SCHEDULE 13 continued PART 1 continued
Pensions BillPage 70
(b) after that subsection insert—
“(2)
The Secretary of State must give such guidance (if any) as he
or she thinks appropriate about GMP conversion.”
21
In section 25 (power for HMRC to impose conditions as to investments and
5resources), in subsection (2), after “A” insert “scheme that was a”.
22
Sections 34 to 36 (cancellation, variation, surrender and refusal of
certificates) are repealed.
23
In the italic heading above section 37, for “scheme rules after certification”
substitute “rules by former salary related contracted-out schemes”.
24
10In section 37 (alteration of rules of contracted-out schemes) for subsections
(1) to (3) substitute—
“(1)
Except in prescribed cases, the rules of a scheme that was a salary
related contracted-out scheme cannot be altered unless the alteration
is of a prescribed description.
(2)
15Regulations made by virtue of subsection (1) may operate so as to
validate with retrospective effect any alteration of the rules which
would otherwise be void under this section.
(3)
Subsection (1) does not apply to a scheme if no person is entitled to
receive, or has accrued rights to, any benefits under the scheme
20attributable to a period when the scheme was contracted-out.”
25 After section 37 insert—
(1) Regulations may prohibit or restrict—
(a) 25the transfer of any liability—
(i)
for the payment of pensions under a relevant scheme,
or
(ii) in respect of accrued rights to such pensions,
(b)
the discharge of any liability to provide pensions under a
30relevant scheme, or
(c)
the payment of a lump sum instead of a pension payable
under a relevant scheme,
except in prescribed circumstances or on prescribed conditions.
(2)
In this section “relevant scheme” means a scheme that was a salary
35related contracted-out scheme by virtue of section 9(2B) and
references to pensions and accrued rights under the scheme are to
such pensions and rights so far as attributable to an earner’s service
on or after the principal appointed day (including, in a case where
there has been a transfer payment, any pensions or rights deriving
40(directly or indirectly) from—
(a)
an earner’s service on or after the principal appointed day in
employment that was contracted-out employment by
reference to another scheme, or
(b)
in a case where the transfer payment was made before the
45first abolition date, protected rights under another
occupational pension scheme or under a personal pension
Pensions BillPage 71
scheme which derive from payments or contributions in
respect of employment on or after the principal appointed
day.)
(3)
Regulations under subsection (1) may provide that any provision of
5this Part shall have effect subject to such modifications as may be
specified in the regulations.”
26
For the heading to Chapter 2 of Part 3 substitute “Reduction in social
security benefits for members of schemes that were contracted-out”.
27 In section 40 (scope of Chapter 2)—
(a) 10omit paragraph (a);
(b)
in paragraph (c) for “such schemes” substitute “schemes that were
contracted-out pension schemes”.
28 The italic heading above section 41 is repealed.
29 Section 41 (reduced rates of Class 1 contributions) is repealed.
30
(1)
15Section 42 (review and alteration of reduced rates of Class 1 contributions)
is repealed.
(2)
There is no duty, before the repeal of section 42 comes into force, to lay
before Parliament any reports under that section.
31
In section 48A (additional pension and other benefits), in subsection (1), for
20the words from the beginning to the end of paragraph (b) substitute “In
relation to—
“(a)
any tax week falling before the first abolition date where the
amount of a Class 1 contribution attributable to
section 8(1)(a) of the Social Security Contributions and
25Benefits Act 1992 in respect of the earnings paid to or for the
benefit of an earner in that week was reduced under section
42A of this Act (as it then had effect),
(b)
any tax week falling before the second abolition date where
the amount of a Class 1 contribution attributable to
30section 8(1)(a) of the Social Security Contributions and
Benefits Act 1992 in respect of the earnings paid to or for the
benefit of an earner in that week was reduced under section
41 of this Act (as it then had effect), or
(c)
any tax week falling before the first abolition date where an
35amount was paid under section 45(1) of this Act (as it then
had effect) in respect of the earnings paid to or for the benefit
of an earner,”.
32 Section 49 (women, married women and widows) is repealed.
33
Section 50 (powers of HMRC to approve arrangements for scheme ceasing
40to be certified) is repealed.
34
In section 51 (calculation of guaranteed minimum pensions under approved
arrangements), in subsection (1)(b), for “ceases” substitute “ceased”.
Pensions BillPage 72
35 For section 52 substitute—
Section 53 shall apply for the purpose of making provision for
securing the continued supervision of any scheme that was a salary
5related contracted-out scheme, other than a public service pension
scheme, if any person is entitled to receive or has accrued rights to—
(a) a guaranteed minimum pension under the scheme, or
(b)
a pension under the scheme attributable to service on or after
the principal appointed day but before the scheme ceased to
10be contracted-out.”
