The Teachers' Pensions Regulations 1997

Explanatory Note

(This note is not part of the Regulations)

These Regulations consolidate with amendments the provisions of the Teachers' Superannuation (Consolidation) Regulations 1988 as amended. The Regulations come into force on 3rd February 1998 but certain provisions have effect from 1st September 1997.

The main changes are as follows:

• failure to pay contributions under the Teachers' Superannuation (Additional Voluntary Contributions) Regulations 1994 is a ground for withdrawing “accepted school” status from an independent school (regulation B3(7)(c)(ii);

• regulation C2 contains new provisions whereby a person aged 50 or over, whether in full-time or part-time employment, whose salary is reduced or who takes up employment with a new employer at a reduced salary may, if the person satisfies certain conditions, elect to pay contributions at the old rate of salary uprated by the retail prices index. Where such an election is made regulation C3 provides that the person must pay employers' contributions on the difference between the old rate of salary and the new unless the employer or former employer elects to pay such contributions; this provision has effect from 1st September 1997;

• the provision formerly in C3(14) of the 1988 Regulations whereby an election to pay additional contributions is treated as not having been made if a declaration as to health is not made in good faith is not re-enacted. New provision is made in Schedule 4, paragraph 8(5) so that the special provisions which would otherwise apply where a person is incapacitated do not apply if the declaration as to health is not made in good faith;

• the provisions formerly in regulation C6 of the 1988 regulations whereby a past period in respect of which additional contributions can be paid is reduced if the person becomes entitled to count war service as reckonable service apply also to a case where a person is entitled to count additional reckonable service by virtue of the acceptance of a transfer value (regulation C7);

• regulation C10 (which re-enacts with modifications provisions formerly in regulation C8A of the 1988 Regulations) and which provides for a person who is called into service in a reserve force to be able to pay additional contributions at the rate of 6% of notional salary for a current period applies to persons who are called up under a call-out notice, or call out order or recall order under the Reserve Forces Act 1996.

• regulations E4(2),(3), and (5) of the 1988 Regulations are not re-enacted. Regulation E4(2) and (3) (Cases B and C) provided for entitlement to retirement benefits for persons in certain types of employment described in Schedule 9 to the 1988 Regulations. Regulation E4(5) (Case D) provided for entitlement to retirement benefits for persons who had reached 70 and were in employment;

• in regulation E6 the formula for calculating the retirement lump sum is changed so that service before 1st October 1956 is treated in the same way as service undertaken on or after that date;

• provision is made for the extension of the provisions for deferment, suspension or reduction of benefit where a person is convicted of offences of certain types in connection with pensionable employment to cases when a person has been convicted of such offences in connection with excluded employment (Regulation E18);

• provision is made that nominations of persons to receive death grants or supplementary death grants must be in writing (regulations E20(8) and E21(7));

• regulation E23 (which re-enacts with modifications regulation E22 of the 1988 Regulations) and which makes provision for the nomination of beneficiaries provides that a parent or brother or sister of the appointor must be either widowed or never have been married;

• regulations E24 and E26 provide that a short-term and long-term pension may only be paid to a nominated beneficiary if the beneficiary was wholly or mainly dependent on the deceased at the date of death;

• in regulation E31 (which re-enacts with modifications regulation E29 of the 1988 Regulations) the provisions for determining a person’s average salary are changed with the effect that for average salary purposes regular part-time employment counts in the same way as full-time employment. Average salary is to be calculated by reference to the salary for the best 365 consecutive days of pensionable employment (rather than reckonable service) during the last 3 years of pensionable employment (rather than reckonable service); effectively, by virtue of regulation H13 and Schedule 16, this provision has effect from 1st September 1997.

• new provision is made (regulation E31(11) to (14)) in a case where in any financial year during the average salary period a person has received an increase in contributable salary which is greater than 10% more than the “standard increase” (as defined). Under such circumstances the person will be treated as having received a salary increase of 10% more than the standard increase, unless the person’s employer elects to pay an additional contribution under regulation G8;

• the rate at which interest is paid on late payment of certain benefits is changed from being 1% above base rate to base rate. Additionally, there are some minor changes in the definition of “base rate” (regulation E34);

• regulation G7 makes provision, in a case where a person has made an election under regulation C2, for an employer or former employer to pay employers' contributions on the difference between the old rate of salary and the new. Regulation G7 also makes provision where the teacher moves to a new employer. Under such circumstances the former employer’s election can continue if confirmed by the former employer or the new employer can elect to pay employers' contributions on the difference in salary; this provision has effect from 1st September 1997;

• regulation G8 makes provision for the additional contribution referred to in regulation E31(11). It is the actuarial value of the difference between retirement benefits based on the actual contributable salary and such benefits based on the contributable salary as if the person had received a salary increase of only 10% more than the standard increase.

• regulation H1 (which re-enacts with modifications provisions formerly in regulation H1 of the 1988 Regulations and which provides that the Regulations are modified by Schedule 10 in certain cases where a person’s salary is reduced) is extended to apply in certain cases where a person leaves employment with one employer and takes up employment with a new employer at a reduced salary. This provision has effect from 1st September 1997;

• regulation H6 provides for repayment of certain contributions where a person received an increase in salary such as is referred to in regulation E31(11) but no election under regulation G8 is made.

• regulation H9 (which provides for determination of questions) no longer provides that a determination by the Secretary of State shall be final. This is in consequence of the extension of the jurisdiction of the Pensions Ombudsman;

• in Schedule 1 “excluded employment” is defined as including part-time employment which would be pensionable if the person had so elected;

• in Schedule 3 the definition of “material benefits” in paragraph 2 is changed;

• the figures in Tables 1 to 3 in Schedule 4 (additional contributions for past period) are changed;

• the provisions formerly in Schedule 9 to the 1988 Regulations have been simplified;

• the provisions formerly in Part VI of Schedule 10 to the 1988 Regulations (which made special provision for service before 1st April 1945) are not re-enacted.