The Judicial Pensions (Fee-Paid Judges) Regulations 2017 No. 522

PART 13 THE FEE-PAID JUDICIAL ADDED YEARS SCHEME

CHAPTER 1 INTRODUCTION

Interpretation and appointment of actuary

103.—(1) In this Part—

“active FPJAYS member” means an FPJAYS member who is an active member of the principal scheme;

“assumed contribution commencement date” has the meaning given in regulation 105(1);

“assumed retirement age” has the meaning given in regulation 105(3);

“assumed retirement date” means the date on which an active FPJAYS member reaches the assumed retirement age;

“equivalent value of any retained benefits” means a period of time expressed in years and any fraction of a year determined by the FPJAYS actuary to represent the value of any retained benefits;

“FPJAYS” is the scheme constituted by this part of the Regulations;

“FPJAYS actuary” means the actuary appointed by the appropriate Minister under paragraph (2) of this regulation;

“FPJAYS member” means a member of the FPJAYS;

“judicial pension scheme” means the scheme constituted by the Judicial Pensions Regulations 2015(1), or any scheme constituted by the 1995 Regulations;

“periodic contributions start date” has the meaning given in regulation 110(2);

“retained benefits” are benefits determined by the administrators as satisfying the definition of that expression for the purposes of the 1995 Regulations as those Regulations were first in force;

“retired FPJAYS member” means an FPJAYS member who has retired from an eligible fee-paid judicial office before the commencement day and who was not an opted-out member of the principal scheme;

“Table 1” means the table in Schedule 1 to the 1995 Regulations

(2) The appropriate Minister must appoint an actuary who appears to the Minister to be appropriately qualified to act as the FPJAYS actuary for the purposes of this Part.

Membership

104.—(1) Membership of the FPJAYS is open to active and retired members of the principal scheme (but not to opted-out members) who held an eligible fee-paid judicial office before 6th April 2006.

(2) A person to whom membership of the FPJAYS is open may become an FPJAYS member by giving notice in writing to the administrators within 12 months of the commencement day (or by such later date as the administrators may agree).

(3) Subject to the provisions of this Part, an FPJAYS member has the right to purchase pension credits in the form of added years.

Assumed dates etc

105.—(1) For the purposes of this Part, an FPJAYS member must nominate a date (“the assumed contribution commencement date”) from which contributions are assumed to have been payable by the member in relation to those credits.

(2) The date nominated under paragraph (1) must be no earlier than the date on which the FPJAYS member first held an eligible fee-paid judicial office and in any event must be between 7th April 2000 and 5th April 2006.

(3) For the purposes of this Part, an active FPJAYS member must nominate an age between the age of 60 and the member’s compulsory retirement age at which that member intends to retire (“the assumed retirement age”).

CHAPTER 2 RETIRED FPJAYS MEMBERS

Purchase of added years by retired FPJAYS members

106.—(1) A notice given under regulation 104(2) by a retired FPJAYS member (“R”) must specify—

(a) R’s assumed contribution commencement date;

(b) the date R retired; and

(c) the number of added years R would like to purchase.

(2) The maximum number of added years that R may purchase under the FPJAYS is to be determined in accordance with the formula where—

(a) A is the aggregate length of R’s reckonable service in eligible fee-paid judicial offices held by R;

(b) B is the aggregate length of R’s service in qualifying judicial office (within the meaning of Part 1 of the Judicial Pensions and Retirement Act 1993); and

(c) C is the equivalent value of any retained benefits to which R was entitled at the assumed contribution commencement date.

(3) Where the maximum number of added years would (apart from this paragraph) be negative, it is instead nil.

Contributions by retired FPJAYS members

107.—(1) The contribution to the FPJAYS for a retired FPJAYS member (“R”) must be made by lump sum payment to the administrators, within 12 months of the date on which R served notice under regulation 104(2).

(2) The total contribution to the FPJAYS which R must make is to be calculated in accordance with this regulation, subject to the limit on the level of contributions in regulation 108.

(3) Where on the date R retired, R had a spouse, civil partner or qualifying child, the contribution is to be determined in accordance with the formula—

where—

(a)

A is the relevant benefits figure (see paragraph (4));

(b)

B is the amount of reckonable service which R accrued in the period beginning with the assumed contribution commencement date and ending with the date on which R retired, calculated in accordance with regulation 5(1) as though paragraph (2) of that regulation does not apply;

(c)

C is the total of the fees paid to R in respect of qualifying fee-paid days in the period referred to in B;

(d)

D is the number of added years R would like to purchase.

