Pension Schemes Bill (HL Bill 79)

(iii) Article 114(1) of the Pensions (Northern Ireland)
Order 1995;

(iv) Article 28(4) of the Welfare Reform and Pensions
(Northern Ireland) Order 1999;

(v) 5Article 279(1) of the Pensions (Northern Ireland)
Order 2005;

(vi) section 61(3) of the Pension Schemes Act 2015;

(vii) regulations made under section 62(4) or 63(4) of the
Pension Schemes Act 2015.

96AC 10Meaning of “normal pension age” in this Chapter

(1) In this Chapter “normal pension age”, in relation to a category of
benefits under a pension scheme, means—

(a) in a case where the scheme is an occupational pension
scheme and those benefits consist only of a guaranteed
15minimum pension, the earliest age at which the member is
entitled to receive the guaranteed minimum pension on
retirement from any employment to which the scheme
applies,

(b) in any other case where the scheme is an occupational
20pension scheme and the scheme provides for the member to
become entitled to receive any of those benefits at a particular
age on retirement from any employment to which the scheme
applies, the earliest age at which the member becomes
entitled to receive any of the benefits, and

(c) 25in a case not falling within paragraph (a) or (b), normal
minimum pension age as defined by section 279(1) of the
Finance Act 2004.

(2) For the purposes of subsection (1) any scheme rule making special
provision as to early retirement on grounds of ill-health or otherwise
30is to be disregarded.

96AD Interpretation of Chapter

In this Chapter—

• “accrued rights”, in relation to a member of a pension scheme,
  means rights that have accrued to or in respect of the member
  35to benefits under the scheme;

• “category”, in relation to benefits, has the meaning given by
  section 89(6);

• “flexible benefit” has the meaning given by section 74 of the
  Pension Schemes Act 2015;

• 40“guarantee date”, in relation to a member who has received a
  statement of entitlement, has the meaning given by section
  89A;

• “member” is to be read in accordance with section 89(11);

• “normal pension age” has the meaning given by section 96C;

• 45“pension credit rights”, in relation to a member of a pension
  scheme, means rights to benefits under the scheme which are
  attributable (directly or indirectly) to a pension credit;

• “salary related occupational pension scheme”: an occupational
  pension scheme is “salary related” if—

  Pension Schemes BillPage 101

  (a)

  the scheme is not a scheme under which all the
  benefits that may be provided are money purchase
  benefits, and

  (b)

  the scheme does not fall within a prescribed class;

• 5“scheme rules”, in relation to a pension scheme, has the
  meaning given by section 96B;

• “statement of entitlement” has the meaning given by section
  89A;

• “transferrable rights” is to be read in accordance with section
  1089(11).”

61 (1) In section 97F (power to give transfer notice) is amended as follows.

(2) In subsection (1), for “pension credit benefit” substitute “pension credit
rights”.

(3) After subsection (3) insert—

“(3A) 15An eligible member who has pension credit rights in relation to more
than one category of benefits under the scheme may exercise the
power to give a transfer notice in relation to the pension credit rights
in relation to any one or more of those categories.”

(4) For subsection (4) substitute—

“(4) 20The cash equivalent for the purposes of subsection (1) shall—

(a) in a case where the pension credit rights relate to a category
of benefits other than money purchase benefits, be taken to be
the amount shown in the relevant statement under section
97H, and

(b) 25in a case where the pension credit rights relate to money
purchase benefits, be determined by reference to the date the
notice under that subsection is given.”

(5) For subsection (6A) substitute—

“(6A) Regulations may—

(a) 30provide for this Chapter not to apply in prescribed
circumstances in relation to a member of a prescribed scheme
or schemes of a prescribed description;

(b) modify the application of this Chapter in relation to a
member who has accrued rights to benefits of a prescribed
35description.

(6B) In this Chapter a reference to a “category” of benefits is to one of the
following three categories—

(a) money purchase benefits;

(b) flexible benefits other than money purchase benefits;

(c) 40benefits that are not flexible benefits.”

