Public Service Pensions and Judicial Offices Bill [HL] (HL Bill 44)

A

BILL

TO

Make provision about public service pension schemes, including retrospective
provision to rectify unlawful discrimination in the way in which existing
schemes were restricted under the Public Service Pensions Act 2013 and
corresponding Northern Ireland legislation; to make provision for the
establishment of new public pension schemes for members of occupational
pension schemes of bodies that were brought into public ownership under the
Banking (Special Provisions) Act 2008; to make provision about the
remuneration and the date of retirement of holders of certain judicial offices;
to make provision about judicial service after retirement; and for connected
purposes.

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and
consent of the Lords Spiritual and Temporal, and Commons, in this present
Parliament assembled, and by the authority of the same, as follows:—

Part 1 Public service pension schemes

Chapter 1 Schemes other than judicial schemes and local government schemes

5Remediable service

1 Meaning of “remediable service”

(1)For the purposes of this Chapter a person’s service in an employment or office
is “remediable service” in that employment or office if the following four
conditions are met.

(2)10In this section “the service in question” means the service mentioned in
subsection (1).

Public Service Pensions and Judicial Offices Bill [HL]Page 2

(3)The first condition is that the service in question takes place in the period
beginning with the day after the closing date and ending with 31 March 2022.

(4)The second condition is that the service in question is—

(a)pensionable service under a Chapter 1 legacy scheme, or

(b)5pensionable service under a Chapter 1 new scheme that would have
been pensionable service under a Chapter 1 legacy scheme but for the
person’s failure to meet a condition relating to the person’s attainment
of normal pension age by a specified date.

(5)The third condition is that the person was, on 31 March 2012 or any earlier day,
10in service in any employment or office that is pensionable service under—

(a)a Chapter 1 legacy scheme,

(b)a judicial legacy scheme (within the meaning of Chapter 2), or

(c)a local government legacy scheme (within the meaning of Chapter 3).

(6)The fourth condition is that there is no disqualifying gap in service falling
15within the period—

(a)beginning with the most recent day in relation to which the third
condition is met, and

(b)ending with the day before the first day of the service in question.

(7)In subsection (6) “disqualifying gap in service” means a period longer than 5
20years at no time during which is the person in service in an employment or
office which is pensionable service under—

(a)a Chapter 1 scheme,

(b)a judicial scheme (within the meaning of Chapter 2), or

(c)a local government scheme (within the meaning of Chapter 3).

(8)25In this Chapter “the closing date” means—

(a)31 March 2015 in relation to service which is pensionable service under
a Chapter 1 scheme that is not an Agency scheme;

(b)31 March 2016 in relation to service which is pensionable service under
an Agency scheme.

(9)30In determining for the purposes of this section whether any service is
pensionable service under a particular scheme, sections 2(1), 39(2) to (5) and
42(2) (under which service may be treated as pensionable, or not pensionable,
under particular schemes) are to be disregarded.

See also section 27(1) (which requires section 61 of the Equality Act 2010 and
35paragraph 2 of Schedule 1 to EEAR(NI) 2006 to be disregarded).

(10)For provision under which the second condition is treated as met in relation to
a person’s service in an employment or office, despite the service not being
pensionable service under a Chapter 1 scheme, see section 5(2) (opted-out
service).

40Retrospective provision about remediable service

2 Remediable service treated as pensionable under Chapter 1 legacy schemes

(1)A person’s remediable service in an employment or office that would, apart
from this subsection, be pensionable service under a Chapter 1 new scheme—

Public Service Pensions and Judicial Offices Bill [HL]Page 3

(a)is not, and is treated as never having been, pensionable service under
that scheme, and

(b)is treated as being, and as always having been, pensionable service
under the relevant Chapter 1 legacy scheme.

5For the meaning of “the relevant Chapter 1 legacy scheme”, see section 4.