36
In section 53 (supervision: former contracted-out schemes), omit
subsection (3).
37 Sections 55 to 68 (state scheme premiums) are repealed.
38
In section 87 (general protection principle), in subsection (1)(a), for sub-
15paragraph (i) substitute—
“(i) the date (“the cessation date”) which is the earlier of—
(a)
the date on which an earner ceases to be in
pensionable service under a scheme that was,
before the second abolition date, a salary
20related contracted-out scheme; and
(b)
the date on which the earner attains
pensionable age;”.
39
In section 96 (further provisions concerning exercise of option to take cash
equivalent in a particular way), in subsection (2), in paragraph (a)(i) omit
25“which is not a contracted-out scheme”.
40
In section 109 (annual increase of guaranteed minimum pensions), in
subsection (3A)(b), omit “for the purposes of Part 3 of the Pensions Act
1995”.
41
In section 171 (questions arising in proceedings), in subsection (1), omit
30paragraph (b) and the “or” before it.
42 In section 178 (trustees and managers of schemes), in paragraph (a)—
(a) after “1985” insert “or”;
(b)
omit “or Part II of Schedule 5 to the Child Support, Pensions and
Social Security Act 2000”.
43 (1) 35Section 181(1) (general interpretation) is amended as follows.
(2) In the appropriate places insert—
““the first abolition date” has the meaning given by section 7A;”
““the second abolition date” has the meaning given by section 7A;”
““the principal appointed day” means 6 April 1997 (which is the day
40designated as the principal appointed day for the purposes of Part 3
of the Pensions Act 1995);”
““salary related contracted-out scheme” is to be construed in
accordance with section 7B;”.
(3) Omit the definition of “abolition date”.
Pensions BillPage 73
(4)
In the definition of “appropriate scheme” and “appropriate scheme
certificate”, for “section 181A” substitute “section 7B”.
(5)
In the definition of “contracting-out certificate”, for “section 7 and section
181A” substitute “section 7B”.
(6)
5In the definition of “contributions equivalent premium”, for “has the
meaning given in” substitute “means a premium that was paid under”.
(7)
In the definition of “earner” and “earnings”, after “in accordance with” insert
“section 8(1B) of this Act and”.
(8)
In the definition of “money purchase contracted-out scheme”, for “section
10181A” substitute “section 7B”.
44
Section 181A (interpretation of references to money purchase contracted-out
schemes or appropriate schemes after first abolition date) is repealed.
45 In section 185 (consultation about other regulations), omit subsection (9).
46 (1) Schedule 2 (certification regulations) is amended as follows.
(2) 15Omit paragraphs 1 to 4.
(3)
In paragraph 5(3A), for “a contracted-out occupational pension scheme
which is being wound up if,” substitute “a scheme which was a contracted-
out occupational pension scheme and which was being wound up before the
second abolition date”.
(4) 20Omit paragraphs 6 to 8.
47 (1) Schedule 4 (priority in bankruptcy) is amended as follows.
(2) In paragraph 2—
(a)
in sub-paragraph (1), after “contributions to a” insert “Northern
Ireland”;
(b) 25in sub-paragraph (5), at the appropriate place insert—
““Northern Ireland salary related contracted-out
scheme” means a salary related contracted-out
scheme within the meaning of the Pension Schemes
(Northern Ireland) Act 1993 (and references to
30employment that is contracted-out by reference to a
scheme are to be read accordingly);”.
(3) In paragraph 3—
(a)
in sub-paragraph (1), after “on account of a” insert “Northern
Ireland”;
(b) 35after sub-paragraph (5) insert—
“(6)
In this paragraph “Northern Ireland contributions
equivalent premium” means a contributions equivalent
premium within the meaning of the Pension Schemes
(Northern Ireland) Act 1993.”
(4) 40Omit paragraph 4(2).
Pensions BillPage 74
48 The Contributions and Benefits Act is amended as follows.
49
5In section 1 (outline of contributory system), in subsection (3), omit the
words after paragraph (b).
50
In section 4C (power to make provision in consequence of provision made
by virtue of section 4B(2) etc), in subsection (5), in each of paragraphs (a)
and (b) omit the words from “, including” to the end.
51
10In section 8 (calculation of primary Class 1 contributions), in subsection (3),
omit paragraph (c) and the “and” before it.
52
In section 9 (calculation of secondary Class 1 contributions), in
subsection (3), omit paragraph (c) and the “and” before it.
53
In section 20 (descriptions of contributory benefits), in subsection (3), for
15“(reduction in state scheme contributions and benefits for members of
certified schemes)” substitute “(reduction in benefits for members of
schemes that were contracted-out)”.
54
In Schedule 1 (supplementary provisions relating to national insurance
contributions), in paragraph 1, omit sub-paragraphs (2), (3), (6) and (9)
20to (11).
