The Occupational and Personal Pension Schemes (Modification of Schemes - Miscellaneous Amendments) Regulations 2016
Citation and Commencement1.
(1)
These Regulations may be cited as the Occupational and Personal Pension Schemes (Modification of Schemes - Miscellaneous Amendments) Regulations 2016.
(2)
These Regulations come into force on 6th April 2016.
Amendment of the Occupational Pension Schemes (Modification of Schemes) Regulations 20062.
“Modification of schemes: revaluation of guaranteed minimum pensions7C.
(1)
The trustees of a trust scheme may by resolution passed before 6th April 2017 modify the scheme for the purposes of —
(a)
revaluing earnings factors for the purposes of section 14 (earner’s guaranteed minimum pension) of the 1993 Act in accordance with section 16(2) (revaluation of earnings factors for the purposes of section 14: early leavers etc.) of that Act as substituted by paragraph 16 of Schedule 13 to the Pensions Act 2014; and
(b)
where the scheme contains a rule or provision that would require or permit the increases referred to in section 16(3) of the 1993 Act to be applied to an earner whose service in contracted-out employment ceased on the second abolition date with effect from a relevant year before the last service tax year, disapplying that rule or provision to the extent that it does not require or permit such increases.
(2)
Modifications made by resolution under paragraph (1)—
(a)
must only have effect from 6th April 2016 or such later date as may be specified; and
(b)
may have effect from a date before the resolution is passed.
(3)
In this regulation—
“contracted-out employment” has the meaning given in section 8 (meaning of “contracted-out employment” etc.) of the 1993 Act6;“earnings factors” has the meaning given in section 181(1) (general interpretation) of the 1993 Act;
“last service tax year” has the meaning given in section 16(2) of the 1993 Act as substituted by paragraph 16 of Schedule 13 to the Pensions Act 2014;
“relevant year” has the meaning given in section 16(5) of the 1993 Act7;“the second abolition date” has the meaning given in section 181(1) of the 1993 Act8.”.
Amendment of the Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 20063.
“(ab)
is made for either or both of the purposes referred to in regulation 7C(1) (modification of schemes: revaluation of guaranteed minimum pensions)10 of the Occupational Pension Schemes (Modification of Schemes) Regulations 2006,”.
Amendment of the Occupational Pension Schemes (Schemes that were Contracted-out) (No.2) Regulations 20154.
(a)
in the opening words, omit “would not”; and
(b)
“(a)
would not—
(i)
affect any of the matters dealt with in Part III of the 1993 Act (schemes that were contracted-out etc. and effects on members’ state scheme rights), or any regulations made under that Part, that relate to guaranteed minimum pensions, in a manner that would or might adversely affect any entitlement or accrued rights of any member of the scheme acquired before the alteration takes effect;
(ii)
affect any of the matters dealt with in sections 87 to 92 of the 1993 Act12 (protection of increases in guaranteed minimum pensions) or sections 109 and 110 of that Act13 (annual increases of guaranteed minimum pensions) or any matters dealt with in regulations made under any of those provisions; or(b)
is made for either or both of the purposes referred to in regulation 7C(1) (modification of schemes: revaluation of guaranteed minimum pensions) of the Occupational Pension Schemes (Modification of Schemes) Regulations 2006.”.
Signed by authority of the Secretary of State for Work and Pensions
These Regulations make changes to regulations as a consequence of provisions contained within section 24(1) of, and Schedule 13 to, the Pensions Act 2014 (c.19) (“the 2014 Act”) which abolishes contracting-out for salary related occupational pension schemes from 6th April 2016, known as “the second abolition date”.
Regulation 2 amends the Occupational Pension Schemes (Modification of Schemes) Regulations 2006 (S.I. 2006/759) to provide a power for such schemes to modify their scheme rules to take account of changes made to section 16(2) of the Pension Schemes Act 1993 (c.48) by Schedule 13 of the 2014 Act. Schemes may use this power to make changes to have effect from the second abolition date.
Regulation 3 provides that changes made using the power provided for in regulation 2 are not ‘listed changes’ for the purposes of the Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 2006 (S.I. 2006/349).
Regulation 4 amends the Occupational Pension Schemes (Schemes that were Contracted-out) (No.2) Regulations 2015 (S.I. 2015/1677) so that changes made using the power provided for in regulation 2 is a permitted change to scheme rules which govern guaranteed minimum pensions.
An analysis of the impact of the abolition of contracting-out has been made as part of the analysis of the 2014 Act. A copy is available in the libraries of both Houses of Parliament and from the Better Regulation Unit of the Department for Work and Pensions, 2D, Caxton House, Tothill Street, London SW1H 9NA.