(4) The relevant benefits figure is determined by taking the following steps—

Step 1

• Use the salary which would have been R’s appropriate annual salary on the assumed contribution commencement date (or if R held more than one eligible fee-paid judicial office on that date, the salary which would have been the highest appropriate annual salary) if R had retired on that date to determine which is the applicable salary group for R specified in Table 1.

Step 2

• From the part of Table 1 for R’s salary group, determine which entry in column 1 describes the period referred to in B (ignoring the heading of the column).

Step 3

• Add together the personal benefits and family benefits percentage figures corresponding to the entry in column 1 referred to in Step 2.

(5) Where R did not have a spouse, civil partner or qualifying child at any point in the period beginning with R’s assumed contribution commencement date and ending with the date R retired, the contribution is to be determined in accordance with paragraphs (3) and (4) as if Step 3 were— “Use the personal benefits figure corresponding to the entry in column 1 referred to in Step 2”.

(6) Where R did not have a spouse, civil partner or qualifying child on the date on which R retired, but did at some point in the period beginning with the assumed contribution commencement date and ending with the date R retired, the contribution due is to be determined in accordance with the formula where—

(a) E is the contribution for the period beginning with R’s assumed contribution commencement date and ending with the date on which R last had a spouse, civil partner or qualifying child, determined in accordance with paragraphs (3) and (4), as if in paragraph (3)(c), “C” refers to the total of fees paid to R in respect of qualifying fee-paid days in that period;

(b) F is the contribution for the period beginning with the day after the date R last had a spouse, civil partner or qualifying child (“the start date”) and ending with the date R retired, determined in accordance with paragraph (5) as if the period referred to in paragraph (3)(c) as applied in paragraph (5) started on the start date.

Retired FPJAYS members: maximum contributions

108.—(1) The total contributions made by a retired FPJAYS member (“R”) under regulation 107 may not exceed the amount which is equal to the sum of the amounts determined for each tax year during the period beginning with the assumed contribution commencement date and ending with the date on which R retired in accordance with the following formula—

where—

(a)

FI is R’s annual fee income for the tax year in question which is subject to income tax, or if lower, the permitted maximum for that tax year, and

(b)

C is the sum of any contributions made by R to any other judicial pension scheme in that tax year, excluding any contributions made by the member in accordance with regulation 3 of the Judicial Pensions (Contributions) Regulations 2012(2).

(2) For the purposes of paragraph (1)(a), R’s “annual fee income” is the total of the fees paid to R in respect of qualifying fee-paid days in the tax year concerned.

Valuation of benefits for retired FPJAYS members

109.—(1) Any pension credits in the form of added years that have been purchased by a retired FPJAYS member (“R”) are to be treated for the purposes of paragraph (2) as if they were periods of reckonable service.

(2) If the addition of the years of reckonable service mentioned in paragraph (1) would, were they to be years of reckonable service accrued other than by the purchase of pension credits, lead to the payment of additional payments under the principal scheme, then benefits of an equivalent nature to those that would have been so payable under that scheme are to be paid under the FPJAYS instead.

(3) If the reckonable service which R accrued in the period between the assumed contribution date and the date on which R retired otherwise than by the purchase of pension credits (“R’s existing reckonable service”) includes reckonable service in two or more eligible judicial offices which R held simultaneously, the pension credits purchased by R shall be divided between the eligible fee paid offices held by R in that period in the same proportion as R’s existing reckonable service.

CHAPTER 3 ACTIVE FPJAYS MEMBERS

Purchase of added years by active FPJAYS members

110.—(1) A notice given by an active FPJAYS member (“M”) under regulation 104(2) must specify—

(a) M’s assumed contribution commencement date;

(b) M’s assumed retirement age;

(c) the number of qualifying fee-paid days which M proposes to work each year to the period ending with the date on which M reaches M’s assumed retirement age; and

(d) the number of added years M intends to purchase.

(2) The date on which M is to start payment of periodic contributions (“the periodic contributions start date”) must—

(a) be within 12 months of the date on which M gives the notice, and

(b) be agreed between M and the administrators.

(3) The maximum number of added years that M may purchase under the FPJAYS is to be determined in accordance with the formula where—

(a) A is the aggregate length of reckonable service in eligible fee-paid judicial offices that M would have at M’s assumed retirement date, assuming that M works the number of qualifying fee-paid days notified under paragraph (1)(c);

(b) B is the aggregate length of service in qualifying judicial office (within the meaning of Part 1 of the Judicial Pensions and Retirement Act 1993) that M would have at M’s assumed retirement date; and

(c) C is the equivalent value of any retained benefits to which M was entitled at the assumed contribution commencement date.

