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Pensions Act 1995

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Pensions Act 1995

1995 CHAPTER 26

An Act to amend the law about pensions and for connected purposes.

[19th July 1995]

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Extent Information

E1Act does not extend to Northern Ireland except specified provisions and amendments by this Act of an enactment which extends also to Northern Ireland see section 178(1)(2)(3).

Modifications etc. (not altering text)

C1Act excluded by Social Security Contributions and Benefits Act 1992 (c. 4), s. 55C(6) (as inserted (11.11.1999 for specified purposes; 1.12.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 6 para. 3; S.I. 2000/1047, art. 2(2)(d), Sch. Pt. IV)

C2Act power to modify conferred (2.4.2001) by the Insolvency Act 2000 (c. 39), ss. 7(2), 16(1); S.I. 2001/766, art. 2(1)(a) (with art. 3)

C4Act: power to amend conferred (2.12.1999) by Northern Ireland Act 1998 (c. 47), s. 87 (with s. 95); S.I. 1999/3209, art. 2, Sch.

C5Act: power to modify conferred (2.4.2001) by Insolvency Act 2000 (c. 39), s. 7(2); S.I. 2001/766, art. 2(1)(a) (with art. 3)

C6Act: functions transferred (6.4.2005) by Pensions Act 2004 (c. 35), ss. 7(1)(b), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7 (with S.I. 2005/695, arts. 5(8), 6, Schs. 2, 3)

C9Act: power to modify conferred (6.4.2006) by Pensions Act 2004 (c. 35), ss. 321(1)(c), 322(1); S.I. 2006/560, art. 2(3), Sch. Pt. 3

C11Act: power to modify conferred (26.11.2008) by Pensions Act 2008 (c. 30), s. 146(2)(b)

Commencement Information

I1Act partly in force at Royal Assent see s. 180(1)(2).

Part IU.K. Occupational pensions

Modifications etc. (not altering text)

C18Pt. I: Pensions Act 2004 (c.35), Pt. 3 construed as one with Pt. I of this Act (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 233, 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

Occupational Pensions Regulatory AuthorityU.K.

F11 The new authority.U.K.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F22 Reports to Secretary of State.U.K.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

Supervision by the AuthorityE+W+S

[F33 Prohibition orders.E+W+S

(1)The Authority may by order prohibit a person from being a trustee of—

(a)a particular trust scheme,

(b)a particular description of trust schemes, or

(c)trust schemes in general,

if they are satisfied that he is not a fit and proper person to be a trustee of the scheme or schemes to which the order relates.

(2)Where a prohibition order is made under subsection (1) against a person in respect of one or more schemes of which he is a trustee, the order has the effect of removing him.

(3)The Authority may, on the application of any person prohibited under this section, by order revoke the order either generally or in relation to a particular scheme or description of schemes.

(4)An application under subsection (3) may not be made—

(a)during the period within which the determination to exercise the power to make the prohibition order may be referred to [F4a tribunal] under section 96(3) or 99(7) of the Pensions Act 2004, and

(b)if the determination is so referred, until the reference, and any appeal against [F5the determination of the tribunal concerned], has been finally disposed of.

(5)A revocation made at any time under this section cannot affect anything done before that time.

(6)The Authority must prepare and publish a statement of the policies they intend to adopt in relation to the exercise of their powers under this section.

(7)The Authority may revise any statement published under subsection (6) and must publish any revised statement.

F6(8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ]

[F73AProhibition orders: directors of corporate trustees etcE+W+S

(1)A company or Scottish partnership is prohibited from being a trustee of a trust scheme at any time when an individual who is a director of the company or a partner in the partnership is prohibited from being a trustee of the scheme by an order under section 3.

(2)Where a company or partnership which is a trustee of a trust scheme becomes prohibited under subsection (1) in relation to the scheme, that subsection has the effect of removing the company or partnership as a trustee.

(3)The Authority may, on the application of a company or Scottish partnership, give notice in writing to the applicant waiving the prohibition under subsection (1)—

(a)in relation to an individual against whom an order under section 3 has been made, and

(b)either generally or in relation to a particular scheme or particular description of schemes.

(4)A notice may be given under subsection (3) only if the Authority is satisfied that the applicant would be a fit and proper person to be a trustee of the scheme or schemes to which the notice relates despite the individual being, or even if the individual were to become, a director of or partner in the applicant.

(5)A notice given at any time under subsection (3) cannot affect anything done before that time.

(6)An application under subsection (3) may not be made—

(a)during the period within which the determination to exercise the power to make the order against the individual may be referred to the Tribunal under section 96(3) or 99(7) of the Pensions Act 2004 (whether by a company or partnership which became prohibited under subsection (1) on the making of the order or by another person), and

(b)if the determination is so referred, until the reference, and any appeal against the Tribunal's determination, has been finally disposed of.

(7)The Authority must prepare and publish a statement of the policies they intend to adopt in relation to the exercise of their powers under this section.

(8)The Authority may revise any statement published under subsection (7) and must publish any revised statement.

(9)References in this section to an order under section 3 are to an order under that section made on or after the date on which section 46(2) of the Pensions Act 2014 comes fully into force.]

4 Suspension orders.E+W+S

(1)The Authority may by order suspend a trustee of a trust scheme—

(a)pending consideration being given to the making of an order against him under section 3(1),

[F8(aa)pending consideration being given to the institution of proceedings against him for an offence involving dishonesty or deception,]

(b)where proceedings have been instituted against him for an offence involving dishonesty or deception and have not been concluded,

[F9(ba)where an application has been made under section 263H of the Insolvency Act 1986 for an order making him bankrupt and the application has not been determined,]

(c)where a petition has been presented to the court for an order adjudging him bankrupt, or for the sequestration of his estate, and proceedings on the petition have not been concluded [F10or an application has been made by him for a debt relief order (under Part 7A of the Insolvency Act 1986) and the application has not been determined],

(d)where the trustee is a company, if a petition for the winding up of the company has been presented to the court and proceedings on the petition have not been concluded,

(e)where an application has been made to the court for a disqualification order against him under the M1Company Directors Disqualification Act 1986 [F11or under [F12the Company Directors Disqualification (Northern Ireland) Order 2002]] and proceedings on the application have not been concluded, or

(f)where the trustee is a company or Scottish partnership and, if any director or, as the case may be, partner were a trustee, the Authority would have power to suspend him under paragraph [F13(aa),] (b), (c) or (e).

(2)An order under subsection (1)—

(a)if made by virtue of paragraph (a) [F14or (aa)] [F15or, in a case where the Authority would have power to suspend a director or partner under paragraph (aa), by virtue of paragraph (f)], has effect for an initial period not exceeding twelve months, and

(b)in any other case, has effect until the proceedings in question are concluded [F16or, in the case of an application for a debt relief order, the application is determined];

but the Authority may by order extend the initial period referred to in paragraph (a) for a further period of twelve months, and any order suspending a person under subsection (1) ceases to have effect [F17in relation to a trust scheme] if an order is made against that person under section 3(1) [F18in relation to that scheme].

(3)An order under subsection (1) has the effect of prohibiting the person suspended, during the period of his suspension, from exercising any functions as trustee of any trust scheme to which the order applies; and the order may apply to a particular trust scheme, a particular [F19description] of trust schemes or trust schemes in general.

(4)An order under subsection (1) may be made on one of the grounds in paragraphs (b) to (e) whether or not the proceedings were instituted, petition presented or application made (as the case may be) before or after the coming into force of that subsection.

(5)The Authority may, on the application of any person suspended under subsection (1), by order revoke the order, either generally or in relation to a particular scheme or a particular [F20description] of schemes; but a revocation made at any time cannot affect anything done before that time.

[F21(5A)An application under subsection (5) may not be made—

(a)during the period within which the determination to exercise the power to make an order under subsection (1) may be referred to [F22a tribunal] under section 96(3) or 99(7) of the Pensions Act 2004, and

(b)if the determination is so referred, until the reference, and any appeal against [F23the determination of the tribunal concerned], has been finally disposed of.]

(6)An order under this section may make provision as respects the period of the trustee’s suspension for matters arising out of it, and in particular for enabling any person to execute any instrument in his name or otherwise act for him and for adjusting any rules governing the proceedings of the trustees to take account of the reduction in the number capable of acting.

F24(7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

Modifications etc. (not altering text)

C19Ss. 3-11 modified in part (11.11.1999 for specified purposes; 1.10.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

Commencement Information

I2S. 4 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Marginal Citations

F255 Removal of trustees: notices.E+W+S

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Textual Amendments

6 Removal or suspension of trustees: consequences.E+W+S

(1)A person who purports to act as trustee of a trust scheme while prohibited from being a trustee of the scheme under section 3 [F26or 3A] or suspended in relation to the scheme under section 4 is guilty of an offence and liable—

(a)on summary conviction, to a fine not exceeding the statutory maximum, and

(b)on conviction on indictment, to a fine or imprisonment or both.

(2)An offence under subsection (1) may be charged by reference to any day or longer period of time; and a person may be convicted of a second or subsequent offence under that subsection by reference to any period of time following the preceding conviction of the offence.

(3)Things done by a person purporting to act as trustee of a trust scheme while prohibited from being a trustee of the scheme under section 3 [F27or 3A] or suspended in relation to the scheme under section 4 are not invalid merely because of that prohibition or suspension.

(4)Nothing in section 3 [F28, 3A] or 4 or this section affects the liability of any person for things done, or omitted to be done, by him while purporting to act as trustee of a trust scheme.

Textual Amendments

Modifications etc. (not altering text)

C19Ss. 3-11 modified in part (11.11.1999 for specified purposes; 1.10.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

Commencement Information

I3S. 6 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

7 Appointment of trustees.E+W+S

(1)Where a trustee of a trust scheme is removed by an order under section 3, [F29by section 3A] or F30... by reason of his disqualification, the Authority may by order appoint another trustee in his place.

(2)Where a trustee appointed under subsection (1) is appointed to replace a trustee appointed under [F31section 23(1)], sections 22 to 26 shall apply to the replacement trustee as they apply to a trustee appointed under [F31section 23(1)].

(3)The Authority may also by order appoint a trustee of a trust scheme where they are satisfied that it is [F32reasonable] to do so in order—

(a)to secure that the trustees as a whole have, or exercise, the necessary knowledge and skill for the proper administration of the scheme,

(b)to secure that the number of trustees is sufficient for the proper administration of the scheme, F33...

(c)to secure the proper use or application of the assets of the scheme [F34, or

(d)otherwise to protect the interests of the generality of the members of the scheme.]

F35(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)The power to appoint a trustee by an order under this section includes power by such an order—

(a)to determine the appropriate number of trustees for the proper administration of the scheme,

(b)to require a trustee appointed by the order to be paid fees and expenses out of the scheme’s resources,

(c)to provide for the removal or replacement of such a trustee.

[F36(5A)An application may be made to the Authority in relation to a trust scheme by—

(a)the trustees of the scheme,

(b)the employer, or

(c)any member of the scheme,

for the appointment of a trustee of the scheme under subsection (3)(a) or (c).]

(6)Regulations may make provision about the descriptions of persons who may or may not be appointed trustees under this section.

Textual Amendments

F32Word in s. 7(3) substituted (26.1.2009) by Pensions Act 2008 (c. 30), ss. 131(1)(a), 149(5)

F34S. 7(3)(d) and preceding word inserted (26.1.2009) by Pensions Act 2008 (c. 30), ss. 131(1)(c), 149(5)

Modifications etc. (not altering text)

C19Ss. 3-11 modified in part (11.11.1999 for specified purposes; 1.10.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

Commencement Information

I4S. 7 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

8 Appointment of trustees: consequences.E+W+S

[F37(1)An order under section 7 appointing a trustee may provide for any fees and expenses of trustees appointed under the order to be paid—

(a)by the employer,

(b)out of the resources of the scheme, or

(c)partly by the employer and partly out of those resources.

(2)Such an order may also provide that an amount equal to the amount (if any) paid out of the resources of the scheme by virtue of subsection (1)(b) or (c) is to be treated for all purposes as a debt due from the employer to the trustees of the scheme.]

(3)Subject to subsection (4), a trustee appointed under that section shall, unless he is the independent trustee and section 22 applies in relation to the scheme, have the same powers and duties as the other trustees.

(4)Such an order may make provision—

(a)for restricting the powers or duties of a trustee so appointed, F38...

(b)for powers or duties to be exercisable by a trustee so appointed to the exclusion of other trustees.

Textual Amendments

F38Word in s. 8(4)(a) repealed (11.11.1999 for specified purposes, 25.4.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 2 para. 10, Sch. 13 Pt. I; S.I. 2000/1047, art. 2(2)(b), Sch. Pt. II

Modifications etc. (not altering text)

C19Ss. 3-11 modified in part (11.11.1999 for specified purposes; 1.10.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

Commencement Information

I5S. 8 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

9 Removal and appointment of trustees: property.E+W+S

Where the Authority have power under this Part to appoint or remove a trustee [F39or a trustee is removed under section 3A], they may exercise [F40by order] the same jurisdiction and powers as are exercisable by the High Court or, in relation to a trust scheme subject to the law of Scotland, the Court of Session for vesting any property in, or transferring any property to, trustees in consequence of the appointment or of the removal.

Textual Amendments

Modifications etc. (not altering text)

C19Ss. 3-11 modified in part (11.11.1999 for specified purposes; 1.10.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

Commencement Information

I6S. 9 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

10 Civil penalties.E+W+S

(1)Where the Authority are satisfied that by reason of any act or omission this section applies to any person, they may by notice in writing require him to pay, within a prescribed period, a penalty in respect of that act or omission not exceeding the maximum amount.

(2)In this section “the maximum amount” means—

(a)£5,000 in the case of an individual and £50,000 in any other case, or

(b)such lower amount as may be prescribed in the case of an individual or in any other case,

and the Secretary of State may by order amend paragraph (a) by substituting higher amounts for the amounts for the time being specified in that paragraph.

(3)Regulations made by virtue of this Part may provide for any person who has contravened any provision of such regulations to pay, within a prescribed period, a penalty under this section not exceeding an amount specified in the regulations; and the regulations must specify different amounts in the case of individuals from those specified in other cases and any amount so specified may not exceed the amount for the time being specified in the case of individuals or, as the case may be, others in subsection (2)(a).

(4)An order made under subsection (2) or regulations made by virtue of subsection (3) do not affect the amount of any penalty recoverable under this section by reason of an act or omission occurring before the order or, as the case may be, regulations are made.

(5)Where—

(a)apart from this subsection, a penalty under this section is recoverable from a body corporate or Scottish partnership by reason of any act or omission of the body or partnership F41... , and

(b)the act or omission was done with the consent or connivance of, or is attributable to any neglect on the part of, any persons mentioned in subsection (6),

this section applies to each of those persons who consented to or connived in the act or omission or to whose neglect the act or omission was attributable.

(6)The persons referred to in subsection (5)(b)—

(a)in relation to a body corporate, are—

(i)any director, manager, secretary, or other similar officer of the body, or a person purporting to act in any such capacity, and

(ii)where the affairs of a body corporate are managed by its members, any member in connection with his functions of management, and

(b)in relation to a Scottish partnership, are the partners.

