(1-6)

House of Commons

Session 2002 - 03
Internet Publications
Other Bills before Parliament

LORDS AMENDMENTs
TO THE
PENSIONS BILL
[The page and line references are to HL Bill 73, the bill as first printed for the Lords.]
Clause 4
1
Page 2, line 27, leave out from “in” to end of line 28 and insert “subsection (3) of

section 9 must, by virtue of subsection (2) of that section, be discharged by the

committee established under that section,”
Clause 8
2
Leave out Clause 8
Clause 9
3
Page 4, line 23, leave out subsection (2) and insert—

“(2)
The Regulator must establish a committee to discharge the non-executive

functions on its behalf.

(2A)
Only non-executive members of the Regulator may be members of the

committee.”
4
Page 4, line 27, leave out paragraphs (a) to (d)
5
Page 5, line 1, leave out “Non-Executive Committee” and insert “committee

established under this section”
6
Page 5, line 4, leave out “Non-Executive Committee’s” and insert “committee’s”
7
Page 5, line 5, at end insert—

“( )
The committee may establish sub-committees, and the members of any

such sub-committee—

(a)
may include persons who are not members of the committee or of

the Regulator, but

(b)
must not include persons who are executive members or other staff

of the Regulator.”
8
Page 5, line 6, leave out “Non-Executive Committee” and insert “committee”

Bill 178 53/3

(  2  )
9
Page 5, line 10, leave out “Non-Executive Committee” and insert “committee”
Clause 11
10
Page 6, line 19, at end insert—

“( )
section (Pension liberation: restraining orders)(10) (application to

permit payments out of an account that is subject to a restraining

order);”
11
Page 6, line 21, at end insert—

“( )
section 38(6A) (application for the issue of a revised contribution

notice under section 38(6C));”
12
Page 6, line 21, at end insert—

“( )
section 45(7) (application for the issue of a revised contribution

notice under section 45(9));”
Clause 12
13
Page 7, line 10, after “prepared,” insert “including the matters mentioned in

subsection (2A),”
14
Page 7, line 11, leave out from “prepared” to end of line 12 and insert “under

subsection (4) of section 9 by the committee established under that section.”
15
Page 7, line 12, at end insert—

“(2A)
The matters referred to in subsection (2)(a) are—

(a)
the strategic direction of the Regulator and the manner in which it

has been kept under review;

(b)
the steps taken to scrutinise the performance of the Chief Executive

in securing that the Regulator’s functions are exercised efficiently

and effectively;

(c)
the Regulator’s objectives and targets (including its main objectives

as set out in section 5 or in any corresponding provision in force in

Northern Ireland) and the steps taken to monitor the extent to

which they are being met.”
After Clause 18
16
Insert the following new Clause—

“Pension liberation: interpretation

(1)
In this section and sections (Pension liberation: court’s power to order

restitution), (Pension liberation: restraining orders) and (Pension liberation:

repatriation orders)—

(a)
“pension scheme” means an occupational pension scheme or a

personal pension scheme,

(b)
“deposit-taker” has the meaning given by subsections (8A) and (8B)

of section 49 of the Pensions Act 1995 (c. 26), except that, for the

purposes of this definition, subsection (8A)(c) of that section has

effect with the omission of the words from “or” to the end,

(c)
references to money liberated from a pension scheme are to be read

in accordance with subsection (2),

(  3  )

(d)
“liberated member”, in relation to money liberated from a pension

scheme, means the member of the pension scheme who is referred

to in subsection (2)(a), and

(e)
“restraining order” means a restraining order under section

(Pension liberation: restraining orders).

(2)
Money is to be taken to have been liberated from a pension scheme if—

(a)
the money directly or indirectly represents an amount that, in

respect of accrued rights of a member of a pension scheme, has been

transferred out of the scheme in pursuance of—

(i)
a relevant statutory provision, or

(ii)
a provision of the applicable rules, other than a relevant

statutory provision,

(b)
the trustees or managers of the scheme transferred the amount out

of the scheme on the basis that a third party (“the liberator”) would

secure that the amount was used in an authorised way,

(c)
the amount has not been used in an authorised way, and

(d)
the liberator has not secured, and is not likely to secure, that the

amount will be used in an authorised way.

