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Pensions Bill


Pensions Bill
Part 5 — Occupational and personal pension schemes: miscellaneous provisions

175

 

(4)   

In Part 3 of Schedule 1 to the House of Commons Disqualification Act 1975

(c. 24) (other disqualifying offices), after “Pensions Ombudsman” insert “and

any deputy to that Ombudsman appointed under section 145A of the Pension

Schemes Act 1993.”.

(5)   

In Part 3 of Schedule 1 to the Northern Ireland Assembly Disqualification Act

5

1975 (c. 25)(other disqualifying offices), at the appropriate place insert—

           

“Pensions Ombudsman and any deputy to that Ombudsman

appointed under section 145A of the Pension Schemes Act 1993”.

243     

Jurisdiction

(1)   

After section 146(4) of the Pension Schemes Act 1993 (c. 48) (power to apply

10

Part 10 of that Act to those concerned with the administration of a scheme)

insert—

“(4A)   

For the purposes of subsection (4) a person or body of persons  is

concerned with the administration of an occupational or personal

pension scheme where the person or body is responsible for carrying

15

out an act of administration concerned with the scheme.”

(2)   

The amendment made by this section has effect in relation to the making of any

provision under section 146(4) of the Pension Schemes Act 1993 applying Part

10 of that Act in relation to a complaint or a dispute in so far as it relates to a

matter which arises on or after the day on which this section comes into force.

20

(3)   

For the purposes of subsection (2), a question falling within section 146(1)(g) of

the Pension Schemes Act 1993 is to be treated as a dispute.

244     

Investigations

(1)   

Omit section 54 of the Child Support, Pensions and Social Security Act 2000

(c. 19) (“the 2000 Act”) (which amends sections 148, 149 and 151 of the Pension

25

Schemes Act 1993 and which has not been brought into force except for the

purpose of making regulations and rules).

(2)   

Omit the following provisions of the Pension Schemes Act 1993 —

(a)   

section 148(5)(ba) and (bb) as inserted by section 54(2) of the 2000 Act,

(b)   

section 149(1), (1A) and (1B) as substituted by section 54(3) of the 2000

30

Act,

(c)   

section 149(3)(ba) as substituted by section 54(4) of the 2000 Act,

(d)   

section 149(3)(d) and the word “and” immediately preceding it as

inserted by section 54(5) of the 2000 Act,

(e)   

section 149(8) as inserted by section 54(6) of the 2000 Act,

35

(f)   

section 151(1)(c) and the word “and” immediately preceding it as

inserted by section 54(7) of the 2000 Act,

(g)   

section 151(3)(ba) and (bb) as substituted by section 54(8) of the 2000

Act, and

(h)   

in section 151(3)(c) the words “any of paragraphs (a) to (bb)” as inserted

40

by section 54(8) of the 2000 Act,

   

to the extent that those amendments made by section 54 of the 2000 Act have

been brought into force for the purpose of making regulations and rules.

 

 

Pensions Bill
Part 5 — Occupational and personal pension schemes: miscellaneous provisions

176

 

Pension compensation

245     

Amendments relating to the Pensions Compensation Board

(1)   

The Pensions Act 1995 (c. 26) is amended as follows.

(2)   

In section 80 (review of decisions of the Pensions Compensation Board)—

(a)   

after subsection (2) insert—

5

“(2A)   

The Compensation Board may also review such a

determination without an application being made.”

(b)   

for subsections (4) and (5) substitute—

“(4)   

Regulations may make provision—

(a)   

with respect to reviews under this section (or any

10

corresponding provision in force in Northern Ireland);

(b)   

with respect to applications under subsection (2) (or any

corresponding provision in force in Northern Ireland)

and the procedure to be adopted on any such

application.”

15

(3)   

In section 81 (cases where compensation provisions apply), omit subsections

(1)(d), (2A) and (7).

(4)   

In section 83 (amount of compensation) for subsections (3) and (4) substitute—

“(3)   

The amount of the payment, or (if there is more than one) the aggregate,

must not exceed the aggregate of—

20

(a)   

the amount (if any) by which the shortfall at the application date

exceeds the recoveries of value made between the application

date and the settlement date, and

(b)   

interest at the prescribed rate for the prescribed period on the

amount of that excess (if any).”

25

Annual increases in rate of pensions

246     

Annual increase in rate of certain occupational pensions

(1)   

Section 51 of the Pensions Act 1995 (annual increase in rate of certain

occupational pensions) is amended in accordance with subsections (2) to (5).

