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Pensions Act 2004

Type Public General Act

Publication 2004-11-18

Last updated 2024-11-18

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

(iii) any appeal against the PPF Ombudsman's determination or directions,

has been finally disposed of.

(3) For the purposes of determining whether or not the condition in section 127(2)(a) or, as the case may be, section 128(2)(a) (condition that scheme assets are less than protected liabilities) is satisfied in relation to a scheme, a binding determination under section 143(2)(a) is conclusive.

This subsection is subject to section 172(3) and (4) (treatment of fraud compensation payments).

(4) Where a determination under section 143(2)(a) becomes binding under this section the Board must as soon as reasonably practicable give a notice to that effect together with a copy of the binding determination to—

(a) the Regulator,

(b) the trustees or managers of the scheme, and

(c) any insolvency practitioner in relation to the employer or, if there is no such insolvency practitioner, the employer.

(5) A notice under subsection (4) must be in the prescribed form and contain the prescribed information.

Provision of informationto members of schemes etc

Financial assistance scheme for members of certain pension schemes

Deferral of retirement pensions and shared additional pensions

Disclosure of state pension information

7B

A notice under section 143(2A) (whether Board will make a determination or obtain an actuarial valuation).

7C

The failure by the Board either to—

(a) make a determination under section 143(2)(a), or

(b) obtain an actuarial valuation under section 143(2)(b).

7D

A determination by the Board under section 143(2)(a) (whether condition in section 127(2)(a) or 128(2)(a) satisfied).

14A

A notice under section 158(3A) (whether Board will make a determination or obtain an actuarial valuation).

14B

The failure by the Board either to—

(a) make a determination under section 158(3)(a), or

(b) obtain an actuarial valuation under section 158(3)(b).

14C

A determination by the Board under section 158(3)(a) (whether condition in section 158(1) satisfied).

90A

(1) The Regulator may, in relation to public service pension schemes, issue codes of practice—

(a) containing practical guidance in relation to the exercise of functions under relevant pensions legislation, and

(b) regarding the standards of conduct and practice expected from those who exercise such functions.

(2) The Regulator must issue one or more such codes of practice relating to the following matters—

(a) the discharge of the duties imposed by sections 70 and 70A (duties to report breaches of the law and late payment of employer contributions);

(b) the obligations imposed by section 248A (requirements for knowledge and understanding: pension boards of public service pension schemes);

(d) the discharge of duties imposed under section 113 of the Pension Schemes Act 1993 (disclosure of information to members);

(e) the discharge of the duty imposed by section 49(9)(b) of the Pensions Act 1995 (duty of trustees or managers of occupational pension schemes to report material failures by employers to pay contributions deducted from employee's earnings timeously);

(f) the discharge of the duty imposed by section 50 of the Pensions Act 1995 (internal dispute resolution);

(g) the discharge of duties imposed by virtue of section 5(4) of the Public Service Pensions Act 2013 (pensions board: conflicts of interest and representation) and other duties relating to conflicts of interest;

(h) the discharge of duties imposed under section 6 (pension board: information) of that Act and other duties relating to the publication of information about governance and administration;

(i) the discharge of duties imposed under section 14 of that Act (information about benefits);

(j) the discharge of duties imposed under section 16 (records) of that Act and other duties relating to record-keeping;

(k) such other matters as are prescribed for the purposes of this section.

(3) The Regulator may from time to time revise the whole or any part of a code of practice issued under this section and issue that revised code.

(4) A failure on the part of any person to observe any provision of a code of practice issued under this section does not of itself render that person liable to any legal proceedings.

This is subject to section 13(3)(a) and (8) (power for improvement notice to direct that person complies with code of practice and civil penalties for failure to comply).

(5) A code of practice issued under this section is admissible in evidence in any legal proceedings (within the meaning of section 90) and, if any provision of such a code appears to the court or tribunal concerned to be relevant to any question arising in the proceedings, it must be taken into account in determining that question.

(6) A code of practice issued under this section may be—

(a) combined with a code of practice issued under section 90;

(b) combined with one or more other codes of practice issued under this section.

(7) A code of practice issued under this section may relate to all public service pension schemes or any one or more of them.

(8) In this section, “relevant pensions legislation” means—

(a) the enactments constituting “pensions legislation” within the meaning of section 90, and

(b) sections 5(4) (pension board: conflicts of interest and representation), 6 (pension board: information), 14 (information about benefits) and 16 (records) of the Public Service Pensions Act 2013.

(9) Sections 91 and 92 make provision about the procedure to be followed when a code of practice is issued or revoked under this section.

16G

Any determination by the Board, or the failure to make a determination, under regulation 54(1) of the Pensions Act 2011 (Transitional, Consequential and Supplementary Provisions) Regulations 2014 (determination to discharge benefits as money purchase benefits in certain transitional cases).

16H

Any determination by the Board, or the failure to make a determination, under regulation 55(2) of those Regulations (closed schemes: Board’s assumption of responsibility after the appointed day).

16I

Any direction given by the Board, or the failure to give a direction, under regulation 57(1) of those Regulations (directions to trustees or managers about the exercise of certain powers under those Regulations).

5A

The power under section 3A(3) to give a notice waiving a prohibition.

14A

(1) The Regulator may, if it considers it desirable for the purpose of ensuring compliance with pensions legislation, appoint a person to assist the pension board of a public service pension scheme in the discharge of its functions.

(2) A person appointed under this section may be any person appearing to the Regulator to have the necessary skills.

(3) The pension board of a public service pension scheme must have regard to the advice of a person appointed under this section.

(4) The costs of a person appointed under this section are to be met by the scheme manager of the scheme.

(5) In subsection (1) “pensions legislation” has the same meaning as in section 13.

Reporting late payment of employer contributions

70A

(1) Where—

(a) any amount payable under a public service pension scheme by or on behalf of an employer in relation to the scheme by way of contributions is not paid on or before the date on which it is due under the scheme, and

(b) the scheme manager has reasonable cause to believe that the failure is likely to be of material significance to the Regulator in the exercise of any of its functions,

the scheme manager must give a written report of the matter to the Regulator as soon as reasonably practicable.

(2) No duty to which a person is subject is to be regarded as contravened merely because of any information or opinion contained in a written report under this section.

This is subject to section 311 (protected items).

(3) Section 10 of the Pensions Act 1995 (civil penalties) applies to any person who, without reasonable excuse, fails to comply with an obligation imposed on him by this section.

89A

(1) If the Regulator has reasonable grounds to suspect or believe that a member of the pension board of a public service pension scheme—

(a) has misappropriated any assets of the scheme or is likely to do so, or

(b) has a conflict of interest in relation to investment of assets of the scheme,

the Regulator must report the matter to the scheme manager.

(2) For the purposes of the law of defamation, the reporting of any matter by the Regulator under subsection (1) is privileged unless the reporting is shown to be made with malice.

(3) For the purposes of subsection (1)(b) a person does not have a conflict of interest in relation to investment of assets merely by virtue of membership of the scheme.

248A

(1) This section applies to every individual who is a member of the pension board of a public service pension scheme.

(2) An individual to whom this section applies must be conversant with—

(a) the rules of the scheme, and

(b) any document recording policy about the administration of the scheme which is for the time being adopted in relation to the scheme.

(3) An individual to whom this section applies must have knowledge and understanding of—

(a) the law relating to pensions, and

(b) such other matters as may be prescribed.

(4) The degree of knowledge and understanding required by subsection (3) is that appropriate for the purposes of enabling the individual properly to exercise the functions of a member of the pension board.

249B

(1) The scheme manager of a public service pension scheme must establish and operate internal controls which are adequate for the purpose of securing that the scheme is administered and managed—

(a) in accordance with the scheme rules, and

(b) in accordance with the requirements of the law.