(3)
The following are “relevant statutory provisions” for the purposes of

subsection (2)—

(a)
section 94(1)(a), (aa) or (b) of the Pension Schemes Act 1993 (c. 48)

(right to cash equivalent under Chapter 4 of Part 4 of that Act);

(b)
section 101AB(1)(a) of that Act (right to cash transfer sum under

Chapter 5 of Part 4 of that Act);

(c)
section 101F(1) of that Act (right to cash equivalent of pension credit

benefit).

(4)
In subsection (2) “authorised way” means—

(a)
where the amount concerned is transferred out of the scheme in

pursuance of a provision mentioned in subsection (3)(a), a way

specified in subsection (2) or, as the case may be, subsection (3) of

section 95 of the Pension Schemes Act 1993 (c. 48);

(b)
where that amount is transferred out in pursuance of the provision

mentioned in subsection (3)(b), a way specified in section 101AE(2)

of that Act;

(c)
where that amount is transferred out in pursuance of the provision

mentioned in subsection (3)(c), a way specified in subsection (2) or,

as the case may be, subsection (3) of section 101F of that Act;

(d)
where that amount is transferred out in pursuance of a provision of

the kind mentioned in subsection (2)(a)(ii), a way that is authorised

by the applicable rules for amounts transferred out in pursuance of

that provision.

(5)
In this section “the applicable rules” has the same meaning as, in the case

of the pension scheme concerned, that expression has in section 94 of the

Pension Schemes Act 1993 (c. 48).”
17
Insert the following new Clause—

“Pension liberation: court’s power to order restitution

(1)
This section applies where money has been liberated from a pension

scheme.

(  4  )

(2)
In this section “recoverable property” means (subject to subsection (3))—

(a)
the money or any of it, or

(b)
property (of any kind and wherever situated) that, directly or

indirectly, represents any of the money.

(3)
Where a person acquires the beneficial interest in recoverable property in

good faith, for value and without notice that the property is, or (as the case

may be) represents, money liberated from a pension scheme—

(a)
the property ceases to be recoverable property, and

(b)
no property that subsequently represents it is recoverable property.

(4)
The court, on the application of the Regulator, may make such order as the

court thinks just and convenient for the purpose of securing that

recoverable property, or money representing its value or proceeds of its

sale, is transferred—

(a)
towards a pension scheme,

(b)
towards an annuity or insurance policy, or

(c)
to the liberated member.

(5)
An order under subsection (4) may (in particular) direct a person who

holds recoverable property, or has any degree of control over recoverable

property, to take steps for the purpose mentioned in that subsection.

(6)
Where the court makes an order under paragraph (a) of subsection (4), it

may by order direct the trustees or managers of the scheme referred to in

that paragraph—

(a)
to take steps for the purpose mentioned in that subsection;

(b)
to apply the property or money transferred, in such manner as the

court may direct, for the purpose of providing benefits under that

scheme to or in respect of the liberated member.

(7)
Regulations may modify any of the provisions of the Pension Schemes Act

1993 (c. 48) as it applies in relation to cases where an order is made under

subsection (6).

(8)
The jurisdiction conferred by this section is exercisable by the High Court

or the Court of Session.

(9)
The generality of the jurisdiction conferred by section 17 is not to be taken

to be prejudiced by this section.

(10)
The generality of the jurisdiction conferred by this section is not to be taken

to be prejudiced by section (Pension liberation: repatriation orders).”
18
Insert the following new Clause—

“Pension liberation: restraining orders

(1)
The Regulator may make a restraining order in relation to an account with

a deposit-taker if—

(a)
it is satisfied that the account contains money which has been

liberated from a pension scheme,

(b)
it is satisfied that the account is held by or on behalf of—

(i)
the liberator, or

(ii)
a person who has to, or in practice is likely to, ensure that

the account is operated in accordance with the liberator’s

directions, and

(  5  )

(c)
the order is made pending consideration being given to the making

of one or more repatriation orders in relation to the account under

section (Pension liberation: repatriation orders).

(2)
A restraining order is an order directing that no credit or debit of any

amount may be made to the account concerned (“the restrained account”)

during the period for which the order has effect.

