The Railways Pension Scheme Order 1994

SURPLUS ASSETS

13.  If an actuarial valuation of the Section by the Actuary shows that the Section Assets (excluding the assets retained in the Special Reserve Fund described below and excluding any guarantee payments due after the date of the valuation) are likely to be more than sufficient to provide the benefits for Members as at the date of that valuation, then the Trustee, having considered actuarial advice and subject to the approval of the Secretary of State, shall use the surplus assets in the following order, unless the Trustee with the consent of the Secretary of State and the Pensions Committee otherwise determines within six months of the date of delivery of the valuation:

(1) If, prior to the date 6 months after the date of the valuation, payments have been made either in cash or in some other form, under the terms and conditions of the Secretary of State’s Guarantee, an amount equal in value to the accumulated value of the payments so made or if less the surplus assets, shall be retained in a “special reserve fund” established within this Section (the “Special Reserve Fund”). The Trustee shall invest the Special Reserve Fund at the direction of the Secretary of State subject to the terms and conditions of the Secretary of State’s Guarantee and Clause 5F.

(2) Up to 40% of the surplus assets remaining may then be used to provide additional benefits above the Guaranteed Level of Benefits. An amount equal to one and a half times the value of any benefit increases granted shall be retained in the Special Reserve Fund.

For the purposes of this Rule the actuarial valuation shall be the 3 yearly valuation under Clause 6B of the Pensions Trust (unless the Secretary of State and the Trustee agree otherwise).