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Pensions (No. 2) Act (Northern Ireland) 2008

Schedule 5: Pension compensation on divorce etc.

Schedule 5 makes various amendments to family legislation to enable the courts to make pension compensation sharing orders and attachment orders in respect of pension compensation paid by the Pension Protection Fund.

Part 1 amends the Matrimonial Causes (Northern Ireland) Order 1978.

New Article 26D (Pension compensation sharing orders in connection with divorce proceedings) sets out the circumstances in which a pension compensation sharing order may be made. The effect of this provision is that pension sharing will not be available in relation to rights which have already been shared between parties. Nor will it be available in relation to rights which are the subject of attachment (whether in favour of one of the parties or in favour of a third party).

New Article 26E (pension compensation orders: duty to stay) provides powers to the Lord Chancellor to specify in regulations when the implementation of a sharing order is delayed.

New Article 26F (pension compensation sharing orders: apportionment of charges) provides that a court order may provide for the apportionment of any charge made by the Board of the Pension Protection Fund under section 95 (charges in respect of compensation sharing costs).

Paragraphs 4 to 6 of the Schedule make consequential amendments to other provisions in the Matrimonial Causes (Northern Ireland) Order 1978 following from the other amendments in the Schedule, such as adding necessary cross-references.

Paragraph 7 makes provision in the Matrimonial Causes (Northern Ireland) Order 1978 allowing for the making of attachment orders by inserting new Articles 27F and 27G. These ensure that the court may make attachment orders in respect of Pension Protection Fund compensation in a similar way to the making of attachment orders in respect of pensions under the current provisions of Article 25B and 25D of the Matrimonial Causes (Northern Ireland) Order 1978.

An attachment order is an alternative to a pension sharing order that will be available to the court on divorce etc. where one of the parties has rights to pension compensation. An attachment order simply requires the Board of the Pension Protection Fund to subtract a specified amount from each payment it makes to one party and send it instead to the other party.

New Article 27G (pension compensation: supplementary) allows the Lord Chancellor, through regulations, to specify in relation to the implementation of an attachment order under Article 27F the manner in which the Pension Protection Fund discharges its liability, the manner in which payment is calculated and is made, and the information to be provided in relation to payments.

Paragraph 8 makes consequential amendments to Article 33 of the Matrimonial Causes (Northern Ireland) Order 1978 (variation, discharge etc of certain orders for financial relief) to reflect the amendments made to that Order by this Schedule, such as inserting necessary cross-references to the new Articles and references to compensation sharing orders.

Paragraph 9 inserts a new Article 42B into the Matrimonial Causes (Northern Ireland) Order 1978 (appeals relating to pension compensation sharing orders which have taken effect). This new Article allows the court to make such further orders as required to put the parties, including the Board of the Pension Protection Fund, in the appropriate position following a successful appeal.

Part 2 of the Schedule makes amendments to the Matrimonial and Family Proceedings (Northern Ireland) Order 1989 so that the provisions of that Order relating to the making of financial provision after overseas settlements on divorce, such as the making of interim orders and orders relating to financial provision and property adjustment also apply to, and enable the making of, orders in relation to Pension Protection Fund compensation under the various provisions inserted into the Matrimonial Causes (Northern Ireland) Order 1978 by this Schedule.

Part 3 amends civil partnership legislation. The amendments correspond to those made to matrimonial legislation by Part 1.

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