(2)Where a person has remediable service in multiple employments or offices,
subsection (1) applies separately in relation to the person’s remediable service
in each of them.

(3)Subsection (1) has effect—

(a)10for the purposes of determining which Chapter 1 scheme is (or at any
time was) required to pay benefits to or in respect of a member,

(b)for the purposes of determining the amount of any benefits that are (or
at any time were) payable under a Chapter 1 scheme to or in respect of
a member, and

(c)15subject to subsection (4), and to any other provision of this Chapter to
the contrary, for all other purposes.

(4)Subsection (1) does not have effect for the purposes of determining the
existence or amount of any liability that any member of a Chapter 1 scheme, or
any employer in relation to such a scheme, has (or at any time had) to pay
20pension contributions in respect of a person’s remediable service.

(5)Subsection (1) does not affect—

(a)any arrangements under a Chapter 1 scheme under which a member
pays contributions to the scheme on a voluntary basis so as to secure
additional benefits, or the earlier payment of benefits, under the
25scheme, or

(b)any rights under a Chapter 1 scheme in respect of a transfer in to the
scheme of an amount in respect of rights accrued under another
pension scheme.

(6)For provision disapplying subsection (3)(b), or affecting the time at which that
30provision applies, in relation to pensioner and deceased members, see section
6 (immediate choice to receive new scheme benefits).

(7)For further provision under which benefits determined by reference to a
member’s remediable service may be new scheme benefits, see section 9
(deferred choice to receive new scheme benefits).

3 35Benefits already paid

(1)Subsection (2) applies in relation to any benefits (“the paid benefits”) that a
Chapter 1 new scheme has at any time paid to a person (“P”) so far as—

(a)they are calculated by reference to P’s, or any other person’s,
remediable service in an employment or office, and

(b)40they are benefits that, as a result of section 2(1)(a), P was not entitled to
receive from the scheme.

(2)The paid benefits are to be treated for all purposes—

(a)as not having been paid to P by the Chapter 1 new scheme, but

(b)as having been paid to P instead by the relevant Chapter 1 legacy
45scheme.

Public Service Pensions and Judicial Offices Bill [HL]Page 4

4 Meaning of “the relevant Chapter 1 legacy scheme” etc

(1)In this Chapter “the relevant Chapter 1 legacy scheme”, in relation to a person’s
remediable service in an employment or office, means the Chapter 1 legacy
scheme for people in that employment, or holders of that office, under which
5(disregarding section 2(1)) the person most recently accrued pensionable
service.

This is subject to subsections (2) to (7).

(2)In a case in which—

(a)on or before the closing date, the person opted that their service in the
10employment or office in question should no longer be pensionable
service under the Chapter 1 legacy scheme mentioned in subsection (1),

(b)on the closing date, the rules of that scheme prohibited a person who
had opted that their service in an employment or office should no
longer be pensionable service under the scheme from opting that their
15service in that employment or office should again be pensionable
service under the scheme, and

(c)on that date, the rules of another Chapter 1 legacy scheme for people in
the employment, or holders of the office, in question did not include
such a prohibition,

20“the relevant Chapter 1 legacy scheme”, in relation to the person’s remediable
service in the employment or office, means the Chapter 1 legacy scheme
mentioned in paragraph (c).

(3)In a case in which—

(a)at any time after the closing date, the person opted that their service in
25the employment or office in question should no longer be pensionable
service under a Chapter 1 new scheme,

(b)at any later time before 1 April 2022, the person opted that their service
in the employment or office in question should again be pensionable
service under that scheme,

(c)30at that time, the rules of the Chapter 1 legacy scheme mentioned in
subsection (1) prohibited a person who had opted that their service in
an employment or office should no longer be pensionable service under
the scheme from opting that their service in that employment or office
should again be pensionable service under the scheme, and

(d)35at that time, the rules of another Chapter 1 legacy scheme for people in
the employment, or holders of the office, in question did not include
such a prohibition,

“the relevant Chapter 1 legacy scheme”, in relation to the person’s remediable
service in the employment or office that takes place after the time mentioned in
40paragraph (b), means the Chapter 1 legacy scheme mentioned in paragraph
(d).

