Pensions Bill (HL Bill 37)

(a) omit “and” at the end of paragraph (a), and

(b) after that paragraph insert—

“(aa) if the commencement of periodic compensation

under this paragraph has been postponed for any

5period by virtue of paragraph 25A, the amount of

the actuarial increase under that paragraph, and”.

(8) In paragraph 19(3) (lump sum compensation for deferred member under

pension age at assessment date) for “the protected amount” substitute “the

aggregate of—

“(a) 10the protected amount, and

(b) if the payment of compensation under this paragraph has

been postponed for any period by virtue of paragraph 25A,

the amount of the actuarial increase under that

paragraph.”

(9) 15In paragraph 26 (compensation cap)—

(a) in sub-paragraphs (3)(c) and (6)(e), for “14(3)” substitute “14(3)(a)”,

and

(b) in sub-paragraphs (3)(e) and (6)(g), for “19(3)” substitute “19(3)(a)”.

23 (1) In paragraph 6 (periodic compensation for widow or widower of postponed

20pensioner at assessment date)—

(a) in sub-paragraph (3) after “including” insert “any actuarial increase

under paragraph 25A and”, and

(b) after sub-paragraph (3) insert—

“(3A) If, on the day the postponed pensioner (“P”) died,

25commencement of P’s periodic compensation under

paragraph 5 was postponed by virtue of paragraph 25A,

assume for the purposes of sub-paragraph (3) that the

periodic compensation commenced immediately before

the date of P’s death.”

(2) 30In paragraph 9 (periodic compensation for widow or widower of active

member over pension age at assessment date)—

(a) in sub-paragraph (3) after “including” insert “any actuarial increase

under paragraph 25A and”, and

(b) after sub-paragraph (3) insert—

“(3A) 35If, on the day the active member (“A”) died,

commencement of A’s periodic compensation under

paragraph 8 was postponed by virtue of paragraph 25A,

assume for the purposes of sub-paragraph (3) that the

periodic compensation commenced immediately before

40the date of A’s death.”

(3) In paragraph 13 (periodic compensation for widow or widower of active

member under pension age at assessment date)—

(a) in sub-paragraph (3)(a) after “including” insert “any actuarial

increase under paragraph 25A and”,

(b) 45in sub-paragraph (3)(b) after sub-paragraph (ii) insert—

“(none) (assuming commencement of the periodic

compensation was not postponed by virtue of

paragraph 25A).”, and

(c) after sub-paragraph (3) insert—

“(3ZA) For the purposes of sub-paragraph (3)(a), if on the day the

active member (“A”) died commencement of A’s periodic

compensation under paragraph 11 was postponed by

5virtue of paragraph 25A, assume that the periodic

compensation commenced immediately before the date of

A’s death.”

(4) In paragraph 18 (periodic compensation for widow or widower of deferred

member under pension age at assessment date)—

(a) 10in sub-paragraph (3)(a) after “including” insert “any actuarial

increase under paragraph 25A and”,

(b) in sub-paragraph (3)(b) after sub-paragraph (ii) insert—

“(none) (assuming commencement of the periodic

compensation was not postponed by virtue of

15paragraph 25A).”, and

(c) after sub-paragraph (3) insert—

“(3ZA) For the purposes of sub-paragraph (3)(a), if on the day the

deferred member (“D”) died commencement of D’s

periodic compensation under paragraph 15 was

20postponed by virtue of paragraph 25A, assume that the

periodic compensation commenced immediately before

the date of D’s death.”

24 (1) In paragraph 25B (eligibility for terminal illness lump sum)—

(a) in sub-paragraph (4) in the definition of “relevant age”—

(i) 25in paragraph (a) omit “or deferred” and “or (as the case may

be) 25A”, and

(ii) in paragraph (b) omit “or deferred”, and

(b) after sub-paragraph (4) insert—

“(5) Sub-paragraph (6) applies where—

(a) 30the commencement of a person’s periodic

compensation under paragraph 11 or 15 is

postponed by virtue of paragraph 25A, or

(b) the payment of a person’s lump sum compensation

under paragraph 14 or 19 is postponed by virtue of

35that paragraph.

