

(1)For purposes of this Act " pension " includes (subject to section 9 below)—

(a)any allowance or other benefit payable (either in respect of the services of the pensioner or in respect of the services of any other person) by virtue of any superannuation scheme, whether contained in an enactment or otherwise, including a superannuation scheme providing benefits in the case of injury or death; and

(b)any compensation payable in respect of retirement from an office or employment in pursuance of the provisions of an enactment, any compensation payable in respect of the loss, abolition or relinquishment of an office or employment occasioned by an alteration in the organisation of a department or service or by a transfer or other reorganisation of the functions of local authorities, and any compensation payable in respect of a diminution in the emoluments of an office or employment which has been occasioned as aforesaid.

(2)A pension shall be deemed for purposes of this Act to begin on the day following the last day of the service in respect of which the pension is payable (whenever the pension accrues or becomes payable), except that—

(a)an earnings-related pension based, directly or indirectly, on emoluments received for a period not ending with the last day of that service, other than a substituted pension, is to be deemed to begin on the day following the last day of that period ; and

(b)a substituted pension is to be deemed to begin on the same day as the original pension, or, if earlier, on the day from which the surrender of the original pension takes effect.

(3)Where an earnings-related pension beginning before the year 1969 may be payable either at a rate fixed, directly or indirectly, by reference to emoluments or at a flat rate, the 1969 standard and, if relevant, the 1971 rate of the pension according to either of its rates shall be determined without regard to the other.

9Gratuities and lump sums

(1)References in this Act to a pension shall not apply to any payment made by way only of a return of contributions, with or without interest; but, subject to that, this Act shall apply in relation to any allowance, benefit or compensation whether it takes the form of periodical payments or of a gratuity or other lump sum.

(2)In relation to a lump sum—

(a)references to the time when a pension begins shall apply in accordance with section 8(2) above as in the case of a pension taking the form of periodical payments; and

(b)references to increasing a pension in respect of a period beginning at any time shall have effect as references to increasing any sum becoming payable at or after that time on account of the lump sum or any instalment of it; and

(c)references to the rate of a pension shall have effect as references to the amount of the lump sum or an instalment of it, as the case may require.

(3)In respect of any lump sum or instalment of a lump sum which becomes payable between 1st April and 1st September 1971 there may be paid under section 1 above on or after 1st September 1971 the same increase as if it became payable on that date.

(4)In respect of any lump sum or instalment of a lump sum which becomes payable in the half year ending with the day following the last day of a review period, or in any of the preceding half years beginning in the review period other than the first such half year, but for which the beginning date (as determined under section 8(2) above) fell before the half year in question, the order made under section 2 in respect of the review period shall authorise payment of an increase proportionate (to the nearest one-tenth of one per cent.) to any rise which the cost of living in that half year shows over the cost in the half year following the first day of the review period or, if the beginning date fell after the last-mentioned half year, then over the cost in the half year in which the beginning date fell. The cost of living in any half year is to be taken for purposes of this subsection as the mean of the monthly figures.

(5)For purposes of section 4 above any addition to a lump sum which would have resulted from treating the length of the previous service as being increased by the length of the further service in accordance with section 4(1)(b) shall be supposed not to have become payable until the day following that on which the further service in fact terminated.

(6)Nothing in section 6 above shall apply to any lump sum.

(7)The provisions of this section relating to lump sums shall not apply to the gratuities specified in subsection (8) below, and in relation to those gratuities section 6 above shall have effect as if they had all been included in section 6(1) of the Pensions (Increase) Act 1962 (and not only those payable in respect of local government service); but section 5(1) above shall not require a local authority to increase any such gratuity.

(8)The gratuities to which subsection (7) above applies are—

(a)any gratuity granted by way of periodical payments under any of the following enactments:—

(i)section 23 of the Local Government and other Officers' Superannuation Act 1922 ;

(ii)paragraph 4 of Part I of Schedule 1 to the Local Government (Clerks) Act 1931;

(iii)section 11 of the Local Government Superannuation Act 1937 or of the Local Government Superannuation (Scotland) Act 1937 ;

(b)any gratuity granted by way of periodical payments or by way of an annuity under section 18 of the Local Government Superannuation Act 1953 ;

(c)any gratuity granted by way of periodical payments or by way of an annuity under any local Act (or provisional order confirmed by Parliament) corresponding to any of the enactments mentioned in paragraphs (a) and (b) above. Any question whether a local Act or provisional order corresponds to any of the enactments mentioned in paragraphs (a) and (b) above shall be determined, in the event of dispute, by the Secretary of State.

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