Legalize / United Kingdom / Public General Act

Pensions Act 2014

Type Public General Act

Publication 2014-05-14

Last updated 2025-04-07

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

(12E) (1) A scheme that was a salary related contracted-out scheme is to be treated as including whatever provision it needs to contain to comply with the GMP requirements. (2) A scheme complies with the GMP requirements if, in relation to any earner's service before the principal appointed day, it complies in all respects with sections 13 to 24E. (3) Where— (a) a scheme is permitted by any of those sections to include provision subject to certain requirements, and (b) the scheme includes the provision but not the requirements, the scheme is to be treated by subsection (1) as including the requirements. (4) This section overrides any provision of a scheme to the extent that the provision of the scheme conflicts with it.

(2) For the purposes of section 12E it does not matter whether the scheme ceased to be contracted-out when the amendment made by paragraph 5 of this Schedule came into force or before that time.

(3) But section 12E does not treat a scheme as having included any provision before this paragraph comes into force.

14

In section 13 (minimum pensions for earners), in subsection (2)—

(a) for “is a married woman or widow who is liable” substitute “ was a married woman or widow who was liable ”;

(b) after “Act 1992” insert “ at a time during a relevant year when she was in contracted-out employment by reference to the scheme ”;

“Relevant year” has the meaning given by section 14(8).

15

(1) Section 14 (earner's guaranteed minimum) is amended as follows.

(2) For subsection (1) substitute—

(1) An earner has a guaranteed minimum in relation to the pension provided by a scheme that was a salary related contracted-out scheme if in any tax week in a relevant year— (a) earnings were paid to or for the earner's benefit in respect of employment which was contracted-out by reference to the scheme; and (b) those earnings were in excess of the lower earnings limit for that tax week (or the prescribed equivalent if the earner was paid otherwise than weekly).

(3) In subsection (2), for “earnings such as are mentioned in subsection (1)” substitute “ excess earnings mentioned in subsection (1)(b) ”.

16

In section 16 (revaluation of earnings factors for the purposes of section 14: early leavers etc), for subsection (2) substitute—

(2) The scheme may provide that in a case where— (a) an earner was, before the second abolition date, in contracted-out employment by reference to a scheme, and (b) the earner ceases to be in pensionable service under the scheme before the final relevant year, the earnings factors for that person shall be determined for the purposes of section 14(2) by reference to the last such order to come into force before the end of the tax year in which the earner ceases to be in pensionable service under the scheme (“the last service tax year”).

17

(1) Section 17 (minimum pensions for widows, widowers and surviving civil partners) is amended as follows.

(2) In subsection (4A), after paragraph (a) insert—

(aa) for life, in a case where— (i) the widow, widower or surviving civil partner attained state pension age on or after the second abolition date, and (ii) the earner died on or after the date on which the widow, widower or surviving civil partner attained state pension age; (ab) for any period after the widow, widower or surviving civil partner has attained state pension age, in a case where— (i) the earner died before the widow, widower or surviving civil partner attained state pension age, (ii) the widow, widower or surviving civil partner did not marry or form a civil partnership after the death and before attaining state pension age, and (iii) the widow, widower or surviving civil partner attained state pension age on or after the second abolition date;

(3) After subsection (9) insert—

(9A) For the purposes of subsection (4A)(aa) and (ab) a person attains state pension age when he or she attains pensionable age within the meaning given by the rules in paragraph 1 of Schedule 4 to the Pensions Act 1995.

18

In section 20 (transfer of accrued rights), in subsection (1)(a)—

(a) in sub-paragraph (i), after “under a” insert “ scheme that was a ”;

(b) in sub-paragraph (ii)—

(i) omit “which is not contracted-out,”;

(ii) after “under a” insert “ scheme that was a ”.

19

In section 23 (securing of benefits), in subsection (2), omit paragraph (d).

20

In section 24A—

(a) the existing text becomes subsection (1), and

(b) after that subsection insert—

(2) The Secretary of State must give such guidance (if any) as he or she thinks appropriate about GMP conversion.

21

In section 25 (power for HMRC to impose conditions as to investments and resources), in subsection (2), after “A” insert “ scheme that was a ”.

22

Sections 34 to 36 (cancellation, variation, surrender and refusal of certificates) are repealed.

23

In the italic heading above section 37, for “scheme rules after certification” substitute “ rules by former salary related contracted-out schemes ”.

24

In section 37 (alteration of rules of contracted-out schemes) for subsections (1) to (3) substitute—

(1) Except in prescribed cases, the rules of a scheme that was a salary related contracted-out scheme cannot be altered unless the alteration is of a prescribed description. (2) Regulations made by virtue of subsection (1) may operate so as to validate with retrospective effect any alteration of the rules which would otherwise be void under this section. (3) Subsection (1) does not apply to a scheme if no person is entitled to receive, or has accrued rights to, any benefits under the scheme attributable to a period when the scheme was contracted-out.

25

After section 37 insert—

(37A) (1) Regulations may prohibit or restrict— (a) the transfer of any liability— (i) for the payment of pensions under a relevant scheme, or (ii) in respect of accrued rights to such pensions, (b) the discharge of any liability to provide pensions under a relevant scheme, or (c) the payment of a lump sum instead of a pension payable under a relevant scheme, except in prescribed circumstances or on prescribed conditions. (2) In this section “relevant scheme” means a scheme that was a salary related contracted-out scheme by virtue of section 9(2B) and references to pensions and accrued rights under the scheme are to such pensions and rights so far as attributable to an earner's service on or after the principal appointed day (including, in a case where there has been a transfer payment, any pensions or rights deriving (directly or indirectly) from— (a) an earner's service on or after the principal appointed day in employment that was contracted-out employment by reference to another scheme, or (b) in a case where the transfer payment was made before the first abolition date, protected rights under another occupational pension scheme or under a personal pension scheme which derive from payments or contributions in respect of employment on or after the principal appointed day). (3) Regulations under subsection (1) may provide that any provision of this Part shall have effect subject to such modifications as may be specified in the regulations.

26

For the heading to Chapter 2 of Part 3 substitute “ Reduction in social security benefits for members of schemes that were contracted-out ”.

27

In section 40 (scope of Chapter 2)—

(a) omit paragraph (a);

(b) in paragraph (c) for “such schemes” substitute “ schemes that were contracted-out pension schemes ”.

28

The italic heading above section 41 is repealed.

29

Section 41 (reduced rates of Class 1 contributions) is repealed.

30

(1) Section 42 (review and alteration of reduced rates of Class 1 contributions) is repealed.

(2) There is no duty, before the repeal of section 42 comes into force, to lay before Parliament any reports under that section.

31

In section 48A (additional pension and other benefits), in subsection (1), for the words from the beginning to the end of paragraph (b) substitute

In relation to— (a) any tax week falling before the first abolition date where the amount of a Class 1 contribution attributable to section 8(1)(a) of the Social Security Contributions and Benefits Act 1992 in respect of the earnings paid to or for the benefit of an earner in that week was reduced under section 42A of this Act (as it then had effect), (b) any tax week falling before the second abolition date where the amount of a Class 1 contribution attributable to section 8(1)(a) of the Social Security Contributions and Benefits Act 1992 in respect of the earnings paid to or for the benefit of an earner in that week was reduced under section 41 of this Act (as it then had effect), or (c) any tax week falling before the first abolition date where an amount was paid under section 45(1) of this Act (as it then had effect) in respect of the earnings paid to or for the benefit of an earner,

32

Section 49 (women, married women and widows) is repealed.

33

Section 50 (powers of HMRC to approve arrangements for scheme ceasing to be certified) is repealed.

34

In section 51 (calculation of guaranteed minimum pensions under approved arrangements), in subsection (1)(b), for “ceases” substitute “ ceased ”.

35

For section 52 substitute—

(52) Section 53 shall apply for the purpose of making provision for securing the continued supervision of any scheme that was a salary related contracted-out scheme, other than a public service pension scheme, if any person is entitled to receive or has accrued rights to— (a) a guaranteed minimum pension under the scheme, or (b) a pension under the scheme attributable to service on or after the principal appointed day but before the scheme ceased to be contracted-out.