(7)Where the Authority requires any person to pay a penalty by virtue of subsection (5), they may not also require the body corporate, or Scottish partnership, in question to pay a penalty in respect of the same act or omission.

(8)A penalty under this section is recoverable by the Authority.

[F42(8A)Any penalty recoverable under this section—

(a)shall, if [F43the county court] so orders, be recoverable [F44under section 85 of the County Courts Act 1984] or otherwise as if it were payable under an order of that court; and

(b)may be enforced as if it were an extract registered decree arbitral bearing a warrant for execution issued by the sheriff court of any sheriffdom in Scotland.]

(9)The Authority must pay to the Secretary of State any penalty recovered under this section.

[F45(10)The Authority may not require a person to pay a penalty under this section in respect of an act or omission if the Authority have issued a notice to the person under section 88A of the Pensions Act 2004 (financial penalties) in respect of the same act or omission.]

Textual Amendments

F42S. 10(8A) inserted (11.11.1999 for specified purposes, 25.4.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 2 para. 11; S.I. 2000/1047, art. 2(2)(b), Sch. Pt. II

F43Words in s. 10(8A)(a) substituted (22.4.2014) by Crime and Courts Act 2013 (c. 22), s. 61(3), Sch. 9 para. 52; S.I. 2014/954, art. 2(c) (with art. 3) (with transitional provisions and savings in S.I. 2014/956, arts. 3-11)

Modifications etc. (not altering text)

C19Ss. 3-11 modified in part (11.11.1999 for specified purposes; 1.10.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

C21S. 10 applied by Pension Schemes Act 1993 (c. 48), s. 99(7)(b) (as added (6.4.1996 for specified purposes; 6.4.1997 in so far as not already in force) by the Pensions Act 1995 (c. 26), s. 180(1), Sch. 6 para. 6(e); S.I. 1996/778, art. 2(5)(a), Sch. Pt. V; S.I. 1997/664, art. 2(3), Sch. Pt. II)

C22S. 10 applied (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), ss. 2(4), 89(5)(a) (with s. 8(6)); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 73(c); S.I. 2005/695, art. 2(7), Sch. 1)

C23S. 10 applied (11.11.1999 for specified purposes, 6.4.2001 for specified purposes, 8.10.2001 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), ss. 3(7), 89(5)(a) (with s. 8(6)); S.I. 2001/933, arts. 5(a), 6

C24S. 10 applied (11.11.1999 for specified purposes; 1.12.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), ss. 33(2)(3), 89(5)(a); S.I. 2000/1047, art. 2(2)(d), Sch. Pt. 4

C25S. 10 applied (with modifications) by Pension Schemes Act 1993 (c. 48), s. 111A(8)(9)(11) (as amended (11.11.1999 for specified purposes; 6.4.2001 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), ss. 9, 89(5)(a); S.I. 2000/2958, art. 2(1); Pensions Act 2004 (c. 35), ss. 268(4), 322(1) (with s. 313); S.I. 2006/560, art. 2(3), Sch. Pt. 3)

C26S. 10 applied by Pension Schemes Act 1993 (c. 48), s. 101H(4) (as inserted (11.11.1999 for specified purposes; 1.12.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), ss. 37, 89(5)(a); S.I. 2000/1047, art. 2(2)(d), Sch. Pt. IV)

C27S. 10 applied (S.) by The Local Government Pension Scheme (Scotland) Regulations 1998 (S.I. 1998/366), reg. 149(1)(2) (as inserted (with effect in accordance with reg. 1(2) of the amending S.I.) by S.S.I. 2001/23, regs. 1(2), 4)

C28S. 10 applied (S.) by The Firemen’s Pension Scheme Order 1992 (S.I. 1992/129), Sch. 2 rule N10 (as inserted (with effect in accordance with reg. 1(2) of the amending S.I.) by S.S.I. 2001/310, arts. 1(2), 3)

C29S. 10 applied (11.11.1999 for specified purposes, 1.12.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 33(1)-(3), 89(5)(a); S.I. 2000/1047, art. 2(2)(d), Sch. Pt. IV

C30S. 10 applied by The National Health Service Superannuation Scheme (Scotland) Regulations 1995 (S.I. 1995/365), reg. W10 (as inserted (28.1.2002 with effect in accordance with art. 1(2) of the amending S.S.I.) by S.S.I. 2001/465, reg. 1(2), sch. 1 para. 3)

C52S. 10 applied (30.6.2005) by Pensions Act 2004 (c. 35), ss. 256(3), 322(1) (with s. 313); S.I. 2005/1720, art. 2(8)

C53S. 10 applied (1.7.2005 for specified purposes, 22.9.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 252(5), 322(1) (with s. 313); S.I. 2005/1720, art. 2(14)(a)(b), Sch. Pt. 1

C54S. 10 applied (1.7.2005 for specified purposes, 22.9.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 255(3), 322(1) (with s. 313); S.I. 2005/1720, art. 2(14)(a)(b), Sch. Pt. 1

C55S. 10 applied (with effect in accordance with reg. A1(1)(b) of the amending S.S.I.) by The Teachers Superannuation (Scotland) Regulations 2005 (S.S.I. 2005/393), reg. F9(1)(b)(2)

C56S. 10 applied (1.11.2005 for specified purposes, 6.4.2006 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 241(9), 322(1) (with s. 313); S.I. 2005/2447, art. 2(1)(a)(5)(b), Sch. Pts. 1, 2

C57S. 10 applied (1.11.2005 for specified purposes, 6.4.2006 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 242(11), 322(1) (with s. 313); S.I. 2005/2447, art. 2(1)(a)(5)(b), Sch. Pts. 1, 2

C58S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 223(4), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C59S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 224(8), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C60S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 225(3), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C61S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 226(7), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C62S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 227(8)(9), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C63S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 228(4), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C64S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 229(6), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C65S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 230(4), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C66S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 for specified purposes) by Pensions Act 2004 (c. 35), ss. 287(5), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1 (with art. 3)

C67S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 for specified purposes) by Pensions Act 2004 (c. 35), ss. 291(3), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C68S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 for specified purposes) by Pensions Act 2004 (c. 35), ss. 292(3), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C69S. 10 applied (4.12.2005 for specified purposes, 30.12.2005 for specified purposes) by Pensions Act 2004 (c. 35), ss. 293(7), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

C70S. 10 applied (1.1.2006 for specified purposes, 6.4.2006 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 253(6), 322(1) (with s. 313); S.I. 2005/3331, art. 2(5)(a)(b), Sch. Pt. 5

C71S. 10 applied by Pensions Act 2004 (c. 35), s. 231A(7) (as inserted (24.7.2006) by S.I. 2006/1733, art. 2(7), reg. 1)

C74S. 10: power to apply conferred (26.11.2008) by Pensions Act 2008 (c. 30), ss. 60(2), 149(2)

C75S. 10 applied by Pension Schemes Act 1993 (c. 48), s. 24H(5) (as inserted (1.3.2009 for specified purposes, 6.4.2009 in so far as not already in force) by Pensions Act 2007 (c. 22), ss. 14(3), 30(2)(a); S.I. 2009/406, art. 2(a)(b))

C79S. 10 applied (3.3.2015 for specified purposes) by Pension Schemes Act 1993 (c. 48), s. 93A(6) (as substituted by Pension Schemes Act 2015 (c. 8), s. 89(1)(b)(3)(b), Sch. 4 para. 8 (with s. 87))

C80S. 10: power to apply conferred (3.3.2015 for specified purposes, 6.4.2015 in so far as not already in force) by Pension Schemes Act 2015 (c. 8), ss. 49(2)(c), 89(1)(b)(3)(b) (with s. 87)

C85S. 10 applied (27.4.2017 for specified purposes, 5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 22(10), 44(1)(a) (with Sch. 2); S.I. 2018/965, reg. 2(a)(b)

C86S. 10 applied (27.4.2017 for specified purposes, 5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 25(7), 44(1)(a) (with Sch. 2); S.I. 2018/965, reg. 2(a)(b)

C87S. 10 applied (27.4.2017 for specified purposes, 5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 33(7), 44(1)(a) (with Sch. 2); S.I. 2018/965, reg. 2(a)(b)

C88S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 3(2), 44(2); S.I. 2018/965, reg. 2(a)(b)

C89S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 14(5), 44(2); S.I. 2018/965, reg. 2(a)(b)

C90S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 15(5), 44(2); S.I. 2018/965, reg. 2(a)(b)

C91S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 16(6), 44(2); S.I. 2018/965, reg. 2(a)(b)

C92S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 23(8), 44(2); S.I. 2018/965, reg. 2(a)(b)

C93S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 24(8), 44(2); S.I. 2018/965, reg. 2(a)(b)

C94S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 26(8), 44(2); S.I. 2018/965, reg. 2(a)(b)

C95S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 28(5), 44(2); S.I. 2018/965, reg. 2(a)(b)

C96S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 29(4), 44(2); S.I. 2018/965, reg. 2(a)(b)

C97S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 30(5), 44(2); S.I. 2018/965, reg. 2(a)(b)

C98S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), ss. 32(3), 44(2); S.I. 2018/965, reg. 2(a)(b)

C99S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), s. 44(2), Sch. 1 para. 1(8)-(10); S.I. 2018/965, reg. 2(a)(b)

C100S. 10 applied (5.9.2018 for specified purposes, 1.10.2018 in so far as not already in force) by Pension Schemes Act 2017 (c. 17), s. 44(2), Sch. 1 para. 4(5); S.I. 2018/965, reg. 2(a)(b)

C102S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 7(2), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C103S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 19(4), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C104S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 20(8), 131(1)(3)(a) (with s. 20(9)); S.I. 2022/721, regs. 1(2), 3(a)

C105S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 22(4), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C106S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 23(5), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C107S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 27(5), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C108S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 28(8), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C109S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 29(11), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C110S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 33(14), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C111S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 34(6), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C112S. 10: power to apply conferred (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 36(10), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C113S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 37(6), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C114S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 38(8), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C115S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 39(5), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C116S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 41(5), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C117S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 42(3), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C118S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 43(5), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C119S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 45(7), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C120S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 46(4), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

C121S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), s. 131(1)(3)(a), Sch. 2 para. 1(8)-(10) (with Sch. 2 para. 1(1)); S.I. 2022/721, regs. 1(2), 3(a)

C122S. 10 applied (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), s. 131(1)(3)(a), Sch. 2 para. 4(5); S.I. 2022/721, regs. 1(2), 3(a)

C123S. 10 applied (11.2.2021 for specified purposes) by Pensions Act 2004 (c. 35), s. 221A(6) (as inserted by Pension Schemes Act 2021 (c. 1), s. 131(1)(3)(b), Sch. 10 para. 2)

C124S. 10 applied (11.2.2021 for specified purposes) by Pensions Act 2004 (c. 35), s. 221B(9) (as inserted by Pension Schemes Act 2021 (c. 1), s. 131(1)(3)(b), Sch. 10 para. 2)

C126S. 10(3)-(9) applied (1.9.2005) by Pensions Act 2004 (c. 35), ss. 314(a), 322(1) (with s. 313); S.I. 2005/2447, art. 2(4), Sch. Pt. 1

Commencement Information

I7S. 10 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

I8S. 10(1) in force at 1.6.1996 for specified purposes by S.I. 1996/1412, art. 2(2), Sch. Pt. II

I9S. 10(2)(3) in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

11 Powers to wind up schemes.E+W+S

(1)Subject to the following provisions of this section, the Authority may by order direct or authorise an occupational pension scheme to be wound up if they are satisfied that—

(a)the scheme, or any part of it, ought to be replaced by a different scheme,

(b)the scheme is no longer required, or

(c)it is necessary in order to protect the interests of the generality of the members of the scheme that it be wound up.

(2)The Authority may not make an order under this section on either of the grounds referred to in subsection (1)(a) or (b) unless they are satisfied that the winding up of the scheme—

(a)cannot be achieved otherwise than by means of such an order, or

(b)can only be achieved in accordance with a procedure which—

(i)is liable to be unduly complex or protracted, or

(ii)involves the obtaining of consents which cannot be obtained, or can only be obtained with undue delay or difficulty,

and that it is reasonable in all the circumstances to make the order.

F46(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F47(3A)The Authority may, during an assessment period (within the meaning of section 132 of the Pensions Act 2004 (meaning of “assessment period” for the purposes of Part 2 of that Act)) in relation to an occupational pension scheme, by order direct the scheme to be wound up if they are satisfied that it is necessary to do so in order—

(a)to ensure that the scheme’s protected liabilities do not exceed its assets, or

(b)if those liabilities do exceed its assets, to keep the excess to a minimum.

(3B)In subsection (3A)—

(a)protected liabilities” has the meaning given by section 131 of the Pensions Act 2004, and

(b)references to the assets of the scheme are references to those assets excluding any assets representing the value of any rights in respect of money purchase benefits (within the meaning of that Act) under the scheme.]

(4)An order under this section authorising a scheme to be wound up must include such directions with respect to the manner and timing of the winding up as the Authority think appropriate having regard to the purposes of the order.

[F48This subsection is subject to sections 28, 135 and 219 of the Pensions Act 2004 (winding up order made when freezing order has effect in relation to scheme, during assessment period under Part 2 of that Act etc).]

(5)The winding up of a scheme in pursuance of an order of the Authority under this section is as effective in law as if it had been made under powers conferred by or under the scheme.

(6)An order under this section may be made and complied with in relation to a scheme—

(a)in spite of any enactment or rule of law, or any rule of the scheme, which would otherwise operate to prevent the winding up, or

(b)except for the purpose of the Authority determining whether or not they are satisfied as mentioned in subsection (2), without regard to any such enactment, rule of law or rule of the scheme as would otherwise require, or might otherwise be taken to require, the implementation of any procedure or the obtaining of any consent, with a view to the winding up.

[F49(6A)Subsection (6) does not have effect to authorise the Authority to make an order as mentioned in paragraph (a) or (b) of that subsection, if their doing so would be unlawful as a result of section 6(1) of the Human Rights Act 1998 (unlawful for public authority to act in contravention of a Convention right).]

(7)In the case of a public service pension scheme—

(a)an order under subsection (1) directing or authorising the scheme to be wound up may only be made on the grounds referred to in paragraph (c), and

(b)such an order may, as the Authority think appropriate, adapt, amend or repeal any enactment [F50(including the Scottish Parliamentary Pensions Act 2009 (asp 1))] in which the scheme is contained or under which it is made.

Textual Amendments

Modifications etc. (not altering text)

C19Ss. 3-11 modified in part (11.11.1999 for specified purposes; 1.10.2000 in so far as not already in force) by the Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

Commencement Information

I10S. 11 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

12 Powers to wind up public service schemes.E+W+S

(1)The appropriate authority may by order direct a public service pension scheme to be wound up if they are satisfied that—

(a)the scheme, or any part of it, ought to be replaced by a different scheme, or

(b)the scheme is no longer required.