(6) This paragraph applies as if—

(a) the person first becomes entitled to compensation

under the paragraph in question immediately after

the period of postponement ends, and

(b) 40in sub-paragraph (1)(b), for “if the person lived to

the relevant age, the person would become entitled

on attaining that age” there were substituted “if the

period of postponement ended, the person would

become entitled”.”

(2) 45In paragraph 25E (effect of successful application for terminal illness lump

sum) after sub-paragraph (6) insert—

“(7) Where on the granting of the application—

(a) the commencement of a person’s periodic compensation

under paragraph 11 or 15 is postponed by virtue of

paragraph 25A, or

(b) the payment of a person’s lump sum compensation under

5paragraph 14 or 19 is postponed by virtue of that

paragraph,

this paragraph applies as if the references to the person attaining

the relevant age were references to the period of postponement

ending.”

25 (1) 10Paragraph 28 (annual increase in periodic compensation) is amended as

follows.

(2) In sub-paragraph (3)—

(a) in the definition of “underlying rate”, for “any of the paragraphs

mentioned in sub-paragraph (1)” substitute “paragraph 3 or 22”, and

(b) 15after that definition insert—

• ““underlying rate” means, in the case of periodic
  
  compensation under paragraph 5, 8, 11 or 15, the
  
  aggregate of—

  (a)

  so much of the amount mentioned in sub-
  
  20paragraph (3)(a) of the paragraph in question
  
  as is attributable to post-1997 service,

  (b)

  so much of the amount mentioned in sub-
  
  paragraph (3)(aa) of the paragraph in question
  
  as is attributable to post-1997 service, and

  (c)

  25the amount within sub-paragraph (3)(b) of
  
  that paragraph immediately before the
  
  indexation date.”

(3) In sub-paragraph (5)(a) for the second “the” substitute “each”.

(4) After sub-paragraph (5) insert—

“(5A) 30The amount mentioned in sub-paragraph (3)(aa) of paragraph 5, 8,

11 or 15 is attributable—

(a) to post-1997 service, in so far as it relates to so much of the

amount mentioned in sub-paragraph (3)(a) of the

paragraph in question as is attributable to post-1997

35service, and

(b) to pre-1997 service, in so far as it relates to so much of that

amount as is attributable to pre-1997 service.

(5B) Where the commencement of periodic compensation under

paragraph 5, 8, 11 or 15 has been postponed by virtue of paragraph

4025A, this paragraph applies as if the person first becomes entitled

to periodic compensation under the paragraph in question on the

day on which the periodic compensation commences.”

26 (1) In paragraph 29 (Board’s powers to alter rates of revaluation and

indexation) after sub-paragraph (6) insert—

“(6A) 45A determination under sub-paragraph (2) which has effect as

mentioned in sub-paragraph (6)(b)(ii) may provide that, where the

payment of periodic compensation to a person is postponed by

virtue of paragraph 25A, the determination applies as if the person

first becomes entitled to the periodic compensation on the day on

which the periodic compensation commences.”

(2) In paragraph 30 (Secretary of State’s powers to vary percentage paid as

compensation) after sub-paragraph (6) insert—

“(6A) 5An order under this paragraph which has effect as mentioned in

sub-paragraph (6)(b)(ii) may provide that, where the payment of

compensation to a person is postponed by virtue of paragraph

25A, the order applies as if the person first becomes entitled to the

compensation immediately after the period of postponement

10ends.”

Pension compensation sharing: postponement of compensation

27 Schedule 5 to the Pensions Act 2008 (pension compensation payable on

discharge of pension compensation credit) is amended as follows.

28 (1) Omit paragraph 11 (deferral of compensation).

(2) 15In Part 4, after the Part heading insert—

“Postponement of compensation

16A (1) Regulations may prescribe circumstances in which, and

conditions subject to which, a person who becomes entitled to

periodic compensation under paragraph 4 or 6 may elect to

20postpone the commencement of periodic compensation under

that paragraph.

