House of Commons Amendments

Session 2013 - 14
Internet Publications
Other Bills before Parliament

Consideration of Bill: 29 October 2013
1176

Pensions Bill, continued

“(vii)
regulations made under paragraph 6 of

Schedule [Work-based schemes: power to

restrict charges or impose requirements] to

the Pensions Act 2013.”

10
In section 256 of the Pensions Act 2004 (no indemnification for fines or civil

penalties), in subsection (1)(b), after “or paragraph 10 of Schedule 16 to the

Pensions Act 2013” (inserted by Schedule 16 to this Act) insert “or paragraph

3 of Schedule [Work-based schemes: power to restrict charges or impose

requirements] to that Act”.

11  (1)
Section 16 of the Pensions Act 2008 (automatic enrolment: qualifying

schemes) is amended as follows.

      (2)
In subsection (3), omit paragraphs (a), (aa) and (ab).

      (3)
After subsection (3) insert—

“(3A)
See also paragraphs 1(4) and 2(4) of Schedule [Work-based schemes:

power to restrict charges or impose requirements] to the Pensions Act

2013, which confer power to make regulations providing for a scheme

not to be a qualifying scheme in relation to a jobholder in certain

circumstances.”

      (4)
Omit subsections (4) and (5).

12
In consequence of the amendments made by paragraph 11, section 10 of the

Pensions Act 2011 (qualifying schemes: administration charges) is repealed.’.

Gregg McClymont

38

Clause  29,  page  15,  line  24,  leave out from ‘scheme’ to end of line.

Secretary Iain Duncan Smith

5

Clause  32,  page  16,  line  39,  leave out from beginning to ‘were’ in line 42 and insert

‘In subsection (1)(a), after “service,” insert—

“(aa)
he has at least 30 days’ qualifying service and, if he’.

Secretary Iain Duncan Smith

6

Clause  32,  page  17,  line  1,  leave out subsection (3).

Secretary Iain Duncan Smith

7

Clause  32,  page  17,  leave out lines 6 and 7 and insert—

‘“(10)
Subsections (7) to (9) apply, with the substitution for references to

2 years of references to 30 days, for determining whether a person has at

least 30 days’ qualifying service for the purposes of subsection (1).’.

Consideration of Bill: 29 October 2013
1177

Pensions Bill, continued

Secretary Iain Duncan Smith

8

Clause  32,  page  17,  line  8,  leave out ‘(1)(c)’ and insert ‘(1)(aa)’.

Secretary Iain Duncan Smith

9

Clause  32,  page  17,  line  12,  leave out ‘2 years’’ and insert ‘30 days’’.

Secretary Iain Duncan Smith

10

Clause  32,  page  17,  line  15,  leave out from ‘(4)(b),’ to end of line 16 and insert

‘after “(a)” insert “, (aa)”.’.

Gregg McClymont

53

Clause  34,  page  18,  line  22,  at end insert—

‘(5)
Regulations under this section shall not exempt entire classes of business or

businesses, such as small and medium-sized businesses, from automatic

enrolment.’.

Secretary Iain Duncan Smith

11

Page  18,  line  27,  leave out Clause 35.

Caroline Lucas

54

Clause  42,  page  23,  line  7,  at end add—

‘“(czb)
to promote, and to improve understanding of long-term and sustainable

investment amongst work-based pension schemes,”.’.

Gregg McClymont

39

Schedule  16,  page  84,  line  37,  leave out from ‘of’ to ‘transfer’ in line 1 on page 85,

and insert ‘a transferable benefits scheme, the cash equivalent of the transferable

benefits—

‘(a)
is transferred to a nominated’.

Consideration of Bill: 29 October 2013
1178

Pensions Bill, continued

Gregg McClymont

40

Schedule  16,  page  85,  line  3,  leave out ‘automatic transfer’ and insert ‘transferable

benefits’.

Gregg McClymont

41

Schedule  16,  page  85,  line  8,  leave out from ‘an’ to end of line 9, and insert ‘a

transferable benefits scheme, means a member of the scheme who is no longer having

contributions made to their benefits.’.

Gregg McClymont

42

Schedule  16,  page  85,  line  22,  leave out sub-paragraph (5) and insert—

    ‘(5)
In this Schedule “nominated transfer scheme” means—

(a)
a work-based pension scheme which is registered under Chapter 2 of

Part 4 of the Finance Act 2004 and is a money purchase scheme;

(b)
a scheme in which the qualifying member is a member, or that has

been nominated by the member or the transferable benefits scheme for

the purposes of transferring pots;

(c)
a pension scheme which meets quality standards as set out by the

Secretary of State;

(d)
a pension scheme that meets any other requirements set out in

regulations.’.