(2)   

In subsection (1) omit “and” at the end of paragraph (a) and for paragraph (b)

30

substitute—

“(b)   

the whole, or any part of, the pension is attributable to

pensionable service on or after the appointed day or, in the case

of money purchase benefits, to payments in respect of

employment carried on on or after the appointed day, and

35

(c)   

apart from this section—

(i)   

the annual rate of the pension, or

(ii)   

if only part of the pension is attributable as described in

paragraph (b), so much of the annual rate as is

attributable to that part,

40

   

would not be increased each year by at least the appropriate

percentage of that rate.”

 

 

Pensions Bill
Part 5 — Occupational and personal pension schemes: miscellaneous provisions

177

 

(3)   

In subsection (4)(b) for “5 per cent per annum” substitute “—

(i)   

in the case of a category X pension, 5% per annum, and

(ii)   

in the case of a category Y pension, 2.5% per annum.”

(4)   

After subsection (4) insert—

“(4A)   

For the purposes of this section, a pension is a category X pension if it

5

is—

(a)   

a pension which became a pension in payment before the

commencement day, or

(b)   

a pension—

(i)   

which becomes a pension in payment on or after the

10

commencement day, and

(ii)   

the whole of which is attributable to pensionable service

before that day or, in the case of money purchase

benefits, to payments in respect of employment carried

on before that day.

15

(4B)   

For the purposes of this section, a pension is a category Y pension if it

is a pension—

(a)   

which becomes a pension in payment on or after the

commencement day, and

(b)   

the whole of which is attributable to pensionable service on or

20

after the commencement day or, in the case of money purchase

benefits, to payments in respect of employment carried on on or

after that day.

(4C)   

For the purposes of applying this section in the case of a pension—

(a)   

which becomes a pension in payment on or after the

25

commencement day,

(b)   

part of which is attributable to pensionable service before the

commencement day or, in the case of money purchase benefits,

to payments in respect of employment carried on before that

day, and

30

(c)   

part of which is attributable to pensionable service on or after

that day or, in the case of money purchase benefits, to payments

in respect of employment carried on on or after that day,

   

each of those parts of the pension is to be treated as if it were a separate

pension.”

35

(5)   

In subsection (5)—

(a)   

for “the provisions of subsections (2) and (3)” substitute “any of the

provisions of this section”, and

(b)   

in paragraph (a), after “appointed day” insert “or the commencement

day”.

40

(6)   

After that section insert—

“51ZA  Meaning of the “appropriate percentage”

(1)   

For the purposes of section 51(1)(c) and (2), “the appropriate

percentage” in relation to an increase in the whole or part of the annual

rate of a pension—

45

(a)   

in the case of a category X pension, means the revaluation

percentage for the latest revaluation period specified in the

 

 

Pensions Bill
Part 5 — Occupational and personal pension schemes: miscellaneous provisions

178

 

order under paragraph 2 of Schedule 3 to the Pension Schemes

Act 1993 (revaluation of accrued pension benefits) which is in

force at the time of the increase, and

(b)   

in the case of a category Y pension, means whichever is the

lesser of—

5

(i)   

the revaluation percentage for the latest revaluation

period specified in the order under paragraph 2 of

Schedule 3 to the Pension Schemes Act 1993 which is in

force at the time of the increase, and

(ii)   

2.5%.

10

(2)   

In this section “the revaluation percentage” and “the revaluation

period” have the same meaning as in paragraph 2 of Schedule 3 to the

Pension Schemes Act 1993.”

(7)   

In section 54(3) of that Act (sections 51 to 53: supplementary), at the

appropriate place insert—

15

   

““the commencement day” means the day appointed for the coming into

force of section 246 of the Pensions Act 2004 (amendments to section

51);”.

247     

Annual increase in rate of certain personal pensions

(1)   

Section 162 of the Pensions Act 1995 (c. 26) (annual increase in rate of certain

20

personal pensions) is amended in accordance with subsections (2) and (3).

(2)   

In subsection (1) omit “and” at the end of paragraph (a) and for paragraph (b)

substitute—

“(b)   

the whole, or any part of, the pension is attributable to

contributions in respect of employment carried on on or after

25

the appointed day, and

(c)   

apart from this section—

(i)   

the annual rate of the pension, or

(ii)   

if only part of the pension is attributable as described in

paragraph (b), so much of the annual rate as is

30

attributable to that part,

   

would not be increased each year by at least the appropriate

percentage of that rate.”