(2) Where the commencement of periodic compensation under

paragraph 4 or 6 ceases to be postponed, the Board must

determine—

(a) 25the relevant amount, as at the time the periodic

compensation would have commenced if its

commencement had not been postponed, and

(b) the amount in paragraph (a), increased in accordance with

actuarial factors published by the Board.

(3) 30References in this Schedule to the amount of an actuarial increase

under this paragraph are to the difference between the amounts in

sub-paragraphs (2)(a) and (2)(b).

(4) In sub-paragraph (2) the “relevant amount” means (as

appropriate)—

(a) 35the amount mentioned in paragraph 4(3)(a), or

(b) the aggregate of the amounts mentioned in paragraph

6(3)(a) and (b).”

29 (1) In paragraph 4(3) (periodic compensation for transferee over pension

compensation age on transfer day)—

(a) 40omit “and” at the end of paragraph (a), and

(b) after that paragraph insert—

“(aa) if the commencement of periodic compensation

under this paragraph has been postponed for any

period by virtue of paragraph 16A, the amount of

45the actuarial increase under that paragraph, and”.

(2) In paragraph 4(4) (provisions to which paragraph 4 is subject) after “subject

to” insert “paragraph 16A (postponement of compensation) and”.

(3) In paragraph 6(3) (periodic compensation for transferee under pension

compensation age on transfer day)—

(a) 5omit “and” at the end of paragraph (b), and

(b) after that paragraph insert—

“(ba) if the commencement of periodic compensation

under this paragraph has been postponed for any

period by virtue of paragraph 16A, the amount of

10the actuarial increase under that paragraph, and”.

(4) In paragraph 6(4) (provisions to which paragraph 6 is subject)—

(a) omit the entry for paragraph 11,

(b) omit “and” at the end of the entry for paragraph 15, and

(c) after that entry insert—

• 15“paragraph 16A (postponement of compensation),
  
  and”.

30 (1) In paragraph 5 (periodic compensation for widow etc of transferee over

pension compensation age on transfer day)—

(a) in sub-paragraph (3) after “(including” insert “any actuarial increase

20under paragraph 16A and”, and

(b) after sub-paragraph (3) insert—

“(3A) If, on the day the transferee (“T”) died, commencement of

T’s periodic compensation under paragraph 4 was

postponed by virtue of paragraph 16A, assume for the

25purposes of sub-paragraph (3) that the periodic

compensation commenced immediately before the date of

T’s death.”

(2) In paragraph 7 (periodic compensation for widow etc of transferee under

pension compensation age on transfer day)—

(a) 30in sub-paragraph (3)(a) after “(see paragraph 8)” insert “, any

actuarial increase under paragraph 16A”,

(b) in sub-paragraph (3)(b) after sub-paragraph (ii) insert—

“(none) (assuming commencement of the periodic

compensation was not postponed by virtue of

35paragraph 16A).”, and

(c) after sub-paragraph (3) insert—

“(3A) For the purposes of sub-paragraph (3)(a), if on the day the

transferee (“T”) died commencement of T’s periodic

compensation under paragraph 6 was postponed by virtue

40of paragraph 16A, assume that the periodic compensation

commenced immediately before the date of T’s death.”

31 (1) In paragraph 12 (eligibility for terminal illness lump sum)—

(a) in sub-paragraph (4) in the definition of “relevant age”—

(i) in paragraph (a) omit “or deferred” and “or (as the case may

45be) 11”, and

(ii) in paragraph (b) omit “or deferred”, and

(b) after sub-paragraph (4) insert—

“(5) Sub-paragraph (6) applies where the commencement of a

person’s periodic compensation under paragraph 6 is

postponed by virtue of paragraph 16A.

(6) 5This paragraph applies as if—

(a) the person first becomes entitled to compensation

under paragraph 6 immediately after the period of

postponement ends, and

(b) in sub-paragraph (1)(b), for “if the transferee lived

10to the relevant age, he or she would become

entitled on attaining that age” there were

substituted “if the period of postponement ended,

the transferee would become entitled”.”

