7. CONSEQUENTIAL
AMENDMENTS TO
PENSIONS LEGISLATION—CLAUSES
29 AND 30 AND
SCHEDULES 4 AND
5
The following comments relate to paragraphs
of Schedule 4:
21. We have already commented that the amendments
which apply revaluation of deferred pensions where the PCB involves
the ex-spouse being credited with notional pensionable service
will only work if there is a further amendment adapting the references
to termination of pensionable service so that they will apply
in the case of an ex-spouse.
25. We welcome this amendment preventing
a member who has both rights under a scheme as an employee or
ex-employee and pension credit rights from exercising his right
to a cash equivalent in respect of the employment rights without
exercising his right to transfer his pension credit rights.
37. We find it hard to envisage circumstances
in which trustees would decide that a scheme should be closed
to new active members but open to new PCB members. If they do,
it seems they will be able to insist on external transfer—even
if the scheme is unfunded? The relationship with Clause 10(2)
(death before implementation) and paragraph 9 of Schedule 2 (reduced
pension credit) needs to be considered here.
38. We note that the provisions of section
51 relating to LPI increases on pensions in payment will not apply
to PCB members.
40. On the other hand, we note that the protection
of section 67 will apply to the rights of PCB members.
41. Doesn't section 68(2) of the PA 1995
need to cover pension debits as well?
42. We assume that where a pension derived
from a pension credit comes into payment under a scheme, it will
have the same priority for the purposes of section 73 as any other
pension in payment under the scheme.
44 et seq These seem to be substantive changes
which are not directly relevant to pension sharing. Under section
91 at the moment the lien attaching to a member's benefit can
attach to the contingent spouse's pension. It seems that under
the proposed amendments to section 91 this may no longer be the
case, the argument being that a spouse "has a right to a
future pension under a scheme", whereas under section 91
at the moment the "accrued rights" are of the member
not of the spouse.
45(2) We are puzzled by the distinction being
drawn between "entitlement to a pension" and "right
to a future pension". From the legal point of view an active
or deferred member has as good an entitlement as a pensioner.
Perhaps you should define what you mean by entitlement—this
might help in interpreting s.67 PA 1995 as well.
47. It is noted that the effect of this amendment
is that any reference to a "member" in the Pensions
Act 1995 will include a PCB member, unless the particular section
excludes such a member. We have already commented on the dangers
of automatically including them wherever members are mentioned,
especially if they are included in one Act but not in another.
If they are to be included as "members" they should
be expressly excluded from the definition of "deferred pensioners".
