Pensions Bill

House of Commons

Session 2003 - 04
Internet Publications
Other Bills before Parliament

Pensions Bill

Pensions Bill
Part 1 — The Pensions Regulator
16

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Power to give a direction where freezing order ceases to have effect
(1)
This section applies where—
(a)
the Regulator revokes a freezing order in relation to a scheme or it
otherwise ceases to have effect, and
(b)
at the time when the freezing order ceases to have effect, the Regulator
5
has not made an order under section 11 of the Pensions Act 1995 (c. 26)
(“the 1995 Act”) in relation to the scheme.
(2)
In such a case the Regulator may make an order under this section in relation
to the scheme containing a direction that, if specified conditions are met,
specified benefits are to accrue under the scheme to, or in respect of, specified
10
members of the scheme in respect of specified periods of service being service
in employment which but for the freezing order would have qualified the
member in question for those benefits under the scheme.
(3)
The conditions mentioned in subsection (2) may include—
(a)
a requirement that specified benefits do not accrue to, or in respect of,
15
a member or a specified member unless an election is made by or on
behalf of the member that they are to accrue;
(b)
a requirement that specified benefits do not accrue to, or in respect of,
a member or a specified member unless a contribution of a specified
amount is paid by or on behalf of the member towards the scheme
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within a specified period;
(c)
a requirement that a contribution of a specified amount must be paid
by or on behalf of the employer within a specified period;
(d)
a requirement that such contributions as are specified under paragraph
(b) or (c) are to be accepted for the period for which the freezing order
25
had effect or any part of that period.
(4)
Where the freezing order contained a direction under section 20(4)(d) or (e)
and any amount of any benefit under the scheme was not paid as a result of the
direction—
(a)
the direction does not affect any entitlement to that benefit, and
30
(b)
any benefit to which a member, or a person in respect of a member,
remains entitled at the end of the period for which the freezing order
had effect is an amount which falls due to the member or, as the case
may be, the person at the end of that period.
(5)
If an order made under this section in relation to a scheme is not complied with,
35
section 10 of the 1995 Act (civil penalties) applies to a trustee or a manager of
the scheme who has failed to take all reasonable steps to secure compliance.
(6)
Subsection (7) applies if—
(a)
an order is made under this section in relation to a scheme,
(b)
the order contains a requirement as described in subsection (3)(c) that a
40
contribution of a specified amount must be paid by or on behalf of the
employer within a specified period, and
(c)
the contribution is not paid within that period.
(7)
In such a case—
(a)
section 10 of the 1995 Act applies to the employer if he has failed,
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without reasonable excuse, to secure compliance,

Pensions Bill
Part 1 — The Pensions Regulator
17

(b)
the amount which for the time being remains unpaid after the end of
the specified period is to be treated as a debt due from the employer to
the trustees or managers of the scheme, and
(c)
except in prescribed circumstances, the trustees or managers must,
within a prescribed period, give notice of the failure to pay to the
5
Regulator and to the member.
(8)
If in any case subsection (7)(c) is not complied with, section 10 of the 1995 Act
applies to any trustee or manager who has failed to take all reasonable steps to
secure compliance.
(9)
In this section “specified” means specified in an order under this section.
10
27
Notification of trustees, managers, employers and members
(1)
This section applies where—
(a)
a freezing order is made in relation to a scheme,
(b)
an order is made under section 23 validating action taken in
contravention of a freezing order made in relation to a scheme,
15
(c)
an order is made under section 24(3) directing specified steps to be
taken following the winding up of a scheme, or
(d)
an order is made under section 26 in relation to a scheme where a
freezing order ceases to have effect.
(2)
The Regulator must, as soon as reasonably practicable after the order has been
20
made, notify—
(a)
the trustees or managers of the scheme, and
(b)
the employer in relation to the scheme,

of the fact that the order has been made and of its effect.
(3)
The Regulator may by order direct the trustees or managers of the scheme to
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notify—
(a)
all the members of the scheme, or
(b)
the members of the scheme specified in the order,