(4)Subsection (5) applies in a case in which—

(a)the person never accrued pensionable service as mentioned in
subsection (1), or

(b)45paragraphs (a) and (b) of subsection (2) apply, but no Chapter 1 legacy
scheme falls within paragraph (c) of that subsection.

(5)Where this subsection applies, “the relevant Chapter 1 legacy scheme”, in
relation to the person’s remediable service in the employment or office, means
the Chapter 1 legacy scheme for people in the employment, or holders of the

Public Service Pensions and Judicial Offices Bill [HL]Page 5

office, in question that the person would have been eligible to join on 31 March
2012 if, on that date, the person—

(a)had been in that employment or a holder of that office, and

(b)had met all other conditions as to eligibility (if any).

(6)5Subsection (7) applies in a case in which paragraphs (a) to (c) of subsection (3)
apply, but no Chapter 1 legacy scheme falls within paragraph (d) of that
subsection.

(7)Where this subsection applies, “the relevant Chapter 1 legacy scheme”, in
relation to the person’s remediable service in the employment or office that
10takes place after the time mentioned in subsection (3)(b), means the Chapter 1
legacy scheme for people in the employment, or holders of the office, in
question that the person would have been eligible to join on 31 March 2012 if,
on that date, the person—

(a)had been in that employment or a holder of that office, and

(b)15had met all other conditions as to eligibility (if any).

(8)Remediable service that is treated under section 2(1) as pensionable service
under a Chapter 1 legacy scheme is, if the scheme has different sections or
otherwise makes different provision in relation to different people, treated as
pensionable service under—

(a)20the section or provision of the scheme under which the person most
recently accrued pensionable service (disregarding section 2(1)), or

(b)if the person has not (disregarding section 2(1)) accrued pensionable
service under the scheme, the section or provision under which the
person would have accrued service if on 31 March 2012 the person had
25been in service in the employment or in the office in question, and had
joined the scheme on that date.

5 Election for retrospective provision to apply to opted-out service

(1)Scheme regulations for a Chapter 1 legacy scheme must make provision so as
to secure that an election may be made in relation to relevant opted-out service
30in an employment or office.

(2)Where an election by virtue of this section is made in relation to relevant opted-
out service in an employment or office—

(a)the second condition in section 1 is treated as met in relation to the
service (so that the service becomes “remediable service”), and

(b)35section 2(1)(b) applies to the service (so that the service is treated as
pensionable service under the relevant Chapter 1 legacy scheme).

(3)An election by virtue of this section—

(a)must be made before the end of the election period,

(b)takes effect when it is made, and

(c)40is irrevocable.

(4)In subsection (3) “the end of the election period” means—

(a)the end of the period of one year beginning with the day on which the
member is first sent a remediable service statement, or

(b)such later time as the scheme manager considers reasonable in all the
45circumstances.

Public Service Pensions and Judicial Offices Bill [HL]Page 6

(5)Scheme regulations made by virtue of subsection (1) may, in particular, include
provision—

(a)under which an election may be made in relation to a person’s relevant
opted-out service only on the making of an application by or on behalf
5of the person;

(b)under which an application by virtue of paragraph (a) may be refused
unless a condition specified in the regulations is met;

(c)requiring information to be provided before an election is made;

(d)about the form and manner in which an election is to be made;

(e)10about who may make an election in relation to the service of a deceased
member.