(4) Where the maximum number of added years would (apart from this paragraph) be negative, it is instead nil.

Contributions by active FPJAYS members

111.—(1) The cost for an active FPJAYS member (“M”) of purchasing each added year is to be determined in accordance with the formula—

where—

(a)

A is the relevant benefits figure (see paragraph (2));

(b)

B is the salary which would have been M’s appropriate annual salary on the assumed contribution commencement date if M had retired on that date.

(2) The relevant benefits figure is calculated by taking the following steps—

Step 1

• Use the salary that would have been M’s appropriate annual salary on the assumed contribution commencement date, if M had retired on that date, to determine which is the applicable salary group for M specified in Table 1;

Step 2

• In the part of Table 1 for M’s salary group, determine which entry in column 1 describes the period expressed in years and any fraction of a year beginning with the assumed contribution commencement date and ending with M’s assumed retirement date (ignoring the heading of that column);

Step 3

• Add together the personal benefits and family benefits percentage figures which correspond to the entry in column 1 referred to in Step 2.

(3) M may make contributions to purchase added years by way of—

(a) up to three lump sum payments, made within three years beginning with the date on which M gave notice under regulation 104(2) (but no more than one lump sum payment may be made in each calendar year), in respect of any contributions relating to the period beginning with the assumed contribution commencement date and ending with the day before the periodic contributions start date; and

(b) periodic deductions from fees, which commence on the periodic contributions start date, in relation to contributions relating to the period beginning with the periodic contributions start date and ending with M’s assumed retirement date.

(4) The aggregate amount of the lump sum payments M may make under paragraph (3)(a) is the smaller of—

(a) the amount equal to the sum of the amounts determined for each tax year during the period beginning with the assumed contribution commencement date and ending with the day before the periodic contributions start date in accordance with the following formula—

where—

(i)

FI is M’s annual fee income for the tax year in question which is subject to income tax, or if lower, the permitted maximum for that tax year, and

(ii)

C is the sum of any contributions made by M to any other judicial pension scheme in that tax year, excluding any contributions made by the member in accordance with regulation 3 of the Judicial Pensions (Contributions) Regulations 2012; and

(b) the amount determined in accordance with the formula—

where—

(i)

C is the cost of one added year, determined in accordance with paragraph (1),

(ii)

D is the number of added years which M has notified to the administrators under regulation 110(1)(c) that M intends to purchase,

(iii)

E is the period beginning with the assumed contribution commencement date and ending with M’s assumed retirement date, expressed in years and any fraction of a year,

(iv)

F is the period beginning with the assumed contribution commencement date and ending with the day before the periodic contributions start date, expressed in years and any fraction of a year.

(5) M’s “annual fee income” for the purposes of paragraph (4)(a)(i), is the total of the fees paid to M in respect of qualifying fee-paid days in the tax year concerned.

(6) The maximum aggregate amount of periodic contributions M may make under paragraph (3)(b) is calculated in accordance with the formula—

where—

(a)

C is the cost of one added year, determined in accordance with paragraph (1);

(b)

D is the number of added years which M has specified M intends to purchase;

(c)

E is the period beginning with the assumed contribution commencement date and ending with M’s assumed retirement date, expressed in years and any fraction of a year;

(d)

F is the period beginning with the periodic contributions start date and ending with M’s assumed retirement date, expressed in years and any fraction of a year;

(e)

X is the difference between the maximum amount which M could have contributed under paragraph (3)(a) and the amount M actually contributed under that provision.

(7) The requirement to make periodic contributions to the FPJAYS continues until M—

(a) reaches the assumed retirement age;

(b) retires;

(c) notifies the administrators that M wishes the contributions to cease; or

(d) dies.

Valuation of benefits for active FPJAYS members

112.—(1) If an active FPJAYS member (“M”) retires or otherwise leaves the principal scheme on or after reaching the assumed retirement age the administrators must—

(a) calculate the amount of added years that M has purchased, by dividing the total contributions made by M under regulation 111(3) by the cost of an added year as determined under regulation 111(1); and

(b) notify M of that amount.

(2) Any pension credits in the form of added years that have been purchased by or credited to M are to be treated for the purposes of paragraph (3) as if they were years of reckonable service.

(3) If the addition of the years of reckonable service mentioned in paragraph (2) would, were they to be years of reckonable service accrued other than by the purchase or credit of pension credits, lead to the payment of additional payments under the principal scheme, then benefits of an equivalent nature to those that would have been so payable under that scheme are to be paid under the FPJAYS instead.