(2) In paragraph 15 (effect of successful application for terminal illness lump

15sum) after sub-paragraph (3) insert—

“(4) Where on the granting of the application the commencement of a

person’s periodic compensation under paragraph 6 is postponed

by virtue of paragraph 16A, this paragraph applies as if the

references to the transferee attaining the relevant age were

20references to the period of postponement ending.”

32 (1) Paragraph 17 (annual increase in periodic compensation) is amended as

follows.

(2) In sub-paragraph (4), in the definition of “the underlying rate”—

(a) omit “and” at the end of paragraph (a), and

(b) 25after that paragraph insert—

“(aa) so much of any actuarial increase under paragraph

16A as relates to the amount in paragraph (a), and”.

(3) After sub-paragraph (7) insert—

“(7A) Where the commencement of periodic compensation has been

30postponed by virtue of paragraph 16A, this paragraph applies as

if the transferee first becomes entitled to the periodic

compensation on the day on which the periodic compensation

commences.”

33 In paragraph 20 (Board’s power to alter rates of revaluation and indexation)

35after sub-paragraph (5) insert—

“(5A) A determination under sub-paragraph (1)(b) which has effect as

mentioned in sub-paragraph (5)(b)(ii) may provide that, where the

payment of periodic compensation to the transferee is postponed

by virtue of paragraph 16A, the determination applies as if the

40transferee first becomes entitled to the periodic compensation on

the day on which the periodic compensation commences.”

Calculation of compensation: admissible rules etc

34 (1) Schedule 7 to the Pensions Act 2004 (pension compensation provisions) is

amended as follows.

(2) In paragraph 3(6) (pensions in payment at assessment date) for “35(3)”

substitute “35(3A)”.

(3) In paragraph 5(5) (pensions postponed at assessment date) for “35(3)”

substitute “35(3A)”.

(4) 5In paragraph 35 (admissible rules, recent discretionary increases etc)—

(a) for sub-paragraph (3) substitute—

“(3) This sub-paragraph applies to a scheme if, in calculating

the protected liabilities in relation to the scheme at the

relevant time, the effect of taking into account any recent

10rule changes is that those liabilities are greater than they

otherwise would be.

(3A) This sub-paragraph applies to a scheme if, in calculating

the protected liabilities in relation to the scheme at the

relevant time, the effect of taking into account any recent

15discretionary increases is that those liabilities are greater

than they otherwise would be.”, and

(b) in sub-paragraph (4) for “sub-paragraph (3)” substitute “sub-

paragraphs (3) and (3A)”.

Section 24

SCHEDULE 5 20Contributions towards cost of judicial pensions etc

Part 1 Contributions towards cost of judicial pensions

District Judges (Magistrates’ Courts) Pensions Act (Northern Ireland) 1960 (c. 2 (N.I.))

1 (1) The District Judges (Magistrates’ Courts) Pensions Act (Northern Ireland)

251960 is amended as follows.

(2) Before section 9 (and after the heading “Contributions”) insert—

“8A Contributions towards cost of pension etc

(1) The Lord Chancellor may, by regulations made with the consent of

the Treasury, make provision for and in connection with requiring

30contributions to be made towards the cost of the liability for relevant

benefits.

(2) The prescribed contributions are to be—

(a) made by the person to or in respect of whom the relevant

benefits are to be, or may be, provided;

(b) 35made for the person’s period of relevant service;

(c) in the form of deductions from the salary payable for that

service.

(3) But no contribution is to be made by a person—

(a) for any period of service during which an election under

40section 2A is in force in respect of the person;

(b) for any period of service after the person has completed, in

the aggregate, 20 years’ relevant service;

(c) for any other prescribed period of service;

(d) in any prescribed circumstances.

(4) 5For the purposes of subsection (3)(b), it does not matter whether the

person’s relevant service was service before or after the

commencement of paragraph 1 of Schedule 5 to the Pensions Act

2011 (but no contribution is to be made for a person’s service before

that commencement).

