Pensions Act 2004

[F1 58D Financial penalty for conduct risking accrued scheme benefits U.K.

(1) This section applies in relation to an occupational pension scheme other than—

(a) a money purchase scheme, or

(b) a prescribed scheme or a scheme of a prescribed description.

(2) Section 88A (financial penalties) applies to a person who was party to an act or deliberate failure to act that detrimentally affected in a material way the likelihood of accrued scheme benefits being received (whether the benefits are to be received as benefits under the scheme or otherwise), if—

(a) the person knew or ought to have known that the act or failure to act would have that effect, and

(b) it was not reasonable for the person to act or fail to act in the way that the person did.

(3) This section does not apply where the Regulator is of the opinion that the person, in being a party to the act or failure, was acting in accordance with the person's functions as an insolvency practitioner in relation to another person (see section 58A(9)).

(4) In this section a reference to accrued scheme benefits being received is a reference to benefits the rights to which have accrued by the relevant time being received by, or in respect of, the persons who were members of the scheme before that time.

(5) In this section “the relevant time” means—

(a) in the case of an act, the time of the act;

(b) in the case of a failure to act—

(i) the time when the failure to act occurred, or

(ii) where the failure continued for a period of time, the end of that period;

and, in the case of acts or failures to act forming part of a series, any reference in this subsection to an act or failure to act is a reference to the last of the acts or failures in that series.

(6) A reference in this section to rights which have accrued is to be read in accordance with section 67A(6) and (7) of the Pensions Act 1995 (reading any reference in those subsections to a subsisting right as a reference to a right which has accrued).

(7) In determining for the purposes of this section whether an act or failure to act has detrimentally affected in a material way the likelihood of accrued scheme benefits being received, the following provisions of this Act are to be disregarded—

(a) Chapter 3 of Part 2 (the Board of the Pension Protection Fund: pension protection), and

(b) section 286 (the financial assistance scheme for members of certain pension schemes).

(8) For the purposes of this section the parties to an act or deliberate failure to act include those persons who knowingly assist in the act or failure.

(9) If the Regulator is of the opinion that—

(a) a person was party to a series of acts or deliberate failures to act, and

(b) the requirements of subsection (2) are met in relation to the series,

the series of acts or failures to act is to be regarded as an act or failure to act in relation to which the requirements of subsection (2) are met.]

Textual Amendments

F1 Ss. 58C, 58D inserted (1.10.2021) by Pension Schemes Act 2021 (c. 1), ss. 107(3), 131(1); S.I. 2021/950, reg. 2(3)(d) (with reg. 3(1)(4))