62 For section 97G (restrictions on power to give transfer notice) substitute—

“97G Restrictions on power to give transfer notice

(1) An eligible member may not give a transfer notice in relation to a
category of benefits if a crystallisation event has occurred in relation

to any of the member’s pension credit rights to benefits in that
category.

(2) An eligible member may give a transfer notice in relation to a
category of benefits other than money purchase benefits only if—

(a) 5the member has been provided with a statement under
section 97H in relation to benefits in that category, and

(b) not more than 3 months have passed since the date by
reference to which the amount shown in the statement is
determined.

(3) 10An eligible member may not give a transfer notice in relation to
benefits other than flexible benefits if there is less than one year to go
until the member reaches normal benefit age.

(4) Where an eligible member of a qualifying scheme—

(a) is entitled to give a transfer notice in relation to any category
15of benefits, and

(b) is also entitled to make an application to the trustees or
managers of the scheme under section 91(1) in relation to
benefits in the same category (or would be entitled to do so
but for section 91(1A)(a)),

20the member may not, if the scheme so provides, give a transfer notice
in relation to that category of benefits without also making an
application under section 91(1) in relation to that category of
benefits.

(5) A transfer notice may not be given if a previous transfer notice given
25by the member to the trustees or managers of the scheme is
outstanding.

(6) For the purposes of subsection (1) a crystallisation event occurs in
relation to a member’s pension credit rights to benefits in a category
when—

(a) 30payment of a pension in respect of any of the benefits has
begun,

(b) in the case of money purchase benefits, sums or assets held
for the purpose of providing any of the benefits are
designated as available for the payment of drawdown
35pension (as defined by paragraph 4 of Schedule 28 to the
Finance Act 2004), or

(c) in the case of a personal pension scheme, sums or assets held
for the purpose of providing any of the benefits are applied
for purchasing an annuity or insurance policy.”

63 (1) 40Section 97H (salary related schemes: statements of entitlement) is amended
as follows.

(2) For subsection (1) substitute—

“(1) The trustees or managers of a qualifying scheme must, on the
application of an eligible member, provide the member with a
45written statement of the amount of the cash equivalent of the
member’s pension credit rights in relation to categories of benefits
other than money purchase benefits.

(1A) In the case of a member with pension credit rights in relation to two
categories of benefits other than money purchase benefits, the
application may relate to pension credit rights in relation to either or
both of those categories.”

(3) 5In the heading for “Salary related schemes” substitute “Benefits other than
money purchase”.

64 (1) Section 97J (time for compliance with transfer notice) is amended as follows.

(2) In subsection (1), for paragraphs (a) and (b) substitute—

“(a) in the case of an application that relates to benefits other than
10money purchase benefits, within 6 months beginning with
the valuation date, and

(b) in the case of an application that relates to money purchase
benefits, within 6 months of the date on which the notice is
given.”

(3) 15For subsection (7) substitute—

“(7) In subsection (1)(a), “valuation date” means the date by reference to
which the amount shown in the relevant statement under section
97H is determined.”

65 In section 97M (effect of transfer on trustees’ duties), for the words from
20“pension credit benefit” to the end of the section substitute “benefits to
which the transfer notice relates”.

66 After section 97N insert—

“97NA Prohibition on excluding transfers of some rights without others etc

Except as mentioned in sections 92(4) and 97G(4), a pension scheme
25may not contain rules that would have the effect of—

(a) preventing a member from exercising a right under this
Chapter in relation to a category of benefits without also
exercising a right under this Chapter or otherwise to require
a transfer payment to be made in respect of another category
30of benefits, or

(b) preventing a member who exercises a right under this
Chapter in relation to a category of benefits from accruing
rights to benefits in another category.”

67 (1) Section 97P (interpretation) is amended as follows.

(2) 35In subsection (1), at the appropriate places insert—

• ““category”, in relation to benefits, has the meaning given by
  section 97F(6B);”

• ““flexible benefit” has the meaning given by section 74 of the
  Pension Schemes Act 2015;”.

