Pension Schemes Act 2015

(96A) Except as mentioned in sections 92(4) and 97G(4), a pension scheme may not contain rules that would have the effect of— (a) preventing a member from exercising a right under this Chapter in relation to a category of benefits without also exercising a right under this Chapter or otherwise to require a transfer payment to be made in respect of another category of benefits, or (b) preventing a member who exercises a right under this Chapter in relation to a category of benefits from accruing rights to benefits in another category. (96B) (1) In this Chapter references to the scheme rules, in relation to a pension scheme, are references to— (a) the rules of the scheme, except so far as overridden by a relevant legislative provision, (b) the relevant legislative provisions, to the extent that they have effect in relation to the scheme and are not reflected in the rules of the scheme, and (c) any provision which the rules of the scheme do not contain but which the scheme must contain if it is to conform with the requirements of Chapter 1 of Part 4. (2) For the purposes of subsection (1)— (a) “relevant legislative provision” means any provision contained in any of the following provisions— (i) Schedule 5 to the Social Security (Northern Ireland) Order 1989; (ii) Chapter 2 or 3 of Part 4 or regulations made under either of those Chapters; (iii) this Part or regulations made under this Part; (iv) Part 4A or regulations made under that Part; (v) section 106(1); (vi) Part 2 of the Pensions (Northern Ireland) Order 1995 or orders or regulations made or having effect as if made under that Part; (vii) Article 28 of the Welfare Reform and Pensions (Northern Ireland) Order 1999; (viii) any provision mentioned in Article 279(2) of the Pensions (Northern Ireland) Order 2005; (ix) section 61 of the Pension Schemes Act 2015; (x) regulations made under section 62 or 63 of the Pension Schemes Act 2015; (b) a relevant legislative provision is to be taken to override any of the provisions of the scheme if, and only if, it does so by virtue of any of the following provisions— (i) paragraph 3 of Schedule 5 to the Social Security (Northern Ireland) Order 1989; (ii) section 125(1); (iii) Article 114(1) of the Pensions (Northern Ireland) Order 1995; (iv) Article 28(4) of the Welfare Reform and Pensions (Northern Ireland) Order 1999; (v) Article 279(1) of the Pensions (Northern Ireland) Order 2005; (vi) section 61(3) of the Pension Schemes Act 2015; (vii) regulations made under section 62(4) or 63(4) of the Pension Schemes Act 2015. (96C) (1) In this Chapter “normal pension age”, in relation to a category of benefits under a pension scheme, means— (a) in a case where the scheme is an occupational pension scheme and those benefits consist only of a guaranteed minimum pension, the earliest age at which the member is entitled to receive the guaranteed minimum pension on retirement from any employment to which the scheme applies, (b) in any other case where the scheme is an occupational pension scheme and the scheme provides for the member to become entitled to receive any of those benefits at a particular age on retirement from any employment to which the scheme applies, the earliest age at which the member becomes entitled to receive any of the benefits, and (c) in a case not falling within paragraph (a) or (b), normal minimum pension age as defined by section 279(1) of the Finance Act 2004. (2) For the purposes of subsection (1) any scheme rule making special provision as to early retirement on grounds of ill-health or otherwise is to be disregarded. (96D) In this Chapter— - “accrued rights”, in relation to a member of a pension scheme, means rights that have accrued to or in respect of the member to benefits under the scheme; - “category”, in relation to benefits, has the meaning given by section 89(6); - “flexible benefit” has the meaning given by section 74 of the Pension Schemes Act 2015; - “guarantee date”, in relation to a member who has received a statement of entitlement, has the meaning given by section 89A; - “member” is to be read in accordance with section 89(11); - “normal pension age” has the meaning given by section 96C; - “pension credit rights”, in relation to a member of a pension scheme, means rights to benefits under the scheme which are attributable (directly or indirectly) to a pension credit; - “salary related occupational pension scheme”: an occupational pension scheme is “salary related” if— 1. the scheme is not a scheme under which all the benefits that may be provided are money purchase benefits, and 2. the scheme does not fall within a prescribed class; - “scheme rules”, in relation to a pension scheme, has the meaning given by section 96B; - “statement of entitlement” has the meaning given by section 89A; - “transferrable rights” is to be read in accordance with section 89(11).

61

• (1) Section 97F (power to give transfer notice) is amended as follows.

• (2) In subsection (1), for “pension credit benefit” substitute “ pension credit rights ”.