36

In section 53 (supervision: former contracted-out schemes), omit subsection (3).

37

Sections 55 to 68 (state scheme premiums) are repealed.

38

In section 87 (general protection principle), in subsection (1)(a), for sub-paragraph (i) substitute—

(i) the date (“the cessation date”) which is the earlier of— (a) the date on which an earner ceases to be in pensionable service under a scheme that was, before the second abolition date, a salary related contracted-out scheme; and (b) the date on which the earner attains pensionable age;

39

In section 96 (further provisions concerning exercise of option to take cash equivalent in a particular way), in subsection (2), in paragraph (a)(i) omit “which is not a contracted-out scheme”.

40

In section 109 (annual increase of guaranteed minimum pensions), in subsection (3A)(b), omit “for the purposes of Part 3 of the Pensions Act 1995”.

41

In section 171 (questions arising in proceedings), in subsection (1), omit paragraph (b) and the “or” before it.

42

In section 178 (trustees and managers of schemes), in paragraph (a)—

(a) after “1985” insert “ or ”;

(b) omit “or Part II of Schedule 5 to the Child Support, Pensions and Social Security Act 2000”.

43

(1) Section 181(1) (general interpretation) is amended as follows.

(2) In the appropriate places insert—

“the first abolition date” has the meaning given by section 7A;

“the second abolition date” has the meaning given by section 7A;

“the principal appointed day” means 6 April 1997 (which is the day designated as the principal appointed day for the purposes of Part 3 of the Pensions Act 1995);

“salary related contracted-out scheme” is to be construed in accordance with section 7B;

(3) Omit the definition of “abolition date”.

(4) In the definition of “appropriate scheme” and “appropriate scheme certificate”, for “section 181A” substitute “ section 7B ”.

(5) In the definition of “contracting-out certificate”, for “section 7 and section 181A” substitute “ section 7B ”.

(6) In the definition of “contributions equivalent premium”, for “has the meaning given in” substitute “ means a premium that was paid under ”.

(7) In the definition of “earner” and “earnings”, after “in accordance with” insert “ section 8(1B) of this Act and ”.

(8) In the definition of “money purchase contracted-out scheme”, for “section 181A” substitute “ section 7B ”.

44

Section 181A (interpretation of references to money purchase contracted-out schemes or appropriate schemes after first abolition date) is repealed.

45

In section 185 (consultation about other regulations), omit subsection (9).

46

(1) Schedule 2 (certification regulations) is amended as follows.

(2) Omit paragraphs 1 to 4.

(3) In paragraph 5(3A), for “a contracted-out occupational pension scheme which is being wound up,” substitute “ a scheme which was a contracted-out occupational pension scheme and which was being wound up before the second abolition date ”.

(4) Omit paragraphs 6 to 8.

47

(1) Schedule 4 (priority in bankruptcy) is amended as follows.

(2) In paragraph 2—

(a) in sub-paragraph (1), after “contributions to a” insert “ Northern Ireland ”;

(b) in sub-paragraph (5), at the appropriate place insert—

“Northern Ireland salary related contracted-out scheme” means a salary related contracted-out scheme within the meaning of the Pension Schemes (Northern Ireland) Act 1993 (and references to employment that is contracted-out by reference to a scheme are to be read accordingly);

(3) In paragraph 3—

(a) in sub-paragraph (1), after “on account of a” insert “ Northern Ireland ”;

(b) after sub-paragraph (5) insert—

(6) In this paragraph “Northern Ireland contributions equivalent premium” means a contributions equivalent premium within the meaning of the Pension Schemes (Northern Ireland) Act 1993.

(4) Omit paragraph 4(2).

Part 2 — Other Acts: amendments

48

The Contributions and Benefits Act is amended as follows.

49

In section 1 (outline of contributory system), in subsection (3), omit the words after paragraph (b).

50

In section 4C (power to make provision in consequence of provision made by virtue of section 4B(2) etc), in subsection (5), in each of paragraphs (a) and (b) omit the words from “, including” to the end.

51

In section 8 (calculation of primary Class 1 contributions), in subsection (3), omit paragraph (c) and the “and” before it.

52

In section 9 (calculation of secondary Class 1 contributions), in subsection (3), omit paragraph (c) and the “and” before it.

53

In section 20 (descriptions of contributory benefits), in subsection (3), for “(reduction in state scheme contributions and benefits for members of certified schemes)” substitute “ (reduction in benefits for members of schemes that were contracted-out) ”.

54

In Schedule 1 (supplementary provisions relating to national insurance contributions), in paragraph 1, omit sub-paragraphs (2), (3), (6) and (9) to (11).

55

The Administration Act is amended as follows.

56

In section 150 (annual up-rating of benefits), in subsection (10A), for “the abolition date, as defined by section 181(1) of the Pensions Act,” substitute “ 6 April 2012 (the date appointed for the commencement of section 15(1) of the Pensions Act 2007) ”.

57

In section 191 (interpretation - general)—

(a) in the definition of “money purchase contracted-out scheme”, for “section 181A” substitute “ section 7B ”;

(b) in the definition of “personal pension scheme” etc, for “section 181A(6)” substitute “ section 7B(6) ”.

Pensions Act 1995 (c. 26)

58

The Pensions Act 1995 is amended as follows.

59

(1) Section 51 (annual increase in rate of pension) is amended as follows.

(2) For “the appointed day” (in each place) substitute “ 6 April 1997 ”.

(3) For subsection (8) substitute—

(8) An occupational pension scheme is a “relevant occupational pension scheme” if— (a) it has not, at any time on or after 6 April 1997, been a salary related contracted-out scheme (see section 7B of the Pension Schemes Act 1993), or (b) it has, at any time on or after 6 April 1997, been a salary related contracted-out scheme but no person is entitled to receive, or has accrued rights to, benefits under the scheme attributable to a period on or after that day when it was such a scheme.

60

In section 54 (sections 51 to 53: supplementary), in subsection (3), omit the definition of “the appointed day”.

61

For section 69 substitute—

(69) (1) The Authority may, on an application made to them by the trustees of a registered pension scheme which is being wound up, make an order— (a) modifying the scheme for the purpose of enabling assets remaining after the liabilities of the scheme have been fully discharged to be distributed to the employer, or (b) authorising the trustees to modify the scheme for that purpose. (2) But the Authority may act under subsection (1) only if prescribed requirements in relation to the distribution are satisfied. (3) Regulations may make provision requiring applications under subsection (1) to meet prescribed requirements. (4) Regulations may provide that in prescribed circumstances this section does not apply to schemes falling within a prescribed class or description or applies to them with prescribed modifications. (5) In this section “registered pension scheme” means an occupational pension scheme registered under section 153 of the Finance Act 2004 (other than a public service pension scheme).

62

In section 70 (section 69: supplementary), omit subsection (3).

63

In section 71 (effect of orders under section 69), in subsection (1)—

(a) for “paragraph (a)” substitute “ paragraph (b) ”;

(b) for “paragraph (b)” substitute “ paragraph (a) ”.

(64) In section 72 (modification of public service pension schemes), in subsection (1), for “section 69(1)(b)” substitute “ section 69(1)(a) ”.

65

Sections 136(1), (3) and (5), 137(3) and (4) and 148 (amendments to do with contracting-out) are repealed.

Employment Rights Act 1996 (c. 18)

66

The Employment Rights Act 1996 is amended as follows.

67

In section 3 (note to be included in statement of initial employment particulars), omit subsection (5).

68

In section 11 (references to employment tribunals), in subsection (3), omit paragraph (a) (including the “and” at the end of it).

69

The Child Support, Pensions and Social Security Act 2000 is amended as follows.

70

(1) Section 42 (disclosure of state pension information) is amended as follows.

(2) In subsection (3)(d), omit “which is not contracted-out employment”.

(3) In subsection (11), omit the definition of “contracted-out employment”.

71

Part 2 of Schedule 5 (alternative to anti-franking rules) is repealed.