(2)Subsection (2) of section 11 applies for the purposes of this section as it applies for the purposes of that, but as if references to the Authority were to the appropriate authority.

(3)In this section “the appropriate authority”, in relation to a scheme, means such Minister of the Crown or government department as may be designated by the Treasury as having responsibility for the particular scheme.

(4)An order under this section must include such directions with respect to the manner and timing of the winding up as that authority think appropriate.

(5)Such an order may, as that authority think appropriate, adapt, amend or repeal any enactment in which the scheme is contained or under which it is made.

Commencement Information

I11S. 12 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

F5113 Injunctions and interdicts.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

14 Restitution.E+W+S

(1)If, on the application of the Authority, the court is satisfied—

(a)that a power to make a payment, or distribute any assets, to the employer, has been exercised in contravention of section 37, 76 or 77, or

(b)that any act or omission of the trustees or managers of an occupational pension scheme was in contravention of section 40,

the court may order the employer and any other person who appears to the court to have been knowingly concerned in the contravention to take such steps as the court may direct for restoring the parties to the position in which they were before the payment or distribution was made, or the act or omission occurred.

(2)The jurisdiction conferred by this section is exercisable by the High Court or the Court of Session.

Commencement Information

I12S. 14 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

15 Directions.E+W+S

(1)The Authority may, where in the case of any trust scheme the employer fails to comply with any requirement included in regulations by virtue of section 49(5), direct the trustees to make arrangements for the payment to the members of the benefit to which the requirement relates.

(2)The Authority may—

(a)where in the case of any trust scheme an annual report is published, direct the trustees to include a statement prepared by the Authority in the report, and

(b)in the case of any trust scheme, direct the trustees to send to the members a copy of a statement prepared by the Authority.

(3)A direction under this section must be given in writing.

(4)Where a direction under this section is not complied with, [F52section 10 applies] to any trustee who has failed to take all such steps as are reasonable to secure compliance.

Textual Amendments

F52Words in s. 15(4) substituted (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 39; S.I. 2005/695, art. 2(7), Sch. 1

Modifications etc. (not altering text)

C128S. 15 modified in part (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(i); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. 3 (as amended (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(a))

Commencement Information

I13S. 15 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Member-nominated trustees and directorsU.K.

F5316 Requirement for member-nominated trustees.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5317 Exceptions.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5318 Corporate trustees: member-nominated directors.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5319 Corporate trustees: exceptions.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5320 Selection, and eligibility, of member-nominated trustees and directors.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5321 Member-nominated trustees and directors: supplementary.U.K.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Independent trusteesE+W+S

22 Circumstances in which following provisions apply.E+W+S

(1)This section applies in relation to a trust scheme—

(a)if a person (referred to in this section and sections 23 [F54to 26] as “the practitioner”) begins to act as an insolvency practitioner in relation to a company which, or an individual who, is the employer in relation to the scheme, or

(b)if the official receiver becomes—

(i)the liquidator or provisional liquidator of a company which is the employer in relation to the scheme, F55...

[F56(ia)the interim receiver of the property of a person who is the employer in relation to the scheme, or]

(ii)the receiver and the manager, or the trustee, of the estate of a bankrupt who is the employer in relation to the scheme.

(2)Where this section applies in relation to a scheme [F57by virtue of subsection (1)], it ceases to do so—

(a)if some person other than the employer mentioned in subsection (1) becomes the employer, or

(b)if at any time neither the practitioner nor the official receiver is acting in relation to the employer;

but this subsection does not affect the application of this section in relation to the scheme on any subsequent occasion when the conditions specified in subsection (1)(a) or (b) are satisfied in relation to it.

[F58(2A)To the extent that it does not already apply by virtue of subsection (1), this section also applies in relation to a trust scheme—

(a)at any time during an assessment period (within the meaning of section 132 of the Pensions Act 2004) in relation to the scheme, and

(b)at any time, not within paragraph (a), when the scheme is authorised under section 153 of that Act (closed schemes) to continue as a closed scheme.]

[F59(2B)The responsible person must, as soon as reasonably practicable, give notice of an event within subsection (2C) to—

(a)the Authority,

(b)the Board of the Pension Protection Fund, and

(c)the trustees of the scheme.

(2C)The events are—

(a)the practitioner beginning to act as mentioned in subsection (1)(a), if immediately before he does so this section does not apply in relation to the scheme;

(b)the practitioner ceasing to so act, if immediately after he does so this section does not apply in relation to the scheme;

(c)the official receiver beginning to act in a capacity mentioned in subsection (1)(b)(i), (ia) or (ii), if immediately before he does so this section does not apply in relation to the scheme;

(d)the official receiver ceasing to act in such a capacity, if immediately after he does so this section does not apply in relation to the scheme.

(2D)For the purposes of subsection (2B) “the responsible person” means—

(a)in the case of an event within subsection (2C)(a) or (b) the practitioner, and

(b)in the case of an event within subsection (2C)(c) or (d), the official receiver.

(2E)Regulations may require prescribed persons in prescribed circumstances where this section begins or ceases to apply in relation to a trust scheme by virtue of subsection (2A) to give a notice to that effect to—

(a)the Authority,

(b)the Board of the Pension Protection Fund, and

(c)the trustees of the scheme.

(2F)A notice under subsection (2B), or regulations under subsection (2E), must be in writing and contain such information as may be prescribed.]

(3)In this section and sections 23 [F60to 26]

  • “acting as an insolvency practitioner” and “official receiver” shall be construed in accordance with sections 388 and 399 of the M2Insolvency Act 1986,

  • bankrupt” has the meaning given by section 381 of the Insolvency Act 1986,

  • company” means a company [F61as defined in section 1(1) of the Companies Act 2006] or a company which may be wound up under Part V of the Insolvency Act 1986 (unregistered companies), F62...

  • F63. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F54Words in s. 22(1) substituted (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 40; S.I. 2005/695, art. 2(7), Sch. 1

F55Word in s. 22(1)(b)(i) repealed (10.2.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 36(2)(a), 322(1), Sch. 13 (with s. 313); S.I. 2005/275, art. 2(3)(a)(b), Sch. Pt. 3

F56S. 22(1)(b)(ia) inserted (10.2.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 36(2)(a), 322(1) (with s. 313); S.I. 2005/275, art. 2(3)(a)(b), Sch. Pt. 3

F57Words in s. 22(2) inserted (10.2.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 36(2)(b), 322(1) (with s. 313); S.I. 2005/275, art. 2(3)(a)(b), Sch. Pt. 3

F58S. 22(2A) inserted (10.2.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 36(2)(c), 322(1) (with s. 313); S.I. 2005/275, art. 2(3)(a)(b), Sch. Pt. 3

F59S. 22(2B)-(2F) inserted (10.2.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 36(2)(d), 322(1) (with s. 313); S.I. 2005/275, art. 2(3)(a)(b), Sch. Pt. 3

F60Words in s. 22(3) substituted (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 40; S.I. 2005/695, art. 2(7), Sch. 1

Modifications etc. (not altering text)

Commencement Information

I14S. 22 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Marginal Citations

[F6423Power to appoint independent trusteesE+W+S

(1)While section 22 applies in relation to a trust scheme, the Authority may by order appoint as a trustee of the scheme a person who—

(a)is an independent person in relation to the scheme, and

(b)is registered in the register maintained by the Authority in accordance with regulations under subsection (4).

(2)In relation to a particular trust scheme, no more than one trustee may at any time be an independent trustee appointed under subsection (1).

(3)For the purposes of this section a person is independent in relation to a trust scheme only if—

(a)he has no interest in the assets of the employer or of the scheme otherwise than as trustee of the scheme,

(b)he is neither connected with, nor an associate of—

(i)the employer,

(ii)any person for the time being acting as an insolvency practitioner in relation to the employer, or

(iii)the official receiver acting in any of the capacities mentioned in section 22(1)(b) in relation to the employer, and

(c)he satisfies any prescribed requirements;

and any reference in this Part to an independent trustee is to be construed accordingly.

(4)Regulations must provide for the Authority to compile and maintain a register of persons who satisfy the prescribed conditions for registration.

(5)Regulations under subsection (4) may provide—

(a)for copies of the register or of extracts from it to be provided to prescribed persons in prescribed circumstances;

(b)for the inspection of the register by prescribed persons in prescribed circumstances.

(6)The circumstances which may be prescribed under subsection (5)(a) or (b) include the payment by the person to whom the copy is to be provided, or by whom the register is to be inspected, of such reasonable fee as may be determined by the Authority.

(7)This section is without prejudice to the powers conferred by section 7.]

Textual Amendments

F64S. 23 substituted for ss. 23, 24 (10.2.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 36(3), 322(1) (with s. 313); S.I. 2005/275, art. 2(3)(a)(b), Sch. Pt. 3

Modifications etc. (not altering text)

F6424 Members’ powers to apply to court to enforce duty.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F64S. 23 substituted for ss. 23, 24 (10.2.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 36(3), 322(1) (with s. 313); S.I. 2005/275, art. 2(3)(a)(b), Sch. Pt. 3

25 Appointment and powers of independent trustees: further provisions.E+W+S

(1)If, immediately before the appointment of an independent trustee under [F65section 23(1)], there is no trustee of the scheme other than the employer, the employer shall cease to be a trustee upon the appointment of the independent trustee.

(2)While section 22 applies in relation to a scheme [F66and there is an independent trustee of the scheme appointed under section 23(1)]

(a)any power vested in the trustees of the scheme and exercisable at their discretion may be exercised only by the independent trustee, and

(b)any power—

(i)which the scheme confers on the employer (otherwise than as trustee of the scheme), and

(ii)which is exercisable by him at his discretion but only as trustee of the power,

may be exercised only by the independent trustee.

F67...

(3)While section 22 applies in relation to a scheme [F68and there is an independent trustee of the scheme appointed under section 23(1), the independent trustee may not] be removed from being a trustee by virtue only of any provision of the scheme.

(4)If a trustee appointed under [F69section 23(1)] ceases to be an independent person [F70(within the meaning of section 23(3))], then—

[F71(a)he must as soon as reasonably practicable give written notice of that fact to the Authority, and]

(b)subject to subsection (5), he shall cease to be a trustee of the scheme.

(5)If, in a case where subsection (4) applies, there is no other trustee of the scheme than the former independent trustee, he shall not cease by virtue of that subsection to be a trustee until such time as another trustee is appointed.

[F72(5A)Section 10 applies to any person who, without reasonable excuse, fails to comply with subsection (4)(a).]

[F73(6)An order under section 23(1) may provide for any fees and expenses of the trustee appointed under the order to be paid—

(a)by the employer,

(b)out of the resources of the scheme, or

(c)partly by the employer and partly out of those resources.

(7)Such an order may also provide that an amount equal to the amount (if any) paid out of the resources of the scheme by virtue of subsection (6)(b) or (c) is to be treated for all purposes as a debt due from the employer to the trustees of the scheme.

(8)Where, by virtue of subsection (6)(b) or (c), an order makes provision for any fees or expenses of the trustee appointed under the order to be paid out of the resources of the scheme, the trustee is entitled to be so paid in priority to all other claims falling to be met out of the scheme’s resources.]

Textual Amendments

Modifications etc. (not altering text)

Commencement Information

I15S. 25 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

26 Insolvency practitioner or official receiver to give information to trustees.E+W+S

(1)Notwithstanding anything in section 155 of the M3Insolvency Act 1986 (court orders for inspection etc.), while section 22 applies in relation to a scheme [F74by virtue of subsection (1) of that section], the practitioner or official receiver must provide the trustees of the scheme, as soon as practicable after the receipt of a request, with any information which the trustees may reasonably require for the purposes of the scheme.

(2)Any expenses incurred by the practitioner or official receiver in complying with a request under subsection (1) are recoverable by him as part of the expenses incurred by him in discharge of his duties.

(3)The practitioner or official receiver is not required under subsection (1) to take any action which involves expenses that cannot be so recovered, unless the trustees of the scheme undertake to meet them.

Textual Amendments

Modifications etc. (not altering text)

Commencement Information

I16S. 26 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Marginal Citations

F7526AInformation to be given to the Authority in a s. 22 caseE+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F7526BInformation to be given in cases where s. 22 disappliedE+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F7526CConstruction of ss. 26A and 26BE+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

Trustees: generalE+W+S

27 Trustee not to be auditor or actuary of the scheme.E+W+S

(1)A trustee of a trust scheme, and any person who is connected with, or an associate of, such a trustee, is ineligible to act as an auditor or actuary of the scheme.

(2)Subsection (1) does not make a person who is a director, partner or employee of a firm of actuaries ineligible to act as an actuary of a trust scheme merely because another director, partner or employee of the firm is a trustee of the scheme.

(3)Subsection (1) does not make a person who falls within a prescribed class or description ineligible to act as an auditor or actuary of a trust scheme.

(4)A person must not act as an auditor or actuary of a trust scheme if he is ineligible under this section to do so.

(5)In this section and section 28 references to a trustee of a trust scheme do not include—

(a)a trustee, or

(b)a trustee of a scheme,

falling within a prescribed class or description.

Modifications etc. (not altering text)

C131Ss. 27-30 applied (with modifications) (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(ii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. 3 (as amended (9.12.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(b); S.I. 2005/3331, art. 2(2), Sch. Pt. 2)

Commencement Information

I17S. 27 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I18S. 27 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

28 Section 27: consequences.E+W+S

(1)Any person who acts as an auditor or actuary of a trust scheme in contravention of section 27(4) is guilty of an offence and liable—

(a)on summary conviction, to a fine not exceeding the statutory maximum, and

(b)on conviction on indictment, to imprisonment or a fine, or both.

(2)An offence under subsection (1) may be charged by reference to any day or longer period of time; and a person may be convicted of a second or subsequent offence under that subsection by reference to any period of time following the preceding conviction of the offence.

(3)Acts done as an auditor or actuary of a trust scheme by a person who is ineligible under section 27 to do so are not invalid merely because of that fact.

F76(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

Modifications etc. (not altering text)

C131Ss. 27-30 applied (with modifications) (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(ii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. 3 (as amended (9.12.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(b); S.I. 2005/3331, art. 2(2), Sch. Pt. 2)

Commencement Information

I19S. 28 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

29 Persons disqualified for being trustees.E+W+S

(1)Subject to subsection (5), a person is disqualified for being a trustee of any trust scheme if—

(a)he has been convicted of any offence involving dishonesty or deception,

(b)he has been [F77made] bankrupt or sequestration of his estate has been awarded and (in either case) he has not been discharged [F78or he is the subject of a bankruptcy restrictions order or an interim [F79bankruptcy restrictions] order],

[F80(ba)a moratorium period under a debt relief order (under Part 7A of the Insolvency Act 1986) applies in relation to him or he is the subject of a debt relief restrictions order or an interim debt relief restrictions order (under Schedule 4ZB of the Insolvency Act 1986),]

(c)where the person is a company, if any director of the company is disqualified under this section,

(d)where the person is a Scottish partnership, if any partner is disqualified under this section,

(e)he has made a composition contract or an arrangement with, or granted a trust deed for the behoof of, his creditors and has not been discharged in respect of it, or

(f)he is [F81subject to a disqualification order or disqualification undertaking under the Company Directors Disqualification Act 1986 or the Company Directors Disqualification (Northern Ireland) Order 2002] or to an order made under section 429(2)(b) of the M4Insolvency Act 1986 (failure to pay under county court administration order).

