Welfare Reform and Pensions Bill

Welfare Reform and Pensions Bill - continued	House of Commons

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SCHEDULE 3

PENSION SHARING ORDERS: ENGLAND AND WALES

1. The Matrimonial Causes Act 1973 is amended as follows.

2. - (1) Section 21 (financial provision and property adjustment orders) is amended as follows.

(2) In subsection (2), in paragraphs (c) and (d), there is inserted at the end ", other than one in the form of a pension arrangement (within the meaning of section 25D below)".

(3) After subsection (2) there is inserted-

	"(2A) For the purposes of this Act, a pension sharing order is an order which-
	(a) provides that one party's-
	(i) shareable rights under a specified pension arrangement, or
	(ii) shareable state scheme rights,
	be subject to pension sharing for the benefit of the other party, and
	(b) specifies the percentage value to be transferred."

(4) After subsection (5) there is inserted-

	"(5A) In subsection (2A)-
	(a) the reference to shareable rights under a pension arrangement is to rights in relation to which pension sharing is available under Chapter I of Part IV of the Welfare Reform and Pensions Act 1999, or under corresponding Northern Ireland legislation, and
	(b) the reference to shareable state scheme rights is to rights in relation to which pension sharing is available under Chapter II of Part IV of the Welfare Reform and Pensions Act 1999, or under corresponding Northern Ireland legislation."

3. After section 24A there is inserted-

"Pension sharing orders: divorce.	24B. - (1) On an application made under this section, the court may at the appropriate time make one or more pension sharing orders.
	(2) The "appropriate time" is any time-
	(a) after a statement of marital breakdown has been received by the court and before any application for a divorce order or for a separation order is made to the court by reference to that statement;
	(b) when an application for a divorce order has been made under section 3 of the 1996 Act and has not been withdrawn;
	(c) when an application for a divorce order has been made under section 4 of the 1996 Act and has not been withdrawn;
	(d) after a divorce order has been made.
	(3) The court shall exercise its powers under this section, so far as is practicable, by making on one occasion all such provision as can be made by way of one or more pension sharing orders in relation to the marriage as it thinks fit.
	(4) This section is to be read subject to any restrictions imposed by this Act and to section 19 of the 1996 Act.
Restrictions affecting section 24B.	24C. - (1) No pension sharing order may be made under section 24B above so as to take effect before the making of a divorce order in relation to the marriage.
	(2) The court may not make a pension sharing order under section 24B above at any time while the period for reflection and consideration is interrupted under section 7(8) of the 1996 Act.
	(3) No pension sharing order may be made under section 24B above by virtue of a statement of marital breakdown if, by virtue of section 5(3) or 7(9) of the 1996 Act (lapse of divorce process), it has ceased to be possible-
	(a) for an application to be made by reference to that statement; or
	(b) for an order to be made on such an application.
	(4) No pension sharing order may be made under section 24B above after a divorce order has been made, except-
	(a) in response to an application made before the divorce order was made; or
	(b) on a subsequent application made with the leave of the court.
	(5) A pension sharing order under section 24B above may not be made in relation to a pension arrangement which-
	(a) is the subject of a pension sharing order in relation to the marriage, or
	(b) has been the subject of pension sharing between the parties to the marriage.
	(6) A pension sharing order under section 24B above may not be made in relation to shareable state scheme rights if-
	(a) such rights are the subject of a pension sharing order in relation to the marriage, or
	(b) such rights have been the subject of pension sharing between the parties to the marriage.
	(7) A pension sharing order under section 24B above may not be made in relation to the rights of a person under a pension arrangement if there is in force a requirement imposed by virtue of section 25B or 25C below which relates to benefits or future benefits to which he is entitled under the pension arrangement.
	(8) In this section, "period for reflection and consideration" means the period fixed by section 7 of the 1996 Act.
Pension sharing orders: nullity of marriage.	24D. - (1) On or after granting a decree of nullity of marriage (whether before or after the decree is made absolute), the court may, on an application made under this section, make one or more pension sharing orders in relation to the marriage.
	(2) The court shall exercise its powers under this section, so far as is practicable, by making on one occasion all such provision as can be made by way of one or more pension sharing orders in relation to the marriage as it thinks fit.
	(3) Where a pension sharing order is made under this section on or after the granting of a decree of nullity of marriage, the order is not to take effect unless the decree has been made absolute.
	(4) This section is to be read subject to any restrictions imposed by this Act.
Restrictions affecting section 24D.	24E. - (1) A pension sharing order under section 24D above may not be made in relation to a pension arrangement which-
	(a) is the subject of a pension sharing order in relation to the marriage, or
	(b) has been the subject of pension sharing between the parties to the marriage.
	(2) A pension sharing order under section 24D above may not be made in relation to shareable state scheme rights if-
	(a) such rights are the subject of a pension sharing order in relation to the marriage, or
	(b) such rights have been the subject of pension sharing between the parties to the marriage.
	(3) A pension sharing order under section 24D above may not be made in relation to the rights of a person under a pension arrangement if there is in force a requirement imposed by virtue of section 25B or 25C below which relates to benefits or future benefits to which he is entitled under the pension arrangement.
Pension sharing orders: duty to stay.	24F. - (1) No pension sharing order may be made so as to take effect before the end of such period after the making of the order as may be prescribed by rules made by the Lord Chancellor.
	(2) The power to make rules under this section shall be exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
Pension sharing orders: apportionment of charges.	24G. If a pension sharing order relates to rights under a pension arrangement, the court may include in the order provision about the apportionment between the parties of any charge under section 35 of the Welfare Reform and Pensions Act 1999 (charges in respect of pension sharing costs), or under corresponding Northern Ireland legislation."