(2) Nothing in this section affects any other obligations of the scheme manager to establish or operate internal controls, whether imposed by or by virtue of any enactment, the scheme rules or otherwise.

(3) In this section, “enactment” and “internal controls” have the same meanings as in section 249A.

26A

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Part 4A — Functions under the Pension Schemes Act 2017

44A

The power to withdraw authorisation of a Master Trust scheme under section 19.

44B

The power to give a direction under section 28(4) (direction to pursue continuity option).

44C

The power to make a pause order under section 31.

44D

The power to make an order under paragraph 2(2) of Schedule 1 extending the period for which a pause order has effect.

44E

The power to make an order under paragraph 3 of that Schedule validating action taken in contravention of a pause order.

44F

The power to make an order under paragraph 4(3) of that Schedule directing the notification of members or employers.

44G

Terms used in this Part have the same meaning as in Part 1 of the Pension Schemes Act 2017.

Tax information

Provision of informationto members of schemes etc

Sections 238A and 238B: interpretation

221A

(1) The trustees or managers must determine, and from time to time review and if necessary revise, a strategy for ensuring that pensions and other benefits under the scheme can be provided over the long term.

This is referred to in this Part as a “funding and investment strategy”.

(2) The strategy must, in particular, specify—

(a) the funding level the trustees or managers intend the scheme to have achieved as at the relevant date or relevant dates, and

(b) the investments the trustees or managers intend the scheme to hold on the relevant date or relevant dates.

(3) In subsection (2)—

(a) “funding level” means the ratio of the scheme's assets to its liabilities;

(b) “relevant date” means a date determined in accordance with regulations.

(4) Provision may be made by regulations—

(a) requiring the trustees or managers of a scheme, in determining or revising a funding and investment strategy, to take into account prescribed matters and follow prescribed principles;

(b) as to the level of detail required in a funding and investment strategy;

(d) requiring a funding and investment strategy to be reviewed, and if necessary revised, at such intervals and on such occasions as may be prescribed.

(5) The provision that may be made by virtue of subsection (4)(a) includes provision requiring the trustees or managers, in specifying a funding level for the purposes of subsection (2)(a), to adopt prescribed actuarial methods or assumptions.

(6) Where any requirement of this section is not complied with, section 10 of the Pensions Act 1995 (civil penalties) applies to a trustee or manager who has failed to take all reasonable steps to secure compliance.

221B

(1) The trustees or managers must, as soon as reasonably practicable after determining or revising the scheme's funding and investment strategy, prepare a written statement of—

(a) the scheme's funding and investment strategy, and

(b) the supplementary matters set out in subsection (2).

(2) The supplementary matters are—

(a) the extent to which, in the opinion of the trustees or managers, the funding and investment strategy is being successfully implemented and, where it is not, the steps they propose to take to remedy the position (including details as to timing);

(b) the main risks faced by the scheme in implementing the funding and investment strategy and how the trustees or managers intend to mitigate or manage them;

(c) reflections of the trustees or managers on any significant decisions taken by them in the past that are relevant to the funding and investment strategy (including any lessons learned that have affected other decisions or may do so in the future);

(d) such other matters as may be prescribed.

(3) In this Part—

(a) a statement under subsection (1) is referred to as a “statement of strategy”;

(b) the text included in a statement of strategy by virtue of subsection (1)(a) is referred to as “Part 1” of the statement;

(c) the text included in a statement of strategy by virtue of subsection (1)(b) is referred to as “Part 2” of the statement.

(4) The trustees or managers must from time to time, and at such times and on such occasions as may be prescribed—

(a) review Part 2 of the scheme's statement of strategy, and

(b) if necessary in the light of that review, revise that Part and prepare a replacement statement of strategy incorporating it.

(5) The trustees or managers must consult the employer when preparing or revising Part 2 of a statement of strategy.

(6) A statement of strategy prepared for a trust scheme must be signed on behalf of the trustees by a person who—

(a) is the chair of the trustees, and

(b) meets such other conditions as may be prescribed.

(7) Where subsection (6) cannot be complied with because the trustees of a trust scheme do not have a chair, they must appoint one.

(8) Provision may be made by regulations—

(a) requiring the trustees or managers of a scheme, in preparing or revising Part 2 of a statement of strategy, to take into account prescribed matters and follow prescribed principles;

(b) as to the level of detail required in Part 2 of a statement of strategy;

(d) requiring the trustees or managers of a scheme to send a statement of strategy to the Regulator at such times and on such occasions as may be prescribed.

(9) Where any requirement of this section is not complied with, section 10 of the Pensions Act 1995 (civil penalties) applies to a trustee or manager who has failed to take all reasonable steps to secure compliance.

Pensions dashboards

238A

(1) A pensions dashboard service is an electronic communications service by means of which information about pensions may be requested by, and provided to, an individual or a person authorised by the individual.

(2) “Qualifying pensions dashboard service” means a pensions dashboard service in relation to which prescribed requirements are satisfied.

(3) Requirements prescribed under subsection (2) may, in particular, relate to—

(a) what relevant and other information is to be provided, how it is to be provided and the circumstances in which it is to be provided;

(b) how the pensions dashboard service is to be established, maintained and operated.

(4) In subsection (3)(a) “relevant information” means—

(a) information of a prescribed description about—

(i) state pensions;

(ii) basic or additional retirement pensions;

(b) state pension information relating to the individual in question of such description as may be prescribed;

(c) information of a prescribed description about occupational or personal pension schemes or a prescribed description of occupational or personal pension schemes;

(d) information relating to the individual in question and particular occupational or personal pension schemes of such description as may be prescribed.

(5) Requirements prescribed under subsection (2) may, in particular—

(a) require the pensions dashboard service to comply with standards, specifications or technical requirements published from time to time by—

(i) the Secretary of State,

(ii) the Money and Pensions Service, or

(iii) a person specified or of a description specified in the regulations;

(b) require the provider of the pensions dashboard service to satisfy prescribed conditions;

(i) the Secretary of State,

(ii) the Money and Pensions Service, or

(iii) a person specified or of a description specified in the regulations;

(d) require the provider of the pensions dashboard service to provide, or not to provide, information, facilities or services specified or of a description specified in connection with the pensions dashboard service.

(6) Requirements prescribed under subsection (2) may include provision under which a determination may fall to be made by—

(a) the Secretary of State,

(b) the Money and Pensions Service, or

238B

(1) Requirements prescribed under section 238A(2) may make provision about—

(a) dealing with requests for information about pensions, including provision about the use of intermediaries;

(b) the involvement of the provider of a pensions dashboard service in the arrangements for dealing with requests for information about pensions.

(2) The provision made by virtue of subsection (1) may, in particular, require—

(a) the use of electronic communications;

(b) the use of facilities or services specified or of a description specified in the regulations;

(c) the provision of assistance in connection with the establishment, maintenance or management of such facilities or services;

(d) participation in, or compliance with, arrangements for establishing, maintaining or managing such facilities or services.

(3) The facilities and services for which provision may be made by virtue of subsection (2)(b) may include facilities or services with functions relating to—

(a) the transmission of information,

(b) verifying the identity of a person,

(c) identifying the occupational or personal pension scheme or schemes under which pensions are payable to or in respect of a particular individual,

(d) authenticating information transmitted by means of electronic communications, or

(e) ensuring the security of information transmitted by means of electronic communications.

(4) Regulations under subsection (2)(b) may impose requirements as regards a facility or service, including requirements about—

(a) compliance with standards, specifications or technical requirements published from time to time by—

(i) the Secretary of State,

(ii) the Money and Pensions Service, or

(iii) a person specified or of a description specified in the regulations;

(b) the provider of the facility or service being a person approved from time to time by—

(i) the Secretary of State,

(ii) the Money and Pensions Service, or

(iii) a person specified or of a description specified in the regulations.