55 The Administration Act is amended as follows.
56
In section 150 (annual up-rating of benefits), in subsection (10A), for “the
abolition date, as defined by section 181(1) of the Pensions Act,” substitute
25“6 April 2012 (the date appointed for the commencement of section 15(1) of
the Pensions Act 2007)”.
57 In section 191 (interpretation - general)—
(a)
in the definition of “money purchase contracted-out scheme”, for
“section 181A” substitute “section 7B”;
(b)
30in the definition of “personal pension scheme” etc, for “section
181A(6)” substitute “section 7B(6)”.
58 The Pensions Act 1995 is amended as follows.
59 (1) Section 51 (annual increase in rate of pension) is amended as follows.
(2) 35For “the appointed day” (in each place) substitute “6 April 1997”.
(3) For subsection (8) substitute—
“(8)
An occupational pension scheme is a “relevant occupational pension
scheme” if—
Pensions BillPage 75
(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
5related 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.”
60
In section 54 (sections 51 to 53: supplementary), in subsection (3), omit the
10definition of “the appointed day”.
61 For section 69 substitute—
(1)
The Authority may, on an application made to them by the trustees
15of a registered pension scheme which is being wound up, make an
order—
(a)
modifying the scheme for the purpose of enabling assets
remaining after the liabilities of the scheme have been fully
discharged to be distributed to the employer, or
(b)
20authorising the trustees to modify the scheme for that
purpose.
(2)
But the Authority may act under subsection (1) only if prescribed
requirements in relation to the distribution are satisfied.
(3)
Regulations may make provision requiring applications under
25subsection (1) to meet prescribed requirements.
(4)
Regulations may provide that in prescribed circumstances this
section does not apply to schemes falling within a prescribed class or
description or applies to them with prescribed modifications.
(5)
In this section “registered pension scheme” means an occupational
30pension scheme registered under section 153 of the Finance Act 2004
(other than a public service pension scheme).”
62 In section 70 (section 69: supplementary), omit subsection (3).
63 In section 71 (effect of orders under section 69), in subsection (1)—
(a) for “paragraph (a)” substitute “paragraph (b)”;
(b) 35for “paragraph (b)” substitute “paragraph (a)”;
(64) In section 72 (modification of public service pension schemes), in subsection (1), for “section 69(1)(b)” substitute “section 69(1)(a)”.
65
Sections 136(1), (3) and (5), 137(3) and (4) and 148 (amendments to do with
contracting-out) are repealed.
66 40The Employment Rights Act 1996 is amended as follows.
67
In section 3 (note to be included in statement of initial employment
particulars), omit subsection (5).
Pensions BillPage 76
68
In section 11 (references to employment tribunals), in subsection (3), omit
paragraph (a) (including the “and” at the end of it).
69
The Child Support, Pensions and Social Security Act 2000 is amended as
5follows.
70 (1) Section 42 (disclosure of state pension information) is amended as follows.
(2) In subsection (3)(d), omit “which is not contracted-out employment”.
(3) In subsection (11), omit the definition of “contracted-out employment”.
71 Part 2 of Schedule 5 (alternative to anti-franking rules) is repealed.
72
In section 15 of the Employment Act 2002 (use of information by HMRC), in
subsection (2)(c), for “(certification of pension schemes etc)” substitute
“(schemes that were contracted-out etc)”.
73 15The Companies Act 2006 is amended as follows.
74
In section 140 (interests to be disregarded: employer’s rights of recovery
under pension scheme or employee’s share scheme), in subsection (2), omit
“section 61 of the Pension Schemes Act 1993 or”.
75
In section 673 (interests to be disregarded in determining whether company
20has beneficial interest: employer’s charges and other rights of recovery), in
subsection (1)(b), omit sub-paragraph (ii).
76 The Pensions Act 2007 is amended as follows.
77
(1)
Section 15 (abolition of contracting-out for defined contribution pension
25schemes) is amended as follows.
(2) In subsection (1), for “the abolition date” substitute “6 April 2012”.
(3) In subsection (2), omit the definition of “the abolition date”.
(4)
In subsection (4), for “the abolition date” (in each place) substitute “6 April
2012”.
78
30In section 27 (consequential provision, repeals and revocations), in
subsection (6), for “the abolition date (within the meaning of section 15)”
substitute “6 April 2012”.
79
(1)
Schedule 4 (abolition of contracting-out for defined contribution pension
schemes) is amended as follows.
(2)
35In paragraphs 61, 62(1), (2)(a) and (b)(i) and (3), 65 and 66(2) for “the
abolition date” (in each place) substitute “6 April 2012”.
(3) In paragraph 67(1) omit the definition of “the abolition date”.
