The Local Government (Superannuation and Compensation) (Amendment) Regulations 1988

Explanatory Note

(This note is not part of the Regulations)

Part II of these Regulations amends the Local Government Superannuation Regulations 1986 (“the principal Regulations”). Part III is concerned primarily with related amendments to the Local Government (Compensation for Premature Retirement) Regulations 1982 (“the 1982 Regulations”).

Regulation 3 inserts three new regulations into Part B of the principal Regulations, providing that those who were not pensionable employees under those Regulations on 5th April 1988 should not subsequently become such unless they so elect (new regulation B1A); and giving those who at any time are pensionable employees the opportunity to opt out of, and those who have opted out the opportunity to opt back into, the local government superannuation scheme established under the principal Regulations (new regulations B1B and B1C). The regulation also makes consequential and transitional provision made necessary by the new right to opt out (which replaces in particular certain existing rights of election available to part-time employees), as do regulations 4 (in relation to payments of additional contributions), 7 (in relation to the granting of additional years reckonable service with respect to those who have retired through ill-health), 8 (in relation to death grant), 9 (in relation to gratuities to local government employees) and 10 (in relation to injury allowances).

Regulation 4, by inserting a new regulation C9A and Schedule 6A into the principal Regulations, also permits a pensionable employee to elect to make voluntary contributions under the local government superannuation scheme up to certain limits which are in addition to those provided for by other provisions of the principal Regulations. The additional contributions are to be used by the employee’s administering authority to provide money purchase benefits under pension policies entered into by the authority (paragraphs 1 to 5 of the new Schedule).

The new Schedule makes provision, amongst other matters, for changes of employment by the pensionable employee (paragraph 6), for the making of fresh elections (paragraph 7), and for the limitation of benefits under Part E of the principal Regulations in certain cases (paragraph 8).

Regulation 5 provides that a pensionable employee should be entitled to preserved benefits under the principal Regulations (rather than to receive a return of contributions) where he has accumulated 2 years' reckonable or qualifying service, instead of 5 years' as at present.

Regulation 6 makes minor drafting amendments to the principal Regulations with respect to reckonable and qualifying service. The amendments do not as such change any entitlements under those Regulations, but they allow the provisions of the 1982 Regulations amended by Part III of these Regulations (relating to the crediting of additional service) to mesh more easily with the principal Regulations.

Regulations 11 to 22, in Part III, amend the 1982 Regulations. The 1982 Regulations allow employers of those who are pensionable under the principal Regulations, and who have ceased their employment through redundancy or in the interests of the efficiency of their employing authorities, to compensate them in certain cases (in the form of additions to superannuation benefits) by the award of additional years of service. Without amendment of the 1982 Regulations, those who have opted out of (or not opted into) the local government superannuation scheme as mentioned above would no longer be eligible for compensation. The amendments made by Part III place such people in a position similar to that in which they would have been were they not to have opted out, or failed to opt in.

At the same time the opportunity has been taken to deal with another excluded case, namely those who have not been admitted to the local government superannuation scheme for medical reasons; and to allow service to count in the establishment of eligibility under the 1982 Regulations which might otherwise have been excluded because the employee concerned was a manual worker or was a part-time employee who had not elected to join the scheme. Amendments to the provisions dealing with the calculation of compensation are also made in consequence of the introduction of personal pension arrangements under Part I of the Social Security Act 1986.

The Local Government Reorganisation (Compensation) Regulations 1986 provide for compensation for those suffering loss of employment or loss or diminution of emoluments attributable to the reorganisation of local government under the Local Government Act 1985. They do this in part by reference to the 1982 Regulations. Regulation 23 amends the 1986 Regulations by allowing those who are not pensionable employees for the reasons mentioned above to receive compensation under those Regulations as nearly as may be as if they were pensionable employees, unless they elect otherwise.

Regulation 24 makes transitional provision. It provides that the amendments made by Part III should only apply to those who left their employment on or after the day these Regulations come into force.