(2)In subsection (1)—

(a)paragraph (a) applies whether the conviction occurred before or after the coming into force of that subsection, but does not apply in relation to any conviction which is a spent conviction for the purposes of the M5Rehabilitation of Offenders Act 1974,

(b)paragraph (b) applies whether the adjudication of bankruptcy or the sequestration [F82or the making of the bankruptcy restrictions order or an interim order] occurred before or after the coming into force of that subsection,

(c)paragraph (e) applies whether the composition contract or arrangement was made, or the trust deed was granted, before or after the coming into force of that subsection, and

(d)paragraph (f) applies in relation to orders made before or after the coming into force of that subsection.

F83(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F83(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)The Authority may, on the application of any person disqualified under this section—

(a)give notice in writing to him waiving his disqualification,

F84(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

either generally or in relation to a particular scheme or particular [F85description] of schemes.

(6)A notice givenF86... at any time by virtue of subsection (5) cannot affect anything done before that time.

Textual Amendments

F86Words in s. 29(6) repealed (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/695, art. 2(7), Sch. 1

Modifications etc. (not altering text)

C131Ss. 27-30 applied (with modifications) (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(ii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. 3 (as amended (9.12.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(b); S.I. 2005/3331, art. 2(2), Sch. Pt. 2)

Commencement Information

I20S. 29 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Marginal Citations

30 Persons disqualified: consequences.E+W+S

[F87(1)Where a person who is a trustee of a trust scheme becomes disqualified under section 29 in relation to the scheme, his becoming so disqualified has the effect of removing him as a trustee.]

(2)Where—

(a)a trustee of a trust scheme becomes disqualified under section 29, F88...

F88(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

the Authority may exercise [F89by order] the same jurisdiction and powers as are exercisable by the High Court or, in relation to a trust scheme subject to the law of Scotland, the Court of Session for vesting any property in, or transferring any property to, the trustees.

(3)A person who purports to act as a trustee of a trust scheme while he is disqualified under section 29 is guilty of an offence and liable—

(a)on summary conviction to a fine not exceeding the statutory maximum, and

(b)on conviction on indictment, to a fine or imprisonment or both.

(4)An offence under subsection (3) may be charged by reference to any day or longer period of time; and a person may be convicted of a second or subsequent offence under that subsection by reference to any period of time following the preceding conviction of the offence.

(5)Things done by a person disqualified under section 29 while purporting to act as trustee of a trust scheme are not invalid merely because of that disqualification.

(6)Nothing in section 29 or this section affects the liability of any person for things done, or omitted to be done, by him while purporting to act as trustee of a trust scheme.

F90(7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F90(8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F87S. 30(1) substituted (6.4.2005) by Pensions Act 2004 (c. 35), ss. 37, 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7

F88S. 30(2)(b) and preceding word repealed (6.4.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/695, art. 2(7), Sch. 1

Modifications etc. (not altering text)

C131Ss. 27-30 applied (with modifications) (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(ii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. 3 (as amended (9.12.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(b); S.I. 2005/3331, art. 2(2), Sch. Pt. 2)

Commencement Information

I21S. 30 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

F9130A Accessibility of register of disqualified trusteesE+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F9231 Trustees not to be indemnified for fines or civil penalties.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

Functions of trusteesE+W+S

32 Decisions by majority.E+W+S

(1)Decisions of the trustees of a trust scheme may, unless the scheme provides otherwise, be taken by agreement of a majority of the trustees.

(2)Where decisions of the trustees of a trust scheme may be taken by agreement of a majority of the trustees—

(a)the trustees may, unless the scheme provides otherwise, by a determination under this subsection require not less than the number of trustees specified in the determination to be present when any decision is so taken, and

(b)notice of any occasions at which decisions may be so taken must, unless the occasion falls within a prescribed class or description, be given to each trustee to whom it is reasonably practicable to give such notice.

(3)Notice under subsection (2)(b) must be given in a prescribed manner and not later than the beginning of a prescribed period.

(4)This section is subject to sections 8(4)(b) [F93and 25(2) of this Act and section 241(6) of the Pensions Act 2004].

(5)If subsection (2)(b) is not complied with, [F94section 10 applies] to any trustee who has failed to take all such steps as are reasonable to secure compliance.

Textual Amendments

Modifications etc. (not altering text)

C133Ss. 32-36 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(iii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

Commencement Information

I22S. 32 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I23S. 32 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

33 Investment powers: duty of care.E+W+S

(1)Liability for breach of an obligation under any rule of law to take care or exercise skill in the performance of any investment functions, where the function is exercisable—

(a)by a trustee of a trust scheme, or

(b)by a person to whom the function has been delegated under section 34,

cannot be excluded or restricted by any instrument or agreement.

(2)In this section, references to excluding or restricting liability include—

(a)making the liability or its enforcement subject to restrictive or onerous conditions,

(b)excluding or restricting any right or remedy in respect of the liability, or subjecting a person to any prejudice in consequence of his pursuing any such right or remedy, or

(c)excluding or restricting rules of evidence or procedure.

(3)This section does not apply—

(a)to a scheme falling within any prescribed class or description, or

(b)to any prescribed description of exclusion or restriction.

Modifications etc. (not altering text)

C133Ss. 32-36 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(iii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

Commencement Information

I24S. 33 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I25S. 33 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

34 Power of investment and delegation.E+W+S

(1)The trustees of a trust scheme have, subject to [F95section 36(1) and to] any restriction imposed by the scheme, the same power to make an investment of any kind as if they were absolutely entitled to the assets of the scheme.

(2)Any discretion of the trustees of a trust scheme to make any decision about investments—

(a)may be delegated by or on behalf of the trustees to a fund manager to whom subsection (3) applies to be exercised in accordance with section 36, but

(b)may not otherwise be delegated except under section 25 of the M6Trustee Act 1925 (delegation of trusts [F96during absence abroad][F96for period not exceeding twelve months]) or subsection (5) below.

[F97(3)This subsection applies to a fund manager who, in relation to the investments, may take the decisions in question without contravening the prohibition imposed by section 19 of the Financial Services and Markets Act 2000 (prohibition on carrying on regulated activities unless authorised or exempt).]

(4)The trustees are not responsible for the act or default of any fund manager in the exercise of any discretion delegated to him under subsection (2)(a) if they have taken all such steps as are reasonable to satisfy themselves or the person who made the delegation on their behalf has taken all such steps as are reasonable to satisfy himself—

(a)that the fund manager has the appropriate knowledge and experience for managing the investments of the scheme, and

(b)that he is carrying out his work competently and complying with section 36.

(5)Subject to any restriction imposed by a trust scheme—

(a)the trustees may authorise two or more of their number to exercise on their behalf any discretion to make any decision about investments, and

(b)any such discretion may, where giving effect to the decision would not constitute [F98the carrying on, in the United Kingdom, of a regulated activity (within the meaning of the Financial Services and Markets Act 2000)], be delegated by or on behalf of the trustees to a fund manager to whom subsection (3) does not apply to be exercised in accordance with section 36;

but in either case the trustees are liable for any acts or defaults in the exercise of the discretion if they would be so liable if they were the acts or defaults of the trustees as a whole.

(6)Section 33 does not prevent the exclusion or restriction of any liability of the trustees of a trust scheme for the acts or defaults of a fund manager in the exercise of a discretion delegated to him under subsection (5)(b) where the trustees have taken all such steps as are reasonable to satisfy themselves, or the person who made the delegation on their behalf has taken all such steps as are reasonable to satisfy himself—

(a)that the fund manager has the appropriate knowledge and experience for managing the investments of the scheme, and

(b)that he is carrying out his work competently and complying with section 36;

and subsection (2) of section 33 applies for the purposes of this subsection as it applies for the purposes of that section.

(7)The provisions of this section override any restriction inconsistent with the provisions imposed by any rule of law or by or under any enactment, other than an enactment contained in, or made under, this Part or the M7Pension Schemes Act 1993.

Textual Amendments

F95Words in s. 34(1) inserted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 49; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

F96Words in s. 34(2)(b) substituted (E.W.) (1.3.2000) by Trustee Delegation Act 1999 (c. 15), ss. 5(3), 13(1); S.I. 2000/216, art. 2

Modifications etc. (not altering text)

C133Ss. 32-36 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(iii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

Commencement Information

I26S. 34 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Marginal Citations

[F9935 Investment principles.E+W+S

(1)The trustees of a trust scheme must secure—

(a)that a statement of investment principles is prepared and maintained for the scheme, and

(b)that the statement is reviewed at such intervals, and on such occasions, as may be prescribed and, if necessary, revised.

(2)In this section “statement of investment principles”, in relation to a trust scheme, means a written statement of the investment principles governing decisions about investments for the purposes of the scheme.

(3)Before preparing or revising a statement of investment principles, the trustees of a trust scheme must comply with any prescribed requirements.

(4)A statement of investment principles must be in the prescribed form and cover, amongst other things, the prescribed matters.

(5)Neither a trust scheme nor a statement of investment principles may impose restrictions (however expressed) on any power to make investments by reference to the consent of the employer.

(6)If in the case of a trust scheme—

(a)a statement of investment principles has not been prepared, is not being maintained or has not been reviewed or revised, as required by this section, or

(b)the trustees have not complied with the obligation imposed on them by subsection (3),

section 10 applies to any trustee who has failed to take all reasonable steps to secure compliance.

(7)Regulations may provide that this section is not to apply to any scheme which is of a prescribed description.]

Textual Amendments

F99S. 35 substituted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 244, 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

Modifications etc. (not altering text)

C133Ss. 32-36 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(iii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

C134S. 35 excluded (30.12.2005) by The Occupational Pension Schemes (Investment) Regulations 2005 (S.I. 2005/3378), regs. 1(1), 6 (as amended (6.4.2023 with effect in accordance with reg. 1(10) of the amending S.I.) by S.I. 2023/399, regs. 1(3), 3(4))

Commencement Information

I27S. 35 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I28S. 35 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

36 Choosing investments.E+W+S

[F100(1)The trustees of a trust scheme must exercise their powers of investment in accordance with regulations and in accordance with subsections (3) and (4), and any fund manager to whom any discretion has been delegated under section 34 must exercise the discretion in accordance with regulations.

(1A)Regulations under subsection (1) may, in particular—

(a)specify criteria to be applied in choosing investments, and

(b)require diversification of investments.]

F101(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3)Before investing in any manner (other than in a manner mentioned in Part I of Schedule 1 to the M8Trustee Investments Act 1961) the trustees must obtain and consider proper advice on the question whether the investment is satisfactory having regard to [F102the requirements of regulations under subsection (1), so far as relating to the suitability of investments, and to] the principles contained in the statement under section 35.

(4)Trustees retaining any investment must—

(a)determine at what intervals the circumstances, and in particular the nature of the investment, make it desirable to obtain such advice as is mentioned in subsection (3), and

(b)obtain and consider such advice accordingly.

(5)The trustees, or the fund manager to whom any discretion has been delegated under section 34, must exercise their powers of investment with a view to giving effect to the principles contained in the statement under section 35, so far as reasonably practicable.

(6)For the purposes of this section “proper advice” means—

[F103(a)if the giving of the advice constitutes the carrying on, in the United Kingdom, of a regulated activity (within the meaning of the Financial Services and Markets Act 2000), advice given by a person who may give it without contravening the prohibition imposed by section 19 of that Act (prohibition on carrying on regulated activities unless authorised or exempt);]

(b)in any other case, the advice of a person who is reasonably believed by the trustees to be qualified by his ability in and practical experience of financial matters and to have the appropriate knowledge and experience of the management of the investments of trust schemes.

(7)Trustees shall not be treated as having complied with subsection (3) or (4) unless the advice was given or has subsequently been confirmed in writing.

[F104(8)If the trustees of a trust scheme—

(a)fail to comply with regulations under subsection (1), or

(b)do not obtain and consider advice in accordance with this section,

section 10 applies to any trustee who has failed to take all reasonable steps to secure compliance.]

[F105(9)Regulations may exclude the application of any of the preceding provisions of this section to any scheme which is of a prescribed description.]

Textual Amendments

F100S. 36(1)(1A) substituted for s. 36(1) (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 245(2), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

F101S. 36(2) repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 245(3), 322(1), Sch. 13 (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

F102Words in s. 36(3) substituted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 245(4), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

F104S. 36(8) substituted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 245(5), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

F105S. 36(9) inserted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 245(6), 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a), Sch. Pt. 1

Modifications etc. (not altering text)

C133Ss. 32-36 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(iii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

Commencement Information

I29S. 36 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Marginal Citations

[F10636ARestriction on borrowing by trusteesE+W+S

Regulations may prohibit the trustees of a trust scheme, or the fund manager to whom any discretion has been delegated under section 34, from borrowing money or acting as a guarantor, except in prescribed cases.]

Textual Amendments

F106S. 36A inserted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 246, 322(1) (with s. 313); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

[F10737 Payment of surplus to employer.E+W+S

(1)This section applies to a trust scheme if—

(a)apart from this section power is conferred on the employer or any other person to make payments to the employer out of funds held for the purposes of the scheme, and

(b)the scheme is not being wound up.

[F108(1A)But this section does not apply in the case of any of the payments listed in paragraphs (c) to (f) of section 175 of the Finance Act 2004 (authorised employer payments other than public service scheme payments or authorised surplus payments).]

(2)Where the power referred to in subsection (1)(a) is conferred by the scheme on a person other than the trustees—

(a)it cannot be exercised by that person but may instead be exercised by the trustees, and

(b)any restriction imposed by the scheme on the exercise of the power shall, so far as capable of doing so, apply to its exercise by the trustees.

(3)The power referred to in subsection (1)(a) may only be exercised if—

(a)the trustees have obtained a written valuation of the scheme’s assets and liabilities prepared and signed by a prescribed person;

(b)there is a certificate in force—

(i)stating that in the opinion of that person the prescribed requirements are met as at the date by reference to which the assets are valued and the liabilities are calculated, and

(ii)specifying what in the opinion of that person is the maximum amount of payment that may be made to the employer;

(c)the payment does not exceed the maximum amount specified in the certificate;

(d)the trustees are satisfied that it is in the interests of the members that the power is exercised in the manner proposed;

(e)where the power is conferred by the scheme on the employer, the employer has asked for the power to be exercised, or consented to its being exercised, in the manner proposed;

(f)there is no freezing order in force in relation to the scheme under section 23 of the Pensions Act 2004; and

(g)notice of the proposal to exercise the power has been given, in accordance with prescribed requirements, to the members of the scheme.