Employment Act 2002 (c. 22)

72

In section 15 of the Employment Act 2002 (use of information by HMRC), in subsection (2)(c), for “(certification of pension schemes etc)” substitute “ (schemes that were contracted-out etc) ”.

Pensions Act 2004 (c. 35)

73

In section 258 of the Pensions Act 2004 (pension protection on transfer of employment), in subsection (2)(c), for sub-paragraphs (i) and (ii) substitute “ complies with prescribed requirements ”.

Companies Act 2006 (c. 46)

74

The Companies Act 2006 is amended as follows.

75

In section 140 (interests to be disregarded: employer's rights of recovery under pension scheme or employee's share scheme), in subsection (2), omit “section 61 of the Pension Schemes Act 1993 or”.

76

In section 673 (interests to be disregarded in determining whether company has beneficial interest: employer's charges and other rights of recovery), in subsection (1)(b), omit sub-paragraph (i).

Pensions Act 2007 (c. 22)

77

The Pensions Act 2007 is amended as follows.

78

(1) Section 15 (abolition of contracting-out for defined contribution pension schemes) is amended as follows.

(2) In subsection (1), for “the abolition date” substitute “ 6 April 2012 ”.

(3) In subsection (2), omit the definition of “the abolition date”.

(4) In subsection (4), for “the abolition date” (in each place) substitute “ 6 April 2012 ”.

79

In section 27 (consequential provision, repeals and revocations), in subsection (6), for “the abolition date (within the meaning of section 15)” substitute “ 6 April 2012 ”.

80

(1) Schedule 4 (abolition of contracting-out for defined contribution pension schemes) is amended as follows.

(2) In paragraphs 61, 62(1), (2)(a) and (b)(i) and (3), 65 and 66(2) for “the abolition date” (in each place) substitute “ 6 April 2012 ”.

(3) In paragraph 67(1) omit the definition of “the abolition date”.

Pensions Act 2008 (c. 30)

81

The Pensions Act 2008 is amended as follows.

82

For section 21 substitute—

(21) A defined benefits scheme that has its main administration in the United Kingdom satisfies the quality requirement in relation to a jobholder if it satisfies the test scheme standard in relation to that jobholder.

83

In section 22 (test scheme standard), for subsection (2) substitute—

(2) Subject to subsection (3), the relevant members are J and all active members who are jobholders of the same employer as J.

SCHEDULE 14

Introduction

1

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

What can the power be used to do?

2

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Creation of exceptions

5

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Requirement for actuary’s certificate

6

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

When can the power be used?

7

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Can the power be used more than once?

9

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Modifications for multi-employer or sectionalised schemes

10

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The power overrides other legislation

11

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Procedural requirements and supplementary matters

12

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

13

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Information

14

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Definitions

15

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 15

Part 1 — Great Britain

1

The Social Security Contributions and Benefits Act 1992 is amended as follows.

2

(1) Section 1 (outline of contributory system) is amended as follows.

(2) In subsection (2)—

(a) omit “six”;

(b) in paragraph (d), after “making up entitlement;” insert—

(da) Class 3A, payable by eligible people voluntarily under section 14A with a view to obtaining units of additional pension;

(3) In subsection (4)(a), for “and 3” substitute “ , 3 and 3A ”.

3

After section 14 insert—

(14A) (1) An eligible person is entitled to pay a Class 3A contribution in return for a unit of additional pension. (2) A person is eligible to pay a Class 3A contribution if the person— (a) is entitled to a Category A, Category B or Category D retirement pension or graduated retirement benefit, or (b) has deferred entitlement to a Category A or Category B retirement pension or graduated retirement benefit. (3) The amount of a Class 3A contribution needed to obtain a unit of additional pension is to be determined in accordance with regulations made by the Treasury. (4) Before making those regulations the Treasury must consult the Government Actuary or the Deputy Government Actuary. (5) A person— (a) may pay Class 3A contributions on more than one occasion, but (b) may not obtain more than the maximum number of units of additional pension. (6) The maximum number of units of additional pension that a person may obtain is to be specified by the Treasury in regulations. (7) In this section “deferred”, in relation to graduated retirement benefit, has the meaning given by section 36(4A) of the National Insurance Act 1965. (8) For the meaning of “deferred” in relation to a Category A or Category B retirement pension, see section 55(3) of this Act. (14B) (1) The Treasury may by regulations provide for a Class 3A contribution to be repaid in specified circumstances. (2) Regulations under subsection (1) may, in particular, make provision about applications for repayments and other procedural matters. (3) A person is to be treated as never having had a unit of additional pension if the Class 3A contribution paid in respect of it is repaid. (4) Regulations under subsection (1) may provide for benefits paid to a person because of the unit of additional pension to be recovered by deducting them from the repayment. (14C) (1) The Treasury may by regulations change who is eligible to pay Class 3A contributions. (2) The Treasury may by regulations remove the option for people to pay Class 3A contributions. (3) Regulations under this section may, in particular, amend an Act.

4

If paragraph 3 comes into force before the day mentioned in section 56(4) of this Act, section 14A(2) as inserted by that paragraph has effect as if the reference to entitlement included the prospective entitlement of a person who—

(a) has not yet reached pensionable age, but

(b) will reach pensionable age before that day (assuming that the person lives until pensionable age).

5

In section 43 (persons entitled to more than one retirement pension), in subsection (1), after “subsection (2) below” insert “ and section 61ZC below (which deals with unusual cases involving units of additional pension) ”.

6

In section 44 (Category A retirement pension), in subsection (3)—

(a) in paragraph (b), at the end insert “ or where the pensioner has one or more units of additional pension ”;

(b) after paragraph (b) insert—

For units of additional pension, see section 14A.

7

(1) Section 45 (rate of additional pension in a Category A retirement pension) is amended as follows.

(2) In subsection (1)—

(a) after “shall be” insert

the sum of the following— (a) in relation to any surpluses in the pensioner's earnings factors,

;

(b) at the end insert

; and (b) if the pensioner has one or more units of additional pension, a specified amount for each of those units.

(3) In subsection (2), at the end of paragraph (d) insert

; and (e) if the pensioner has one or more units of additional pension, a specified amount for each of those units.

(4) After subsection (2) insert—

(2A) For the purposes of subsections (1)(b) and (2)(e) the “specified amount” is an amount to be specified by the Secretary of State in regulations.

8

In section 52 (special provision for surviving spouses), after subsection (3) insert—

(3A) In subsection (3) the references to additional pension in a Category A or Category B retirement pension do not include any amount of additional pension attributable to units of additional pension. (3B) If an amount of additional pension in the Category B retirement pension is attributable to units of additional pension, the additional pension in the Category A retirement pension is increased by that amount (in addition to any increase under subsection (3)).

9

After section 61 insert—

(61ZA) (1) This section applies to a person who has one or more units of additional pension if the person— (a) is not entitled to a Category A retirement pension, but (b) would be entitled to a Category A retirement pension if the relevant contribution conditions were satisfied. (2) The relevant contribution conditions are to be taken to be satisfied for the purposes of the person's entitlement to a Category A retirement pension. (3) But where a person is entitled to a Category A retirement pension because of this section, the only element of that pension to which the person is so entitled is the additional pension attributable to the units of additional pension. (4) For units of additional pension, see section 14A. (61ZB) (1) This section applies to a person whose spouse or civil partner died with one or more units of additional pension if the person— (a) is not entitled to a Category B retirement pension as a result of the death, but (b) would be entitled to a Category B retirement pension as a result of the death if the relevant contribution conditions were satisfied. (2) The relevant contribution conditions are to be taken to be satisfied for the purposes of the person's entitlement to that Category B retirement pension. (3) But where a person is entitled to a Category B retirement pension because of this section, the only element of that pension to which the person is so entitled is the additional pension attributable to the units of additional pension. (4) For units of additional pension, see section 14A. (61ZC) (1) Section 43 does not prevent a person from being entitled for the same period to both— (a) a Category A retirement pension because of section 61ZA, and (b) one Category B retirement pension. (2) Section 43 does not prevent a person from being entitled for the same period to both— (a) a Category A retirement pension, and (b) one Category B retirement pension because of section 61ZB (or, if there is more than one such Category B retirement pension, the most favourable of them). (3) Accordingly— (a) in section 43(2)(a) the reference to “a Category A or a Category B retirement pension”, in a case in which subsection (1) or (2) of this section applies, includes “a Category A and a Category B retirement pension”, (b) in sections 43(3)(a) and (aa), 51A and 52 “Category A retirement pension” does not include a pension to which a person is entitled because of section 61ZA, and (c) in sections 43(3)(a) and 52 “Category B retirement pension” does not include a pension to which a person is entitled because of section 61ZB.

