Pension Schemes Bill (HL Bill 90)

the regulations may provide for the application under section 91 to
lapse (but this does not prevent the member making a fresh
application in respect of the increased or reduced cash equivalent).”

58 For section 94 substitute—

“94 5Loss of right to cash equivalent

(1) A member of a pension scheme who acquires the right to take a cash
equivalent under section 90(1) loses that right if no application to
take the cash equivalent is made within the period specified in
section 91(1A) (but this does not prevent the member later acquiring
10a new right to take a cash equivalent under section 90(1) in relation
to the same benefits).

(2) A member of a pension scheme loses the right to take a cash
equivalent in accordance with this Chapter if the scheme is wound
up.”

59 (1) 15Section 95 (trustees’ duties after exercise of option) is amended as follows.

(2) For subsection (2) substitute—

“(2) Subject to the following provisions of this section, if the trustees or
managers of a scheme receive an application under section 91 they
must do what is needed to carry out what the member requires—

(a) 20in the case of an application that relates to benefits other than
money purchase benefits, within 6 months beginning with
the guarantee date shown in the relevant statement of
entitlement, and

(b) in the case of an application that relates to money purchase
25benefits, within 6 months beginning with the date of the
application.”

(3) In subsection (3)(a) omit “at any time before the expiry of the period of 12
months beginning with the termination date”.

(4) Omit subsection (3A).

(5) 30After subsection (4A) insert—

“(4B) Regulations may extend the period for compliance under subsection
(2) or (3) in prescribed circumstances.”

60 After section 96 insert—

“96A Prohibition on excluding future accruals etc

35Except as mentioned in sections 92(4) and 97G(4), a pension scheme
may 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
40a transfer payment to be made in respect of another category
of 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.

96AB Meaning of “scheme rules”: occupational pension schemes

(1) In this Chapter references to the scheme rules, in relation to a pension
scheme, are references to—

(a) the rules of the scheme, except so far as overridden by a
5relevant legislative provision,

(b) the relevant legislative provisions, to the extent that they
have effect in relation to the scheme and are not reflected in
the rules of the scheme, and

(c) any provision which the rules of the scheme do not contain
10but which the scheme must contain if it is to conform with the
requirements of Chapter 1 of Part 4.

(2)
For the purposes of subsection (1)—

(a) “relevant legislative provision” means any provision
contained in any of the following provisions—

(i) 15Schedule 5 to the Social Security (Northern Ireland)
Order 1989;

(ii) Chapter 2 or 3 of Part 4 or regulations made under
either of those Chapters;

(iii) this Part or regulations made under this Part;

(iv) 20Part 4A or regulations made under that Part;

(v) section 106(1);

(vi) Part 2 of the Pensions (Northern Ireland) Order 1995
or orders or regulations made or having effect as if
made under that Part;

(vii) 25Article 28 of the Welfare Reform and Pensions
(Northern Ireland) Order 1999;

(viii) any provision mentioned in Article 279(2) of the
Pensions (Northern Ireland) Order 2005;

(ix) section 61 of the Pension Schemes Act 2015;

(x) 30regulations made under section 62 or 63 of the
Pension Schemes Act 2015;

(b) a relevant legislative provision is to be taken to override any
of the provisions of the scheme if, and only if, it does so by
virtue of any of the following provisions—

(i) 35paragraph 3 of Schedule 5 to the Social Security
(Northern Ireland) Order 1989;

(ii) section 125(1);

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

(iv) 40Article 28(4) of the Welfare Reform and Pensions
(Northern Ireland) Order 1999;

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

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

(vii) 45regulations made under section 62(4) or 63(4) of the
Pension Schemes Act 2015.

96AC Meaning 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
minimum pension, the earliest age at which the member is
entitled to receive the guaranteed minimum pension on
5retirement from any employment to which the scheme
applies,

(b) in any other case where the scheme is an occupational
pension scheme and the scheme provides for the member to
become entitled to receive any of those benefits at a particular
10age 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) in a case not falling within paragraph (a) or (b), normal
minimum pension age as defined by section 279(1) of the
15Finance 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
is to be disregarded.