Gregg McClymont

43

Schedule  16,  page  85,  line  38,  leave out from beginning to end of line 29 on page

87, and insert—

‘Transferable benefits scheme to transfer to nominated transfer scheme

2    (1)
The regulations must require the trustees or managers of a transferable benefits

scheme to establish an agreement with a nominated transfer scheme to make

provision—

(a)
for the transfer of qualifying members’ benefits to the nominated

transfer scheme; and

(b)
describing how and when steps are to be taken in order to effect the

transfer.

      (2)
The regulations may make provision for a protocol through which a

transferable benefits scheme may establish an agreement with a nominated

transfer scheme.

      (3)
The regulations must ensure that where the duty to transfer qualifying

members’ benefits to a nominated transfer scheme, has arisen, the member

may opt out of the transfer or identify an alternative nominated transfer scheme

to which the members’ benefits will be transferred.’.

Consideration of Bill: 29 October 2013
1179

Pensions Bill, continued

Gregg McClymont

44

Schedule  16,  page  88,  line  25,  at end insert—

‘Nominated transfer schemes: quality requirements and administration charges

10A(1)
The regulations may impose requirements that must be satisfied by any

nominated transfer scheme.

      (2)
The requirements may in particular relate to—

(a)
the governance of the scheme;

(b)
the administration of the scheme; and

(c)
the certification of the scheme by the Regulator.

      (3)
The regulations may make provision limiting or prohibiting any administration

charge that may otherwise be imposed on a member of an automatic transfer

scheme.

      (4)
Regulations made because of sub-paragraph (3)—

(a)
may make provision for the manner of, and criteria for, determining

whether an administration charge exceeds any limit or is prohibited;

and

(b)
may provide for the determination to be made in accordance with

guidance issued from time to time by the Secretary of State.

      (5)
The requirements that may be imposed, and the charges that may be limited or

prohibited, because of this paragraph need not relate to things done under the

regulations.’.

Gregg McClymont

45

Schedule  16,  page  88,  line  27,  leave out paragraphs 11 and 12.

Secretary Iain Duncan Smith

28

Schedule  16,  page  88,  line  33,  leave out from beginning to end of line 14 on

page 89.

Caroline Lucas

55

Schedule  16,  page  88,  line  38,  at end insert—

‘(c)
the ability of the scheme to generate sustainable investment returns.’.

Gregg McClymont

46

Schedule  16,  page  89,  line  39,  leave out ‘an automatic’ and insert ‘a nominated’.

Gregg McClymont

47

Schedule  16,  page  90,  line  1,  leave out ‘current’.

Gregg McClymont

48

Schedule  16,  page  90,  line  2,  after ‘member’, insert ‘in a nominated transfer

scheme’.

Consideration of Bill: 29 October 2013
1180

Pensions Bill, continued

Gregg McClymont

49

Schedule  16,  page  90,  line  3,  leave out sub-paragraph (2).

Secretary Iain Duncan Smith

29

Schedule  16,  page  91,  line  1,  leave out from beginning to end of line 10.

Gregg McClymont

50

Schedule  16,  page  91,  leave out line 11.

Gregg McClymont

51

Schedule  16,  page  91,  line  21,  at end insert ‘“nominated transfer scheme” has the

meaning given by sub-paragraph 1(5);’.

Gregg McClymont

52

Schedule  16,  page  91,  leave out lines 36 and 37.

Secretary Iain Duncan Smith

30

Schedule  16,  page  93,  line  8,  at end add—


‘In section 256 of the Pensions Act 2004 (no indemnification for fines or civil

penalties), in subsection (1)(b)—

(a)
for “or section” substitute “, section”;

(b)
after “2008” insert “or paragraph 10 of Schedule 16 to the Pensions

Act 2013”.’.

Secretary Iain Duncan Smith

31

Schedule  18,  page  95,  line  24,  at end add—

‘Part 3

transitional provision

Interpretation

7
In this Part of this Schedule “the commencement date” means the date on

which the amendments made by Part 1 of this Schedule come into force.

8
Other expressions used in this Part of this Schedule have the same meaning as

in Part 2 of the Pensions Act 2004

Recalculation of periodic compensation going forwards

9    (1)
This paragraph applies in relation to a person if—

(a)
the person is entitled to periodic compensation under paragraph 3, 11

or 15 of Schedule 7 to the Pensions Act 2004,

Consideration of Bill: 29 October 2013
1181

Pensions Bill, continued

(b)
the compensation is restricted in accordance with paragraph 26 of that

Schedule (compensation cap), and

(c)
the person first became entitled to the compensation before the

commencement date.