10

In section 122 (interpretation), in subsection (1), at the appropriate place insert—

“unit of additional pension” means a unit of additional pension for which a person has paid a Class 3A contribution under section 14A;

11

In section 176 (parliamentary control), in subsection (1)(a), at the appropriate places insert— “ section 14A; ” “ section 45(2A); ”.

12

In the heading to Schedule 1, for “and 3” substitute “ , 3 and 3A ”.

13

(1) Section 162 of the Social Security Administration Act 1992 (destination of contributions) is amended as follows.

(2) In subsection (5)(e), after “those contributions;” insert—

(ea) in the case of Class 3A contributions, 15.5 per cent of the amount estimated to be the total of those contributions;

(3) In subsection (8)(c), for “or (e)” substitute “ , (e) or (ea) ”.

Welfare Reform and Pensions Act 1999 (c. 30)

14

In section 47 of the Welfare Reform and Pensions Act 1999 (shareable state scheme rights), in subsection (2)(a), omit “earnings-related”.

Part 2 — Northern Ireland

15

The Social Security Contributions and Benefits (Northern Ireland) Act 1992 is amended as follows.

16

(1) Section 1 (outline of contributory system) is amended as follows.

(2) In subsection (2)—

(a) omit “six”;

(b) in paragraph (d), after “making up entitlement;” insert—

(da) Class 3A, payable by eligible people voluntarily under section 14A with a view to obtaining units of additional pension;

(3) In subsection (4)(a), for “and 3” substitute “ , 3 and 3A ”.

17

After section 14 insert—

(14A) (1) An eligible person is entitled to pay a Class 3A contribution in return for a unit of additional pension. (2) A person is eligible to pay a Class 3A contribution if the person— (a) is entitled to a Category A, Category B or Category D retirement pension or graduated retirement benefit, or (b) has deferred entitlement to a Category A or Category B retirement pension or graduated retirement benefit. (3) The amount of a Class 3A contribution needed to obtain a unit of additional pension is to be determined in accordance with regulations made by the Treasury. (4) Before making those regulations the Treasury must consult the Government Actuary or the Deputy Government Actuary. (5) A person— (a) may pay Class 3A contributions on more than one occasion, but (b) may not obtain more than the maximum number of units of additional pension. (6) The maximum number of units of additional pension that a person may obtain is to be specified by the Treasury in regulations. (7) In this section “deferred”, in relation to graduated retirement benefit, has the meaning given by section 35(4A) of the National Insurance Act (Northern Ireland) 1966. (8) For the meaning of “deferred” in relation to a Category A or Category B retirement pension, see section 55(3) of this Act. (14B) (1) The Treasury may by regulations provide for a Class 3A contribution to be repaid in specified circumstances. (2) Regulations under subsection (1) may, in particular, make provision about applications for repayments and other procedural matters. (3) A person is to be treated as never having had a unit of additional pension if the Class 3A contribution paid in respect of it is repaid. (4) Regulations under subsection (1) may provide for benefits paid to a person because of the unit of additional pension to be recovered by deducting them from the repayment. (14C) (1) The Treasury may by regulations change who is eligible to pay Class 3A contributions. (2) The Treasury may by regulations remove the option for people to pay Class 3A contributions. (3) Regulations under this section may, in particular, amend an Act.

18

(1) If paragraph 17 comes into force before the new state pension commencement date for Northern Ireland, section 14A(2) as inserted by that paragraph has effect as if the reference to entitlement included the prospective entitlement of a person who—

(a) has not yet reached pensionable age, but

(b) will reach pensionable age before that day (assuming that the person lives until pensionable age).

(2) In this paragraph “the new state pension commencement date for Northern Ireland” means the date on which legislation in Northern Ireland corresponding to section 2 of this Act comes fully into force.

19

In section 121 (interpretation), in subsection (1), at the appropriate place insert—

“unit of additional pension” means a unit of additional pension for which a person has paid a Class 3A contribution under section 14A;

20

In section 172 (procedure for regulations etc), in subsection (11A), after “11(3)” insert “ , 14A ”.

21

In the heading to Schedule 1, for “and 3” substitute “ , 3 and 3A ”.

22

(1) Section 142 of the Social Security Administration (Northern Ireland) Act 1992 (destination of contributions) is amended as follows.

(2) In subsection (5)(e), after “those contributions;” insert—

(ea) in the case of Class 3A contributions, 15.5 per cent of the amount estimated to be the total of those contributions;

(3) In subsection (8)(c), for “or (e)” substitute “ , (e) or (ea) ”.

SCHEDULE 16

Forfeiture Act 1982 (c. 34)

1

In section 4 of the Forfeiture Act 1982 (Upper Tribunal to decide whether forfeiture rule applies to social security benefits), in the definition of “relevant enactment” in subsection (5), after the entry relating to Part 1 of this Act (inserted by Schedule 12 to this Act) insert— “ section 30 of that Act, ”.

2

The Social Security Contributions and Benefits Act 1992 is amended as follows.

3

(1) Section 20 (descriptions of contributory benefits) is amended as follows.

(2) In subsection (1), for paragraph (ea) substitute—

(ea) widowed parent's allowance;

(3) In subsection (2), in the definition of “long-term benefit” omit paragraph (bb).

4

(1) Section 21 (contribution conditions) is amended as follows.

(2) In the table in subsection (2) omit the entries for bereavement payment and bereavement allowance.

(3) Omit subsection (4).

5

In section 22 (earnings factors), in subsection (2), after paragraph (c) (inserted by Schedule 12 to this Act) insert

and (d) establishing entitlement to bereavement support payment under section 30 of the Pensions Act 2014.

6

(1) Section 23A (contributions credits for relevant parents and carers) is amended as follows.

(2) In subsection (1) omit paragraph (e).

(3) In subsection (6)(b) omit “or (e)”.

7

For the italic heading above section 36 substitute “ Bereavement benefits: deaths before the day on which section 30 of the Pensions Act 2014 comes into force ”.

8

Section 36 (bereavement payment) is repealed.

9

Section 36A (cases in which sections 37 to 41 apply) is repealed.

10

(1) Section 37 (widowed mother's allowance) is amended as follows.

(2) Before subsection (1) insert—

(A1) This section applies only in cases where a woman's husband has died before 9 April 2001.

(3) At the end of the heading insert “ : deaths before 9 April 2001 ”.

11

(1) Section 38 (widow's pension) is amended as follows.

(2) Before subsection (1) insert—

(A1) This section applies only in cases where a woman's husband has died before 9 April 2001.

(3) At the end of the heading insert “ : deaths before 9 April 2001 ”.

12

In section 39A (widowed parent's allowance), for subsection (1) substitute—

(1) This section applies where— (a) a person's spouse or civil partner has died before the day on which section 30 of the Pensions Act 2014 comes into force (but see subsection (1A)), (b) the person has not married or formed a civil partnership after the death but before that day, and (c) the person is under pensionable age on that day. (1A) This section does not apply in cases where a woman's husband has died before 9 April 2001.

13

Section 39B (bereavement allowance where no dependent children) is repealed.

14

(1) Section 39C (rate of widowed parent's allowance and bereavement allowance) is amended as follows.

(2) Omit subsection (2).

(3) Omit subsection (5).

(4) In the heading omit “and bereavement allowance”.

15

In section 48B (Category B retirement pension for widows and widowers), in subsection (8), for “the appointed day (as defined by section 36A(3))” substitute “ 9 April 2001 ”.