4. In section 25 (matters to which the court is to have regard in deciding how to exercise its powers with respect to financial relief)-

(a) in subsection (1), for "24A" there is substituted "24D", and

(b) in subsection (2), for "or 24A" there is substituted ", 24A, 24B or 24D".

5. In section 25A(1) (court's duty to consider desirability of exercising power to achieve clean break), for "24A" there is substituted "24D".

6. - (1) Section 31 (variation, discharge etc. of certain orders for financial relief) is amended as follows.

(2) In subsection (2), at the end there is inserted-

"(g) a pension sharing order under section 24B which is made at a time when no divorce order has been made, and no separation order is in force, in relation to the marriage."

(3) In subsection (4A), for "or (ea)" there is substituted ", (ea) or (g)".

(4) After subsection (4B) there is inserted-

	"(4C) No variation of a pension sharing order shall be made so as to take effect before the making of a divorce order in relation to the marriage.
	(4D) The variation of a pension sharing order prevents the order taking effect before the end of such period after the making of the variation as may be prescribed by rules made by the Lord Chancellor."

(5) In subsection (5)-

(a) for "(7F)" there is substituted "(7H)",

(b) for "or (e)" there is substituted ", (e) or (g)", and

(6) In subsection (7B), after paragraph (b) there is inserted-

"(ba) one or more pension sharing orders;"

(7) After subsection (7F) there is inserted-

	"(7G) Section 24B(3) above applies where the court makes a pension sharing order under subsection (7B) above as it applies where the court makes such an order under section 24B above.
	(7H) Section 24C(5) to (7) apply in relation to a pension sharing order under subsection (7B) above as they apply in relation to such an order under section 24B above."

(8) After subsection (14) there is inserted-

"(15) The power to make rules under subsection (4D) shall be exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament."

7. After section 31A there is inserted-

"Discharge of pension sharing orders on making of separation order.

31B. Where, after the making of a pension sharing order under section 24B above in relation to a marriage, a separation order is made in relation to the marriage, the pension sharing order is discharged."

8. In section 33A (consent orders), in subsection (3), in the definition of "order for financial relief", after "property adjustment order," there is inserted "any pension sharing order,".

9. After section 40 there is inserted-

"Appeals relating to pension sharing orders which have taken effect.	40A. - (1) Subsections (2) and (3) below apply where an appeal against a pension sharing order is begun on or after the day on which the order takes effect.
	(2) If the pension sharing order relates to a person's rights under a pension arrangement, the appeal court may not set aside or vary the order if the person responsible for the pension arrangement has acted to his detriment in reliance on the taking effect of the order.
	(3) If the pension sharing order relates to a person's shareable state scheme rights, the appeal court may not set aside or vary the order if the Secretary of State has acted to his detriment in reliance on the taking effect of the order.
	(4) Where subsection (2) or (3) above applies, the appeal court may make such further orders (including one or more pension sharing orders) as it thinks fit, for the purpose of putting the parties in the position it considers appropriate.
	(5) Section 24F above only applies to a pension sharing order under this section if the decision of the appeal court can itself be the subject of an appeal.
	(6) In subsection (2), the reference to the person responsible for the pension arrangement is to be read in accordance with section 25D(4) above."

Prepared 28 April 1999