(5) Regulations under subsection (2)(d) may, in particular, require the provider of the pensions dashboard service—

(a) to cooperate with the Money and Pensions Service or a person specified or of a description specified in the regulations;

(b) to coordinate activities with the Money and Pensions Service or a person specified or of a description specified in the regulations;

(c) to enable the Money and Pensions Service or a person specified or of a description specified in the regulations to monitor or audit compliance by the provider.

(6) Except as provided by subsection (7), regulations under section 238A(2) may provide for the processing of personal data in accordance with the regulations not to be in breach of—

(a) any obligation of confidence owed by the person processing the personal data, or

(b) any other restriction on the processing of personal data (however imposed).

(7) Regulations under section 238A(2) are not to be read as authorising or requiring such processing of personal data as would contravene the data protection legislation (but in determining whether particular processing of data would do so, take into account the power conferred or duty imposed by the provision of regulations in question).

238C

(1) This section applies for the purposes of sections 238A and 238B.

(2) A reference to state pension information, in relation to an individual, is a reference to the information about that individual specified in—

(a) section 42(7) of the Child Support, Pensions and Social Security Act 2000, or

(b) section 38(7) of the Child Support, Pensions and Social Security Act (Northern Ireland) 2000.

(3) A reference to the Money and Pensions Service includes a reference to a person with whom arrangements are made under section 5(1), (2) or (3) of the Financial Guidance and Claims Act 2018.

(4) In sections 238A and 238B—

“additional retirement pension” means—any additional pension or shared additional pension under—the Social Security Contributions and Benefits Act 1992, orthe Social Security Contributions and Benefits (Northern Ireland) Act 1992, orany graduated retirement benefit under—sections 36 and 37 of the National Insurance Act 1965, orsections 35 and 36 of the National Insurance Act (Northern Ireland) 1966;

“basic retirement pension” means any basic pension under—the Social Security Contributions and Benefits Act 1992, orthe Social Security Contributions and Benefits (Northern Ireland) Act 1992;

“the data protection legislation” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act);

“electronic communications service” has the meaning given by section 32 of the Communications Act 2003;

“personal data” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act);

“state pension” means any state pension under—Part 1 of the Pensions Act 2014, orPart 1 of the Pensions Act (Northern Ireland) 2015.

238D

(1) Regulations may impose requirements on the trustees or managers of a relevant occupational pension scheme with respect to—

(a) providing pensions information by means of—

(i) a qualifying pensions dashboard service, or

(ii) the pensions dashboard service provided by the Money and Pensions Service;

(b) facilitating the provision of pensions information by means of—

(i) a qualifying pensions dashboard service, or

(ii) the pensions dashboard service provided by the Money and Pensions Service.

(2) In this section “pensions information” means, in relation to a relevant occupational pension scheme, such information as may be prescribed, which may include in particular—

(a) information relating to—

(i) the constitution of the scheme,

(ii) the administration and finances of the scheme,

(iii) the rights and obligations that arise or may arise under the scheme,

(iv) the pensions and other benefits an entitlement to which would be likely to accrue to a member, or be capable of being secured by a member, in respect of the rights that may arise under the scheme, and

(v) other matters relevant to occupational pension schemes in general or to occupational pension schemes of a description to which the scheme belongs;

(b) information as regards the position of an individual in relation to the scheme.

(3) Regulations under subsection (1) may, in particular, impose requirements about—

(a) the persons to whom pensions information must be provided;

(b) the circumstances in which pensions information must be provided;

(d) the manner and form in which pensions information must be provided;

(e) the time within which pensions information must be provided;

(f) the way in which pensions information must be held.

(4) Regulations under subsection (1) may require the trustees or managers of a scheme to comply with standards, specifications or technical requirements published from time to time by—

(a) the Secretary of State,

(b) the Money and Pensions Service, or

(5) Regulations under subsection (1) may include provision under which a determination may fall to be made by—

(a) the Secretary of State,

(b) the Money and Pensions Service, or

(6) Regulations under subsection (1) may require the trustees or managers to provide prescribed information about their carrying out of requirements prescribed under this section to—

(a) the Regulator,

(b) the Money and Pensions Service, or

(7) In complying with requirements prescribed under this section, a trustee or manager of an occupational pension scheme must have regard to guidance issued from time to time by—

(a) the Secretary of State, or

(b) a person specified or of a description specified in the regulations.

238E

(1) Regulations under section 238D(1) may make provision about—

(a) how pensions information is to be provided, including provision about the use of intermediaries;

(b) the involvement of the trustees or managers of a scheme in the arrangements for dealing with requests for information about pensions.

(2) The provision made by virtue of subsection (1) may, in particular, require—

(a) the use of electronic communications;

(b) the use of facilities or services specified or of a description specified in the regulations;

(c) the provision of assistance in connection with the establishment, maintenance or management of such facilities or services;

(d) participation in, or compliance with, arrangements for establishing, maintaining or managing such facilities or services.

(3) The facilities and services for which provision may be made by virtue of subsection (2)(b) may include facilities or services with functions relating to—

(a) the transmission of information,

(b) verifying the identity of a person,

(c) identifying the occupational or personal pension scheme or schemes under which pensions are payable to or in respect of a particular individual,

(d) authenticating information transmitted by means of electronic communications, or

(e) ensuring the security of information transmitted by means of electronic communications.

(4) Regulations under subsection (2)(b) may impose requirements as regards a facility or service, including requirements about—

(a) compliance with standards, specifications or technical requirements published from time to time by—

(i) the Secretary of State,

(ii) the Money and Pensions Service, or

(iii) a person specified or of a description specified in the regulations;

(b) the provider of the facility or service being a person approved from time to time by—

(i) the Secretary of State,

(ii) the Money and Pensions Service, or

(iii) a person specified or of a description specified in the regulations.

(5) Regulations under subsection (2)(d) may, in particular, require the trustees or managers—

(a) to cooperate with the Money and Pensions Service or other persons specified or of a description specified in the regulations;

(b) to coordinate activities with the Money and Pensions Service or other persons specified or of a description specified in the regulations.

(6) Except as provided by subsection (7), regulations under section 238D(1) may provide for the processing of personal data in accordance with the regulations not to be in breach of—

(a) any obligation of confidence owed by the person processing the personal data, or

(b) any other restriction on the processing of personal data (however imposed).

(7) Regulations under section 238D(1) are not to be read as authorising or requiring such processing of personal data as would contravene the data protection legislation (but in determining whether particular processing of data would do so, take into account the power conferred or duty imposed by the provision of regulations in question).

238F

(1) This section has effect for the purposes of sections 238D and 238E.

(2) A reference to the Money and Pensions Service includes a reference to a person with whom arrangements are made under section 5(1), (2) or (3) of the Financial Guidance and Claims Act 2018.

(3) In sections 238D and 238E—

“the data protection legislation” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act);

“pensions dashboard service” means—a pensions dashboard service within the meaning of section 238A, ora pensions dashboard service within the meaning of Article 215A of the Pensions (Northern Ireland) Order 2005 (S.I. 2005/255 (N.I. 1));

“personal data” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act);

“qualifying pensions dashboard service” means a pensions dashboard service that satisfies—such requirements as may be prescribed by regulations under section 238A, orsuch requirements as may be prescribed by regulations under Article 215A of the ;

“relevant occupational pension scheme” means an occupational pension scheme which is not a stakeholder pension scheme (as defined in section 1 of the Welfare Reform and Pensions Act 1999).

238G

(1) Regulations may make provision with a view to securing that the trustees or managers of a relevant occupational pension scheme comply with a provision of regulations under section 238D.