(3)
A restraining order must—

(a)
specify the name of the deposit-taker in respect of which it is made,

(b)
identify the account in respect of which it is made, and

(c)
contain such other information as may be prescribed.

(4)
A restraining order—

(a)
takes effect when the deposit-taker concerned is notified by the

Regulator of the making of the order, and

(b)
(subject to subsection (7)) ceases to have effect through expiry of

time at the end of the six months beginning with the day when it is

made.

(5)
The Regulator may, at a time when a restraining order has effect, make an

order extending (or further extending) the restraining order.

(6)
An order under subsection (5) (an “extension order”) takes effect—

(a)
when the deposit-taker concerned is notified by the Regulator of the

making of the order, but

(b)
only if notification under paragraph (a) occurs at a time when the

restraining order concerned has effect.

(7)
Where an extension order takes effect—

(a)
the restraining order concerned does not cease to have effect

through expiry of time until the end of the six months beginning

with the time when it would have ceased to have effect through

expiry of time had it not been extended, but

(b)
for so long as the extension order has effect, no further extension

order can take effect before that time in relation to the restraining

order.

(8)
A restraining order does not prevent the crediting to the restrained account

of an amount representing interest payable by the deposit-taker on any

amount which is, or has been, in the account.

(9)
Where a restraining order has effect, the deposit-taker must return to the

payer any money credited to the restrained account in breach of the order.

(10)
Where a restraining order has effect, the Regulator may, on an application

made by or with the consent of the person by whom the restrained account

is held, by order permit a payment specified in the order to be made out of

the account if the Regulator is satisfied—

(a)
that the payment will be made for the purpose of enabling—

(i)
any individual to meet his reasonable living expenses, or

(ii)
any person to carry on a trade, business, profession or

occupation,

(b)
that the beneficial interest in the money out of which the payment

will be made belongs—

(i)
to the individual, or person, concerned, or

(ii)
to a person who consents to the making of the payment, and

(  6  )

(c)
that the money out of which the payment will be made is not money

liberated from a pension scheme.

(11)
Section 10 of the Pensions Act 1995 (c. 26) (civil penalties) applies to a

deposit-taker who, without reasonable excuse, fails to comply with any

obligation imposed by a restraining order or by this section.”
19
Insert the following new Clause—

“Pension liberation: repatriation orders

(1)
Subsections (2) and (3) apply where—

(a)
a restraining order has effect, and

(b)
the Regulator is satisfied that the restrained account contains an

amount of money liberated from a pension scheme.

(2)
The Regulator may by order—

(a)
direct the deposit-taker concerned to pay from the account a sum

not exceeding that amount—

(i)
towards a pension scheme,

(ii)
towards an annuity or insurance policy, or

(iii)
to the liberated member, and

(b)
where it makes an order under paragraph (a)(i), direct the trustees

or managers of the scheme to apply the sum, in such manner as the

Regulator may direct, for the purpose of providing benefits under

the scheme to or in respect of the liberated member.

(3)
If it appears to the Regulator, on taking an overall view of transactions

taking place before the restraining order was made, that there are two or

more individuals each of whom is a person who is or may be the liberated

member in relation to some of the money, the Regulator may determine the

sums to be paid from the restrained account under subsection (2) on any

basis that appears to the Regulator to be just and reasonable.

(4)
Regulations may modify any of the provisions of the Pension Schemes Act

1993 (c. 48) as it applies in relation to cases where an order is made under

subsection (2)(b).

(5)
Section 10 of the Pensions Act 1995 (c. 26) (civil penalties) applies to a

deposit-taker who, without reasonable excuse, fails to comply with a

direction given to him under subsection (2)(a).

(6)
If the trustees or managers of a pension scheme fail to comply with a

direction given to them under subsection (2)(b), that section applies to any

trustee or manager who has failed to take all reasonable steps to secure

compliance.

(7)
In this section “restrained account” has the meaning given by section

(Pension liberation: restraining orders).”
Clause 20
20
Page 12, line 27, after “scheme” insert “rules”
21
Page 12, line 47, at end insert “rules”
22
Page 13, line 2, after “scheme” insert “rules”