• (3) After subsection (3) insert—

(3A) An eligible member who has pension credit rights in relation to more than one category of benefits under the scheme may exercise the power to give a transfer notice in relation to the pension credit rights in relation to any one or more of those categories.

• (4) For subsection (4) substitute—

(4) The cash equivalent for the purposes of subsection (1) shall— (a) in a case where the pension credit rights relate to a category of benefits other than money purchase benefits, be taken to be the amount shown in the relevant statement under section 97H, and (b) in a case where the pension credit rights relate to money purchase benefits, be determined by reference to the date the notice under that subsection is given.

• (5) For subsection (6A) substitute—

(6A) Regulations may— (a) provide for this Chapter not to apply in relation to a person of a prescribed description; (b) provide for this Chapter not to apply in prescribed circumstances in relation to a member of a prescribed scheme or schemes of a prescribed description; (c) modify the application of this Chapter in relation to a member who has accrued rights to benefits of a prescribed description. (6B) In this Chapter a reference to a “category” of benefits is to one of the following three categories— (a) money purchase benefits; (b) flexible benefits other than money purchase benefits; (c) benefits that are not flexible benefits.

62

For section 97G (restrictions on power to give transfer notice) substitute—

(97G) (1) An eligible member may not give a transfer notice in relation to a category of benefits if a crystallisation event has occurred in relation to any of the member's pension credit rights to benefits in that category. (2) An eligible member may give a transfer notice in relation to a category of benefits other than money purchase benefits only if— (a) the member has been provided with a statement under section 97H in relation to benefits in that category, and (b) not more than 3 months have passed since the date by reference to which the amount shown in the statement is determined. (3) An eligible member may not give a transfer notice in relation to benefits other than flexible benefits if there is less than one year to go until the member reaches normal benefit age. (4) Where an eligible member of a qualifying scheme— (a) is entitled to give a transfer notice in relation to any category of benefits, and (b) is also entitled to make an application to the trustees or managers of the scheme under section 91(1) in relation to benefits in the same category (or would be entitled to do so but for section 91(1A)(a)), the member may not, if the scheme so provides, give a transfer notice in relation to that category of benefits without also making an application under section 91(1) in relation to that category of benefits. (5) A transfer notice may not be given if a previous transfer notice given by the member to the trustees or managers of the scheme is outstanding. (6) Regulations may extend the period specified in subsection (2)(b) in prescribed circumstances. (7) For the purposes of subsection (1) a crystallisation event occurs in relation to a member's pension credit rights to benefits in a category when— (a) payment of a pension in respect of any of the benefits has begun, (b) in the case of money purchase benefits, sums or assets held for the purpose of providing any of the benefits are designated as available for the payment of drawdown pension (as defined by paragraph 4 of Schedule 28 to the Finance Act 2004), or (c) in the case of a personal pension scheme, sums or assets held for the purpose of providing any of the benefits are applied for purchasing an annuity or insurance policy.

63

• (1) Section 97H (salary related schemes: statements of entitlement) is amended as follows.

• (2) For subsection (1) substitute—

(1) The trustees or managers of a qualifying scheme must, on the application of an eligible member, provide the member with a written statement of the amount of the cash equivalent of the member's pension credit rights in relation to categories of benefits other than money purchase benefits. (1A) In the case of a member with pension credit rights in relation to two categories of benefits other than money purchase benefits, the application may relate to pension credit rights in relation to either or both of those categories.

• (3) In the heading for “Salary related schemes” substitute “ Benefits other than money purchase ”.

64

• (1) Section 97J (time for compliance with transfer notice) is amended as follows.

• (2) In subsection (1), for paragraphs (a) and (b) substitute—

(a) in the case of an application that relates to benefits other than money purchase benefits, within 6 months beginning with the valuation date, and (b) in the case of an application that relates to money purchase benefits, within 6 months of the date on which the notice is given.

• (3) After subsection (2) insert—

(2A) Regulations may extend the period for complying with the notice in prescribed circumstances.

• (4) For subsection (7) substitute—

(7) In subsection (1)(a), “valuation date” means the date by reference to which the amount shown in the relevant statement under section 97H is determined.

65

In section 97M (effect of transfer on trustees' duties), for the words from “pension credit benefit” to the end of the section substitute “ benefits to which the transfer notice relates ”.

66

After section 97N insert—

(97NA) Except as mentioned in sections 92(4) and 97G(4), a pension scheme may not contain rules that would have the effect of— (a) preventing a member from exercising a right under this Chapter in relation to a category of benefits without also exercising a right under this Chapter or otherwise to require a transfer payment to be made in respect of another category of benefits, or (b) preventing a member who exercises a right under this Chapter in relation to a category of benefits from accruing rights to benefits in another category.