(2) The regulations may, among other things—

(a) provide for the Regulator to issue a notice (a “compliance notice”) to a person with a view to ensuring the person's compliance with a provision of regulations under section 238D;

(b) provide for the Regulator to issue a notice (a “third party compliance notice”) to a person with a view to ensuring another person's compliance with a provision of the regulations;

(c) provide for the Regulator to issue a notice (a “penalty notice”) imposing a penalty on a person where the Regulator is of the opinion that the person—

(i) has failed to comply with a compliance notice or third party compliance notice, or

(ii) has contravened a provision of regulations under section 238D;

(d) provide for the making of a reference to the First-tier Tribunal or Upper Tribunal in respect of the issue of a penalty notice or the amount of a penalty;

(e) confer other functions on the Regulator.

(3) The regulations may make provision for determining the amount, or the maximum amount, of a penalty in respect of a failure or contravention.

(4) But the amount of a penalty imposed under the regulations in respect of a failure or contravention must not exceed—

(a) £5,000, in the case of an individual, and

(b) £50,000, in any other case.

(5) In this section “relevant occupational pension scheme” has the meaning given by section 238F.

Requirement for knowledge and understanding: individual trustees

Inalienability of occupational pension

Payments made by employers to personal pension schemes

Resolution of disputes

Investigations

Power to prescribe conditions by reference to Inland Revenue approval

Restriction on purchase of annuities

Disclosure of state pension information

General interpretation

PART 4B — Functions under Part 1 of the Pension Schemes Act 2021

44H

The power to give a direction under section 23(2) (direction to obtain actuarial valuation or take other steps to remedy or mitigate failure in relation to a collective money purchase scheme).

44I

The power to give a direction under section 29(6) (direction to implement proposals in a resolution plan).

44J

The power under section 30 to withdraw authorisation of a collective money purchase scheme.

44K

The power to give a direction under section 41(4) (direction to pursue a continuity option).

44L

The power to make a pause order under section 44.

44M

The power to make an order under paragraph 2(2) of Schedule 2 extending the period for which a pause order has effect.

44N

The power to make an order under paragraph 3 of Schedule 2 validating action taken in contravention of a pause order.

44O

The power to make an order under paragraph 4(3) of Schedule 2 directing the notification of members or employers.

38E

(1) For the purposes of section 38 the employer resources test is met in relation to an act or failure to act if the Regulator is of the opinion that—

(a) the act or failure reduced the value of the resources of the employer, and

(b) that reduction was a material reduction relative to the estimated section 75 debt in relation to the scheme.

(2) For the purposes of this section—

(a) what constitutes the resources of the employer is to be determined in accordance with regulations;

(b) the value of the resources of the employer is to be determined, calculated and verified in a prescribed manner.

(3) In this section the “estimated section 75 debt” means the amount which the Regulator estimates to be the amount of the debt which would become due from the employer to the trustees or managers of the scheme under section 75 of the Pensions Act 1995 (deficiencies in the scheme assets) if—

(a) section 75(2) applied, and

(b) the time designated by the trustees or managers of the scheme for the purposes of section 75(2) were the relevant time.

(4) When calculating the estimated section 75 debt under subsection (3), the amount of any debt due at the relevant time from the employer under section 75 of the Pensions Act 1995 is to be disregarded.

(5) In this section “the relevant time” means—

(a) in a case where the act or failure to act forms part of a series of acts or failures to act, the time immediately before the first of the acts occurred or the first of the failures to act first occurred;

(b) in any other case, the time immediately before the act occurred or the failure to act first occurred.

38F

(1) This section applies where—

(a) a warning notice is given to any person (“P”) in respect of a contribution notice under section 38, and

(b) the contribution notice under consideration would be issued wholly or partly by reference to the Regulator's opinion that the employer resources test is met in relation to an act or deliberate failure to act to which P was a party.

(2) If the Regulator is satisfied that P has shown that—

(a) conditions A and C are met, and

(b) where applicable, condition B is met,

the Regulator must not issue the contribution notice by reference to its being of the opinion mentioned in subsection (1)(b).

(3) Condition A is that, before becoming a party to the act or failure, P gave due consideration to the extent to which the act or failure might reduce the value of the resources of the employer relative to the estimated section 75 debt in relation to the scheme.

(4) Condition B is that, in any case where as a result of that consideration P considered that the act or failure might have such an effect, P took all reasonable steps to eliminate or minimise the potential for the act or failure to have such an effect.

(5) Condition C is that, having regard to all relevant circumstances prevailing at the time of the act or at the time when the failure to act first occurred, it was reasonable for P to conclude that the act or failure would not bring about a reduction in the value of the resources of the employer that would be a material reduction relative to the estimated section 75 debt in relation to the scheme.

(6) P is to be regarded as giving the consideration mentioned in condition A only if P has made the enquiries, and done the other acts, that a reasonably diligent person would have made or done in the circumstances.

(7) For the purposes of condition C the reference to the circumstances mentioned in that condition is a reference to those circumstances of which P was aware, or ought reasonably to have been aware, at the time of the act or the time when the failure to act first occurred (including acts or failures to act which have occurred before that time and P's expectation at that time of other acts or failures to act occurring).

(8) For the purposes of conditions A and C—

(a) the “estimated section 75 debt” means the amount which is a reasonable estimate of the amount of the debt which would become due from the employer to the trustees or managers of the scheme under section 75 of the Pensions Act 1995 (deficiencies in the scheme assets) if—

(i) section 75(2) applied, and

(ii) the time designated by the trustees or managers of the scheme for the purposes of section 75(2) were the time immediately before the act occurred or the failure to act first occurred;

(b) the amount of any debt due at the time in question from the employer under section 75 of the Pensions Act 1995 is to be disregarded.

(9) In the case of acts or failures to act forming part of a series, P is to be regarded as having shown the matters mentioned in subsection (2) if P shows in the case of each of the acts or failures in the series that—

(a) conditions A and C are met, and (where applicable) condition B is met, in relation to the act or failure, or

(b) the act or failure was one of a number of acts or failures (a “group” of acts or failures) selected by P in relation to which the following matters are shown.

(10) The matters to be shown are that—

(a) before becoming a party to the first of the acts or failures in the group, condition A is met in relation to the effect of the acts or failures in the group taken together,

(b) condition B is (where applicable) met in relation to that effect, and

(c) condition C is then met in relation to each of the acts or failures in the group (determined at the time at which each act or failure concerned occurred or first occurred).

(11) If at any time P considers that condition C will not be met in relation to any particular act or failure in the group—

(a) the previous acts or failures in the group are to be regarded as a separate group for the purposes of subsection (9), and

(b) P may then select another group consisting of the particular act or failure concerned, and any subsequent act or failure, in relation to which P shows the matters mentioned in subsection (10).

Nothing in paragraph (b) is to be read as preventing P from showing the matters mentioned in subsection (9)(a).

(12) If—

(a) P is unable to show in the case of each of the acts or failures in the series that the matters set out in subsection (9)(a) or (b) are met, but

(b) does show in the case of some of them that those matters are met,

the acts or failures within paragraph (b) are not to count for the purposes of section 38E as acts or failures to act in the series.

(13) In this section—

(a) section 38E(2) (the resources of the employer and their value) has effect for the purpose of this section as it has effect for the purposes of section 38E;

(b) “a warning notice” means a notice given as mentioned in section 96(2)(a);

(c) a reference to a party to an act or failure to act includes a reference to a person who knowingly assists in the act or failure.

69A

(1) Except where the Regulator otherwise directs, the appropriate person must—

(a) give notice to the Regulator of any notifiable event;

(b) give notice to the Regulator of any material change in, or in the expected effects of, a notifiable event;

(2) In subsection (1) “notifiable event” means a prescribed event in respect of the employer in relation to an eligible scheme.

