Explanatory Memorandum

Pensions Act (Northern Ireland) 2012

2012 CHAPTER 3

1 June 2012

Commentary on Sections

Part 2: Automatic Enrolment

Section 16: Arrangements where transitional conditions cease to be satisfied

Section 16 amends section 30 of the Pensions (No. 2) Act. Under section 30(5), if certain conditions of deferral cease to apply, the employer must enrol the jobholder into an alternative scheme. Currently section 30(5) provides that the alternative scheme must either be another defined benefit or hybrid scheme, or a money purchase scheme. This amendment gives employers a further option of enrolling jobholders into a personal pension scheme. It also has the effect of requiring the Department to make regulations about the arrangements that must be made by an employer in order for the jobholder to become a member of a personal pension scheme.

Subsection (3) amends subsection (6)(b) to ensure that where an employer makes arrangements to enrol a jobholder into a personal pension scheme the jobholder is not required to make a back payment of contributions.