(3) 40In that subsection, omit the definition of “pension credit benefit”.

(4) Omit subsection (2).

(5) In subsection (3), for “given to the trustees or managers of a salary related
occupational pension scheme” substitute “in relation to benefits other than
money purchase benefits”.”

68 Omit section 97Q.

69 In section 125 (overriding requirements), in subsection (1), for “Chapters II,
III, IV and V of Part IV” substitute “Chapters 2 and 3 of Part 4, Chapters 1
and 2 of Part 4ZA”.

70 5In section 126 (extra-statutory benefits), in paragraph (b), for “Chapter II, IV
or V of Part IV” substitute “Chapter 2 of Part 4 or Chapter 1 or 2 of Part 4ZA”.

71 In section 149 (power to modify certain provisions), in subsection (1), for
“Chapters II, III and IV of Part IV” substitute “Chapters 2 and 3 of Part 4 and
Chapter 1 of Part 4ZA”.

72 10In section 174 (linked qualifying service), in subsection (1)(a)—

(a) in the opening words, for “Chapter 4 or 5 of Part IV” substitute
“Chapter 1 or 2 of Part 4ZA”;

(b) in sub-paragraph (iii)—

(i) for “Chapter 4 of Part IV” substitute “Chapter 1 of Part 4ZA”;

(ii) 15for “Chapter 5” substitute “Chapter 2”.

73 In section 176 (interpretation), in subsection (1), in paragraph (b) of the
definition of “transfer credits”, for “Chapter 5 of Part IV” substitute “Chapter
2 of Part 4ZA”.

Pensions (Northern Ireland) Order 1995 (S.I. 1995/3213 (N.I. 22)S.I. 1995/3213 (N.I. 22))

74 20The Pensions (Northern Ireland) Order 1995 is amended as follows.

75 In Article 67A (the subsisting rights provisions: interpretation), in paragraph
(9)(a), for head (ii) substitute—

“(ii) Chapter 2 or 3 of Part 4 of the Pension Schemes Act
(certain protection for early leavers) or regulations
25made under either of those Chapters;

(iia) Chapter 1 or 2 of Part 4ZA of that Act (transfers and
contribution refunds) or regulations made under
either of those Chapters;”.

76 In Article 73 (preferential liabilities on winding up), in paragraph (9), for
30“Chapter 5 of Part IV” substitute “Chapter 2 of Part 4ZA”.

77 In Article 73B (Article 73 and 73A: supplementary), in paragraph (7), for
“Chapter 4 of Part IV” substitute “Chapter 1 of Part 4ZA”.

78 In Article 121 (interpretation of Part 2), in paragraph (1), in paragraph (b) of
the definition of “transfer credits”, for “Chapter 5 of Part IV of the Pension
35Schemes Act (early leavers)” substitute “Chapter 2 of Part 4ZA of the
Pension Schemes Act (transfers and contribution refunds)”.

Pensions (Northern Ireland) Order 2005 (S.I. 2005/255 (N.I. 1)S.I. 2005/255 (N.I. 1))

79 The Pensions (Northern Ireland) Order 2005 is amended as follows.

80 (1) Article 2 (interpretation) is amended as follows.

(2) 40In paragraph (3), for “an occupational pension scheme” substitute “a
pension scheme”.

(3) In paragraph (4)(a), for head (ii) substitute—

“(ii) Chapter 2 or 3 of Part 4 of the Pension Schemes Act
(certain protection for early leavers) or regulations
made under either of those Chapters;

(iia) 5Chapter 1 or 2 of Part 4ZA of that Act (transfers and
contribution refunds) or regulations made under
either of those Chapters;”.

81 (1) Article 14 (pension liberation: interpretation) is amended as follows.

(2) In paragraph (2)(a)—

(a) 10after “accrued rights” insert “or an entitlement”;

(b) in head (ii), for “the applicable rules” substitute “the scheme rules”.