(3) For the purposes of subsection (1) each of the following is “the appropriate person”—

(a) the employer in relation to the scheme,

(b) a person connected with the employer,

(d) a person of a prescribed description.

(4) Regulations may make provision about the meaning of a “material change” for the purposes of this section.

(5) A notice under subsection (1) must be given to the Regulator—

(a) in the case of a notice under subsection (1)(a), as soon as reasonably practicable after the person giving it becomes aware of the notifiable event, subject to subsection (6),

(b) in the case of a notice under subsection (1)(b), as soon as reasonably practicable after the person giving it becomes aware of the material change, subject to subsection (6), or

(c) in the case of a notice under subsection (1)(c), as soon as reasonably practicable after the person giving it becomes aware that the notifiable event is not going to take place or (as the case may be) did not take place.

(6) Regulations may require a notice under subsection (1)(a) or (b) to be given before the beginning of the prescribed period ending with—

(a) the notifiable event in question, or

(b) the material change in question.

(7) A notice under subsection (1)(a) or (b) must be accompanied by a statement (an “accompanying statement”).

(8) An accompanying statement must contain prescribed information.

(9) The information that may be prescribed under subsection (8) includes, in particular—

(a) a description of the event,

(b) a description of any adverse effects of the event on the eligible scheme,

(d) a description of any communication with the trustees or managers of the eligible scheme about the event.

(10) Where a person gives the Regulator a notice under subsection (1), the person must give a copy of the notice and any accompanying statement to the trustees or managers of the eligible scheme at the same time.

(11) A notice or accompanying statement under this section must be in writing.

(12) No duty to which a person is subject is to be regarded as contravened merely because of any information or opinion contained in a notice or accompanying statement under this section.

This is subject to section 311 (protected items).

(13) Section 88A (financial penalties) applies to a person who, without reasonable excuse, fails to comply with an obligation imposed on the person by this section.

(14) For the purposes of this section—

(a) section 249 of the Insolvency Act 1986 (connected persons) applies as it applies for the purposes of any provision of the first Group of Parts of that Act,

(b) section 435 of the Insolvency Act 1986 (associated persons) applies as it applies for the purposes of that Act, and

(c) section 229 of the Bankruptcy (Scotland) Act 2016 (associated persons) applies as it applies for the purposes of that Act.

(15) In this section—

“eligible scheme” has the meaning given by section 126;

“event” includes a failure to act.

72A

(1) The Regulator may, by notice in writing, require any person to whom section 72(2) applies to attend before the Regulator, at a time and place specified in the notice, to answer questions and provide explanations on one or more matters specified in the notice that are relevant to the exercise of any of the Regulator's functions.

(2) A notice under subsection (1) must contain such other information as may be prescribed.

77A

(1) The Regulator may issue a fixed penalty notice to a person if it considers that the person—

(a) has failed to comply with a notice under section 72 or 72A,

(b) has failed to comply with a requirement under section 75, or

(2) A fixed penalty notice is a notice requiring the person to whom it is issued to pay a penalty within the period specified in the notice.

(3) The penalty—

(a) is to be determined in accordance with regulations, and

(b) must not exceed £50,000.

(4) A fixed penalty notice must—

(a) state the amount of the penalty;

(b) state the date by which the penalty must be paid, which must be at least 28 days after the date on which the notice is issued;

(d) specify the failure or conduct to which the penalty relates;

(e) state that the Regulator may issue an escalating penalty notice under section 77B if the person fails to comply with a notice under section 72 or 72A;

(f) notify the person to whom the notice is issued of the review process under section 43 of the Pensions Act 2008 and the right of referral to a tribunal under section 44 of that Act (as applied by subsection (5)).

(5) The following sections of the Pensions Act 2008 apply to a penalty notice under this section as they apply to a penalty notice under section 40 of that Act—

(a) section 42 (penalty notices: recovery);

(b) section 43 (review of penalty notices);

(6) This section does not apply in a case where section 40 of the Pensions Act 2008 or section 17 of the Pension Schemes Act 2017 applies.

77B

(1) The Regulator may issue an escalating penalty notice to a person if it considers that the person has failed to comply with a notice under section 72 or 72A.

(2) But the Regulator may not issue an escalating penalty notice to a person if—

(a) the person has exercised the right of referral to a tribunal under section 44 of the Pensions Act 2008 (as applied by section 77A(5)) in respect of a fixed penalty notice issued under section 77A in relation to that notice under section 72 or 72A, and

(b) the reference has not been determined.

(3) An escalating penalty notice is a notice requiring a person to pay an escalating penalty if the person fails to comply with a notice under section 72 or 72A before a specified date.

(4) An escalating penalty is a penalty which is calculated by reference to a daily rate.

(5) The daily rate—

(a) is to be determined in accordance with regulations, and

(b) must not exceed £10,000.

(6) An escalating penalty notice must—

(a) specify the failure to which the penalty relates;

(b) state that, if the person fails to comply with the notice under section 72 or 72A before a specified date, the person will be liable to pay an escalating penalty;

(d) state the date from which the escalating penalty will be payable, which must not be earlier than the date specified in the fixed penalty notice under section 77A(4)(b);

(e) state that the escalating penalty will continue to be payable at the daily rate until the date on which the person complies with the notice under section 72 or 72A or such earlier date as the Regulator may determine;

(f) notify the person to whom the notice is issued of the review process under section 43 of the Pensions Act 2008 and the right of referral to a tribunal under section 44 of that Act (as applied by subsection (7)).

(7) The following sections of the Pensions Act 2008 apply to an escalating penalty notice under this section as they apply to an escalating penalty notice under section 41 of that Act—

(a) section 42 (penalty notices: recovery);

(b) section 43 (review of penalty notices);

(8) This section does not apply in a case where section 41 of the Pensions Act 2008 or section 18 of the Pension Schemes Act 2017 applies.

38C

(1) For the purposes of section 38 the employer insolvency test is met in relation to an act or failure to act if the Regulator is of the opinion that—

(a) immediately after the relevant time, the value of the assets of the scheme was less than the amount of the liabilities of the scheme, and

(b) if a debt under section 75(4) of the Pensions Act 1995 (deficiencies in scheme assets: employer insolvency etc) had fallen due from the employer to the scheme immediately after the relevant time, the act or failure would have materially reduced the amount of the debt likely to be recovered by the scheme.

(2) For the purposes of subsection (1)—

(a) the value of the assets of the scheme immediately after the relevant time is the value which the Regulator estimates to be their value,

(b) the amount of the liabilities of the scheme immediately after the relevant time is the amount which the Regulator estimates to be the amount of those liabilities, and

(c) the amount of the debt is the amount which the Regulator estimates to be the amount of the debt under section 75(4) of the Pensions Act 1995 that would have fallen due immediately after the relevant time.

(3) When estimating the value and the amounts referred to in subsection (2), the Regulator must take into account how assets and liabilities, and their value or amount, are determined and calculated for the purposes of section 75(4) of the Pensions Act 1995.

(4) When estimating—

(a) the value of the assets of the scheme immediately after the relevant time, and

(b) the amount of the debt under section 75(4) of the Pensions Act 1995 falling due immediately after the relevant time,

the Regulator must disregard the amount of any debt due immediately after the relevant time from the employer under section 75 of the Pensions Act 1995.

(5) In this section “the relevant time” means—

(a) in the case of an act, the time of the act, or

(b) in the case of a failure to act—

(i) the time when the failure occurred, or

(ii) where the failure continued for a period of time, the time which the Regulator determines and which falls within that period;

and, in the case of acts or failures to act forming part of a series, any reference in this subsection to an act or failure to act is a reference to the last of the acts or failures in that series.