(4)Provision may be made by regulations as to—

(a)the requirements (which may be alternative requirements) that must be met, in relation to any proposed payment to the employer out of funds held for the purposes of a scheme, with respect to the value of the scheme’s assets and the amount of its liabilities;

(b)the assets and liabilities to be taken into account for that purpose and the manner in which their value or amount is to be determined, calculated and verified;

(c)the maximum amount of the payment that may be made to the employer, having regard to the value of the scheme’s assets and the amount of its liabilities;

(d)the giving of a certificate as to the matters mentioned in paragraphs (a) and (c); and

(e)the period for which such a certificate is to be in force.

(5)The trustees must also comply with any other prescribed requirements in connection with the making of a payment under this section.

(6)If the trustees—

(a)purport to exercise the power referred to in subsection (1)(a) without complying with the requirements of this section, or

(b)fail to comply with any requirement of regulations under subsection (5),

section 10 applies to any of them who has failed to take all reasonable steps to secure compliance.

(7)If a person other than the trustees purports to exercise the power referred to in subsection (1)(a), section 10 applies to him.

(8)Regulations may provide that in prescribed circumstances this section does not apply, or applies with prescribed modifications, to schemes of a prescribed description.]

38 Power to defer winding up.E+W+S

(1)If, apart from this section, the rules of a trust scheme would require the scheme to be wound up, the trustees may determine—

[F109(a)that the scheme is not for the time being to be wound up but that no new members are to be admitted to it, or

(b)that the scheme is not for the time being to be wound up but that no new members, except pension credit members, are to be admitted to it.]

(2)Where the trustees make a determination under subsection (1), they may also determine—

(a)that no further contributions are to be paid towards the scheme [F110(other than those due to be paid before the determination is made)], or

(b)that no F111...benefits are to accrue to, or in respect of, members of the scheme;

F112...

[F113(2A)Subsection (2) does not authorise the trustees to determine—

(a)where there are accrued rights or pension credit rights to any benefit, that the benefit is not to be increased, or

(b)where the power conferred by that subsection is exercisable by virtue of a determination under subsection (1)(b), that members of the scheme may not acquire pension credit rights under it.]

(3)This section does not apply to—

(a)a money purchase scheme, or

(b)a scheme falling within a prescribed class or description.

[F114(4)This section also does not apply in relation to a trust scheme where the trustees are required to wind up, or continue the winding up, of the scheme under section 154(1) of the Pensions Act 2004 (requirement to wind up certain schemes with sufficient assets to meet protected liabilities).]

Textual Amendments

F109S. 38(1)(a)(b) substituted for words (1.12.2000) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(1), Sch. 12 para. 50(2); S.I. 2000/1047, art. 2(2)(d) Sch. Pt. 4

F112Words in s. 38(2) repealed (1.12.2000) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(1), Sch. 12 para. 50(3), Sch. 13 Pt. III; S.I. 2000/1047, art. 2(2)(d) Sch. Pt. 4

F113S. 38(2A) inserted (1.12.2000) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(1), Sch. 12 para. 50(4); S.I. 2000/1047, art. 2(2)(d) Sch. Pt. 4

Modifications etc. (not altering text)

Commencement Information

I32S. 38 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I33S. 38 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

39 Exercise of powers by member trustees.E+W+S

No rule of law that a trustee may not exercise the powers vested in him so as to give rise to a conflict between his personal interest and his duties to the beneficiaries shall apply to a trustee of a trust scheme, who is also a member of the scheme, exercising the powers vested in him in any manner, merely because their exercise in that manner benefits, or may benefit, him as a member of the scheme.

Modifications etc. (not altering text)

C144S. 39 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(iii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

Commencement Information

I34S. 39 in force at 1.1.1996 by S.I. 1995/3104, art. 2(1)

Functions of trustees or managersU.K.

40 Restriction on employer-related investments.U.K.

(1)The trustees or managers of an occupational pension scheme must secure that the scheme complies with any prescribed restrictions with respect to the proportion of its resources that may at any time be invested in, or in any description of, employer-related investments.

(2)In this section—

  • employer-related investments” means—

    (a)

    shares or other securities issued by the employer or by any person who is connected with, or an associate of, the employer,

    (b)

    land which is occupied or used by, or subject to a lease in favour of, the employer or any such person,

    (c)

    property (other than land) which is used for the purposes of any business carried on by the employer or any such person,

    (d)

    loans to the employer or any such person, and

    (e)

    other prescribed investments,

  • F115. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F116(2A)In the definition of “employer-related investments” in subsection (2) “securities” means—

(a)shares,

(b)instruments creating or acknowledging indebtedness,

(c)instruments giving entitlements to investments,

(d)certificates representing securities.]

[F116(2B)Subsection (2A) must be read with—

(a)section 22 of the Financial Services and Markets Act 2000,

(b)any relevant order made under that section, and

(c)Schedule 2 to that Act.]

(3)To the extent (if any) that sums due and payable by a person to the trustees or managers of an occupational pension scheme remain unpaid—

(a)they shall be regarded for the purposes of this section as loans made to that person by the trustees or managers, and

(b)resources of the scheme shall be regarded as invested accordingly.

(4)If in the case of a trust scheme subsection (1) is not complied with, [F117section 10 applies] to any trustee who fails to take all such steps as are reasonable to secure compliance.

(5)If any resources of an occupational pension scheme are invested in contravention of subsection (1), any trustee or manager who agreed in the determination to make the investment is guilty of an offence and liable—

(a)on summary conviction, to a fine not exceeding the statutory maximum, and

(b)on conviction on indictment, to a fine or imprisonment, or both.

Textual Amendments

F117Words in s. 40(4) substituted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 51; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

Commencement Information

I35S. 40 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I36S. 40 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

41 Provision of documents for members.E+W+S

(1)Regulations may require the trustees or managers of an occupational pension scheme—

(a)to obtain at prescribed times the documents mentioned in subsection (2), and

(b)to make copies of them, and of the documents mentioned in subsection (3), available to the persons mentioned in subsection (4).

(2)The documents referred to in subsection (1)(a) are—

(a)the accounts audited by the auditor of the scheme,

(b)the auditor’s statement about contributions under the scheme,

F118(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F119(3)The documents referred to in subsection (1)(b) are—

(a)any statement of funding principles prepared or revised under section 223 of the Pensions Act 2004,

(b)any valuation or report prepared by the actuary under section 224 of that Act,

(c)any certificate given by the actuary under section 225 or 227 of that Act.]

(4)The persons referred to in subsection (1)(b) are—

(a)members and prospective members of the scheme,

(b)spouses [F120or civil partners] of members and of prospective members,

(c)persons within the application of the scheme and qualifying or prospectively qualifying for its benefits,

(d)independent trade unions recognised to any extent for the purposes of collective bargaining in relation to members and prospective members of the scheme.

[F121(5)Regulations may in the case of occupational pension schemes provide for—

(a)prescribed persons,

(b)persons with prescribed qualifications or experience, or

(c)persons approved by the Secretary of State,

to act for the purposes of subsection (2) instead of scheme auditors or actuaries.

(5A)Regulations may impose duties on the trustees or managers of an occupational pension scheme to disclose information to, and make documents available to, a person acting under subsection (5).

(5B)If any duty imposed under subsection (5A) is not complied with, [F122section 10 applies to any trustee, and] to any manager, who has failed to take all such steps as are reasonable to secure compliance.]

(6)Regulations shall make provision for referring to an [F123employment tribunal] any question whether an organisation is such a trade union as is mentioned in subsection (4)(d) and may make provision as to the form and content of any such document as is referred to in subsection (2).

Textual Amendments

F118S. 41(2)(c) repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

F119S. 41(3) substituted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 52(a); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

F121S. 41(5)-(5B) substituted for s. 41(5) (1.1.2001) by Child Support, Pensions and Social Security Act 2000 (c. 19), s. 86(1)(b)(2), Sch. 5 para. 12(1) (with s. 83(6)); S.I. 2000/3166, art. 2(3)(b)(vii)

F122Words in s. 41(5B) substituted (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 52(b); S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1

Modifications etc. (not altering text)

C145S. 41 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(iv); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

Commencement Information

I37S. 41 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I38S. 41 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

[F12441AClimate change riskU.K.

(1)Regulations may impose requirements on the trustees or managers of an occupational pension scheme of a prescribed description with a view to securing that there is effective governance of the scheme with respect to the effects of climate change.

(2)The effects of climate change in relation to which provision may be made under subsection (1) include, in particular—

(a)risks arising from steps taken because of climate change (whether by governments or otherwise), and

(b)opportunities relating to climate change.

(3)The requirements which may be imposed by the regulations include, in particular, requirements about—

(a)reviewing the exposure of the scheme to risks of a prescribed description;

(b)assessing the assets of the scheme in a prescribed manner;

(c)determining, reviewing and (if necessary) revising a strategy for managing the scheme's exposure to risks of a prescribed description;

(d)determining, reviewing and (if necessary) revising targets relating to the scheme's exposure to risks of a prescribed description;

(e)measuring performance against such targets;

(f)preparing documents containing information of a prescribed description.

(4)Regulations under subsection (3)(b) may, in particular, require—

(a)that assets are assessed by reference to their exposure to risks of a prescribed description, and

(b)that an assessment includes determining the contribution of the assets of the scheme to climate change.

(5)The regulations may require the trustees or managers of the scheme to take into account—

(a)different ways in which the climate might change, and

(b)different steps that might be taken because of climate change.

(6)Regulations under subsection (5) may require the trustees or managers of the scheme to adopt prescribed assumptions as to future events, including assumptions about—

(a)the steps that might be taken for the purpose of achieving the Paris Agreement goal or other climate change goal, or

(b)the achievement of the Paris Agreement goal or other climate change goal.

(7)In complying with requirements imposed by the regulations, a trustee or manager must have regard to guidance prepared from time to time by the Secretary of State.

(8)In this section “the Paris Agreement goal” means the goal of holding the increase in the average global temperature to well below 2°C above pre-industrial levels referred to in Article 2(1)(a) of the agreement done at Paris on 12 December 2015.

41BClimate change risk: publication of informationU.K.

(1)Regulations may require the trustees or managers of an occupational pension scheme of a prescribed description to publish information of a prescribed description relating to the effects of climate change on the scheme (which may include information about matters to which regulations under section 41A may relate).

(2)Regulations under subsection (1) may, among other things—

(a)require the trustees or managers to publish a document of a prescribed description;

(b)require information or a document to be made available free of charge;

(c)require information or a document to be provided in a form that is or by means that are prescribed or of a prescribed description.

(3)In complying with requirements imposed by the regulations, a trustee or manager must have regard to guidance prepared from time to time by the Secretary of State.

41CSections 41A and 41B: complianceU.K.

(1)Regulations may make provision with a view to ensuring compliance with a provision of regulations under section 41A or 41B.

(2)The regulations may in particular—

(a)provide for the Authority to issue a notice (a “compliance notice”) to a person with a view to ensuring the person's compliance with a provision of regulations under section 41A or 41B;

(b)provide for the Authority to issue a notice (a “third party compliance notice”) to a person with a view to ensuring another person's compliance with a provision of regulations under section 41A or 41B;

(c)provide for the Authority to issue a notice (a “penalty notice”) imposing a penalty on a person where the Authority are of the opinion that the person—

(i)has failed to comply with a compliance notice or third party compliance notice, or

(ii)has contravened a provision of regulations under section 41A or 41B;

(d)provide for the making of a reference to the First-tier Tribunal or Upper Tribunal in respect of the issue of a penalty notice or the amount of a penalty;

(e)confer other functions on the Authority.

(3)The regulations may make provision for determining the amount, or the maximum amount, of a penalty in respect of a failure or contravention.

(4)But the amount of a penalty imposed under the regulations in respect of a failure or contravention must not exceed—

(a)£5,000, in the case of an individual, and

(b)£50,000, in any other case.]

Employee trusteesE+W+S

F12542 Time off for performance of duties and for training.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F125Ss. 42-46 repealed (22.8.1996) by Employment Rights Act 1996 (c. 18), s. 243, Sch. 3 Pt. I (with ss. 191, 192, 194, 195, 202, 241, Sch. 2)

F12543 Payment for time off.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F125Ss. 42-46 repealed (22.8.1996) by Employment Rights Act 1996 (c. 18), s. 243, Sch. 3 Pt. I (with ss. 191, 192, 194, 195, 202, 241, Sch. 2)

F12544 Time limit for proceedings.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F125Ss. 42-46 repealed (22.8.1996) by Employment Rights Act 1996 (c. 18), s. 243, Sch. 3 Pt. I (with ss. 191, 192, 194, 195, 202, 241, Sch. 2)

F12545 Remedies.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F125Ss. 42-46 repealed (22.8.1996) by Employment Rights Act 1996 (c. 18), s. 243, Sch. 3 Pt. I (with ss. 191, 192, 194, 195, 202, 241, Sch. 2)

F12546 Right not to suffer detriment in employment or be unfairly dismissed.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F125Ss. 42-46 repealed (22.8.1996) by Employment Rights Act 1996 (c. 18), s. 243, Sch. 3 Pt. I (with ss. 191, 192, 194, 195, 202, 241, Sch. 2)

AdvisersE+W+S

47 Professional advisers.E+W+S

(1)For every occupational pension scheme there shall be—

(a)an individual, or a firm, appointed by the trustees or managers as auditor (referred to in this Part, in relation to the scheme, as “the auditor”), and

(b)an individual appointed by the trustees or managers as actuary (referred to in this Part, in relation to the scheme, as “the actuary”).

(2)For every occupational pension scheme the assets of which consist of or include investmentsF126... there shall be an individual or a firm appointed by or on behalf of the trustees or managers as fund manager.

[F127(2A)References in this section to investments must be read with—

(a)section 22 of the Financial Services and Markets Act 2000;

(b)any relevant order under that section; and

(c)Schedule 2 to that Act.]

(3)If in the case of an occupational pension scheme any person—

(a)is appointed otherwise than by the trustees or managers as legal adviser or to exercise any prescribed functions in relation to the scheme, or

(b)is appointed otherwise than by or on behalf of the trustees or managers as a fund manager,

[F128section 10 applies to any trustee, and] to any manager, who in exercising any of his functions places reliance on the skill or judgement of that person.

(4)In this Part, in relation to an occupational pension scheme—

(a)the auditor, actuary and legal adviser appointed by the trustees or managers,

(b)any fund manager appointed by or on behalf of the trustees or managers, and

(c)any person appointed by the trustees or managers to exercise any of the functions referred to in subsection (3)(a),

are referred to as “professional advisers”.

(5)This section does not apply to an occupational pension scheme falling within a prescribed class or description and regulations may—

(a)make exceptions to subsections (1) to (3),

(b)specify the qualifications and experience, or approval, required for appointment as a professional adviser.

(6)Regulations may make provision as to—

(a)the manner in which professional advisers may be appointed and removed,

(b)the terms on which professional advisers may be appointed (including the manner in which the professional advisers may resign).

(7)Subject to regulations made by virtue of subsection (6), professional advisers shall be appointed on such terms as the trustees or managers may determine.