Pensions BillPage 77
80 The Pensions Act 2008 is amended as follows.
81 For section 21 substitute—
5A defined benefits scheme that has its main administration in the
United Kingdom satisfies the quality requirement in relation to a
jobholder if it satisfies the test scheme standard in relation to that
jobholder.”
82 In section 22 (test scheme standard), for subsection (2) substitute—
“(2)
10Subject to subsection (3), the relevant members are J and all active
members who are jobholders of the same employer as J.”
Section 24
1
15This Schedule is about the power under section 24(2) to amend an
occupational pension scheme in relation to some or all of its members.
2 (1) The power may be used—
(a) to increase the employee contributions of the relevant members;
(b) 20to alter the future accrual of benefits for or in respect of them.
(2) But the power may not be used in a way that would—
(a)
increase the amount of the total annual employee contributions of
the relevant members by more than the annual increase in the
employer’s national insurance contributions in respect of them,
(b)
25reduce the amount of the scheme’s liabilities in respect of the benefits
that accrue annually for or in respect of the relevant members by
more than the annual increase in the employer’s national insurance
contributions in respect of them, or
(c)
result in the sum of the amount of any increase in the total annual
30employee contributions of the relevant members and the amount of
any reduction in the scheme’s liabilities in respect of the benefits that
accrue annually for or in respect of the relevant members being more
than the annual increase in the employer’s national insurance
contributions in respect of the relevant members.
(3) 35Regulations are to define what is meant by—
(a) the total annual employee contributions of the relevant members;
(b)
the annual increase in an employer’s national insurance
contributions in respect of the relevant members;
(c)
a scheme’s liabilities in respect of the benefits that accrue annually
40for or in respect of the relevant members.
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(4) Regulations may create exceptions to sub-paragraph (2).
3
(1)
The power may not be used in a way that would or might adversely affect
the subsisting rights of—
(a) a member of the scheme, or
(b) 5a survivor of a member of the scheme.
(2)
“Subsisting right” and “survivor” have the meanings given by section 67A of
the Pensions Act 1995.
4 Regulations may impose further restrictions on the use of the power.
5
10The power may not be used to amend a scheme in relation to a member of a
description specified in regulations under this paragraph.
6
(1)
The power may be used only if an actuary has certified that the proposed
amendments would comply with such of the requirements imposed by or
15under this Schedule as are specified in regulations under this paragraph.
(2) “Actuary” means—
(a) a person of a description specified in regulations, or
(b) a person approved by the Secretary of State.
7
20The power may be used before or after the repeal of section 41 of the Pension
Schemes Act 1993 comes into force (but amendments made under it must
not be framed so as to take effect before the repeal comes into force).
8
An amendment made before the repeal of section 41 of the Pension Schemes
Act 1993 comes into force does not take effect in relation to any relevant
25members who have ceased to be in contracted-out employment by reference
to the scheme before the repeal comes into force.
9
(1)
The power may be used to amend a scheme in relation to the same relevant
members on more than one occasion.
(2)
30For the purposes of paragraph 2 as it applies in relation to the use of the
power on the second or subsequent occasion, all of the amendments are to
be treated as if they were being made on that occasion.
(3)
Regulations may make further provision modifying section 24(2) to (5) or
this Schedule (including paragraph 2) where the power is used to amend the
35scheme in relation to the same relevant members on more than one occasion.
10
(1)
Regulations may modify section 24(2) to (5) or this Schedule as it applies in
relation to—
(a) multi-employer schemes, or
Pensions BillPage 79
(b) schemes that have different rules for different members.
(2)
“Multi-employer scheme” means a scheme in relation to which there is more
than one employer.
11
5An amendment under section 24 and this Schedule may be made in relation
to any member, and has effect, despite anything in any other enactment to
the contrary.
12
Regulations may impose procedural requirements about the use of the
10power and the manner in which any amendments must be made.
13 In this Schedule—
“employee contributions” means, in relation to a member of a scheme,
contributions made to the scheme by or on behalf of the member on
15his or her own account;
“relevant member”, in relation to a scheme, means a member in relation
to whom the scheme has been or is to be amended under
section 24(2).
Section 28
1
In section 4 of the Forfeiture Act 1982 (Upper Tribunal to decide whether
forfeiture rule applies to social security benefits), in the definition of
“relevant enactment” in subsection (5), after the entry relating to Part 1 of
25this Act (inserted by Schedule 12 to this Act) insert—
“section 27 of that Act,”.
2
The Social Security Contributions and Benefits Act 1992 is amended as
follows.
3 (1) 30Section 20 (descriptions of contributory benefits) is amended as follows.
(2) In subsection (1), for paragraph (ea) substitute—
“(ea) widowed parent’s allowance;”.
(3)
In subsection (2), in the definition of “long-term benefit” omit paragraph
(bb).
4 (1) 35Section 21 (contribution conditions) is amended as follows.