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The Occupational Pension Schemes (Power to Amend Schemes to Reflect Abolition of Contracting-out) Regulations 2015

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8.—(1) The actuary must comply with the following requirements in carrying out the calculations under regulations 4(2), 5(2) and 6(4).

(2) The calculations are to be carried out–

(a)as if the proposed amendments took effect on the calculation date;

(b)taking account only of the effect of the proposed amendments;

(c)at the present value at the calculation date; and

(d)where an assumption is used in more than one calculation, using the same assumption for each calculation in which it is used.

(3) Any data used in the calculations, other than earnings data, must be data–

(a)the actuary considers is relevant; and

(b)which–

(i)is as at the calculation date, or

(ii)refers to the period of one year ending with the calculation date,

as the actuary considers appropriate.

(4) Calculations must be made using–

(a)the methods and assumptions used to calculate the scheme’s technical provisions–

(i)where the calculation date is the same date as the effective date of an actuarial valuation, calculated by reference to that date, or

(ii)where the calculation date is not the same date as that date, calculated by reference to the date of the most recent actuarial valuation before the calculation date, updated if necessary to reflect market conditions at the calculation date; and

(b)any other assumptions which the actuary considers necessary and which are consistent with the assumptions used to calculate the scheme’s technical provisions, updated if necessary to reflect market conditions at the calculation date.

(5) Where paragraph (6) applies, the actuary must adjust the requested assumptions to a best estimate basis by removing any margin for prudence provided the actuary is satisfied such adjustments are consistent with the principles that would be used by the trustees or managers of the scheme in calculating an initial cash equivalent under regulation 7B of the Occupational Pension Schemes (Transfer Values) Regulations 1996 (initial cash equivalents for salary related benefits other than cash balance benefits not calculated by reference to final salary)(1) at the calculation date.

(6) This paragraph applies where the–

(a)principal employer in a case falling within regulation 14 or 15; or

(b)employer in any other case,

writes to the actuary instructing the actuary to adjust any assumptions (“the requested assumptions”) to remove any margin for prudence.

(7) Subject to regulation 8(8), the–

(a)principal employer in a case falling within regulation 14 or 15; or

(b)employer in any other case,

must choose a calculation date which may be any date after 31st December 2011.

(8) Where the power is used in relation to the same members in the same scheme on a second or subsequent occasion the calculation date must be the same date as on the first occasion the power was used.

(9) In this regulation, “any margin for prudence” means any margin for adverse deviation allowed for in accordance with regulation 5(4)(a) of the Occupational Pension Schemes (Scheme Funding) Regulations 2005 (calculation of technical provisions)(2).

(1)

S.I. 1996/1847; regulation 7B was inserted by S.I. 2008/1050, relevant amending instruments are 2008/2450 and 2014/1711.

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