38D

(1) This section applies where—

(a) a warning notice is given to any person (“P”) in respect of a contribution notice under section 38, and

(b) the contribution notice under consideration would be issued wholly or partly by reference to the Regulator's opinion that the employer insolvency test is met in relation to an act or deliberate failure to act to which P was a party.

(2) If the Regulator is satisfied that P has shown that—

(a) conditions A and C are met, and

(b) where applicable, condition B is met,

the Regulator must not issue the contribution notice by reference to its being of the opinion mentioned in subsection (1)(b).

(3) If the Regulator is satisfied that P or another person has shown that condition D is met, the Regulator must not issue the contribution notice by reference to its being of the opinion mentioned in subsection (1)(b).

(4) Condition A is that, before becoming a party to the act or failure, P gave due consideration to the extent to which, if a debt under section 75(4) of the Pensions Act 1995 were to fall due from the employer to the scheme—

(a) immediately after the act or failure, or

(b) where the failure might continue for a period of time, at any time within that period,

the act or failure might materially reduce the amount of the debt likely to be recovered by the scheme.

(5) Condition B is that, in any case where as a result of that consideration P considered that the act or failure might have such an effect, P took all reasonable steps to eliminate or minimise the potential for the act or failure to have such an effect.

(6) Condition C is that, having regard to all relevant circumstances prevailing at the time of the act or at the time when the failure to act first occurred, it was reasonable for P to conclude that, if a debt under section 75(4) of the Pensions Act 1995 were to fall due from the employer to the scheme—

(a) immediately after the act or failure, or

(b) where the failure might continue for a period of time, at any time within that period,

the act or failure would not materially reduce the amount of the debt likely to be recovered by the scheme.

(7) Condition D is that, immediately after the relevant time, the value of the assets of the scheme equalled or was more than the amount at that time of the liabilities of the scheme.

(8) P is to be regarded as giving the consideration mentioned in condition A only if P has made the enquiries, and done the other acts, that a reasonably diligent person would have made or done in the circumstances.

(9) For the purposes of condition C the reference to the circumstances mentioned in that condition is a reference to those circumstances of which P was aware, or ought reasonably to have been aware, at the time of the act or the time when the failure to act first occurred (including acts or failures to act which have occurred before that time and P's expectation at that time of other acts or failures to act occurring).

(10) For the purposes of conditions A, C and D the amount of any debt due at the time in question from the employer under section 75 of the Pensions Act 1995 is to be disregarded.

(11) In the case of acts or failures to act forming part of a series, P is to be regarded as having shown the matters mentioned in subsection (2) if P shows in the case of each of the acts or failures in the series that—

(a) conditions A and C are met, and (where applicable) condition B is met, in relation to the act or failure, or

(b) the act or failure was one of a number of acts or failures (a “group” of acts or failures) selected by P in relation to which the following matters are shown.

(12) The matters to be shown are that—

(a) before becoming a party to the first of the acts or failures in the group, condition A is met in relation to the effect of the acts or failures in the group taken together,

(b) condition B is (where applicable) met in relation to that effect, and

(c) condition C is then met in relation to each of the acts or failures in the group (determined at the time at which each act or failure concerned occurred or first occurred).

(13) If at any time P considers that condition C will not be met in relation to any particular act or failure in the group—

(a) the previous acts or failures in the group are to be regarded as a separate group for the purposes of subsection (11), and

(b) P may then select another group consisting of the particular act or failure concerned, and any subsequent act or failure, in relation to which P shows the matters mentioned in subsection (12).

Nothing in paragraph (b) is to be read as preventing P from showing the matters mentioned in subsection (11)(a).

(14) If—

(a) P is unable to show in the case of each of the acts or failures in the series that the matters set out in subsection (11)(a) or (b) are met, but

(b) does show in the case of some of them that those matters are met,

the acts or failures within paragraph (b) are not to count for the purposes of section 38C as acts or failures to act in the series.

(15) In this section—

(a) “the relevant time” has the meaning given by section 38C;

(b) “a warning notice” means a notice given as mentioned in section 96(2)(a);

(c) a reference to a party to an act or failure to act includes a reference to a person who knowingly assists in the act or failure.

42A

(1) This section applies where a contribution notice is issued to a person under section 38.

(2) If the person, without reasonable excuse, fails to pay the debt due by virtue of the contribution notice to—

(a) the trustees or managers of the scheme, or

(b) the Board of the Pension Protection Fund (as the case may be),

before the date specified in the contribution notice for the purposes of this subsection (see section 40(2A)), the person is guilty of an offence.

(3) A person guilty of an offence under subsection (2) is liable—

(a) on summary conviction in England and Wales, to a fine;

(b) on summary conviction in Scotland, to a fine not exceeding level 5 on the standard scale.

(4) Proceedings for an offence under subsection (2) may not be instituted if an application under section 41(7) has been made—

(a) in relation to the contribution notice, or

(b) in relation to a contribution notice which is a corresponding contribution notice for the purposes of section 40(8),

and the application has not been determined, withdrawn or abandoned.

(5) Proceedings for an offence under subsection (2) may be instituted in England and Wales only—

(a) by the Regulator or the Secretary of State, or

(b) by or with the consent of the Director of Public Prosecutions.

42B

(1) This section applies where a contribution notice is issued to a person under section 38.

(2) Section 88A (financial penalties) applies to the person if the person, without reasonable excuse, fails to pay the debt due by virtue of the contribution notice to—

(a) the trustees or managers of the scheme, or

(b) the Board of the Pension Protection Fund (as the case may be),

before the date specified in the contribution notice for the purposes of this subsection (see section 40(2A)).

(3) The Regulator may not issue a warning notice to the person in respect of the imposition of a penalty under section 88A as it applies by virtue of subsection (2) if an application under section 41(7) has been made—

(a) in relation to the contribution notice, or

(b) in relation to a contribution notice which is a corresponding contribution notice for the purposes of section 40(8),

and the application has not been determined, withdrawn or abandoned.

(4) In this section “warning notice” means a notice given as mentioned in section 96(2)(a).

Sanctions for avoidance of employer debt etc

58A

(1) This section applies in relation to an occupational pension scheme other than—

(a) a money purchase scheme, or

(b) a prescribed scheme or a scheme of a prescribed description.

(2) A person commits an offence only if—

(a) the person does an act or engages in a course of conduct that—

(i) prevents the recovery of the whole or any part of a debt which is due from the employer in relation to the scheme under section 75 of the Pensions Act 1995 (deficiencies in the scheme assets),

(ii) prevents such a debt becoming due,

(iii) compromises or otherwise settles such a debt, or

(iv) reduces the amount of such a debt which would otherwise become due,

(b) the person intended the act or course of conduct to have such an effect, and

(3) A reference in this section to an act or course of conduct includes a failure to act.

(4) This section does not apply to a person if the act done, or course of conduct engaged in, by the person is in accordance with the person's functions as an insolvency practitioner in relation to another person.

(5) For the purposes of this section a reference to a debt due under section 75 of the Pensions Act 1995 includes a contingent debt under that section.

(6) Accordingly, in the case of such a contingent debt, the reference in subsection (2)(a) to preventing a debt becoming due is to be read as including a reference to preventing the occurrence of any of the events specified in section 75(4C)(a) or (b) of the Pensions Act 1995 upon which the debt is contingent.

(7) A person guilty of an offence under subsection (2) is liable—

(a) on summary conviction in England and Wales, to a fine;

(b) on summary conviction in Scotland, to a fine not exceeding the statutory maximum;

(8) Proceedings for an offence under subsection (2) may be instituted in England and Wales only—

(a) by the Regulator or the Secretary of State, or

(b) by or with the consent of the Director of Public Prosecutions.