(4) If M retires on the ground of ill-health or dies before the assumed retirement age, M must, for the purposes of calculating the benefits payable under paragraph (3), be credited with pension credits equivalent to the number of added years that M intended to purchase notified to the administrators by M under regulation 110(1)(c).

(5) Paragraph (4) does not apply during any period where M has ceased making periodic contributions.

(6) If M ceases to make periodic contributions M may apply to the administrators to resume making periodic contributions but any such application—

(a) must not be accepted if M has reached the assumed retirement age;

(b) must not result in M making contributions at a rate that is higher than the rate at which M was contributing before M ceased to pay periodic contributions; and

(c) must be accompanied by a declaration signed by M stating that M has no reason to believe that health may prevent continuation of service until the assumed retirement age.

(7) If M’s application under paragraph (6) is accepted by the administrators, this regulation and regulations 111 and 113 apply separately to those contributions and the value of benefits purchased with them.

(8) If an application by M under paragraph (6) to resume making contributions has been accepted and M subsequently—

(a) retires on the ground of ill-health or dies within 12 months of the date on which M started to pay periodic contributions again; or

(b) dies or retires on the ground of ill-health because of an incapacity to which M became subject within 12 months of that date,

paragraph (4) does not apply unless the administrators are satisfied that the declaration given in accordance with paragraph (6)(c) was made in good faith.

(9) If M ceases making periodic contributions before reaching assumed retirement age for reasons other than death or retirement on the ground of ill-health—

(a) the administrators must—

(i) calculate the amount of added years that M has purchased by the date of cessation, by dividing the total contributions made by M under regulation 111(3) up to the date of cessation by the cost of an added year as determined under regulation 111(1), and

(ii) notify M of that amount; and

(b) at the date of cessation M must be credited by the administrators with pension credits equivalent to the number of added years M has purchased, as calculated under sub-paragraph (a).

(10) For the purposes of this regulation, parts of added years purchased by M must be valued on a pro-rata basis.

Refund of contributions

113.—(1) If an active FPJAYS member (“M”) who is paying periodic contributions under the FPJAYS is neither married nor a civil partner and has no qualifying children at the time M retires, dies or otherwise leaves the principal scheme, M, or M’s estate, is entitled to a refund in accordance with this regulation.

(2) The amount to be refunded must be determined in accordance with the formula where—

(a) A is the relevant family benefits percentage (see paragraph (3));

(b) S is the salary that would have been M’s appropriate annual salary on the assumed contribution commencement date if M had retired on that date (“the relevant salary”);

(c) B is the period beginning with the day after the date M last ceased to have a spouse or a civil partner or qualifying child and ending with the date M ceased to make contributions, expressed in years and any fraction of a year;

(d) C is the period beginning with the assumed contribution date and ending with the date M ceased to make contributions, expressed in years and any fraction of a year;

(e) D is the number of added years M has purchased, calculated in accordance with regulation 112(1).

(3) The relevant family benefits percentage is determined as follows—

Step 1

• Use the relevant salary to determine which is the applicable salary group for M specified in Table 1.

Step 2

• In the part of Table 1 for M’s salary group, determine which entry in column 1 describes the period mentioned in paragraph (2)(d) (ignoring the heading of that column).

Step 3

• Use the family benefits percentage figure which corresponds to the entry in column 1 referred to in step 2.

(4) If M’s total contributions to the FPJAYS exceed the smaller of—

(a) the amount necessary to purchase the number of added years notified to the administrators by the member under regulation 110(1)(c); and

(b) the amount necessary to purchase the maximum number of added years permissible under regulation 110(3) (calculated on the basis that the assumed retirement date referred to in that paragraph is M’s actual retirement date),

M is entitled to a refund of the excess contributions.

(5) Where a refund is payable under this regulation, it must be paid together with compound interest at the rate announced annually in relation to the Principal Civil Service Pension Scheme.

CHAPTER 4 GENERAL

Limit on children’s pension benefits

114.  Any benefits that are paid under the FPJAYS in the form of a children’s pension under regulation 42 cease to be payable on the date that the recipient attains the age of 23.

Reduction of benefits

115.—(1) This regulation applies where the administrators of the FPJAYS pay the whole or any part of the lifetime allowance charge arising on a benefit crystallisation event relating to the FPJAYS in relation to a FPJAYS member.

(2) The pensions or other benefits payable under this Part to or in respect of the FPJAYS member may (notwithstanding any other provision of these Regulations) be reduced by such amount as, in accordance with normal actuarial practice, reflects the amount of the payments made.

(1)

S.I. 2015/182.

(2)

S.I. 2012/516. Regulation 3 was substituted by S.I. 2016/30.