(5) 10In this section—

• “prescribed” means specified in, or determined in accordance
  
  with, regulations;

• “relevant benefits” means—

  (a)

  a pension under section 2;

  (b)

  15a lump sum under section 3;

• “relevant service” means service as a district judge (magistrates’
  
  courts) in Northern Ireland.

(6) Regulations under this section may make provision for

consequential, transitional and incidental matters.

(7) 20Regulations made under this section shall be subject to annulment in

like manner as a statutory instrument and section 5 of the Statutory

Instruments Act 1946 shall apply accordingly.”

(3) In section 10(a) (district judges (magistrates’ courts) serving again after

retirement) after “any contribution” insert “by virtue of section 9”.

25Judicial Pensions Act 1981 (c. 20)1981 (c. 20)

2 (1) The Judicial Pensions Act 1981 is amended as follows.

(2) In section 25(1)(a) (persons serving again after retirement) after “any

contribution” insert “by virtue of section 23”.

(3) After section 33 insert—

“33ZA 30 Contributions towards cost of certain judicial pensions etc

(1) The appropriate Minister may, by regulations made with the

concurrence of the Treasury, make provision for and in connection

with requiring contributions to be made towards the cost of the

liability for relevant benefits.

(2) 35The prescribed contributions are to be—

(a) made by the person to or in respect of whom the relevant

benefits are to be, or may be, provided;

(b) made for the person’s period of relevant service;

(c) in the form of deductions from the salary payable for that

40service.

(3) But no contribution is to be made by a person—

(a) for any period of service during which an election under

section 14A is in force in respect of the person;

(b) for any period of service after the person has completed, in

the aggregate, 20 years’ relevant service;

(c) for any other prescribed period of service;

(d) in any prescribed circumstances.

(4) 5For the purposes of subsection (3)(b), it does not matter whether the

person’s relevant service was service before or after the

commencement of paragraph 2 of Schedule 5 to the Pensions Act

2011 (but no contribution is to be made for a person’s service before

that commencement).

(5) 10In this section—

• “the appropriate Minister” means—

  (a)

  in relation to offices existing only in Scotland, the
  
  Secretary of State, or

  (b)

  subject to paragraph (a), the Lord Chancellor;

• 15“prescribed” means specified in, or determined in accordance
  
  with, regulations;

• “relevant benefits” means—

  (a)

  a pension under section 7 or Schedule 1;

  (b)

  a pension for a sheriff (but not a sheriff principal)
  
  20under section 1 of the Sheriffs’ Pensions (Scotland)
  
  Act 1961;

  (c)

  a lump sum under section 17, so far as relating to a
  
  pension within paragraph (a) or (b);

• “relevant service”—

  (a)

  25in relation to a pension under section 7 or a lump sum
  
  under section 17 so far as relating to such a pension,
  
  means service as a stipendiary magistrate in England
  
  or Wales;

  (b)

  in relation to a pension for service in an office in
  
  30paragraph 1 of Schedule 1 (except where under
  
  paragraph 3 of that Schedule this section does not
  
  apply) or a lump sum under section 17 so far as
  
  relating to such a pension, means relevant service as
  
  defined in paragraph 2 of that Schedule in relation to
  
  35the office;

  (c)

  in relation to pension for a sheriff (but not a sheriff
  
  principal) under section 1 of the Sheriffs’ Pensions
  
  (Scotland) Act 1961 or a lump sum under section 17 so
  
  far as relating to such a pension, means service as a
  
  40sheriff (but not a sheriff principal).

(6) Regulations under this section—

(a) are to be made by statutory instrument;

(b) may make different provision for different cases or classes of

case;

(c) 45may make provision for consequential, transitional and

incidental matters.

(7) A statutory instrument containing regulations under this section is

subject to annulment in pursuance of a resolution of either House of

Parliament.”

(4) In Schedule 1 (certain Senior Courts and county court officers and President

of Transport Tribunal) in paragraph 3(2)(b) after “Part II” insert “and section

33ZA”.

Constitutional Reform Act 2005 (c. 4)2005 (c. 4)