(9) For the purposes of this section and sections 58B to 58D “insolvency practitioner”, in relation to a person, means—

(a) a person acting as an insolvency practitioner, in relation to that person, in accordance with section 388 of the Insolvency Act 1986, or

(b) an insolvency practitioner within the meaning of section 121(9)(b) (persons of a prescribed description).

58B

(1) This section applies in relation to an occupational pension scheme other than—

(a) a money purchase scheme, or

(b) a prescribed scheme or a scheme of a prescribed description.

(2) A person commits an offence only if—

(a) the person does an act or engages in a course of conduct that detrimentally affects in a material way the likelihood of accrued scheme benefits being received (whether the benefits are to be received as benefits under the scheme or otherwise),

(b) the person knew or ought to have known that the act or course of conduct would have that effect, and

(3) A reference in this section to an act or a course of conduct includes a failure to act.

(4) A reference in this section to accrued scheme benefits being received is a reference to benefits the rights to which have accrued by the relevant time being received by, or in respect of, the persons who were members of the scheme before that time.

(5) In this section “the relevant time” means—

(a) in the case of an act, the time of the act,

(b) in the case of a failure to act—

(i) the time when the failure occurred, or

(ii) where the failure continued for a period of time, the end of that period, or

(6) A reference in this section to rights which have accrued is to be read in accordance with section 67A(6) and (7) of the Pensions Act 1995 (reading any reference in those subsections to a subsisting right as a reference to a right which has accrued).

(7) For the purposes of this section the benefits that may be received under the following provisions of this Act are to be disregarded—

(a) Chapter 3 of Part 2 (the Board of the Pension Protection Fund: pension protection), and

(b) section 286 (the financial assistance scheme for members of certain pension schemes).

(8) This section does not apply to a person if the act done, or course of conduct engaged in, by the person is in accordance with the person's functions as an insolvency practitioner in relation to another person (see section 58A(9)).

(9) A person guilty of an offence under subsection (2) is liable—

(a) on summary conviction in England and Wales, to a fine;

(b) on summary conviction in Scotland, to a fine not exceeding the statutory maximum;

(10) Proceedings for an offence under subsection (2) may be instituted in England and Wales only—

(a) by the Regulator or the Secretary of State, or

(b) by or with the consent of the Director of Public Prosecutions.

58C

(1) This section applies in relation to an occupational pension scheme other than—

(a) a money purchase scheme, or

(b) a prescribed scheme or a scheme of a prescribed description.

(2) Section 88A (financial penalties) applies to a person who was party to an act or deliberate failure to act the main purpose or one of the main purposes of which was—

(a) to prevent the recovery of the whole or any part of a debt which is due from the employer in relation to the scheme under section 75 of the Pensions Act 1995 (deficiencies in the scheme assets),

(b) to prevent such a debt becoming due,

(d) to reduce the amount of such a debt which would otherwise become due,

if it was not reasonable for the person to act or fail to act in the way that the person did.

(3) This section does not apply where the Regulator is of the opinion that the person, in being a party to the act or failure, was acting in accordance with the person's functions as an insolvency practitioner in relation to another person (see section 58A(9)).

(4) For the purposes of this section a reference to a debt due under section 75 of the Pensions Act 1995 includes a contingent debt under that section.

(5) Accordingly, in the case of such a contingent debt, the reference in subsection (2) to preventing a debt becoming due is to be read as including a reference to preventing the occurrence of any of the events specified in section 75(4C)(a) or (b) of the Pensions Act 1995 upon which the debt is contingent.

(6) For the purposes of this section the parties to an act or deliberate failure to act include those persons who knowingly assist in the act or failure.

(7) If the Regulator is of the opinion that—

(a) a person was party to a series of acts or deliberate failures to act, and

(b) the requirements of subsection (2) are met in relation to the series,

the series of acts or failures to act is to be regarded as an act or failure to act in relation to which the requirements of subsection (2) are met.

58D

(1) This section applies in relation to an occupational pension scheme other than—

(a) a money purchase scheme, or

(b) a prescribed scheme or a scheme of a prescribed description.

(2) Section 88A (financial penalties) applies to a person who was party to an act or deliberate failure to act that detrimentally affected in a material way the likelihood of accrued scheme benefits being received (whether the benefits are to be received as benefits under the scheme or otherwise), if—

(a) the person knew or ought to have known that the act or failure to act would have that effect, and

(b) it was not reasonable for the person to act or fail to act in the way that the person did.

(3) This section does not apply where the Regulator is of the opinion that the person, in being a party to the act or failure, was acting in accordance with the person's functions as an insolvency practitioner in relation to another person (see section 58A(9)).

(4) In this section a reference to accrued scheme benefits being received is a reference to benefits the rights to which have accrued by the relevant time being received by, or in respect of, the persons who were members of the scheme before that time.

(5) In this section “the relevant time” means—

(a) in the case of an act, the time of the act;

(b) in the case of a failure to act—

(i) the time when the failure to act occurred, or

(ii) where the failure continued for a period of time, the end of that period;

and, in the case of acts or failures to act forming part of a series, any reference in this subsection to an act or failure to act is a reference to the last of the acts or failures in that series.

(6) A reference in this section to rights which have accrued is to be read in accordance with section 67A(6) and (7) of the Pensions Act 1995 (reading any reference in those subsections to a subsisting right as a reference to a right which has accrued).

(7) In determining for the purposes of this section whether an act or failure to act has detrimentally affected in a material way the likelihood of accrued scheme benefits being received, the following provisions of this Act are to be disregarded—

(a) Chapter 3 of Part 2 (the Board of the Pension Protection Fund: pension protection), and

(b) section 286 (the financial assistance scheme for members of certain pension schemes).

(8) For the purposes of this section the parties to an act or deliberate failure to act include those persons who knowingly assist in the act or failure.

(9) If the Regulator is of the opinion that—

(a) a person was party to a series of acts or deliberate failures to act, and

(b) the requirements of subsection (2) are met in relation to the series,

the series of acts or failures to act is to be regarded as an act or failure to act in relation to which the requirements of subsection (2) are met.

80A

(1) Section 88A (financial penalties) applies to a person who has knowingly or recklessly provided the Regulator with information which is false or misleading in a material particular, if the information was provided to the Regulator in the circumstances mentioned in subsection (2)(a), (b) or (c).

(2) The circumstances referred to in subsection (1) are—

(a) that the information was provided in purported compliance with a requirement under—

(i) section 62 (the register: duties of trustees or managers),

(ii) section 64 (duty of trustees or managers to provide scheme return),

(iii) section 69 (duty to notify the Regulator of certain events),

(iv) section 69A (duty to give notices and statements to the Regulator in respect of certain events),

(v) section 72 (provision of information),

(vi) section 72A (interviews),

(vii) section 75 (inspection of premises: powers of inspectors), or

(viii) regulations under section 11 of the Pensions Act 2008 (information about employers' duties to be given to the Regulator);

(b) that the information was provided in applying for registration of a pension scheme under section 2 of the Welfare Reform and Pensions Act 1999 (registration of stakeholder pension schemes);

(c) that the information was provided otherwise than as mentioned in paragraph (a) or (b) but in circumstances in which the person providing the information intends, or could reasonably be expected to know, that it would be used by the Regulator for the purpose of exercising its functions under—

(i) the Pensions Act 1995,

(ii) this Act,

(iii) the Pensions Act 2008,

(iv) Schedule 18 to the Pensions Act 2014,

(v) the Pension Schemes Act 2017, or

(vi) Part 1 of the Pension Schemes Act 2021.