(6)The conditions that may be specified by virtue of subsection (5)(b) include in
particular—

(a)a condition relating to the reason why the person opted that the service
15to which the application relates should not be pensionable service (or
did not opt that it should be pensionable service) under a Chapter 1
scheme;

(b)a condition requiring—

(i)the transfer to the scheme of any assets and liabilities held for
20the purposes of a partnership pension account that are referable
to pension contributions made by or on behalf of the person in
respect of the person’s relevant opted-out service, and

(ii)the surrender of any entitlement to a pension under the scheme,
and any right to a future pension under the scheme, that would
25otherwise arise under the rules of the scheme in respect of the
value of the assets and liabilities transferred.

(7)For the purposes of this section a person’s opted-out service is “relevant” in
relation to a Chapter 1 legacy scheme if the scheme is the relevant Chapter 1
legacy scheme (within the meaning given by section 4(1)) in relation to that
30service (reading the reference in that provision to remediable service as a
reference to opted-out service).

Pensioner and deceased members: immediate choice of new scheme benefits

6 Immediate choice to receive new scheme benefits

(1)Scheme regulations for a Chapter 1 legacy scheme must make provision so as
35to secure that an election for new scheme benefits may be made in relation to
the remediable service in an employment or office of a relevant member of the
scheme that is pensionable service under the scheme (whether or not by virtue
of section 2(1)).

(2)In this section “relevant member”, in relation to a Chapter 1 legacy scheme,
40means a member of the scheme who, immediately before the coming into force
of section 2(1) in relation to the scheme—

(a)is a pensioner member of the scheme, or of a Chapter 1 new scheme, in
relation to the employment or office, or

(b)is deceased.

(3)45Where a member has remediable service in multiple employments or offices
that is pensionable service under the scheme, provision made under subsection (1)

Public Service Pensions and Judicial Offices Bill [HL]Page 7

must include provision for separate elections in relation to the member’s
remediable service in each of them.

(4)Section 2(1)

(a)has effect in relation to a relevant member’s remediable service in an
5employment or office for the purposes mentioned in section 2(3)(b)
(effect of section 2(1) on amount of benefits payable) only if no election
by virtue of this section is made before the end of the section 6 election
period, and

(b)in such a case, applies for those purposes in relation to the relevant
10member’s remediable service from the end of the section 6 election
period.

(5)Where an election by virtue of this section is made in relation to a member’s
remediable service in an employment or office, the benefits payable under the
scheme to or in respect of the member, so far as they are determined by
15reference to the member’s legacy scheme remediable service in the
employment or office, are new scheme benefits.

(6)For the purposes of subsection (5) a member’s remediable service in an
employment or office is “legacy scheme remediable service” in that
employment or office if and to the extent that it is pensionable service under a
20Chapter 1 legacy scheme otherwise than by virtue of section 2(1).

(7)An election by virtue of this section has effect in relation to all of the member’s
remediable service in the employment or office in question that is pensionable
service under the scheme.

7 Elections by virtue of section 6: timing and procedure

(1)25An election—

(a)must be made before the end of the section 6 election period,

(b)is treated as having taken effect—

(i)immediately before the member became a pensioner member of
the scheme, or (if earlier) became a pensioner member of a
30Chapter 1 new scheme, in relation to the employment or office,
or

(ii)if the member died without having become a pensioner
member of the scheme, or of a Chapter 1 new scheme, in
relation to the employment or office, immediately before the
35member’s death, and

(c)is irrevocable.

(2)In this Chapter “the end of the section 6 election period” means—

(a)the end of the period of one year beginning with the day on which the
member is first sent a remediable service statement, or

(b)40such later time as the scheme manager considers reasonable in all the
circumstances.

(3)Scheme regulations made by virtue of section 6(1) may, in particular, include
provision—

(a)requiring information to be provided before an election is made;

(b)45about the form and manner in which an election is to be made;

(c)about who may make an election in relation to the remediable service
of a deceased member.

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(4)References in this section to “an election” are to an election by virtue of section
6.

8 Power to deem election by virtue of section 6 to have been made

(1)Scheme regulations made by virtue of section 6(1) may include provision
5under which an election by virtue of section 6 is treated as having been made
immediately before the end of the section 6 election period.

