Appendix 4
S.I. 2011/1364: memorandum from the Ministry of
Defence
Armed Forces Pension Scheme 2005 (Amendment) Order
2011 (S.I. 2011/1364)
1. The Joint Committee on Statutory
Instruments requested a memorandum in response to the following
point made in relation to the above mentioned instrument.
'In relation to article 2(4), explain
how a member can be within paragraph (7) of rule D.2 of the 2005
Scheme rules when that person attains pension age and, consequently,
how the amendments to paragraphs(1) and (2) of that rule are intended
to operate.'
2. Rule D.2 as amended by the Order,
in so far as it is relevant to the point made by the Committee,
will provide as follows:
D.2 Retirement before reaching pension
age
(1) A member who ceases to be in
service by virtue of which he is eligible to be an active member
of the Scheme before reaching pension age is entitled to a pension
for life and a lump sum if the member attains pension benefit
age or, in the case of a member who is within paragraph (7) of
this rule, the member attains pension age and either—
(a) he has at least two years'
qualifying service, or
(b) he is entitled to short service
benefit by virtue of section 71 of the Pension Schemes Act 1993
(basic principles as to short service benefit) because of a transfer
value payment having been accepted by the Scheme under Part F
(transfers).
(2) The pension and the lump sum
become payable immediately on the member attaining pension benefit
age or, in the case of a member who is within paragraph (7) of
this rule, attaining pension age.
(7) A member is within this paragraph
if the member satisfies the following two conditions—
(a) the first condition is that
the member has attained at least 54 years and 274 days of age
but not yet the pension age; and
(b) the second condition is that
the Scheme administrator is satisfied that the member intends
either—
(i) to enter civilian employment
which would not be available if the member continued in service
until pension age; or
(ii) to undertake a course
of full time education, or a training course, which starts before
the time at which the member reaches pension age.
3. The intended effect of article
2(4) (as stated in the Explanatory Note) is to amend rule D.2
to enable a member to retire up to three months before reaching
pension age (55) in order to take up a job in civilian employment
or to undertake a course of full time education or a training
course and to receive the pension and lump sum on attaining the
pension age.
4. The Department's view is that,
on any purposive construction, the intention is met by the amendments
made by article 2(4). A member who, when their service ceases
before reaching pension age of 55, satisfies the conditions of
paragraph (7) (including the one concerning the pension age not
yet having being reached) will receive their pension on attaining
that age.
5. However, the Department regularly
reviews the operation of the Pension Scheme rules in light of
changes in pensions policy and, if it is demonstrated that the
provision is being misinterpreted in its application, it will
be amended.
Ministry of Defence
28 June 2011
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