16

In section 48BB (Category B retirement pension: entitlement by reference to benefits under section 39A or 39B), in subsection (3)(a)(i), after “bereavement allowance” insert “ under section 39B (before that section was repealed) ”.

17

(1) Section 60 (complete or partial failure to satisfy contribution condition) is amended as follows.

(2) In subsection (1) omit paragraph (ab).

(3) In subsection (3) omit paragraphs (a) and (bb).

18

(1) Schedule 3 (contribution conditions for entitlement to benefit) is amended as follows.

(2) Omit paragraph 4 and the italic heading above it.

(3) Omit paragraphs 7 and 9.

19

In Schedule 4 (rates of benefits etc) omit Part 2.

20

The Social Security Administration Act 1992 is amended as follows.

21

(1) Section 1 (entitlement to benefit dependent on claim) is amended as follows.

(2) For subsection (2) substitute—

(2) Where under subsection (1) a person is required to make a claim or to be treated as making a claim for a benefit in order to be entitled to it, the person is not entitled to it in respect of any period more than 12 months before the date on which the claim is made or treated as made. (2A) But subsection (2) does not apply— (a) to disablement benefit or reduced earnings allowance, or (b) in a case where a claim for the benefit is made or treated as made by virtue of section 3(2).

(3) In subsection (4), after paragraph (zb) (inserted by Schedule 12 to this Act) insert—

(zc) bereavement support payment under section 30 of the Pensions Act 2014;

22

In section 2A (claim or full entitlement to certain benefits conditional on work-focused interview), in subsection (2)(d), omit “(other than a bereavement payment)”.

23

(1) Section 3 (late claims for bereavement benefit where death is difficult to establish) is amended as follows.

(2) Subsection (3) is repealed.

(3) After subsection (4) insert—

(5) In subsection (2) “bereavement benefit” means— (a) bereavement support payment, or (b) widowed parent's allowance.

24

In section 5 (regulations about claims for and payments of benefits), in subsection (2), after paragraph (zb) (inserted by Schedule 12 to this Act) insert—

(zc) bereavement support payment under section 30 of the Pensions Act 2014;

25

In section 71 (overpayments - general), in subsection (11), after paragraph (ad) insert—

(ae) bereavement support payment under section 30 of the Pensions Act 2014;

26

In section 121DA (interpretation of Part 6), in subsection (1), after paragraph (hl) (inserted by Schedule 12 to this Act) insert—

(hm) Part 5 of the Pensions Act 2014;

27

In section 122B (supply of other government information for fraud prevention and verification), in subsection (3)(b), after “, Part 1 of the Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ , section 30 of that Act ”.

28

In section 124 (age, death and marriage), in subsection (1), after paragraph (af) (inserted by Schedule 12 to this Act) insert—

(ag) of section 30 of the Pensions Act 2014; and

29

In section 125 (regulations as to notification of deaths), in subsection (1), after “, Part 1 of the Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ , section 30 of that Act ”.

30

In section 150 (annual up-rating of benefits), in subsection (1), after paragraph (p) (inserted by Schedule 12 to this Act) insert—

(q) specified in regulations under section 30 of the Pensions Act 2014 (bereavement support payment).

31

(1) Section 163 (general financial arrangements) is amended as follows.

(2) In subsection (1), after paragraph (za) (inserted by Schedule 12 to this Act) insert—

(zb) bereavement support payment under section 30 of the Pensions Act 2014;

(3) In subsection (2)(a), after “, Part 1 of the Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ , section 30 of that Act ”.

(4) In subsection (3)(b), after “or Part 1 of the Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ or section 30 of that Act ”.

32

In section 170 (Social Security Advisory Committee), in subsection (5)—

(a) in the definition of “the relevant enactments”, after paragraph (am) (inserted by Schedule 12 to this Act) insert—

(an) section 30 of the Pensions Act 2014;

;

(b) in the definition of “the relevant Northern Ireland enactments”, after paragraph (am) (inserted by Schedule 12 to this Act) insert—

(an) any provisions in Northern Ireland which correspond to section 30 of the Pensions Act 2014;

33

(1) Section 179 (reciprocal agreements) is amended as follows.

(2) In subsection (3)(a), after “Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ , Part 5 of that Act ”.

(3) In subsection (4), after paragraph (ai) (inserted by Schedule 12 to this Act) insert—

(aj) to Part 5 of the Pensions Act 2014;

(4) In subsection (5)—

(a) after “Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ or section 30 of that Act ”;

(b) after paragraph (ad) (inserted by Schedule 12 to this Act) insert—

(ae) bereavement support payment;

34

In section 187 (inalienability), in subsection (1), after paragraph (ad) insert—

(ae) bereavement support payment under section 30 of the Pensions Act 2014;

35

In section 191 (interpretation), in the definition of “benefit”, for “and personal independence payment” substitute “ , personal independence payment and bereavement support payment under section 30 of the Pensions Act 2014 ”.

36

In section 2 of the Social Security Act 1993 (payments into National Insurance Fund out of money provided by Parliament), in subsection (4)(a), after “(za),” (inserted by Schedule 12 to this Act) insert “ (zb), ”.

37

The Social Security Act 1998 is amended as follows.

38

In section 2 (use of computers), in subsection (2), after paragraph (m) (inserted by Schedule 12 to this Act) insert

or (n) section 30 of the Pensions Act 2014;

39

(1) Section 8 (decisions by Secretary of State) is amended as follows.

(2) In subsection (3), after paragraph (ab) (inserted by Schedule 12 to this Act) insert—

(ac) bereavement support payment under section 30 of the Pensions Act 2014;

(3) In subsection (4), after “Part 1 of the Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ or section 30 of that Act ”.

40

In section 11 (regulations with respect to decisions), in subsection (3), in the definition of “the current legislation”, after “Part 1 of the Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ and section 30 of that Act ”.

41

In section 27 (restriction on entitlement in cases of error), in subsection (7), in the definition of “benefit”—

(a) after paragraph (df) insert—

(dg) bereavement support payment under section 30 of the Pensions Act 2014;

;

(b) in paragraph (e), for “to (df)” substitute “ to (dg) ”.

42

In section 28 (correction of errors in decisions etc), in subsection (3)(j), after “Part 1 of the Pensions Act 2014” (inserted by Schedule 12 to this Act) insert “ or section 30 of that Act ”.

43

The Social Security Fraud Act 2001 is amended as follows.

44

In section 6A (definitions), in subsection (1), in the definition of “disqualifying benefit”, after paragraph (ca) insert—

(cb) bereavement support payment under section 30 of the Pensions Act 2014 or under any provision in Northern Ireland which corresponds to that section;

45

In section 10 (power to supplement and mitigate loss of benefit provisions), in subsection (3), after paragraph (bf) (inserted by Schedule 12 to this Act) insert—

(bg) bereavement support payment under section 30 of the Pensions Act 2014 or under any provision in Northern Ireland which corresponds to that section;

Income Tax (Earnings and Pensions) Act 2003 (c. 1)

46

The Income Tax (Earnings and Pensions) Act 2003 is amended as follows.

47

In section 660 (taxable benefits: UK benefits - Table A), in the table in subsection (1), in the entry relating to bereavement allowance, omit the words “SSCBA 1992 Section 39B” (in the second column).

48

In section 677 (UK social security benefits wholly exempt from tax), in Part 1 of Table B in subsection (1), in the entry relating to bereavement payments, omit the words “SSCBA 1992 Section 36” (in the second column).

SCHEDULE 17

Part 1 — Automatic transfer of pension benefits

Regulations providing for transfer of cash equivalent of transferable benefits

1

(1) The Secretary of State must make regulations with a view to ensuring that, where a qualifying member of an automatic transfer scheme has transferable benefits under another pension scheme, the cash equivalent of the transferable benefits—

(a) is transferred to the automatic transfer scheme, and

(b) is used to provide rights for the member under it.

(2) In this Schedule “automatic transfer scheme” means—

(a) a work-based pension scheme, other than a scheme of a prescribed description, which is registered under Chapter 2 of Part 4 of the Finance Act 2004 and is a money purchase scheme, or

(b) a pension scheme of a prescribed description.