(8)If in the case of an occupational pension scheme an auditor, actuary or fund manager is required under this section to be appointed but the appointment has not been made, or not been made in accordance with any requirements imposed under this section, [F129section 10 applies to any trustee, and] to any manager, who has failed to take all such steps as are reasonable to secure compliance.

(9)Regulations may in the case of occupational pension schemes—

(a)impose duties on any person who is or has been the employer, and on any person who acts as auditor or actuary to such a person, to disclose information to the trustees or managers and to the scheme’s professional advisers,

(b)impose duties on the trustees or managers to disclose information to, and make documents available to, the scheme’s professional advisers.

(10)If in the case of an occupational pension scheme a person fails to comply with any duty imposed under subsection (9)(a), section 10 applies to him.

(11)If in the case of an occupational pension scheme any duty imposed under subsection (9)(b) is not complied with, [F130section 10 applies to any trustee, and] to any manager, who has failed to take all such steps as are reasonable to secure compliance.

Textual Amendments

Modifications etc. (not altering text)

C147S. 47 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(v)(3); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III (as amended (9.12.2005) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 12 para. 76(2)(d); S.I. 2005/3331, art. 2(2), Sch. Pt. 2)

Commencement Information

I39S. 47 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I40S. 47 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

F13148“Blowing the whistle”.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

Receipts, payments and recordsE+W+S

49 Other responsibilities of trustees, employers, etc.E+W+S

(1)The trustees of any trust scheme must, except in any prescribed circumstances, keep any money received by them in a separate account kept by them [F132with a deposit-taker].

F133(1A). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2)Regulations may require the trustees of any trust scheme to keep—

(a)records of their meetings (including meetings of any of their number), and

(b)books and records relating to any prescribed transaction.

(3)Regulations may, in the case of any trust scheme, require the employer, and any prescribed person acting in connection with the scheme, to keep books and records relating to any prescribed transaction.

(4)Regulations may require books or records kept under subsection (2) or (3) to be kept in a prescribed form and manner and for a prescribed period.

(5)Regulations must, in cases where payments of benefit to members of trust schemes are made by the employer, require the employer to make into a separate account kept by him [F134with a deposit-taker] any payments of benefit which have not been made to the members within any prescribed period.

(6)If in the case of any trust scheme any requirements imposed by or under subsection (1) or (2) are not complied with, [F135section 10 applies] to any trustee who has failed to take all such steps as are reasonable to secure compliance.

(7)If in the case of any trust scheme any person fails to comply with any requirement imposed under subsection (3) or (5), section 10 applies to him.

[F136(8)Where on making a payment of any earnings in respect of any employment there is deducted any amount corresponding to any contribution payable on behalf of an active member of an occupational pension scheme, the amount deducted is to be paid, within a prescribed period, to the trustees or managers of the scheme.

[F137(8A)“Deposit taker” means—

(a)a person who has permission under [F138Part 4A] of the Financial Services and Markets Act 2000 to accept deposits;

F139(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c)the Bank of England F140... ;

(d)the National Savings Bank; or

(e)a municipal bank, that is to say a company which was, immediately before the repeal of the Banking Act 1987 exempted from the prohibition in section 3 of that Act by virtue of section 4(1) of, and paragraph 4 of Schedule 2 to, that Act.

(8B)Paragraphs (a) and (b) of subsection (8A) must be read with—

(a)section 22 of the Financial Services and Markets Act 2000;

(b)any relevant order under that section; and

(c)Schedule 2 to that Act.]

(9)If in any case there is a failure to comply with subsection (8)—

(a)section 10 applies to the employer; and

[F141(b)if the trustees or managers have reasonable cause to believe that the failure is likely to be of material significance in the exercise by the Authority of any of their functions, they must, except in prescribed circumstances, give notice of the failure to the Authority and the member within a reasonable period after the end of the prescribed period under subsection (8).]

(10)If in any case subsection (9)(b) is not complied with—

F142(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)section 10 applies to any trustee or manager who has failed to take all [F143reasonable steps to secure compliance].

(11)If any person is knowingly concerned in the fraudulent evasion of the obligation imposed by subsection (8) in any case, he is guilty of an offence.

(12)A person guilty of an offence under subsection (11) is liable—

(a)on summary conviction, to a fine not exceeding the statutory maximum; and

(b)on conviction on indictment, to imprisonment for a term not exceeding seven years or a fine or both.

(13)A person shall not be required by virtue of subsection (9)(a) above to pay a penalty under section 10 in respect of a failure if in respect of that failure he has been—

(a)required to pay a penalty under that section by virtue of section 3(7) of the Welfare Reform and Pensions Act 1999 (failures in respect of stakeholder pensions), or

(b)convicted of an offence under subsection (11) above.]

Textual Amendments

F136S. 49(8)-(13) substituted for s. 49(8) (11.11.1999 for specified purposes, 3.4.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), ss. 10(1), 89(5)(a); S.I. 2000/629, art. 2

F141S. 49(9)(b) substituted (1.7.2005 for specified purposes, 6.4.2006 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 269(1), 322(1) (with s. 313); S.I. 2005/1720, art. 2(15)(a)(b), Sch. Pt. 2

Modifications etc. (not altering text)

C149S. 49 applied (with modifications) in part (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(vi); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

C150S. 49(8) excluded (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), s. 131(1)(3)(a), Sch. 2 para. 1(2)(b); S.I. 2022/721, regs. 1(2), 3(a)

Commencement Information

I41S. 49 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I42S. 49 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

[F14449A Record of winding-up decisions.E+W+S

(1)Except so far as regulations otherwise provide, the trustees or managers of an occupational pension scheme shall keep written records of—

(a)any determination for the winding-up of the scheme in accordance with its rules;

(b)decisions as to the time from which steps for the purposes of the winding-up of the scheme are to be taken;

(c)determinations under section 38;

(d)determinations in accordance with the rules of the scheme to postpone the commencement of a winding-up of the scheme.

(2)For the purpose of this section—

(a)the determinations and decisions of which written records must be kept under this section include determinations and decisions by persons who—

(i)are not trustees or managers of a scheme, but

(ii)are entitled, in accordance with the rules of a scheme, to make a determination for its winding-up;

and

(b)regulations may, in relation to such determinations or decisions as are mentioned in paragraph (a), impose obligations to keep written records on the persons making the determinations or decisions (as well as, or instead of, on the trustees or managers).

(3)Regulations may provide for the form and content of any records that are required to be kept under this section.

F145(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)Section 10 applies to any trustee or manager of a scheme who fails to take all such steps as are reasonable to secure compliance by the trustees or managers of that scheme with those obligations.]

Textual Amendments

F144S. 49A inserted (1.3.2002 for specified purposes, 1.4.2002 in so far as not already in force) by Child Support, Pensions and Social Security Act 2000 (c. 19), ss. 49(3), 86(1)(b)(2) (with s. 83(6)); S.I. 2002/437, art. 3(1)(e)(2)

Modifications etc. (not altering text)

Resolution of disputesE+W+S

[F14650Requirement for dispute resolution arrangementsE+W+S

(1)The trustees or managers of an occupational pension scheme must secure that dispute resolution arrangements complying with the requirements of this section are made and implemented.

(2)Dispute resolution arrangements are arrangements for the resolution of pension disputes.

(3)For this purpose a pension dispute is a dispute which—

(a)is between—

(i)the trustees or managers of a scheme, and

(ii)one or more persons with an interest in the scheme (see section 50A),

(b)is about matters relating to the scheme, and

(c)is not an exempted dispute (see subsection (9)).

(4)The dispute resolution arrangements must provide a procedure—

(a)for any of the parties to the dispute mentioned in subsection (3)(a)(ii) to make an application for a decision to be taken on the matters in dispute (“an application for the resolution of a pension dispute”), and

(b)for the trustees or managers to take that decision.

(4A)The dispute resolution arrangements may make provision for securing that an application for the resolution of a pension dispute may not be made to the trustees or managers unless—

(a)the matters in dispute have been previously referred to a person of a description specified in the arrangements (“the specified person”) in order for him to consider those matters, and

(b)the specified person has given his decision on those matters,

and for enabling the specified person's decision to be confirmed or replaced by the decision taken by the trustees or managers on the application, after reconsidering those matters.

(5)Where an application for the resolution of a pension dispute is made in accordance with the dispute resolution arrangements, the trustees or managers must—

(a)take the decision required on the matters in dispute within a reasonable period of the receipt of the application by them, and

(b)notify the applicant of the decision within a reasonable period of it having been taken.

(5A)In a case where a reference is made to the specified person in accordance with provision made under subsection (4A), subsection (5) applies in relation to the specified person as it applies in relation to the trustees or managers in a case where an application for the resolution of a pension dispute is made to them.

(6)The procedure provided for by the dispute resolution arrangements in pursuance of subsection (4) must include the provision required by section 50B.

(7)Dispute resolution arrangements under subsection (1) must, in the case of existing schemes, have effect on and after the date of commencement of this section in relation to applications made on or after that date.

(8)This section does not apply in relation to an occupational pension scheme if—

(a)every member of the scheme is a trustee of the scheme,

(b)the scheme has no more than one member, or

(c)the scheme is of a prescribed description.

(9)For the purposes of this section a dispute is an exempted dispute if—

(a)proceedings in respect of it have been commenced in any court or tribunal,

(b)the Pensions Ombudsman has commenced an investigation in respect of it as a result of a complaint made or a dispute referred to him, or

(c)it is of a prescribed description.

(10)If, in the case of an occupational pension scheme, the dispute resolution arrangements required by this section to be made—

(a)have not been made, or

(b)are not being implemented,

section 10 applies to any of the trustees or managers who have failed to take all reasonable steps to secure that such arrangements are made or implemented.

Textual Amendments

F146Ss. 50-50B substituted for s. 50 (5.3.2008 for specified purposes, 6.4.2008 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 273, 322(1) (with s. 313) (as amended by Pensions Act 2007 (c. 22), ss. 16, 30(3)); S.I. 2008/627, art. 2(a)(b)

Modifications etc. (not altering text)

C152S. 50 modified (11.11.1999 for specified purposes, 1.10.2000 in so far as not already in force) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(5)(a), Sch. 1 para. 1(1)(2)(b)(vii); S.I. 2000/1047, art. 2(2)(c), Sch. Pt. III

50AMeaning of “person with an interest in the scheme”E+W+S

(1)For the purposes of section 50 a person is a person with an interest in an occupational pension scheme if—

(a)he is a member of the scheme,

(b)he is a widow, widower [F147, surviving civil partner] or surviving dependant of a deceased member of the scheme,

(c)he is a surviving non-dependant beneficiary of a deceased member of the scheme,

(d)he is a prospective member of the scheme,

(e)he has ceased to be within any of the categories of persons referred to in paragraphs (a) to (d), or

(f)he claims to be such a person as is mentioned in paragraphs (a) to (e) and the dispute relates to whether he is such a person.

(2)In subsection (1)(c) a “non-dependant beneficiary”, in relation to a deceased member of an occupational pension scheme, means a person who, on the death of the member, is entitled to the payment of benefits under the scheme.

(3)In subsection (1)(d) a “prospective member” means any person who, under the terms of his contract of service or the rules of the scheme—

(a)is able, at his own option, to become a member of the scheme,

(b)will become so able if he continues in the same employment for a sufficiently long period,

(c)will be admitted to the scheme automatically unless he makes an election not to become a member, or

(d)may be admitted to it subject to the consent of his employer.

Textual Amendments

F146Ss. 50-50B substituted for s. 50 (5.3.2008 for specified purposes, 6.4.2008 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 273, 322(1) (with s. 313) (as amended by Pensions Act 2007 (c. 22), ss. 16, 30(3)); S.I. 2008/627, art. 2(a)(b)

50BThe dispute resolution procedureE+W+S

(1)The procedure provided for by the dispute resolution arrangements in pursuance of section 50(4) must (in accordance with section 50(6)) include the following provision.

(2)The procedure must provide that an application for the resolution of a pension dispute under section 50(4) may be made or continued on behalf of a person who is a party to the dispute mentioned in section 50(3)(a)(ii)—

(a)where the person dies, by his personal representative,

(b)where the person is a minor or is otherwise incapable of acting for himself, by a member of his family or some other person suitable to represent him, and

(c)in any other case, by a representative nominated by him.

(3) The procedure—

(a)must include provision requiring an application to which subsection (3A) applies to be made by the end of such reasonable period as is specified;

(b)may include provision about the time limits for making such other applications for the resolution of pension disputes as are specified.

(3A)This subsection applies to—

(a)any application by a person with an interest in a scheme as mentioned in section 50A(1)(e), and

(b)any application by a person with an interest in a scheme as mentioned in section 50A(1)(f) who is claiming to be such a person as is mentioned in section 50A(1)(e).

(4)The procedure must include provision about—

(a)the manner in which an application for the resolution of a pension dispute is to be made,

(b)the particulars which must be included in such an application, and

(c)the manner in which any decisions required in relation to such an application are to be reached and given.

(4A)The provision made under subsection (4)(c) may include provision for decisions of the trustees or managers to be taken on their behalf by one or more of their number.

(5)The procedure must provide that if, after an application for the resolution of a pension dispute has been made, the dispute becomes an exempted dispute within the meaning of section 50(9)(a) or (b), the resolution of the dispute under the procedure ceases.]

Textual Amendments

F146Ss. 50-50B substituted for s. 50 (5.3.2008 for specified purposes, 6.4.2008 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 273, 322(1) (with s. 313) (as amended by Pensions Act 2007 (c. 22), ss. 16, 30(3)); S.I. 2008/627, art. 2(a)(b)

IndexationE+W+S

51 Annual increase in rate of pension.E+W+S

(1)Subject to [F148subsections (6) and (7)] this section applies to a pension under an occupational pension scheme if—

(a)the scheme—

[F149(i)is a registered pension scheme under section 153 of the Finance Act 2004, and]

(ii)is not a public service pension scheme, and

[F150(iii)in the case where the pension becomes a pension in payment on or after the commencement day, is not a money purchase scheme, and]

[F151(b)the whole, or any part of, the pension is attributable—

(i)to pensionable service on or after [F1526 April 1997], or

(ii)in the case of money purchase benefits where the pension is in payment before the commencement day, to payments in respect of employment carried on on or after [F1526 April 1997], and

(c)apart from this section—

(i)the annual rate of the pension, or

(ii)if only part of the pension is attributable as described in paragraph (b), so much of the annual rate as is attributable to that part,

would not be increased each year by at least the appropriate percentage of that rate.]

[F153(1A)Where a pension scheme is divided into sections, each section that is a collective money purchase scheme for the purposes of Part 1 of the Pension Schemes Act 2021 (see section 1(2)(b) of that Act) is to be treated for the purposes of this section as a separate occupational pension scheme which is a money purchase scheme.]

(2)[F154Subject to sections 51A and 52], where a pension to which this section applies, or any part of it, is attributable to pensionable service on or after [F1526 April 1997] or, in the case of money purchase benefits [F155where the pension is in payment before the commencement day], to payments in respect of employment carried on on or after [F1526 April 1997]

(a)the annual rate of the pension, or

(b)if only part of the pension is attributable to pensionable service or, as the case may be, to payments in respect of employment carried on on or after [F1526 April 1997], so much of the annual rate as is attributable to that part,

must be increased annually by at least the appropriate percentage.

