(This note is not part of the Regulations)
These Regulations make further amendments to the National Health Service Superannuation Scheme (Scotland) (Additional Voluntary Contributions) Regulations 1998 (“the AVC Regulations”). The AVC Regulations make provision for the payment of additional voluntary contributions by persons who are members of the NHS Superannuation Scheme (Scotland), or by their employers, in order to secure additional pension benefits. Certain provisions have retrospective effect as authorised by section 12 of the Superannuation Act 1972. Regulation 9(c), which substitutes a new Regulation 11(6) of the AVC Regulations, shall have effect from 1st November 1999.
Regulation 1 provides for citation, commencement, and extent.
Regulation 2 prescribes that the AVC Regulations will be amended in accordance with Regulations 3 to 14.
Regulation 3 amends the definition of “dependant” to clarify that the definition includes a person in whose favour an election has been made under regulation JI of the National Health Service Superannuation Scheme (Scotland) Regulations 1995 (allocation of pension by member for benefit of dependent); inserts a revised definition of “insurance company” in accordance with section 255 of the Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001 (meaning of “insurance company”); inserts a definition of “occupational pension scheme”; substitutes a definition of “participator” which clarifies (but does not change) the existing definition; and inserts additional wording in the definition of “pensionable employment” to clarify that the Regulations cover employment approved for the purposes of a direction under section 7 of the Superannuation (Miscellaneous Provisions) Act 1967.
Regulation 4 amends regulation 3 of the AVC Regulations (making and acceptance of elections) to clarify that “absence from work” means absence on ill health; provides that the member is not receiving tax relief under section 594(1) of the Taxes Act on the date on which the notice of such an election is received by the Scottish Ministers and confirms that the member will be notified in writing of the Scottish Ministers acceptance of an election.
Regulation 5 amends regulation 4 of the AVC Regulations (payment and amount of additional voluntary contributions) to reduce the number of days from 10 days to 7 days from the date of deduction for remittance of the members contributions to the Scottish Ministers, and amends a reference to a paragraph in Schedule 1 of the AVC Regulations.
Regulation 6 amends regulation 6 of the AVC Regulations (circumstances in which elections cease to have effect) to provide that an election shall be treated as not having ceased to have effect in circumstances where a contributor is in receipt of pension benefits under the 1995 Regulations, or where the member has left pensionable employment and wished to switch AVC investments or future contributions to another authorised fund.
Regulation 7 removes the restriction which limited inward transfers to contributions paid during any previous employment.
Regulation 8 substitutes a new regulation 10 of the AVC Regulations (outward transfers) and provides that a member who has left pensionable employment and a member continuing in pensionable employment may transfer the value of investments made under these Regulations to another form of pension arrangement, including a free standing additional voluntary contributions scheme (FSAVC), without also having to transfer the value of their pension rights under the 1995 Regulations. Those continuing in NHS employment may only transfer to a FSAVC.
Regulation 9 makes some minor clarifications to regulation 11 of the AVC Regulations (Retirement and dependants' pensions), and amends regulation 11(6) of the AVC Regulations so that, from 1st November 1999, the link between main scheme and AVC scheme benefits is broken, and members may leave their investments or take them at any time up to age 75. If the member fails to make an election on or before his 75th birthday, the Scottish Ministers may realise the investments in order to provide benefits.
Regulations 10 to 13 amend paragraph references to take account of the revised numbering in the new Schedule 1, and make minor technical changes.
Regulation 14 inserts a new Schedule 1 of the AVC Regulations, in which the paragraphs have been renumbered to include additional definitions, clarify the Inland Revenue relaxations in respect of retained benefits and raise the limit on retirement pensions in cases where the member retires after age 60 and is entitled to a greater pension because of its postponement.
Within the new Schedule 1:
Part I (Benefit limits) includes definitions for “permitted amount”, “Tax year”, “Total retirement benefits” and “the year in question”. The definition of “retained benefits” has been adjusted to include the Inland Revenue relaxations which allow retained benefits to be ignored in certain circumstances.
Part II (Retirement pensions) incorporates in paragraph 13, a new provision KK, so as to raise the limit for retirement pensions in cases where the member retires after age 60 and is entitled to a greater pension because of its postponement, and to remove the provision which unintentionally prevented the benefits underpin of 40 years at age 60.
Parts III (Dependants' pensions) and IV (Lump sums on death) – paragraphs have been renumbered.
These Regulations impose no cost on business.