      (2)
The protected pension rate for the person is to be recalculated as if the

amendments made by Part 1 of this Schedule had always been in force and the

recalculated protected pension rate has effect for the person as from the

commencement date.

      (3)
For the purposes of that recalculation, paragraph 26A(7) of Schedule 7 to the

Pensions Act 2004 (inserted by Part 1 of this Schedule) has effect as if—

(a)
the references to an order made by the Secretary of State were

references to the relevant old order, and

(b)
the reference to actuarial adjustment factors were a reference to the

relevant old actuarial adjustment factors.

      (4)
In this paragraph—

“the protected pension rate”—

(d)
for a person entitled to periodic compensation under paragraph 3

or 15 of Schedule 7 to the Pensions Act 2004, means the

protected pension rate for the purposes of sub-paragraph (3)(a)

of that paragraph;

(e)
for a person entitled to periodic compensation under paragraph

11 of that Schedule, means the protected notional pension for the

purposes of sub-paragraph (3)(a) of that paragraph;

“the relevant old order” means the order in force under paragraph 26(7) of

Schedule 7 to the 2004 Act (as originally enacted) at the time when the

person first became entitled to the periodic compensation;

“the relevant old actuarial adjustment factors” means the actuarial

adjustment factors published by the Board under paragraph 26(7) of

Schedule 7 to the 2004 Act (as originally enacted) at the time when the

person first became entitled to the periodic compensation.

      (5)
Nothing in this paragraph affects increases already accrued under paragraph

28 of Schedule 7 to the Pensions Act 2004 in relation to periods before the

commencement date.

New cap does not generally affect old payments

10  (1)
Nothing in this Schedule affects—

(a)
periodic compensation for a person for periods before the

commencement date, or

(b)
lump sum compensation for a person who became entitled to the

compensation before the commencement date.

      (2)
In this paragraph—

“periodic compensation” means compensation within paragraph 26(4)(a),

(b) or (d) of Schedule 7 to the Pensions Act 2004;

“lump sum compensation” means compensation within paragraph 26(4)(c)

or (e) of that Schedule.

Survivors’ compensation

11
When working out the annual rate of a person’s periodic compensation under

paragraph 4(3), 13(3) or 18(3) of Schedule 7 to the Pensions Act 2004, take

into account any effect that paragraph 9 would have had on the dead person’s

rate if it were not for the death.

Consideration of Bill: 29 October 2013
1182

Pensions Bill, continued

Cases involving early payment or postponement of compensation

12
Nothing in this Schedule affects the amount of—

(a)
an actuarial reduction under paragraph 25 of Schedule 7 to the

Pensions Act 2004 in a case where a person became entitled to

periodic compensation or lump sum compensation before the

commencement date, or

(b)
an actuarial increase under paragraph 25A of that Schedule in a case

where the commencement of periodic compensation or the payment of

lump sum compensation was postponed before the commencement

date (even if it continues to be postponed on or after that date).

Recalculation of terminal illness lump sums given in the past year

13  (1)
This paragraph applies in relation to a person who is alive on the

commencement date if—

(a)
the person has become entitled to a terminal illness lump sum under

paragraph 25E of Schedule 7 to the Pensions Act 2004 at any time in

the period of one year ending with the commencement date, and

(b)
the amount of the terminal illness lump sum was restricted in

accordance with paragraph 26 of that Schedule (compensation cap).

      (2)
The terminal illness lump sum for the person is to be recalculated under

Schedule 7 to the Pensions Act 2004 as if the amendments made by Part 1 of

this Schedule had been in force at the time that the person became entitled to it.

      (3)
For the purposes of that recalculation, paragraph 26A(7) of Schedule 7 to the

Pensions Act 2004 (inserted by Part 1 of this Schedule) has effect as if—

(a)
the references to an order made by the Secretary of State were

references to the relevant old order, and

(b)
the reference to actuarial adjustment factors were a reference to the

relevant old actuarial adjustment factors.

      (4)
In sub-paragraph (3)—

“the relevant old order” means the order in force under paragraph 26(7) of

Schedule 7 to the 2004 Act (as originally enacted) at the time when the

person became entitled to the terminal illness lump sum;

“the relevant old actuarial adjustment factors” means the actuarial

adjustment factors published by the Board under paragraph 26(7) of

Schedule 7 to the 2004 Act (as originally enacted) at the time when the

person became entitled to the terminal illness lump sum.

Meaning of “the pension compensation provisions” in Part 2 of the Pensions Act 2004

14
Section 162(2) of the Pensions Act 2004 is to be treated as including a

reference to this Part of this Schedule among “the pension compensation

provisions”.’.



© Parliamentary copyright	Revised 29 October 2013