(3) In this Schedule “qualifying member”, in relation to an automatic transfer scheme, means an active member of the scheme of a prescribed description.

(4) For the purposes of this Schedule a person has transferable benefits under a pension scheme if—

(a) the scheme is a transferable benefits scheme,

(b) the person is a member of the scheme,

(d) the member has accrued rights to benefits under the scheme rules ,

(e) all of those rights accrued on or after the prescribed date (which may be a date before the coming into force of this paragraph),

(f) the cash equivalent of those benefits is less than the prescribed amount (but not nil), and

(g) any other prescribed conditions are met.

(5) In this Schedule “transferable benefits scheme” means—

(a) a work-based pension scheme, other than a scheme of a prescribed description, which is registered under Chapter 2 of Part 4 of the Finance Act 2004 and is a money purchase scheme, or

(b) a pension scheme of a prescribed description.

(6) In sub-paragraph (4)—

(a) the reference to “scheme rules” is to be read in accordance with section 100B of the Pension Schemes Act 1993;

(b) “benefits” means—

(i) money purchase benefits other than money purchase benefits of a prescribed description, or

(ii) benefits of a prescribed description.

Automatic transfer scheme to find out whether members have transferable benefits

2

(1) The regulations must require the trustees or managers of an automatic transfer scheme to take steps to find out whether a qualifying member of the scheme has transferable benefits under another pension scheme.

(2) The regulations may make provision—

(a) about when a step is to be taken (for example, within a prescribed period after a person becomes a qualifying member or at prescribed intervals);

(b) for the steps to be taken at any particular time to relate to a particular qualifying member, or to some or all qualifying members.

Automatic transfer scheme to request transfer of cash equivalent

3

(1) The regulations must require the trustees or managers of an automatic transfer scheme to give a transfer notice if—

(a) they find out that a qualifying member of the scheme has transferable benefits under another pension scheme, and

(b) any other prescribed conditions are met.

(2) A “transfer notice” is a notice given to the trustees or managers of the other pension scheme requesting the transfer of the cash equivalent of the transferable benefits to the automatic transfer scheme.

(3) The conditions that may be prescribed because of sub-paragraph (1)(b) include a condition that the trustees or managers must not give a transfer notice unless the qualifying member consents in accordance with the regulations.

Right to opt out of automatic transfer

4

(1) If the regulations do not include the condition mentioned in paragraph 3(3), they must ensure that where the duty to give a transfer notice has arisen in relation to transferable benefits of a qualifying member of an automatic transfer scheme, the member can opt out of the transfer in accordance with the regulations.

(2) The regulations must provide that, where the member does opt out—

(a) the duty to give the transfer notice is not to be complied with, and

(b) the cash equivalent of the member's transferable benefits is not to be transferred.

Information to be given to qualifying members of automatic transfer schemes

5

(1) The regulations must require a prescribed person to give information to a qualifying member of an automatic transfer scheme who has transferable benefits under another scheme for the purpose of helping the member to decide whether (as applicable)—

(a) to consent to the giving of a transfer notice in relation to the transferable benefits, or

(b) to opt out of the transfer of the cash equivalent of the transferable benefits.

(2) The information to be given—

(a) must include information about the effect of the regulations, and in particular the member's power to consent or right to opt out (as applicable);

(b) may include other information, for example information about the schemes.

Transferable benefits scheme to comply with request

6

(1) The regulations must require the trustees or managers of a pension scheme who receive a transfer notice requesting the transfer of the cash equivalent of a person's transferable benefits to do what is needed to carry out the request.

(2) The regulations may in particular—

(a) require the trustees or managers of the scheme to take particular steps to carry out the request;

(b) provide for the discharge, in prescribed circumstances, of any obligation to provide the transferable benefits.

(3) The regulations may provide for circumstances in which the duty to carry out the request does not apply.

Automatic transfer scheme to use cash equivalent to provide rights under the scheme

7

(1) The regulations must require the trustees or managers of an automatic transfer scheme to whom the cash equivalent of a person's transferable benefits is transferred to use the cash equivalent to provide rights for the person under the scheme.

(2) The regulations may make provision about how that is to be done and in particular about—

(a) the nature and value of the rights to be provided;

(b) calculating and verifying the value of the rights to be provided.

Cash equivalents: calculation and verification

8

(1) The regulations may provide for the manner in which cash equivalents are to be calculated and verified.

(2) The regulations may in particular—

(a) provide that a cash equivalent is to be increased or reduced in prescribed circumstances;

(b) make provision about the time by reference to which a cash equivalent is to be calculated for the purposes of a provision of the regulations.

(3) Regulations made because of sub-paragraph (2)(a) may provide for a cash equivalent to be reduced to nil.

Disclosure of information and establishment of database

9

(1) The regulations must make provision about disclosure of information.

(2) The regulations may in particular require a person to disclose information to another person—

(a) for the purposes of helping a person to comply with a duty imposed on the person by the regulations, or

(b) otherwise for the purposes of a provision of the regulations.

(3) The regulations may require the Secretary of State or the Regulator to establish and operate a database containing information relating to people who have or had transferable benefits for the purposes of helping the trustees or managers of an automatic transfer scheme to comply with their duties under the regulations.

Compliance

10

(1) The regulations may make provision with a view to ensuring compliance with any provision of the regulations.

(2) For this purpose the regulations may in particular—

(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 the regulations;

(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 has failed to comply with a compliance notice or third party compliance notice or has contravened a provision of the regulations;

(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.

Record keeping

11

(1) The regulations may require any person—

(a) to make records;

(b) to preserve records for a prescribed period;

(2) The regulations may provide that section 10 of the Pensions Act 1995 (civil penalties) applies to a person who fails to comply with those requirements.

Further provision about the regulations

12

The regulations may—

(a) impose or confer other functions on the trustees or managers of an automatic transfer scheme or transferable benefits scheme;

(b) confer a discretion on a person.

Review of limit on value of cash equivalent

13

(1) The regulations must require the Secretary of State to review from time to time the amount for the time being prescribed under paragraph 1(4)(f).

(2) The regulations must provide—

(a) for the first review to be conducted no later than 5 years after the date on which regulations under this Schedule first come into force;

(b) for subsequent reviews to be conducted no later than 5 years after the previous review.

(3) The regulations must require the Secretary of State, in conducting a review, to have regard to—

(a) changes in the general level of prices in Great Britain;

(b) changes in the general level of earnings in Great Britain;

(4) The regulations must authorise the Secretary of State to estimate the general level of prices or earnings for the purposes of the review in the manner the Secretary of State thinks fit.

Part 2 — Merger of pension accounts

14

(1) The Secretary of State may by regulations make provision for the purposes of requiring dormant pension accounts of a qualifying member of an automatic transfer scheme to be merged into a current pension account of the member.

(2) The regulations may not require a dormant pension account to be merged unless the accrued rights to benefits to which the account relates would be transferable benefits of the member if—

(a) all other accrued rights to benefits of the member, and any relevant contributions, were ignored, and

(b) any other prescribed matter were ignored.

(3) The regulations may in particular—

(a) make provision for determining into which current pension account (if the member has more than one) a dormant pension account is to be merged;

(b) provide that the rules of the scheme that are to apply to a merged pension account are those that apply to the current pension account into which a dormant pension account is being merged;

(c) require the trustees or managers of the scheme to make a transfer of assets representing the accrued rights to benefits to which a dormant pension account relates;

(d) include provision corresponding or similar to any provision which may be made by regulations under Part 1 of this Schedule.

(4) In this paragraph “pension account”, in relation to a member of a scheme, means an account relating to the member's accrued rights to benefits in respect of a particular period of employment; and a pension account—

(a) is “dormant” if relevant contributions in relation to the period of employment to which the account relates have ceased; and

(b) is “current” if such contributions have not ceased.

(5) In this paragraph—

(a) references to “accrued rights to benefits”, in relation to a member of a scheme, are to accrued rights to benefits under the applicable rules (within the meaning given by paragraph 1(6));

(b) “employment” has the prescribed meaning;

(c) “relevant contributions”, in relation to a member of a scheme, means contributions to the scheme by, or on behalf or in respect of, the member.