[F156(3)Subsection (2) does not apply to the annual rate of a pension under an occupational pension scheme, or to a part of that rate, if under the rules of the scheme the rate or part is for the time being being increased at intervals of not more than twelve months by at least the relevant percentage.

(4)For the purposes of subsection (3) the relevant percentage is—

(a)the percentage increase in the consumer prices index for the reference period, being a period determined, in relation to each periodic increase, under the rules, or

(b)if lower, the default percentage for that period.

(4ZA)Subsection (2) does not apply to the annual rate of a pension under an occupational pension scheme, or to a part of that rate, if subsection (4ZB) applies to the rate or part.

(4ZB)Subject to subsection (4ZD), this subsection applies to the rate or part if, under the rules of the scheme, the rate or part is for the time being being increased, and since the relevant time has always been increased, at intervals of not more than twelve months by at least—

(a)the percentage increase in the retail prices index for the reference period, being a period determined, in relation to each periodic increase, under the rules, or

(b)if lower, the default percentage for that period.

(4ZC)In subsection (4ZB) “the relevant time” means—

(a)the beginning of 2011 or, if later, the time when the pension became a pension in payment, or

(b)if the pension was transferred to the scheme from another occupational pension scheme as a pension in payment after the beginning of 2011, the time of the transfer.

(4ZD)If the pension was transferred to the scheme as mentioned in subsection (4ZC)(b), subsection (4ZB) does not apply to the rate or part unless, immediately before the transfer, subsection (4ZB) (read with this subsection if relevant) applied to the rate or part by reference to the scheme from which the pension was transferred (or would have applied had subsection (4ZB) been in force immediately before the transfer).

(4ZE)If only part of the pension is attributable to pensionable service or, as the case may be, to payments in respect of employment carried on on or after [F1526 April 1997], in subsections (3) to (4ZD) references to the annual rate of the pension are references to so much of that rate as is attributable to that part.

(4ZF)For the purposes of subsections (4) and (4ZB) the default percentage for a period is the percentage for that period which corresponds to—

(a)in the case of a category X pension, 5% per annum, and

(b)in the case of a category Y pension, 2.5% per annum.

(4ZG)In subsections (4) and (4ZB)—

  • consumer prices index” means—

    (a)

    the general index of consumer prices (for all items) published by the Statistics Board, or

    (b)

    where that index is not published for a month, any substituted index or figures published by the Board;

  • retail prices index” means—

    (a)

    the general index of retail prices (for all items) published by the Statistics Board, or

    (b)

    where that index is not published for a month, any substituted index or figures published by the Board.]

[F157(4A)For the purposes of this section, a pension is a category X pension if it is—

(a)a pension which became a pension in payment before the commencement day, or

(b)a pension—

(i)which becomes a pension in payment on or after the commencement day, and

(ii)the whole of which is attributable to pensionable service before that day.

(4B)For the purposes of this section, a pension is a category Y pension if it is a pension—

(a)which becomes a pension in payment on or after the commencement day, and

(b)the whole of which is attributable to pensionable service on or after the commencement day.

(4C)For the purposes of applying this section in the case of a pension—

(a)which becomes a pension in payment on or after the commencement day,

(b)part of which is attributable to pensionable service before the commencement day, and

(c)part of which is attributable to pensionable service on or after that day,

each of those parts of the pension is to be treated as if it were a separate pension.]

(5)Regulations may provide that [F158any of the provisions of this section] apply in relation to a pension as if so much of it as would not otherwise be attributable to pensionable service or to payments in respect of employment were attributable to pensionable service or, as the case may be, payments in respect of employment—

(a)before [F1526 April 1997] [F159or the commencement day],

(b)on or after that day, or

(c)partly before and partly on or after that day.

(6)This section does not apply to any pension or part of a pension [F160which is attributable (directly or indirectly) to a pension credit or] which, in the opinion of the trustees or managers, is derived from the payment by any member of the scheme of voluntary contributions.

[F161(7)This section does not apply to any pension (or part of a pension) under a relevant occupational pension scheme which—

(a)is a cash balance benefit (see section 51ZB), and

(b)first comes into payment on or after the day on which section 21 of the Pensions Act 2011 comes into force.]

[F162(8)An occupational pension scheme is a “relevant occupational pension scheme” if—

(a)it has not, at any time on or after 6 April 1997, been a salary related contracted-out scheme (see section 7B of the Pension Schemes Act 1993), or

(b)it has, at any time on or after 6 April 1997, been a salary related contracted-out scheme but no person is entitled to receive, or has accrued rights to, benefits under the scheme attributable to a period on or after that day when it was such a scheme.]

Textual Amendments

F148Words in s. 51(1) substituted (3.1.2012) by Pensions Act 2011 (c. 19), ss. 21(2), 38(4); S.I. 2011/3034, art. 3(c)

F150S. 51(1)(a)(iii) inserted (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(2)(b), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

F151S. 51(1)(b)(c) substituted for s. 51(1)(b) (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(2)(c), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

F153S. 51(1A) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), s. 131(1)(3)(a), Sch. 3 para. 7; S.I. 2022/721, regs. 1(2), 3(a)

F154Words in s. 51(2) substituted (1.12.2000) by Child Support, Pensions and Social Security Act 2000 (c. 19), ss. 51(1), 86(1)(b)(2) (with s. 83(6)); S.I. 2000/3166, art. 2(2)(b)

F155Words in s. 51(2) inserted (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(3), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

F156S. 51(3)-(4ZG) substituted for s. 51(3)(4) (3.1.2012) by Pensions Act 2011 (c. 19), ss. 19(8), 38(4); S.I. 2011/3034, art. 3(b)

F157S. 51(4A)-(4C) inserted (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(5), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

F158Words in s. 51(5) substituted (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(6)(a), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

F159Words in s. 51(5)(a) inserted (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(6)(b), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

F160Words in s. 51(6) inserted (1.12.2000) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(1), Sch. 12 para. 51; S.I. 2000/1047, art. 2(2)(d) Sch. Pt. 4

Modifications etc. (not altering text)

Commencement Information

I43S. 51 in force at 6.4.1996 for specified purposes by S.I. 1996/778, art. 2(5)(a), Sch. Pt. V

I44S. 51 in force at 6.4.1997 in so far as not already in force by S.I. 1997/664, art. 2(3), Sch. Pt. 3

[F16351ZAMeaning of “the appropriate percentage”E+W+S

(1)For the purposes of section 51(1)(c) and (2), “the appropriate percentage” in relation to an increase in the whole or part of the annual rate of a pension—

(a)in the case of a category X pension, means the [F164higher revaluation percentage] for the latest revaluation period specified in the order under paragraph 2 of Schedule 3 to the Pension Schemes Act 1993 (revaluation of accrued pension benefits) which is in force at the time of the increase, and

[F165(b)in the case of a category Y pension, means the lower revaluation percentage for that period.]

(2)In this section [F166“the higher revaluation percentage”, “the lower revaluation percentage”] and “the revaluation period” have the same meaning as in paragraph 2 of Schedule 3 to the Pension Schemes Act 1993.]

Textual Amendments

F163S. 51ZA inserted (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(7), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

F164Words in s. 51ZA(1)(a) substituted (6.4.2009) by Pensions Act 2008 (c. 30), s. 149(1), Sch. 2 para. 8(2)(a) (with s. 101(2)(3)); S.I. 2009/82, art. 2(2)(f)

F166Words in s. 51ZA(2) substituted (6.4.2009) by Pensions Act 2008 (c. 30), s. 149(1), Sch. 2 para. 8(3) (with s. 101(2)(3)); S.I. 2009/82, art. 2(2)(f)

Modifications etc. (not altering text)

[F16751ZBMeaning of “cash balance benefit”E+W+S

(1)For the purposes of section 51(7)(a), a pension provided to or in respect of a member of an occupational pension scheme is a “cash balance benefit” if conditions 1 and 2 are met.

(2)Condition 1 is that the rate of the pension is calculated by reference to a sum of money (“the available sum”) which is available under the scheme for the provision of benefits to or in respect of the member.

(3)Condition 2 is that under the scheme—

(a)there is a promise about the amount of the available sum, but

(b)there is no promise about the rate or amount of the benefits to be provided.

(4)The promise mentioned in subsection (3)(a) includes in particular a promise about the change in the value of, or the return from, payments made under the scheme by the member or by any other person in respect of the member.

(5)The promise mentioned in subsection (3)(b) includes a promise that—

(a)the amount of the available sum will be sufficient to provide benefits of a particular rate or amount;

(b)the rate or amount of a benefit will represent a particular proportion of the available sum.

(6)But a pension is not prevented from being a cash balance benefit merely because under the scheme there is a promise that—

(a)the rate or amount of a benefit payable in respect of a deceased member will be a particular proportion of the rate or amount of a benefit which was (or would have been) payable to the member;

(b)the amount of a lump sum payable to a member, or in respect of a deceased member, will represent a particular proportion of the available sum.]

[F16851A Restriction on increase where annuity tied to investments.E+W+S

(1)No increase under section 51 is required to be made, at any time on or after the relevant date, of so much of any pension under a money purchase scheme as—

(a)is payable by way of an annuity the amount of which for any year after the first year of payment is determined (whether under the terms of the scheme or under the terms of the annuity contract in pursuance of which it is payable) by reference to fluctuations in the value of, or the return from, particular investments; [F169and]

F170(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c)satisfies such other conditions (if any) as may be prescribed.

(2)For the purposes of this section it shall be immaterial whether the annuity in question is payable out of the funds of the scheme in question or under an annuity contract entered into for the purposes of the scheme.

(3)In this section “the relevant date” means the date appointed for the coming into force of section 51 of the Child Support, Pensions and Social Security Act 2000.]

52 Restriction on increase where member is under 55.E+W+S

(1)Subject to subsection (2), no increase under section 51 is required to be paid to or for a member of a scheme whose pension is in payment but who has not attained the age of 55 at the time when the increase takes effect.

(2)Subsection (1) does not apply if the member—

(a)is permanently incapacitated by mental or physical infirmity from engaging in regular full-time employment, or

(b)has retired on account of mental or physical infirmity from the employment in respect of which, or on retirement from which, the pension is payable.

(3)The rules of a scheme may provide that if, in a case where a pension has been paid to or for a member under the age of 55 at an increased rate in consequence of subsection (2), the member—

(a)ceases to suffer from the infirmity in question before he attains the age of 55, but

(b)continues to be entitled to the pension,

any increases subsequently taking effect under section 51 in the annual rate of the pension shall not be paid or shall not be paid in full.

(4)In any case where—

(a)by virtue only of subsection (1) or (3), increases are not paid to or for a member or are not paid in full, but

(b)the member attains the age of 55 or, in a case falling within subsection (3), again satisfies the condition set out in subsection (2)(a) or (b),

his pension shall then become payable at the annual rate at which it would have been payable apart from subsection (1) or (3).

Modifications etc. (not altering text)

Commencement Information

I45S. 52 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

53 Effect of increases above the statutory requirement.E+W+S

(1)Where in any tax year the trustees or managers of an occupational pension scheme make an increase in a person’s pension, not being an increase required by section 109 of the M9Pension Schemes Act 1993 or section 51 of this Act, they may deduct the amount of the increase from any increase which, but for this subsection, they would be required to make under either of those sections in the next tax year.

(2)Where in any tax year the trustees or managers of such a scheme make an increase in a person’s pension and part of the increase is not required by section 109 of the Pension Schemes Act 1993 or section 51 of this Act, they may deduct that part of the increase from any increase which, but for this subsection, they would be required to make under either of those sections in the next tax year.

(3)Where by virtue of subsection (1) or (2) any pensions are not required to be increased in pursuance of section 109 of the Pension Schemes Act 1993 or section 51 of this Act, or not by the full amount that they otherwise would be, their amount shall be calculated for any purpose as if they had been increased in pursuance of the section in question or, as the case may be, by that full amount.

[F171(3A)In subsections (1) and (2), the references to a person’s pension do not include any pension which is attributable (directly or indirectly) to a pension credit.]

(4)In section 110 of the M10Pension Schemes Act 1993 (resources for annual increase of guaranteed minimum pension)—

(a)subsections (2) to (4) are omitted, and

(b)in subsection (1), for “subsection (2) or (3)” there is substituted “ section 53 of the Pensions Act 1995 ”.

Textual Amendments

F171S. 53(3A) inserted (1.12.2000) by Welfare Reform and Pensions Act 1999 (c. 30), s. 89(1), Sch. 12 para. 52; S.I. 2000/1047, art. 2(2)(d) Sch. Pt. 4

Modifications etc. (not altering text)

Commencement Information

I46S. 53 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

Marginal Citations

54 Sections 51 to 53: supplementary.E+W+S

(1)The first increase required by section 51 in the rate of a pension must take effect not later than the first anniversary of the date on which the pension is first paid; and subsequent increases must take effect at intervals of not more than twelve months.

(2)Where the first such increase is to take effect on a date when the pension has been in payment for a period of less than twelve months, the increase must be of an amount at least equal to one twelfth of the amount of the increase so required (apart from this subsection) for each complete month in that period.

(3)In sections 51 to 53 and this section—

  • annual rate”, in relation to a pension, means the annual rate of the pension, as previously increased under the rules of the scheme or under section 51,

  • F172. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

  • F173. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

  • [F174the commencement day” means the day appointed for the coming into force of section 278 of the Pensions Act 2004 (amendments to section 51),]

  • pension”, in relation to a scheme, means any pension in payment under the scheme and includes an annuity.

Textual Amendments

F172Words in s. 54(3) omitted (6.4.2016) by virtue of Pensions Act 2014 (c. 19), s. 56(4), Sch. 13 para. 60

F174Words in s. 54(3) inserted (15.3.2005 for specified purposes, 6.4.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 278(8), 322(1) (with s. 313); S.I. 2005/275, art. 2(7), Sch. Pt. 7; S.I. 2005/695, art. 2(4)

Modifications etc. (not altering text)

Commencement Information

I47S. 54 in force at 6.4.1997 by S.I. 1997/664, art. 2(3), Sch. Pt. 3

55 Section 51: end of annual increase in GMP.E+W+S

In section 109 of the M11Pension Schemes Act 1993 (annual increase of guaranteed minimum pensions)—

(a)in subsection (2) (increase in rate of that part of guaranteed minimum pension attributable to earnings factors for tax year 1988-89 and subsequent tax years) for “the tax year 1988-89 and subsequent tax years” there is substituted “ the tax years in the relevant period ”, and

(b)after subsection (3) there is inserted—

(3A)The relevant period is the period—

(a)beginning with the tax year 1988-89, and

(b)ending with the last tax year that begins before the principal appointed day for the purposes of Part III of the Pensions Act 1995.

