Pensions Bill (HL Bill 55)

38 In section 2 (use of computers), in subsection (2), after paragraph (m)
15(inserted by Schedule 12 to this Act) insert “or

(n) section 29 of the Pensions Act 2013;”.

39 (1) Section 8 (decisions by Secretary of State) is amended as follows.

(2) In subsection (3), after paragraph (ab) (inserted by Schedule 12 to this Act)
insert—

“(ac) 20bereavement support payment under section 29 of the
Pensions Act 2013;”.

(3) In subsection (4), after “Part 1 of the Pensions Act 2013” (inserted by
Schedule 12 to this Act) insert “or section 29 of that Act”.

40 In section 11 (regulations with respect to decisions), in subsection (3), in the
25definition of “the current legislation”, after “Part 1 of the Pensions Act 2013”
(inserted by Schedule 12 to this Act) insert “and section 29 of that Act”.

41 In section 27 (restriction on entitlement in cases of error), in subsection (7),
in the definition of “benefit”—

(a) after paragraph (df) insert—

“(dg) 30bereavement support payment under section 29 of the
Pensions Act 2013;”;

(b) in paragraph (e), for “to (df)” substitute “to (dg)”.

42 In section 28 (correction of errors in decisions etc), in subsection (3)(j), after
“Part 1 of the Pensions Act 2013” (inserted by Schedule 12 to this Act) insert
35“or section 29 of that Act”.

Social Security Fraud Act 2001 (c. 11)Social Security Fraud Act 2001 (c. 11)

43 The Social Security Fraud Act 2001 is amended as follows.

44 In section 6A (definitions), in subsection (1), in the definition of
“disqualifying benefit”, after paragraph (ca) insert—

“(cb) 40bereavement support payment under section 29 of the
Pensions Act 2013 or under any provision in Northern
Ireland which corresponds to that section;”.

45 In section 10 (power to supplement and mitigate loss of benefit provisions),
in subsection (3), after paragraph (bf) (inserted by Schedule 12 to this Act)
insert—

“(bg) bereavement support payment under section 29 of the
5Pensions Act 2013 or under any provision in Northern
Ireland which corresponds to that section;”.

Income Tax (Earnings and Pensions) Act 2003 (c. 1)2003 (c. 1)

46 The Income Tax (Earnings and Pensions) Act 2003 is amended as follows.

47 In section 660 (taxable benefits: UK benefits - Table A), in the table in
10subsection (1), in the entry relating to bereavement allowance, omit the
words “SSCBA 1992 Section 39B” (in the second column).

48 In section 677 (UK social security benefits wholly exempt from tax), in Part 1
of Table B in subsection (1), in the entry relating to bereavement payments,
omit the words “SSCBA 1992 Section 36” (in the second column).

Section 32

15SCHEDULE 16 Automatic transfer of pension benefits etc

Part 1 Automatic transfer of pension benefits

Regulations providing for transfer of cash equivalent of transferable benefits

1 (1) 20The Secretary of State must make regulations with a view to ensuring that,
where a qualifying member of an automatic transfer scheme has transferable
benefits under another pension scheme, the cash equivalent of the
transferable benefits—

(a) is transferred to the automatic transfer scheme, and

(b) 25is used to provide rights for the member under it.

(2) In this Schedule “automatic transfer scheme” means—

(a) a work-based pension scheme, other than a scheme of a prescribed
description, which is registered under Chapter 2 of Part 4 of the
Finance Act 2004 and is a money purchase scheme, or

(b) 30a pension scheme of a prescribed description.

(3) In this Schedule “qualifying member”, in relation to an automatic transfer
scheme, means an active member of the scheme of a prescribed description.

(4) For the purposes of this Schedule a person has transferable benefits under a
pension scheme if—

(a) 35the scheme is a transferable benefits scheme,

(b) the person is a member of the scheme,

(c) contributions to the scheme by, or on behalf or in respect of, the
member have ceased,

(d) the member has accrued rights to benefits under the applicable rules,

(e) all of those rights accrued on or after the prescribed date (which may
be a date before the coming into force of this paragraph),

(f) the cash equivalent of those benefits is less than the prescribed
amount (but not nil), and

(g) 5any other prescribed conditions are met.

(5) In this Schedule “transferable benefits scheme” means—

(a) a work-based pension scheme, other than a scheme of a prescribed
description, which is registered under Chapter 2 of Part 4 of the
Finance Act 2004 and is a money purchase scheme, or

(b) 10a pension scheme of a prescribed description.

(6) In sub-paragraph (4)—

• “the applicable rules”—

  (a)

  in relation to an occupational pension scheme, has the
  meaning given by section 94(2) of the Pension Schemes Act
  151993;

  (b)

  in relation to a personal pension scheme, means the rules of
  the scheme;

• “benefits” means—

  (a)

  money purchase benefits other than money purchase benefits
  20of a prescribed description, or

  (b)

  benefits of a prescribed description.

Automatic transfer scheme to find out whether members have transferable benefits

2 (1) The regulations must require the trustees or managers of an automatic
transfer scheme to take steps to find out whether a qualifying member of the
25scheme has transferable benefits under another pension scheme.

(2) The regulations may make provision—

(a) about when a step is to be taken (for example, within a prescribed
period after a person becomes a qualifying member or at prescribed
intervals);

(b) 30for the steps to be taken at any particular time to relate to a particular
qualifying member, or to some or all qualifying members.