Part 3 — Interpretation etc

Interpretation etc

15

(1) In this Schedule—

“active member”—in relation to an occupational pension scheme, has the meaning given by section 124(1) of the Pensions Act 1995, andin relation to a personal pension scheme, means a member of the scheme in respect of whom contributions are being paid into the scheme;

“automatic transfer scheme” has the meaning given by paragraph 1(2);

“managers”, in relation to a pension scheme (other than a scheme established under a trust), means the persons responsible for the management of the scheme;

“money purchase benefits” has the meaning given by section 181(1) of the Pension Schemes Act 1993;

“money purchase scheme” has the meaning given by section 181(1) of the Pension Schemes Act 1993;

“occupational pension scheme” has the meaning given by section 1 of the Pension Schemes Act 1993;

“pension scheme” means—an occupational pension scheme, ora personal pension scheme;

“personal pension scheme” has the meaning given by section 1 of the Pension Schemes Act 1993;

“prescribed” means prescribed by regulations made by the Secretary of State;

“qualifying member” has the meaning given by paragraph 1(3);

“the Regulator” means the Pensions Regulator;

“transferable benefits”, and references to a person having transferable benefits, are to be read in accordance with paragraph 1(4);

“transferable benefits scheme” has the meaning given by paragraph 1(5);

“transfer notice” means a notice given under regulations made because of paragraph 3;

“work-based pension scheme” means—an occupational pension scheme,a personal pension scheme where direct payment arrangements (within the meaning of section 111A of the Pension Schemes Act 1993) exist in respect of one or more members of the scheme who are workers, ora personal pension scheme which is or has been registered under section 2 of the Welfare Reform and Pensions Act 1999 (stakeholder pension schemes);

“worker” means a person—who is a worker for the purposes of Part 1 of the Pensions Act 2008, orto whom a provision of Part 1 of that Act applies as if the person were a worker because of a provision of Chapter 8 of that Part;but for the purposes of paragraph (b), ignore section 92 of that Act.

(2) The Secretary of State may by regulations make provision about when contributions to a pension scheme are to be regarded as having ceased for the purposes of paragraph 1(4)(c) or 14(4).

Crown application

16

(1) This Schedule applies to a pension scheme managed by or on behalf of the Crown as it applies to other pension schemes.

(2) Accordingly, references in this Schedule to a person in the person's capacity as a trustee or manager of a pension scheme include the Crown, or a person acting on behalf of the Crown, in that capacity.

(3) This Schedule applies to persons employed by or under the Crown as it applies to persons employed by a private person.

Overriding provision

17

(1) Regulations under this Schedule may provide that specified provisions override any provision of an automatic transfer scheme or transferable benefits scheme to the extent that it conflicts with them.

(2) A “specified provision” is a provision of regulations under this Schedule specified in the regulations for the purposes of this paragraph.

Other provision relating to regulations under this Schedule

18

(1) Regulations under this Schedule may amend or otherwise modify any enactment (whenever passed or made).

(2) Regulations made because of sub-paragraph (1) may in particular amend section 175(1) of the Pension Schemes Act 1993 (levies towards certain expenditure) so as to include expenditure of the Secretary of State or the Commissioners for Her Majesty's Revenue and Customs under the regulations.

(3) In this paragraph “enactment” includes an enactment contained in subordinate legislation within the meaning of the Interpretation Act 1978.

19

Before making any regulations under this Schedule, the Secretary of State must consult such persons as the Secretary of State considers appropriate.

Amendments

20

(1) The Pension Schemes Act 1993 is amended as follows.

(2) In section 94(2A) (right to cash equivalent)—

(a) in paragraph (a), after sub-paragraph (vii) insert—

(viii) regulations made under Schedule 17 to the Pensions Act 2014;

;

(b) in paragraph (b), after sub-paragraph (v) insert—

(vi) regulations made under paragraph 17 of Schedule 17 to the Pensions Act 2014;

(3) In section 101AI(8) (rights to cash transfer sum and contribution refund: further provisions)—

(a) in paragraph (a), after sub-paragraph (vii) insert—

(viii) regulations made under Schedule 17 to the Pensions Act 2014;

;

(b) in paragraph (b), after sub-paragraph (v) insert—

(vi) regulations made under paragraph 17 of Schedule 17 to the Pensions Act 2014;

21

In section 256 of the Pensions Act 2004 (no indemnification for fines or civil penalties), in subsection (1)(b)—

(a) for “or section” substitute “ , section ”;

(b) after “2008” insert “ or paragraph 10 of Schedule 17 to the Pensions Act 2014 ”.

SCHEDULE 18

Power to restrict charges

1

(1) The Secretary of State may by regulations make provision—

(a) prohibiting administration charges which are of a specified class or description, or which exceed specified limits, from being imposed on members of a relevant scheme;

(b) prohibiting a relevant scheme from containing provision under which administration charges which are of a specified class or description, or which exceed specified limits, will or may be imposed on members of the scheme.

“Specified” means specified in the regulations.

(2) The regulations—

(a) may make provision for the manner of, and criteria for, determining whether an administration charge is of a specified class or description or exceeds specified limits;

(b) may provide for the determination to be made in accordance with guidance issued from time to time by the Secretary of State.

(3) The regulations may impose duties on the trustees or managers of a relevant scheme or others.

(4) The regulations may provide that a scheme is not a qualifying scheme in relation to a jobholder for the purposes of Part 1 of the Pensions Act 2008 if a provision of the regulations—

(a) is contravened, or

(b) is contravened in a way specified in the regulations.

(5) In this paragraph—

“administration charge”, in relation to a member of a pension scheme, means any of the following to the extent that they may be used to meet the administrative expenses of the scheme, to pay commission or in any other way that does not constitute the provision of pension benefits for or in respect of members or the making of transfer payments with a view to acquiring rights or entitlements to pension benefits under different pension schemes—any payments made to the scheme by, or on behalf or in respect of, the member,any income or capital gain arising from the investment of such payments, orthe value of the member's rights under the scheme;

“relevant scheme” means a pension scheme of a description specified in the regulations.

Power to impose requirements relating to administration or governance

2

(1) The Secretary of State may by regulations impose requirements relating to the administration or governance of a relevant scheme that must be satisfied in relation to the scheme.

(2) The regulations—

(a) may make provision for the manner of, and criteria for, determining whether a requirement is satisfied;

(b) may provide for the determination to be made in accordance with guidance issued from time to time by the Secretary of State.

(3) The regulations may impose duties on the trustees or managers of a relevant scheme or others.

(4) The regulations may provide that a scheme is not a qualifying scheme in relation to a jobholder for the purposes of Part 1 of the Pensions Act 2008 if a provision of the regulations—

(a) is contravened, or

(b) is contravened in a way specified in the regulations.

(5) In this paragraph “relevant scheme” means a pension scheme of a description specified in the regulations.

Compliance

3

(1) The Secretary of State may by regulations make provision with a view to ensuring compliance with a provision of regulations under paragraph 1 or 2.

(2) The regulations may in particular—

(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 paragraph 1 or 2;

(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 regulations under paragraph 1 or 2;

(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 has failed to comply with a compliance notice or third party compliance notice or has contravened a provision of regulations under paragraph 1 or 2;

(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.

Interpretation

4

(1) Expressions used in this Schedule and in Schedule 17 have the same meaning in this Schedule as in that Schedule (see paragraph 15 of that Schedule).

(2) In this Schedule “relevant scheme” is to be construed in accordance with paragraphs 1(5) and 2(5).

(3) Where a pension scheme is divided into sections, each section that is a collective money purchase scheme for the purposes of Part 1 of the Pension Schemes Act 2021 (see section 1(2)(b) of that Act) is to be treated for the purposes of this Schedule as a separate scheme.

Crown application

5

(1) This Schedule applies to a pension scheme managed by or on behalf of the Crown as it applies to other pension schemes.

(2) Accordingly, a reference in this Schedule to a person in the person's capacity as a trustee or manager of a pension scheme include the Crown, or a person acting on behalf of the Crown, in that capacity.