Commencement Information

I48S. 55 in force at 4.2.1997 by S.I. 1997/216, art. 2(2)

Marginal Citations

Minimum funding requirementE+W+S

F17556 Minimum funding requirement.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F175Ss. 56-61 repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1 (with S.I. 2005/3377, reg. 1, Sch. 4 Pt. 2)

F17557 Valuation and certification of assets and liabilities.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F175Ss. 56-61 repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1 (with S.I. 2005/3377, reg. 1, Sch. 4 Pt. 2)

F17558 Schedules of contributions.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F175Ss. 56-61 repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1 (with S.I. 2005/3377, reg. 1, Sch. 4 Pt. 2)

F17559 Determination of contributions: supplementary.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F175Ss. 56-61 repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1 (with S.I. 2005/3377, reg. 1, Sch. 4 Pt. 2)

F17560 Serious underprovision.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F175Ss. 56-61 repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1 (with S.I. 2005/3377, reg. 1, Sch. 4 Pt. 2)

F17561 Sections 56 to 60: supplementary.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F175Ss. 56-61 repealed (4.12.2005 for specified purposes, 30.12.2005 in so far as not already in force) by Pensions Act 2004 (c. 35), s. 322(1), Sch. 13; S.I. 2005/3331, art. 2(1)(a)(b), Sch. Pt. 1 (with S.I. 2005/3377, reg. 1, Sch. 4 Pt. 2)

Equal treatmentE+W+S

F17662 The equal treatment rule.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F17663 Equal treatment rule: supplementary.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F17664 Equal treatment rule: exceptions.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F17665 Equal treatment rule: consequential alteration of schemes.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F17666 Equal treatment rule: effect on terms of employment, etc.E+W+S

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F177Treatment of overseas residents etc.U.K.

Textual Amendments

F177S. 66A and cross-heading inserted (23.7.2001) by Child Support, Pensions and Social Security Act 2000 (c. 19), ss. 55, 86(1)(b)(2) (with s. 83(6)); S.I. 2001/2295, art. 2(a)

66A Prohibition on different rules for overseas residents etc.U.K.

(1)This section applies where an occupational pension scheme contains provisions contravening subsection (2) or (3).

(2)Except so far as regulations otherwise provide, provisions of an occupational pension scheme contravene this subsection to the extent that they would (apart from this section) have an effect with respect to—

(a)the entitlement of any person to benefits under the scheme, or

(b)the payment to any person of benefits under the scheme,

which would be different according to whether or not a place outside the United Kingdom is specified by that person as the place to which he requires payments of benefits under the scheme to be made to him.

(3)Except so far as regulations otherwise provide, provisions of an occupational pension scheme contravene this subsection to the extent that they would (apart from this section) have an effect with respect to—

(a)the entitlement of any person to remain a member of the scheme,

(b)the eligibility of any person to remain a person by or in respect of whom contributions are made towards or under the scheme, or

(c)the making by or in respect of any person who is a member of the scheme of any contributions towards or under the scheme,

which would be different according to whether that person works wholly in the United Kingdom or wholly or partly outside the United Kingdom.

(4)Provisions contravening subsection (2) shall have effect, in relation to all times after the coming into force of section 55 of the Child Support, Pensions and Social Security Act 2000, as if they made the same provision in relation to a person who requires payments of benefits to be made to a place outside the United Kingdom as they make in relation to a person in whose case all payments of benefits fall to be made to a place in the United Kingdom.

(5)Provisions contravening subsection (3) shall have effect, in relation to all times after the coming into force of section 55 of the Child Support, Pensions and Social Security Act 2000, as if they made the same provision in relation to persons working wholly or partly outside the United Kingdom as they make in relation to persons working wholly in the United Kingdom.

(6)This section—

(a)shall be without prejudice to any enactment under which any amount is to be or may be deducted, or treated as deducted, from amounts payable by way of benefits under the scheme or treated as so payable; and

(b)shall not apply in relation to so much of any provision of a scheme as is required for securing compliance with the conditions of any [F178registration], exemption or relief given or available under the Tax Acts.]

Modification of schemesU.K.

[F17967The subsisting rights provisionsE+W+S

(1)The subsisting rights provisions apply to any power conferred on any person by an occupational pension scheme to modify the scheme, other than a power conferred by—

(a)a public service pension scheme, or

(b)a prescribed scheme or a scheme of a prescribed description.

[F180(1A)Any exercise of such a power to make a prohibited modification is void.]

(2)Any exercise of such a power to make a regulated modification is voidable in accordance with section 67G unless the following are satisfied in respect of the modification—

(a)in the case of each affected member—

(i)if the modification is a protected modification, [F181or the scheme is a collective money purchase scheme within the meaning of Part 1 of the Pension Schemes Act 2021,] the consent requirements (see section 67B),

(ii)[F182if sub-paragraph (i) does not apply], either the consent requirements or the actuarial equivalence requirements (see section 67C),

(b)the trustee approval requirement (see section 67E), and

(c)the reporting requirement (see section 67F).

(3)The subsisting rights provisions do not apply in relation to the exercise of a power—

(a)for a purpose connected with debits under section 29(1) of the Welfare Reform and Pensions Act 1999, F183...

F183(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F184(3A)Regulations may provide for cases in which the subsisting rights provisions do not apply.]

(4)References in this section and sections 67A to 67I to “the subsisting rights provisions” are to this section and those sections.

(5)Subsection (6) applies in relation to the exercise of a power to which the subsisting rights provisions apply to make a regulated modification where a member of the scheme dies before the requirements mentioned in subsection (2), so far as they apply in his case, have been complied with in respect of the modification if—

(a)before he died he had given his consent to the modification in accordance with section 67B(4)(b), or

(b)before he died, or before the trustees of the scheme had become aware that he had died, the trustees had complied with section 67C(4)(a), (b) and (d) in respect of the modification in his case.

(6)Any of the requirements mentioned in subsection (2), as it applies in respect of the modification—

(a)which is satisfied in the case of the member, or

(b)which would have been satisfied in his case had he not died before it was satisfied,

is to be taken to be satisfied in the case of any survivor of the member in respect of the modification.

Textual Amendments

F179Ss. 67-67I substituted for s. 67 (1.11.2005 for specified purposes, 6.4.2006 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 262, 322(1) (with s. 313); S.I. 2005/2447, art. 2(5)(a)(b), Sch. Pt. 2

F180S. 67(1A) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(2)(a), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F181Words in s. 67(2)(a)(i) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(2)(b), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F182Words in s. 67(2)(a)(ii) substituted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(2)(c), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F183S. 67(3)(b) and preceding word omitted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by virtue of Pension Schemes Act 2021 (c. 1), ss. 24(2)(d), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F184S. 67(3A) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(2)(e), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

67AThe subsisting rights provisions: interpretationU.K.

(1)In the subsisting rights provisions, each of the following expressions has the meaning given to it by the following provisions of this section—

  • [F185“prohibited modification”]

  • “regulated modification”

  • “protected modification”

  • “detrimental modification”

  • “affected member”

  • “subsisting right”

  • “scheme rules”.

[F186(1A)Prohibited modification” means a modification of an occupational pension scheme which on taking effect would or might result in any subsisting right of—

(a)a member of the scheme, or

(b)a survivor of a member of the scheme,

which is not a right or entitlement to money purchase benefits becoming, or being replaced with, a right or entitlement to collective money purchase benefits under the scheme rules.]

(2)Regulated modification” means a modification which is—

(a)a protected modification, or

(b)a detrimental modification,

or is both.

(3)Protected modification” means a modification [F187, other than a prohibited modification,] of an occupational pension scheme which—

[F188(a)on taking effect would or might result in a relevant transformation of any subsisting right of a member of the scheme or a survivor of a member of the scheme (see subsection (3A)),]

(b)would or might result in a reduction in the prevailing rate of any pension in payment under the scheme rules [F189, other than a pension that is a collective money purchase benefit], or

(c)is of a prescribed description.

F190...

[F191(3A)For the purposes of subsection (3)(a), there is a relevant transformation of a subsisting right where—

(a)a subsisting right that is not a right or entitlement to money purchase benefits becomes, or is replaced with, a right or entitlement to money purchase benefits under the scheme rules,

(b)a subsisting right that is a right or entitlement to money purchase benefits other than collective money purchase benefits becomes, or is replaced with, a right or entitlement to collective money purchase benefits under the scheme rules, or

(c)a subsisting right that is a right or entitlement to collective money purchase benefits becomes, or is replaced with, a right or entitlement to money purchase benefits other than collective money purchase benefits under the scheme rules.

(3B)For the purposes of subsection (3A), the reference in the definition of “money purchase benefits” in section 181(1) of the Pension Schemes Act 1993 to the widow, widower or surviving civil partner of a member of an occupational pension scheme is to be read as including any other survivor of the member.]

(4)Detrimental modification” means a modification [F192, other than a prohibited modification,] of an occupational pension scheme which on taking effect would or might adversely affect any subsisting right of—

(a)any member of the scheme, or

(b)any survivor of a member of the scheme.

(5)A person is an “affected member”—

(a)in relation to a protected modification within paragraph (a) or (b) of subsection (3), if, at the time the modification takes effect, he is—

(i)a member of the scheme, or

(ii)a survivor of a member of the scheme,

and, on taking effect, the modification would or might affect any of his subsisting rights as mentioned in that paragraph,

(b)in relation to a protected modification within paragraph (c) of that subsection, if he is of a prescribed description, and

(c)in relation to a detrimental modification which is not a protected modification if, at the time the modification takes effect, he is—

(i)a member of the scheme, or

(ii)a survivor of a member of the scheme,

and, on taking effect, the modification would or might adversely affect any of his subsisting rights.

(6)Subsisting right” means—

(a)in relation to a member of an occupational pension scheme, at any time—

(i)any right which at that time has accrued to or in respect of him to future benefits under the scheme rules, or

(ii)any entitlement to the present payment of a pension or other benefit which he has at that time, under the scheme rules, and

(b)in relation to the survivor of a member of an occupational pension scheme, at any time, any entitlement to benefits, or right to future benefits, which he has at that time under the scheme rules in respect of the member.

For this purpose, “right” includes a pension credit right.

(7)At any time when the pensionable service of a member of an occupational pension scheme is continuing, his subsisting rights are to be determined as if he had opted, immediately before that time, to terminate that service.

(8)Scheme rules”, in relation to a scheme, means—

(a)the rules of the scheme, except so far as overridden by a relevant legislative provision,

(b)the relevant legislative provisions, to the extent that they have effect in relation to the scheme and are not reflected in the rules of the scheme, and

(c)any provision which the rules of the scheme do not contain but which the scheme must contain if it is to conform with the requirements of Chapter 1 of Part 4 of the Pension Schemes Act 1993 (preservation of benefit under occupational pension schemes).

(9)For the purposes of subsection (8)—

(a)relevant legislative provision” means any provision contained in any of the following provisions—

(i)Schedule 5 to the Social Security Act 1989 (equal treatment for men and women);

[F193(ii)Chapter 2 or 3 of Part 4 of the Pension Schemes Act 1993 (certain protection for early leavers) or regulations made under either of those Chapters;

(iia)Chapter 1 or 2 of Part 4ZA of that Act (transfers and contribution refunds) or regulations made under either of those Chapters;]

(iii)Part 4A of that Act (requirements relating to pension credit benefit) or regulations made under that Part;

(iv)section 110(1) of that Act (requirement as to resources for annual increase of guaranteed minimum pensions);

(v)this Part of this Act (occupational pensions) or subordinate legislation made or having effect as if made under this Part;

(vi)section 31 of the Welfare Reform and Pensions Act 1999 (pension debits: reduction of benefit);

(vii)any provision mentioned in section 306(2) of the Pensions Act 2004;

[F194(xi)section 55 of the Pension Schemes Act 2015;

(xii)regulations made under section 56 or 57 of the Pension Schemes Act 2015;]

[F195(xiii)sections 21, 23, 26, 28, 29 and 33 of and Schedule 1 to the Pension Schemes Act 2017;]

[F196(xiv)regulations made under section 18(4) of or paragraph 1(6) of Schedule 2 to the Pension Schemes Act 2021;

(xv)sections 34, 39, 41, 42 and 45 of the Pension Schemes Act 2021;]

(b)a relevant legislative provision is to be taken to override any of the provisions of the scheme if, and only if, it does so by virtue of any of the following provisions—

(i)paragraph 3 of Schedule 5 to the Social Security Act 1989;

(ii)section 129(1) of the Pension Schemes Act 1993;

(iii)section 117(1) of this Act;

(iv)section 31(4) of the Welfare Reform and Pensions Act 1999;

(v)section 306(1) of the Pensions Act 2004;

[F197(ix)section 55(3) of the Pension Schemes Act 2015;

(x)regulations made under section 56(4) or 57(4) of the Pension Schemes Act 2015;]

[F198(xi)sections 21(7), 23(7), 26(9), 28(6), 29(2) and 33(5) of and paragraph 1(7) of Schedule 1 to the Pension Schemes Act 2017;]

[F199(xii)sections 18(7)(b), 34(5), 39(6), 41(6), 42(2) and 45(5) of and paragraph 1(7) of Schedule 2 to the Pension Schemes Act 2021.]

(10)For the purposes of this section—

(a)survivor”, in relation to a member of an occupational pension scheme, means a person who—

(i)is the widow or widower of the member, or

(ii)has survived the member and has any entitlement to benefit, or right to future benefits, under the scheme rules in respect of the member, and

(b)a modification would or might adversely affect a person’s subsisting right if it would alter the nature or extent of the entitlement or right so that the benefits, or future benefits, to which the entitlement or right relates would or might be less generous.

(11)In the subsisting rights provisions, in relation to—

(a)the exercise of a power to modify an occupational pension scheme to which the subsisting rights provisions apply, or

(b)a modification made, or to be made, in exercise of such a power,

references to “the scheme” are to be read as references to the scheme mentioned in paragraph (a).

Textual Amendments

F179Ss. 67-67I substituted for s. 67 (1.11.2005 for specified purposes, 6.4.2006 in so far as not already in force) by Pensions Act 2004 (c. 35), ss. 262, 322(1) (with s. 313); S.I. 2005/2447, art. 2(5)(a)(b), Sch. Pt. 2

F185Words in s. 67A(1) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(3), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F186S. 67A(1A) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(4), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F187Words in s. 67A(3) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(5)(a), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F188S. 67A(3)(a) substituted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(5)(b), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F189Words in s. 67A(3)(b) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(5)(c), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F190Words in s. 67A(3) omitted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by virtue of Pension Schemes Act 2021 (c. 1), ss. 24(5)(d), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F191S. 67A(3A)(3B) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(6), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F192Words in s. 67A(4) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(7), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F196S. 67A(9)(a)(xiv)(xv) inserted (11.2.2021 for specified purposes, 1.8.2022 in so far as not already in force) by Pension Schemes Act 2021 (c. 1), ss. 24(8)(a), 131(1)(3)(a); S.I. 2022/721, regs. 1(2), 3(a)

F198S. 67A(9)(b)(xi) inserted (27.4.2017) by