80B

(1) This section applies in relation to an occupational pension scheme other than—

(a) a money purchase scheme, or

(b) a prescribed scheme or a scheme of a prescribed description.

(2) Section 88A (financial penalties) applies to a person who has knowingly or recklessly provided a trustee or manager of the scheme with information which is false or misleading in a material particular, if the information was provided to the trustee or manager of the scheme in the circumstances mentioned in subsection (3)(a) or (b).

(3) The circumstances referred to in subsection (2) are—

(a) that the information was provided in purported compliance with a requirement under—

(i) regulations under section 7 of the Superannuation Act 1972 (superannuation of persons employed in local government service and other persons selected by the Secretary of State),

(ii) regulations under section 113A of the Pension Schemes Act 1993 (power to require disclosure of information about transfers from one scheme to another),

(iii) section 22(2B)(c) of the Pensions Act 1995 (insolvency practitioner or official receiver to give notice of certain events to trustees of scheme),

(iv) section 26 of that Act (insolvency practitioner or official receiver to give information to trustees),

(v) regulations under section 47(9) of that Act (power to impose duties on employers, auditors and actuaries to disclose information), or

(vi) a direction under section 72B of that Act (directions by Regulator for facilitating winding up of scheme);

(b) that the information was provided otherwise than as mentioned in paragraph (a) but in circumstances in which the person providing the information intends, or could reasonably be expected to know, that it would be used by the trustee or manager who receives it in that person's capacity as a trustee or manager of the scheme.

Financial penalties

88A

(1) Where the Regulator is satisfied that by reason of an act this section applies to a person, the Regulator may issue a notice to the person requiring the person to pay a penalty in respect of that act of an amount specified in the notice within a period specified in the notice.

(2) The amount of the penalty is to be an amount, not exceeding £1 million, determined by the Regulator.

(3) Regulations may amend subsection (2) by substituting a higher amount for the amount for the time being specified in subsection (2).

(4) The date on which the period specified in the notice ends must be at least 28 days after the date on which the notice is issued.

(5) The notice must specify the provision by virtue of which the penalty is imposed.

(6) Where—

(a) a penalty under this section may, apart from this subsection, be imposed on a body corporate, and

(b) the act in question was done with the consent or connivance of a director, manager, secretary or other similar officer of the body or a person purporting to act in any such capacity,

this section applies to that person.

(7) Where the affairs of a body corporate are managed by its members, subsection (6) applies in relation to the acts of a member in connection with the member's functions of management as to a director of a body corporate.

(8) Where—

(a) a penalty under this section may, apart from this subsection, be imposed on a Scottish partnership, and

(b) the act in question was done with the consent or connivance of a partner,

this section applies to that person.

(9) If the Regulator requires a person to pay a penalty under this section by virtue of subsection (6) or (8), it may not also require the body corporate or the Scottish partnership to pay a penalty under this section in respect of the same act.

(10) The Regulator may not issue a notice under this section to a person in relation to an act if—

(a) the person has been convicted of an offence in respect of the same act, or

(b) criminal proceedings for the offence have been instituted against the person in respect of the act and the proceedings have not been concluded.

(11) The Regulator may not issue a notice under this section to a person in respect of an act if the Regulator has required the person to pay a penalty under section 10 of the Pensions Act 1995 (civil penalties) in respect of the same act.

(12) In this section “act” includes omission.

88B

(1) Subsection (3) applies where—

(a) the Regulator is satisfied that section 88A applies to a person by virtue of section 58C or 58D (financial penalty for avoidance of employer debt etc),

(b) the Regulator issues a notice under section 88A requiring the person to pay a penalty in respect of the act or failure to act in question, and

(c) when the notice under section 88A is issued, the person is subject to one or more contribution notices issued under section 38 (contribution notices where avoidance of employer debt).

(2) Subsection (3) does not apply if, when the notice under section 88A is issued, a qualifying insolvency event has occurred in relation to the employer in relation to the scheme by reference to which the penalty under section 88A is imposed.

(3) The Regulator may not take any step to recover the penalty specified in the notice under section 88A (including accepting an amount offered in payment or part payment of the penalty) until after—

(a) the relevant date relating to the contribution notice or (as the case may be) the latest of the relevant dates relating to the contribution notices, or

(b) if sooner, the date on which a qualifying insolvency event occurs in relation to the employer in relation to the scheme by reference to which the penalty under section 88A is imposed.

(4) In this section—

“qualifying insolvency event” has the meaning given by section 127(3);

“the relevant date” means, in relation to a contribution notice issued under section 38—the date specified under section 40(2A) for the purposes of sections 42A(2) and 42B(2), disregarding any date that has effect instead of that date by virtue of section 41(10A) or (11B), orif sooner, the date on which the sum specified in the contribution notice is paid.

88C

(1) A penalty under section 88A is recoverable by the Regulator.

(2) In England and Wales, such a penalty is, if the county court so orders, recoverable under section 85 of the County Courts Act 1984 or otherwise as if it were payable under an order of that court.

(3) In Scotland, a notice to pay such a penalty is enforceable as if it were an extract registered decree arbitral bearing a warrant for execution issued by the sheriff court of any sheriffdom in Scotland.

(4) The Regulator must pay into the Consolidated Fund a penalty recovered under this section.

Annual reports to Secretary of State

115A

(1) The Secretary of State may lend money to the Board for the purposes of the exercise of the Board’s functions under Chapter 4 of this Part and any corresponding provision in force in Northern Ireland.

(2) A loan under this section may be made on such terms (including as to repayment and interest) as the Secretary of State may determine.

Inalienability of occupational pension

Payments made by employers to personal pension schemes

Winding up

Debt due from the employer when assets insufficient

Investigations

Power to increase pensions giving effect to pension credits etc

Restriction on purchase of annuities

Dissolution of OPRA

Repeals and revocations

41A

The power to require a person to pay a penalty under section 88A.

Calculation of compensation on and after 1 January 2024

22A

(1) This paragraph applies where—

(a) the assessment date falls on or after 1 January 2024, and

(b) there is a person (“P”) who, at the beginning of the assessment period in question, is or may become entitled to payment of compensation in accordance with paragraph 3, 5, 7, 8, 10, 11, 14, 15, 19, 20 or 22 in respect of the scheme.

(2) Sub-paragraph (3) applies where, but for that sub-paragraph, the value as at the beginning of the assessment period of the compensation which is or may become payable to or in respect of P in accordance with any of paragraphs 3, 4, 5, 6, 7, 8, 9, 10, 11, 13, 14, 15, 18, 19, 20, 22 and 23 (“the relevant compensation provisions”) in respect of the scheme would be less than 50% of the value of the benefits which have accrued to or in respect of P under the admissible rules of the scheme immediately before the assessment date (“the benefits value”).

(3) Where this sub-paragraph applies, the amounts of the compensation which is or may become payable to or in respect of P in accordance with any of the relevant compensation provisions in respect of the scheme are to be adjusted in accordance with guidance issued by the Board so as to secure that the value as at the beginning of the assessment period of that compensation is increased to an amount equal to 50% of the benefits value.

(4) The following are to be determined in accordance with guidance issued by the Board—

(a) the value of the compensation which is or may become payable to or in respect of P in accordance with any of the relevant compensation provisions in respect of the scheme;

(b) the value of the benefits which have accrued to or in respect of P under the admissible rules of the scheme.

(5) In this paragraph—

(a) a reference to benefits which have accrued to or in respect of a person under the admissible rules of the scheme does not include a reference to such of those benefits as are attributable (directly or indirectly) to a pension credit;

(b) a reference to compensation which is or may become payable to or in respect of a person in accordance with a provision of this Schedule does not include a reference to so much of that compensation as is attributable (directly or indirectly) to a pension credit.

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