Serious underprovision
60.—(1) Paragraph (2) applies where, in the case of an occupational pension scheme to which Article 56 applies, an actuarial valuation shows that, on the effective date of the valuation, the value of the scheme assets is less than 90 per cent. of the amount of the scheme liabilities (the difference shown in the valuation being referred to in this Article as “the shortfall”).
(2) The employer must—
(a)by making an appropriate payment to the trustees or managers, or
(b)by a prescribed method,
secure an increase in the value of the scheme assets which, taken with any contributions paid is not less than the shortfall.
(3) The required increase in that value must be secured—
(a)before the end of a prescribed period beginning with the signing of the valuation, or
(b)if the actuarial valuation was obtained by reason of such a statement in a certificate as is referred to in Article 57(2), before the end of a prescribed period beginning with the signing of the certificate.
(4) Except in prescribed circumstances, if the employer fails to secure the required increase in value before the end of the period applicable under paragraph (3), the trustees or managers must, within the period of fourteen days (or such longer period as is prescribed) beginning with the end of that period, give written notice of that fact to the Authority and to the members of the scheme.
(5) If the employer fails to secure the required increase in value before the end of the period applicable under paragraph (3), then so much of the shortfall as, at any subsequent time, has not been met by an increase in value under paragraph (2) made—
(a)by making an appropriate payment to the trustees or managers,
(b)by a prescribed method, or
(c)by contributions made before the end of that period,
shall, if not a debt due from the employer to the trustees or managers apart from this paragraph, be treated at that time as such a debt.
(6) Where an increase in value is secured by a prescribed method, the increase is to be treated for the purpose of this Article as being of an amount determined in accordance with regulations.
(7) The Authority may in prescribed circumstances extend (or further extend) the period applicable under paragraph (3).
(8) If paragraph (4) is not complied with—
(a)Article 3 applies to any trustee who has failed to take all such steps as are reasonable to secure compliance, and
(b)Article 10 applies to any trustee or manager who has failed to take all such steps.