(3) This Schedule applies to persons employed by or under the Crown as it applies to persons employed by a private person.

Overriding provision

6

(1) The Secretary of State may by regulations provide that specified provisions override any provision of a relevant scheme to the extent that it conflicts with them.

(1A) The Secretary of State may by regulations provide that specified provisions override any term of a relevant contract to the extent that it conflicts with them.

(2) A “specified provision” is a provision of regulations under this Schedule specified in regulations made under sub-paragraph (1) or (1A) .

(3) “Relevant contract” means a contract between the trustees or managers of a relevant scheme and a person providing services in relation to the scheme.

Other provision relating to regulations under this Schedule

7

(1) The Secretary of State may by regulations amend or otherwise modify any enactment (whenever passed or made) in connection with any provision made by regulations under the preceding provisions of this Schedule.

(2) In this paragraph “enactment” includes an enactment contained in subordinate legislation within the meaning of the Interpretation Act 1978.

8

Before making any regulations under this Schedule, the Secretary of State must consult such persons as the Secretary of State considers appropriate.

Amendments

9

(1) The Pension Schemes Act 1993 is amended as follows.

(2) In section 94(2A) (right to cash equivalent)—

(a) in paragraph (a), after sub-paragraph (viii) (inserted by Schedule 17 to this Act) insert—

(ix) regulations made under Schedule 18 to the Pensions Act 2014;

;

(b) in paragraph (b), after sub-paragraph (vi) (inserted by Schedule 17 to this Act) insert—

(vii) regulations made under paragraph 6 of Schedule 18 to the Pensions Act 2014.

(3) In section 101AI(8) (rights to cash transfer sum and contribution refund: further provisions)—

(a) in paragraph (a), after sub-paragraph (viii) (inserted by Schedule 17 to this Act) insert—

(ix) regulations made under Schedule 18 to the Pensions Act 2014;

;

(b) in paragraph (b), after sub-paragraph (vi) (inserted by Schedule 17 to this Act) insert—

(vii) regulations made under paragraph 6 of Schedule 18 to the Pensions Act 2014.

10

In section 256 of the Pensions Act 2004 (no indemnification for fines or civil penalties), in subsection (1)(b), after “or paragraph 10 of Schedule 17 to the Pensions Act 2014” (inserted by Schedule 17 to this Act) insert “ or paragraph 3 of Schedule 18 to that Act ”.

11

(1) Section 16 of the Pensions Act 2008 (automatic enrolment: qualifying schemes) is amended as follows.

(2) In subsection (3), omit paragraphs (a), (aa) and (ab).

(3) After subsection (3) insert—

(3A) See also paragraphs 1(4) and 2(4) of Schedule 18 to the Pensions Act 2014, which confer power to make regulations providing for a scheme not to be a qualifying scheme in relation to a jobholder in certain circumstances.

(4) Omit subsections (4) and (5).

12

In consequence of the amendments made by paragraph 11, section 10 of the Pensions Act 2011 (qualifying schemes: administration charges) is repealed.

SCHEDULE 19

Pensions Act 1995 (c. 26)

1

The Pensions Act 1995 is amended as follows.

2

In section 6 (removal or suspension of trustees: consequences)—

(a) in subsections (1) and (3), after “section 3” insert “ or 3A ”;

(b) in subsection (4), after “section 3” insert “ , 3A ”.

3

In section 7 (appointment of trustees), in subsection (1), after “section 3,” insert “ by section 3A ”.

4

In section 9 (removal and appointment of trustees: property), after “a trustee” insert “ or a trustee is removed under section 3A ”.

Pensions Act 2004 (c. 35)

5

The Pensions Act 2004 is amended as follows.

6

In section 10 (functions exercisable by the Determinations Panel), in subsection (6), after paragraph (e) insert—

(ea) section 3A(3) of that Act (application for waiver of prohibition);

7

In section 66 (register of prohibited trustees), in subsection (1), for the words from “of all” to the end substitute “(“the prohibition register”) of—

(a) all persons who are prohibited under section 3 of the Pensions Act 1995, and (b) all persons appearing to the Regulator to be prohibited under section 3A of that Act.

8

In section 96 (Pensions Regulator's regulatory functions: standard procedure), in subsection (6), after paragraph (i) insert—

(ia) the power under section 3A(3) of that Act to give a notice waiving a prohibition;

9

In section 97 (Pensions Regulator's regulatory functions: special procedure), in subsection (5), after paragraph (j) insert—

(ja) the power under section 3A(3) of that Act to give a notice waiving a prohibition;

10

(1) Schedule 2 (Pensions Regulator's reserved regulatory functions) is amended as follows.

(2) After paragraph 5 insert—

(5A) The power under section 3A(3) to give a notice waiving a prohibition.

(3) In paragraph 9(a), after “orders)” insert “ or by section 3A ”.

SCHEDULE 20

Part 1 — The new compensation cap

1

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part 2 — Consequential amendments

4

The Pensions Act 2004 is amended as follows.

5

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6

(1) Schedule 7 is amended as follows.

(2) In paragraph 24(2), at the end insert “ of the periodic compensation at that time ”.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part 3 — Effect of change in transitional cases

Recalculation of periodic compensation going forwards

8

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

New cap does not generally affect old payments

9

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Survivors’ compensation

10

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cases involving early payment or postponement of compensation

11

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Recalculation of terminal illness lump sums given in the past year

12

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Meaning of “the pension compensation provisions” in Part 2 of the Pensions Act 2004

13

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part 4 — Schemes undergoing assessment or winding up on the commencement date

Schemes undergoing assessment on the commencement date

14

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Schemes that begin winding up before the commencement date

15

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Meaning of “undergoing assessment”

16

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Meaning of “eligible scheme”

17

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part 5 — Interpretation and power to make further transitional provision

Interpretation

18

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Further transitional provision

20

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

21

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

22

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Entitlement to state pension at full or reduced rate

Recalculation and backdating of transitional rate in special cases

Section 17 supplementary: calculating weeks, overseas residents, etc

Shared state pension on divorce etc

Overseas residents

Option to boost old retirement pensions

Increase in pensionable age to 67

State pension credit: phasing out assessed income periods

Automatic re-enrolment: exceptions where automatic enrolment deferred

Alternative quality requirements for UK defined benefits schemes

Automatic enrolment: transitional period for hybrid schemes

Unpaid scheme contributions

Preparation of guidance for pensions illustrations

Regulations and orders

Power to make consequential amendments etc

Regulations and orders

How to calculate the amount for pre-commencement qualifying years

Step 1: calculation of the person's pension under the old system

Step 2: calculation of a pension based on the new system

Step 4: revaluation

Introduction

Dead spouse or civil partner in old state pension system etc

Dead spouse or civil partner in new state pension system

Supplementary

Introduction

Reading this document does not replace reading the official text published on legislation.gov.uk. Contains public sector information licensed under the Open Government Licence v3.0. We assume no responsibility for any inaccuracies arising from the conversion of the original CLML XML to this format.

This text is published under legislation.gov.uk's own terms of reuse, not a Legalize or public-domain licence. legislation.gov.uk
Open Government Licence v3.0 (attribution required)
© Crown and database right. Derived from content available under the Open Government Licence v3.0 from legislation.gov.uk.

Pensions Act 2014

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

39

40

41

42

43

44

45

46

47

Part 2 — Other Acts: amendments

Social Security Contributions and Benefits Act 1992 (c. 4)

48

49

50

51

52

53

54

Social Security Administration Act 1992 (c. 5)

55

56

57

Pensions Act 1995 (c. 26)

58

59

60

61

62

63

65

Employment Rights Act 1996 (c. 18)

66

67

68

Child Support, Pensions and Social Security Act 2000 (c. 19)

69

70

71

Employment Act 2002 (c. 22)

72

Pensions Act 2004 (c. 35)

73

Companies Act 2006 (c. 46)

74

75

76

Pensions Act 2007 (c. 22)

77

78

79

80

Pensions Act 2008 (c. 30)

81

82