(3)   

After subsection (2) insert—

“(2A)   

For the purposes of this section, a pension is a category X pension if it

35

is—

(a)   

a pension which became a pension in payment before the

commencement day, or

(b)   

a pension—

(i)   

which becomes a pension in payment on or after the

40

commencement day, and

(ii)   

the whole of which is attributable to contributions in

respect of employment carried on before that day.

(2B)   

For the purposes of this section, a pension is a category Y pension if it

is a pension—

45

 

 

Pensions Bill
Part 5 — Occupational and personal pension schemes: miscellaneous provisions

179

 

(a)   

which becomes a pension in payment on or after the

commencement day, and

(b)   

the whole of which is attributable to contributions in respect of

employment carried on on or after that day.

(2C)   

For the purposes of applying this section in the case of a pension—

5

(a)   

which becomes a pension in payment on or after the

commencement day,

(b)   

part of which is attributable to contributions in respect of

employment carried on before that day, and

(c)   

part of which is attributable to contributions in respect of

10

employment carried on on or after that day,

   

each of those parts of the pension is to be treated as if it were a separate

pension.”

(4)   

After that section insert—

“162A  Meaning of the “appropriate percentage”

15

(1)   

For the purposes of section 162(1)(c) and (2), “the appropriate

percentage” in relation to an increase in the whole or part of the annual

rate of a pension—

(a)   

in the case of a category X pension, means the revaluation

percentage for the latest revaluation period specified in the

20

order under paragraph 2 of Schedule 3 to the Pension Schemes

Act 1993 (revaluation of accrued pension benefits) which is in

force at the time of the increase, and

(b)   

in the case of a category Y pension, means whichever is the

lesser of—

25

(i)   

the revaluation percentage for the latest revaluation

period specified in the order under paragraph 2 of

Schedule 3 to the Pension Schemes Act 1993 which is in

force at the time of the increase, and

(ii)   

2.5%.

30

(2)   

In this section “the revaluation percentage” and “the revaluation

period” have the same meaning as in paragraph 2 of Schedule 3 to the

Pension Schemes Act 1993.”

(5)   

In section 163(3) of that Act (section 162: supplementary), at the appropriate

place insert—

35

   

““the commencement day” means the day appointed for the coming into

force of section 247 of the Pensions Act 2004 (amendments to section

162);”.

248     

Power to increase pensions giving effect to pension credits etc

(1)   

Section 40 of the Welfare Reform and Pensions Act 1999 (c. 30) (power of the

40

Secretary of State to increase pensions provided to give effect to certain rights)

is amended as follows.

(2)   

In subsection (1), for “5%” substitute “the maximum percentage”.

(3)   

After subsection (2) insert—

“(2A)   

For the purposes of subsection (1) the “maximum percentage” means—

45

 

 

Pensions Bill
Part 5 — Occupational and personal pension schemes: miscellaneous provisions

180

 

(a)   

5% in a case where—

(i)   

the pension is in payment before the commencement

day, or

(ii)   

the pension is not in payment before the commencement

day but the entitlement to the relevant pension credit

5

arose before that day, and

(b)   

2.5% in a case where the entitlement to the relevant pension

credit arises on or after the commencement day.”

(4)   

In subsection (3), at the appropriate places insert—

   

““commencement day” means the day appointed for the coming into

10

force of section 248 of the Pensions Act 2004 (amendments to section

40);”

   

““relevant pension credit” means the pension credit to which the eligible

pension credit rights or, as the case may be, the safeguarded rights

relate.”

15

Revaluation

249     

Exemption from statutory revaluation requirement  

(1)   

Section 84 of the Pension Schemes Act 1993 (c. 48) (basis of revaluation) is

amended as follows.

(2)   

In subsection (5), after paragraph (a) insert “or

20

(b)   

under any arrangement which maintains the value of the

pension or other benefit by reference to the rise in the retail

prices index during that period,”.

(3)   

After that subsection add—

“(6)   

In subsection (5)(b), “retail prices index” means—

25

(a)   

the general index of retail prices (for all items) published by the

Office for National Statistics; or

(b)   

where that index is not published for a month, any substituted

index or figures published by that Office.”

Contracting out

30

250     

Meaning of “working life” in Pension Schemes Act 1993

In section 181 of the Pension Schemes Act 1993 (general interpretation), in

subsection (1) for the definition of “working life” substitute—

““working life”, in relation to a person, means the period beginning with

the tax year in which the person attains the age of 16 and ending

35

with—

(a) 

the tax year before the one in which the person attains the age

of 65 in the case of a man or 60 in the case of a woman, or

(b) 

if earlier, the tax year before the one in which the person dies.”

 

 

 
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