96AD Interpretation of Chapter

20In 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
  to benefits under the scheme;

• “category”, in relation to benefits, has the meaning given by
  25section 89(6);

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

• “guarantee date”, in relation to a member who has received a
  statement of entitlement, has the meaning given by section
  3089A;

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

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

• “pension credit rights”, in relation to a member of a pension
  scheme, means rights to benefits under the scheme which are
  35attributable (directly or indirectly) to a pension credit;

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

  (a)

  the scheme is not a scheme under which all the
  benefits that may be provided are money purchase
  40benefits, and

  (b)

  the scheme does not fall within a prescribed class;

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

• “statement of entitlement” has the meaning given by section
  4589A;

• “transferrable rights” is to be read in accordance with section
  89(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) An eligible member who has pension credit rights in relation to more
5than 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) The cash equivalent for the purposes of subsection (1) shall—

(a) 10in 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) in a case where the pension credit rights relate to money
15purchase benefits, be determined by reference to the date the
notice under that subsection is given.”

(5) For subsection (6A) substitute—

“(6A) Regulations may—

(a) provide for this Chapter not to apply in relation to a person
20of a prescribed description;

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

(c) modify the application of this Chapter in relation to a
25member who has accrued rights to benefits of a prescribed
description.

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

(a) money purchase benefits;

(b) 30flexible benefits other than money purchase benefits;

(c) benefits 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
35category 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) 40the 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) An 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) 5is entitled to give a transfer notice in relation to any category
of 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
10but for section 91(1A)(a)),

the 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) 15A transfer notice may not be given if a previous transfer notice given
by the member to the trustees or managers of the scheme is
outstanding.

(6) Regulations may extend the period specified in subsection (2)(b) in
prescribed circumstances.

(7) 20For 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) payment of a pension in respect of any of the benefits has
begun,

(b) 25in 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
pension (as defined by paragraph 4 of Schedule 28 to the
Finance Act 2004), or

(c) 30in 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) Section 97H (salary related schemes: statements of entitlement) is amended
as follows.

(2) 35For 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
written statement of the amount of the cash equivalent of the
member’s pension credit rights in relation to categories of benefits
40other 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) 45In 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
money purchase benefits, within 6 months beginning with
the valuation date, and

(b) 5in the case of an application that relates to money purchase
benefits, within 6 months of the date on which the notice is
given.”

(3) After subsection (2) insert—

“(2A) Regulations may extend the period for complying with the notice in
10prescribed circumstances.”

(4) For 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 15In section 97M (effect of transfer on trustees’ duties), for the words from
“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

20Except as mentioned in sections 92(4) and 97G(4), a pension scheme
may 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
25a transfer payment to be made in respect of another category
of 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) 30Section 97P (interpretation) is amended as follows.

(2) In 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
  35Pension Schemes Act 2015;”.

(3) In 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
40money 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 In 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
5Chapter 1 of Part 4ZA”.

72 In 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) 10for “Chapter 4 of Part IV” substitute “Chapter 1 of Part 4ZA”;

(ii) for “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”.

15Pensions (Northern Ireland) Order 1995 (S.I. 1995/3213 (N.I. 22)S.I. 1995/3213 (N.I. 22))

74 The 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
20(certain protection for early leavers) or regulations
made 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 25In Article 73 (preferential liabilities on winding up), in paragraph (9), for
“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
30the definition of “transfer credits”, for “Chapter 5 of Part IV of the Pension
Schemes 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) 35Article 2 (interpretation) is amended as follows.

(2) In 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
40(certain protection for early leavers) or regulations
made 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;”.

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

(2) 5In paragraph (2)(a)—

(a) after “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) 10section 90 of the Pension Schemes Act (right to cash
equivalent 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) 15Omit paragraph (5).

82 In 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) 20Chapter 1 of Part 4ZA of the Pension Schemes Act (transfer
rights: 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) 25for “Chapter 4 of Part IV” substitute “Chapter 1 of Part 4ZA”;

(b) for “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 30In Article 122 (payment of scheme benefits), in paragraph (3)(b), for
“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) 35In paragraph 32(1)(b), for “Chapter 5 of Part IV” substitute “Chapter 2 of Part
4ZA”.

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)”.

8 (1) Section 29 (regulations and orders) is amended as follows.

(2) In subsection (2), after “other than” insert “regulations under section 18A
above or”.

(3) After subsection (2) insert—

“(2A) A statutory instrument which contains regulations under section
518A may not be made unless a draft of the instrument has been laid
before and approved by a resolution of each House of Parliament.”