(3) In paragraph (3)—

(a) for sub-paragraph (a) substitute—

“(a) section 90 of the Pension Schemes Act (right to cash
15equivalent under Chapter 1 of Part 4ZA of that Act);”;

(b) in sub-paragraph (b), for “Chapter 5 of Part IV” substitute “Chapter
2 of Part 4ZA”.

(4) In paragraph (4)(d), for “the applicable rules” substitute “the scheme rules”.

(5) Omit paragraph (5).

82 20In Article 19 (freezing orders), in paragraph (4)(g), for “salary related
schemes” substitute “benefits other than money purchase”.

83 In Article 20 (consequences of freezing order), in paragraph (7), for sub-
paragraphs (a) and (b) substitute—

“(a) Chapter 1 of Part 4ZA of the Pension Schemes Act (transfer
25rights: general), or

(b) Chapter 2 of that Part (early leavers: cash transfer sums and
contribution refunds),”.

84 In Article 68 (inspection of premises), in paragraph (2)(d)—

(a) for “Chapter 4 of Part IV” substitute “Chapter 1 of Part 4ZA”;

(b) 30for “Chapter 5 of Part IV” substitute “Chapter 2 of Part 4ZA”.

85 In Article 119 (restrictions on winding up, discharge of liabilities etc.), in
paragraph (6)(b), for “Chapter 5 of Part IV” substitute “Chapter 2 of Part
4ZA”.

86 In Article 122 (payment of scheme benefits), in paragraph (3)(b), for
35“Chapter 5 of Part IV” substitute “Chapter 2 of Part 4ZA”.

87 (1) Schedule 6 (pension compensation provisions) is amended as follows.

(2) In paragraph 20(1)(c), for “Chapter 5 of Part IV” substitute “Chapter 2 of Part
4ZA”.

(3) In paragraph 32(1)(b), for “Chapter 5 of Part IV” substitute “Chapter 2 of Part
404ZA”.

Section 78

SCHEDULE 5 Pension scheme for fee-paid judges: consequential amendments

Pensions (Increase) Act 1971 (c. 56)Pensions (Increase) Act 1971 (c. 56)

1 The Pensions (Increase) Act 1971 is amended as follows.

2 5In section 19(2)(a) (extent to Northern Ireland)—

(a) after “or section” insert “18A or”;

(b) after “section 10 of that Act” insert “or provision made under section
18A of that Act that is corresponding or similar to the provision that
may be made by regulations under section 10 of that Act”.

3 10In Schedule 2 (official pensions), after paragraph 4A insert—

“4AA A pension payable under a scheme made under section 18A of the
Judicial Pensions and Retirement Act 1993, other than a pension
payable under or by virtue of provision that is corresponding or
similar to the provision that may be made by regulations under
15section 10 of that Act.”

Judicial Pensions and Retirement Act 1993 (c. 8)Judicial Pensions and Retirement Act 1993 (c. 8)

4 The Judicial Pensions and Retirement Act 1993 is amended as follows.

5 In section 22 (application of the Pensions (Increase) Act 1971 to Northern
Ireland), in subsection (2)—

(a) 20after “shall include” insert “—

(a)”;

(b) at the end insert “; and

(b) pensions payable under a scheme made under section
18A above, other than pensions payable under or by
25virtue of provision that is corresponding or similar to
the provision that may be made by regulations under
section 10 above.”

6 (1) Section 28 (funding arrangements) is amended as follows.

(2) In subsection (2) (benefits payable out of money provided by Parliament),
30after paragraph (a) (but before the “and” at the end) insert—

“(aa) any pension or other benefits payable under a scheme made
under section 18A above,”.

(3) In subsection (7), for “section 10 above” substitute “—

(a) section 10 above, or

(b) 35provision made under section 18A above that is
corresponding or similar to the provision that may be made
by regulations under section 10 above.”

7 In section 28A (contributions in respect of Northern Ireland judges), at the
end insert “or as a fee-paid judge in Northern Ireland (within the meaning
40given by section 18A)”.