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Pensions Act (Northern Ireland) 2015


5.The Act has seven parts:

Part 1 of the Act contains provisions to reform the state pension system and introduce a new state pension. It replaces the current two-component system with a single component flat-rate pension. It also contains provisions for a number of changes arising from the introduction of the new state pension, including the abolition of contracting-out for salary-related occupational pension schemes and the abolition of the savings credit element of state pension credit for those people who reach pensionable age on or after the introduction of the new state pension.

Part 2 provides for amendments to the Contributions and Benefits Act to make provision for the payment of extra additional state pension to people who have paid Class 3A voluntary National Insurance contributions.

Part 3 amends the 1995 Order to begin the increase of pensionable age from 66 to 67 eight years earlier. The increase will begin in 2026 and end in 2028.

Part 4 contains two sections relating to the assessed income period (“AIP”) in state pension credit claims. The AIP is a feature of state pension credit that removes the requirement for certain individuals to notify the Department of changes to retirement provision (broadly defined as capital, annuities and retirement pension) for a defined period, for the purposes of assessing their entitlement to state pension credit. The first measure provides for the phasing out of the AIP in state pension credit cases from April 2016. The second measure repeals existing legislation in the Pensions (No. 2) Act to ensure that indefinite AIPs set before 6th April 2014 will continue beyond that date.

Part 5 contains provisions to reform bereavement benefits and introduce a new bereavement support payment.

Part 6 contains a number of measures related to private pensions legislation, including:

  • a power to provide for a system of automatic transfers of a person’s accrued rights to benefits under a pension scheme, to another scheme of which that person is an active member;

  • a provision for regulations to be made banning the practice of providing incentives which encourage individuals to transfer a cash equivalent value of their accrued rights from a salary-related occupational scheme to an alternative arrangement;

  • the removal of the existing power to make refunds of contributions (“short service refunds”) to members of money purchase occupational pension schemes who terminate their membership before two years have elapsed since they joined the scheme;

  • a provision for regulations to be made to restrict charges in, and impose governance and administration requirements on, schemes specified in regulations;

  • amendments to the Pensions (No. 2) Act relating to automatic enrolment, including a power to specify certain groups that employers will not be required to enrol or re-enrol;

  • amendments to the Pension Schemes Act regarding the payment of a limited amount of unpaid pension contributions from the National Insurance Fund where an employer becomes insolvent so that all those who may become members of a pension scheme as a result of the workplace pension reforms are entitled to this protection;

  • a power to require pension levies to be paid in respect of past periods;

  • various technical amendments to the 1995 Order and the 2005 Order designed to improve operational processes for the Pensions Regulator; and

  • a new objective for the Pensions Regulator which sets out that the Regulator must consider how it can minimise any adverse impacts on an employer’s sustainable growth when exercising its functions under Part 4 of the 2005 Order.

Part 7 contains technical provisions.

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Explanatory Notes

Text created by the Northern Ireland Assembly department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes accompany all Acts of the Northern Ireland Assembly.


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