The Occupational and Personal Pension Schemes (Transfer Values) (Amendment) Regulations 2008

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations amend the Personal Pension Schemes (Transfer Values) Regulations 1987 (S.I. 1987/1112), the Occupational Pension Schemes (Transfer Values) Regulations 1996 (S.I. 1996/1847) and the Occupational Pension Schemes (Early Leavers: Cash Transfer Sums and Contribution Refunds) Regulations 2006 (S.I. 2006/33). Those amended Regulations set out the manner of calculating and verifying transfer values (the amount that may be transferred from one pension scheme to another).

Regulations 3(2) and 4(2) insert a requirement for trustees or managers of public service pension schemes to comply with guidance. The guidance is prepared, and where appropriate revised, by the Treasury. It sets out how discount rates are to be calculated. Discount rates are used by trustees or managers when calculating and verifying transfer values.

Regulations 2(2), 3(3) and 4(3) clarify amendments made by the Occupational Pension Schemes (Transfer Values) (Amendment) Regulations 2008 (S.I. 2008/1050) (“the 2008 Regulations”). In calculating and verifying the transfer value for a money purchase scheme, trustees or managers are required to calculate the realisable value of the member’s pension benefits. These amendments specify that the realisable value is the value on the date the transfer value is calculated.

Regulation 4(4) corrects a minor drafting error from the 2008 Regulations.

An assessment of the impact of these Regulations on the private and voluntary sectors was included in the impact assessment that accompanied the 2008 Regulations. Copies of that assessment are available in the libraries of both Houses of Parliament. Copies may be obtained from the Department for Work and Pensions, Better Regulation Unit, 4th Floor, Adelphi, 1-11 John Adam Street, London WC2N 6HT or from the Department’s website at http://www.dwp.gov.uk/resourcecentre/ria.asp.