of the fact that the order mentioned in subsection (1) has been made and of its
effect.
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(4)
Notification is to be within the period and in the manner specified in the order
under subsection (3).
(5)
If an order made under subsection (3) is not complied with, section 10 of the
Pensions Act 1995 (c. 26) (civil penalties) applies to a trustee or manager to
whom the order is directed who has failed to take all reasonable steps to secure
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compliance.
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Supplementary provision relating to orders under sections 20 to 27
(1)
An order may be made in relation to a scheme under any of sections 20, 22, 23,
24, 26 and 27—
(a)
in spite of any enactment or rule of law, or any rule of the scheme,
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which would otherwise operate to prevent the order being made, and
(b)
without regard to any such enactment, rule of law or rule of the scheme
as would otherwise require, or might otherwise be taken to require, the
implementation of any procedure or the obtaining of any consent, with
a view to the making of the order.
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Pensions Bill
Part 1 — The Pensions Regulator
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(2)
Subsection (1) does not have effect to authorise the Regulator to make an order
as mentioned in that subsection if its doing so would be unlawful as a result of
section 6(1) of the Human Rights Act 1998 (c. 42) (unlawful for public authority
to act in contravention of a Convention right).
Trustees of occupational pension schemes
5
29
Prohibition orders
For section 3 of the Pensions Act 1995 (c. 26) (prohibition orders) substitute—
“3
Prohibition orders
(1)
The Authority may by order prohibit a person from being a trustee of —
(a)
a particular trust scheme,
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(b)
a particular description of trust schemes, or
(c)
trust schemes in general,

if they are satisfied that he is not a fit and proper person to be a trustee
of the scheme or schemes to which the order relates.
(2)
Where a prohibition order is made under subsection (1) against a
15
person in respect of one or more schemes of which he is a trustee, the
order has the effect of removing him.
(3)
The Authority may, on the application of any person prohibited under
this section, by order revoke the order either generally or in relation to
a particular scheme or description of schemes.
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(4)
An application under subsection (3) may not be made—
(a)
during the period within which the determination to exercise
the power to make the prohibition order may be referred to the
Tribunal under section 70(3) or 73(7) of the Pensions Act 2004,
and
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(b)
if the determination is so referred, until the reference, and any
appeal against the Tribunal’s determination, has been finally
disposed of.
(5)
A revocation made at any time under this section cannot affect
anything done before that time.
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(6)
The Authority must prepare and publish a statement of the policies
they intend to adopt in relation to the exercise of their powers under
this section.
(7)
The Authority may revise any statement published under subsection
(6) and must publish any revised statement.
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(8)
In this section “the Tribunal” means the Pensions Regulator Tribunal
established under section 76 of the Pensions Act 2004.”
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Suspension orders
In section 4 of the Pensions Act 1995 (suspension orders)—
(a)
for subsection (1)(b) substitute—
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“(b)
pending consideration being given to the institution of
proceedings against him for an offence involving

Pensions Bill
Part 1 — The Pensions Regulator
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dishonesty or deception or where such proceedings
have been instituted and have not been concluded,”,
(b)
in subsection (2)—
(i)
omit “and” at the end of paragraph (a) and insert—
“(aa)
if made by virtue of paragraph (b), has effect—
5
(i)
for an initial period of twelve months, if
proceedings are not instituted within
that period, and
(ii)
in any other case, until the proceedings in
question are concluded,”,
10
(ii)
after “effect” insert “in relation to a trust scheme”, and
(iii)
after “section 3(1)” insert “in relation to that scheme”,
(c)
after subsection (5) insert—
“(5A)
An application under subsection (5) may not be made—
(a)
during the period within which the determination to
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exercise the power to make an order under subsection
(1) may be referred to the Tribunal under section 70(3) or
73(7) of the Pensions Act 2004, and
(b)
if the determination is so referred, until the reference,
and any appeal against the Tribunal’s determination,
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has been finally disposed of.”, and
(d)
After subsection (6) insert—
“(7)
In this section “the Tribunal” means the Pensions Regulator
Tribunal established under section 76 of the Pensions Act 2004.”
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Appointments by Regulator
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(1)
In section 7 of the Pensions Act 1995 (c. 26) (appointment of trustees)—
(a)
omit subsection (4), and
(b)
after subsection (5) insert—
“(5A)
An application may be made to the Regulator in relation to a
trust scheme by—
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(a)
the trustees of the scheme,
(b)
the employer, or
(c)
any member of the scheme,

for the appointment of a trustee of the scheme under subsection
(3)(a) or (c).”
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(2)
In section 8 of that Act (consequences of appointment of trustees under section
7), for subsections (1) and (2) substitute—
“(1)
An order under section 7 appointing a trustee may provide for any fees
and expenses of trustees appointed under the order to be paid—
(a)
by the employer,
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(b)
out of the resources of the scheme, or
(c)
partly by the employer and partly out of those resources.
(2)
Such an order may also provide that an amount equal to the amount (if
any) paid out of the resources of the scheme by virtue of subsection
(1)(b) or (c) is to be treated for all purposes as a debt due from the
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employer to the trustees of the scheme.”