(2)Provision by virtue of subsection (1) may be made only in relation to cases in
which—

(a)the end of the section 6 election period in relation to a member has
10passed, and

(b)no decision as to whether an election is to be made in relation to the
member’s remediable service has been communicated to the scheme.

(3)Provision by virtue of subsection (1) may, in particular, include provision
specifying conditions that are to be met if an election is to be treated as having
15been made, including conditions relating to the value of benefits payable under
the scheme if an election is or is not made.

Active and deferred members: deferred choice of new scheme benefits

9 Deferred choice to receive new scheme benefits

(1)Scheme regulations for a Chapter 1 legacy scheme must make provision so as
20to secure that an election for new scheme benefits may be made in relation to
the remediable service in an employment or office of a relevant member of the
scheme that is pensionable service under the scheme (whether or not by virtue
of section 2(1)).

(2)In this section “relevant member”, in relation to a Chapter 1 legacy scheme,
25means a member of the scheme who, immediately before the coming into force
of section 2(1) in relation to the scheme—

(a)is an active or deferred member of the scheme, or of a Chapter 1 new
scheme, in relation to the employment or office, and

(b)is not a pensioner member of a Chapter 1 scheme in relation to the
30employment or office.

(3)Where a member has remediable service in multiple employments or offices
that is pensionable service under the scheme, provision made under subsection
(1) must make provision for separate elections in relation to the member’s
remediable service in each of them.

(4)35Where an election by virtue of this section is made in relation to a member’s
remediable service in an employment or office, the benefits payable under the
scheme to or in respect of the member, so far as they are determined by
reference to the member’s remediable service in that employment or office are
new scheme benefits.

(5)40An election by virtue of this section has effect in relation to all of the member’s
remediable service in the employment or office in question that is pensionable
service under the scheme.

Public Service Pensions and Judicial Offices Bill [HL]Page 9

10 Elections by virtue of section 9: timing and procedure

(1)Scheme regulations made by virtue of section 9(1) must specify a time (“the end
of the section 9 election period”) in relation to a member.

(2)The end of the section 9 election period must not be more than one year before
5the day on which the member is reasonably expected to become entitled to a
pension under the scheme.

(3)An election—

(a)must be made before the end of the section 9 election period, and

(b)(subject to subsection (4)) takes effect immediately before the member
10becomes a pensioner member of the scheme in relation to the
employment or office.

(4)Where an election is made on behalf of a deceased member, the election is
treated as having taken effect immediately before the member’s death.

(5)Scheme regulations made by virtue of section 9(1) may, in particular, include
15provision—

(a)requiring information to be provided before an election is made;

(b)about the form and manner in which an election is to be made;

(c)about who may make an election in relation to the remediable service
of a deceased member;

(d)20subject to subsection (6), about how and when an election lapses or may
be revoked.

(6)Scheme regulations made by virtue of section 9(1) may not provide for an
election made in relation to a member’s remediable service in an employment
or office to lapse or be revoked after any relevant benefits have become payable
25to or in respect of the member after the end of the section 9 election period.

(7)Where an election lapses or is revoked, the election is treated as never having
had effect.

(8)References in this section to “an election” are to an election by virtue of section
9.

11 30Power to deem election by virtue of section 9 to have been made

(1)Scheme regulations made by virtue of section 9(1) may include provision
under which an election by virtue of section 9 is treated as having been made
immediately before the end of the section 9 election period.

(2)Provision by virtue of subsection (1) may be made only in relation to cases in
35which—

(a)the end of the section 9 election period in relation to a member has
passed, and

(b)no decision as to whether an election is to be made in relation to the
member’s remediable service has been communicated to the scheme.

(3)40Provision by virtue of subsection (1) may, in particular, include provision
specifying conditions that are to be met if an election is to be treated as having
been made, including conditions relating to the value of benefits payable under
the scheme if an election is or is not made.