Automatic transfer scheme to request transfer of cash equivalent

3 (1) The regulations must require the trustees or managers of an automatic
transfer scheme to give a transfer notice if—

(a) 35they find out that a qualifying member of the scheme has
transferable benefits under another pension scheme, and

(b) any other prescribed conditions are met.

(2) A “transfer notice” is a notice given to the trustees or managers of the other
pension scheme requesting the transfer of the cash equivalent of the
40transferable benefits to the automatic transfer scheme.

(3) The conditions that may be prescribed because of sub-paragraph (1)(b)
include a condition that the trustees or managers must not give a transfer
notice unless the qualifying member consents in accordance with the
regulations.

Right to opt out of automatic transfer

4 (1) If the regulations do not include the condition mentioned in paragraph 3(3),
they must ensure that where the duty to give a transfer notice has arisen in
relation to transferable benefits of a qualifying member of an automatic
5transfer scheme, the member can opt out of the transfer in accordance with
the regulations.

(2) The regulations must provide that, where the member does opt out—

(a) the duty to give the transfer notice is not to be complied with, and

(b) the cash equivalent of the member’s transferable benefits is not to be
10transferred.

Information to be given to qualifying members of automatic transfer schemes

5 (1) The regulations must require a prescribed person to give information to a
qualifying member of an automatic transfer scheme who has transferable
benefits under another scheme for the purpose of helping the member to
15decide whether (as applicable)—

(a) to consent to the giving of a transfer notice in relation to the
transferable benefits, or

(b) to opt out of the transfer of the cash equivalent of the transferable
benefits.

(2) 20The information to be given—

(a) must include information about the effect of the regulations, and in
particular the member’s power to consent or right to opt out (as
applicable);

(b) may include other information, for example information about the
25schemes.

Transferable benefits scheme to comply with request

6 (1) The regulations must require the trustees or managers of a pension scheme
who receive a transfer notice requesting the transfer of the cash equivalent
of a person’s transferable benefits to do what is needed to carry out the
30request.

(2) The regulations may in particular—

(a) require the trustees or managers of the scheme to take particular
steps to carry out the request;

(b) provide for the discharge, in prescribed circumstances, of any
35obligation to provide the transferable benefits.

(3) The regulations may provide for circumstances in which the duty to carry
out the request does not apply.

Automatic transfer scheme to use cash equivalent to provide rights under the scheme

7 (1) The regulations must require the trustees or managers of an automatic
40transfer scheme to whom the cash equivalent of a person’s transferable
benefits is transferred to use the cash equivalent to provide rights for the
person under the scheme.

(2) The regulations may make provision about how that is to be done and in
particular about—

(a) the nature and value of the rights to be provided;

(b) calculating and verifying the value of the rights to be provided.

5Cash equivalents: calculation and verification

8 (1) The regulations may provide for the manner in which cash equivalents are
to be calculated and verified.

(2) The regulations may in particular—

(a) provide that a cash equivalent is to be increased or reduced in
10prescribed circumstances;

(b) make provision about the time by reference to which a cash
equivalent is to be calculated for the purposes of a provision of the
regulations.

(3) Regulations made because of sub-paragraph (2)(a) may provide for a cash
15equivalent to be reduced to nil.

Disclosure of information and establishment of database

9 (1) The regulations must make provision about disclosure of information.

(2) The regulations may in particular require a person to disclose information to
another person—

(a) 20for the purposes of helping a person to comply with a duty imposed
on the person by the regulations, or

(b) otherwise for the purposes of a provision of the regulations.

(3) The regulations may require the Secretary of State or the Regulator to
establish and operate a database containing information relating to people
25who have or had transferable benefits for the purposes of helping the
trustees or managers of an automatic transfer scheme to comply with their
duties under the regulations.

Compliance

10 (1) The regulations may make provision with a view to ensuring compliance
30with any provision of the regulations.

(2) For this purpose the regulations may in particular—

(a) provide for the Regulator to issue a notice (a “compliance notice”) to
a person with a view to ensuring the person’s compliance with a
provision of the regulations;

(b) 35provide for the Regulator 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 the regulations;

(c) provide for the Regulator to issue a notice (a “penalty notice”)
imposing a penalty on a person where the Regulator is of the opinion
40that the person has failed to comply with a compliance notice or third
party compliance notice or has contravened a provision of the
regulations;

(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 Regulator.

(3) 5The 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) 10£50,000, in any other case.

Record keeping

11 (1) The regulations may require any person—

(a) to make records;

(b) to preserve records for a prescribed period;

(c) 15to provide records to the Regulator on request.

(2) The regulations may provide that section 10 of the Pensions Act 1995 (civil
penalties) applies to a person who fails to comply with those requirements.

Further provision about the regulations

12 The regulations may—

(a) 20impose or confer other functions on the trustees or managers of an
automatic transfer scheme or transferable benefits scheme;

(b) confer a discretion on a person.

Review of limit on value of cash equivalent

13 (1) 25The regulations must require the Secretary of State to review from time to
time the amount for the time being prescribed under paragraph 1(4)(f).

(2) The regulations must provide—

(a) for the first review to be conducted no later than 5 years after the date
on which regulations under this Schedule first come into force;

(b) 30for subsequent reviews to be conducted no later than 5 years after the
previous review.

(3) The regulations must require the Secretary of State, in conducting a review,
to have regard to—

(a) changes in the general level of prices in Great Britain;

(b) 35changes in the general level of earnings in Great Britain;

(c) any other factors the Secretary of State considers relevant.

(4) The regulations must authorise the Secretary of State to estimate the general
level of prices or earnings for the purposes of the review in the manner the
Secretary of State thinks fit.