67

• (1) Section 97P (interpretation) is amended as follows.

• (2) In subsection (1), at the appropriate places insert—

“category”, in relation to benefits, has the meaning given by section 97F(6B);

“flexible benefit” has the meaning given by section 74 of the Pension Schemes Act 2015;

.

• (3) In that subsection, omit the definition of “pension credit benefit”.

• (4) Omit subsection (2).

• (5) In subsection (3), for “given to the trustees or managers of a salary related occupational pension scheme” substitute “ in relation to benefits other than money purchase benefits ”.”

68

Omit section 97Q.

69

In section 125 (overriding requirements), in subsection (1), for “Chapters II, III, IV and V of Part IV” substitute “ Chapters 2 and 3 of Part 4, Chapters 1 and 2 of Part 4ZA ”.

70

In section 126 (extra-statutory benefits), in paragraph (b), for “Chapter II, IV or V of Part IV” substitute “ Chapter 2 of Part 4 or Chapter 1 or 2 of Part 4ZA ”.

71

In section 149 (power to modify certain provisions), in subsection (1), for “Chapters II, III and IV of Part IV” substitute “ Chapters 2 and 3 of Part 4 and Chapter 1 of Part 4ZA ”.

72

In section 174 (linked qualifying service), in subsection (1)(a)—

• (a) in the opening words, for “Chapter 4 or 5 of Part IV” substitute “ Chapter 1 or 2 of Part 4ZA ”;

• (b) in sub-paragraph (iii)—

• (i) for “Chapter 4 of Part IV” substitute “ Chapter 1 of Part 4ZA ”;

• (ii) for “Chapter 5” substitute “ Chapter 2 ”.

73

In section 176 (interpretation), in subsection (1), in paragraph (b) of the definition of “transfer credits”, for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

Pensions (Northern Ireland) Order 1995 (S.I. 1995/3213 (N.I. 22))

74

The Pensions (Northern Ireland) Order 1995 is amended as follows.

75

In Article 67A (the subsisting rights provisions: interpretation), in paragraph (9)(a), for head (ii) substitute—

(ii) Chapter 2 or 3 of Part 4 of the Pension Schemes Act (certain protection for early leavers) or regulations made under either of those Chapters; (iia) Chapter 1 or 2 of Part 4ZA of that Act (transfers and contribution refunds) or regulations made under either of those Chapters;

.

76

In Article 73 (preferential liabilities on winding up), in paragraph (9), for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

77

In Article 73B (Article 73 and 73A: supplementary), in paragraph (7), for “Chapter 4 of Part IV” substitute “ Chapter 1 of Part 4ZA ”.

78

In Article 121 (interpretation of Part 2), in paragraph (1), in paragraph (b) of the definition of “transfer credits”, for “Chapter 5 of Part IV of the Pension Schemes Act (early leavers)” substitute “ Chapter 2 of Part 4ZA of the Pension Schemes Act (transfers and contribution refunds) ”.

Pensions (Northern Ireland) Order 2005 (S.I. 2005/255 (N.I. 1))

79

The Pensions (Northern Ireland) Order 2005 is amended as follows.

80

• (1) Article 2 (interpretation) is amended as follows.

• (2) In paragraph (3), for “an occupational pension scheme” substitute “ a pension scheme ”.

• (3) In paragraph (4)(a), for head (ii) substitute—

(ii) Chapter 2 or 3 of Part 4 of the Pension Schemes Act (certain protection for early leavers) or regulations made under either of those Chapters; (iia) Chapter 1 or 2 of Part 4ZA of that Act (transfers and contribution refunds) or regulations made under either of those Chapters;

.

81

• (1) Article 14 (pension liberation: interpretation) is amended as follows.

• (2) In paragraph (2)(a)—

• (a) after “accrued rights” insert “ or an entitlement ”;

• (b) in head (ii), for “the applicable rules” substitute “ the scheme rules ”.

• (3) In paragraph (3)—

• (a) for sub-paragraph (a) substitute—

(a) section 90 of the Pension Schemes Act (right to cash equivalent under Chapter 1 of Part 4ZA of that Act);

;

• (b) in sub-paragraph (b), for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

• (4) In paragraph (4)(d), for “the applicable rules” substitute “ the scheme rules ”.

• (5) Omit paragraph (5).

82

In Article 19 (freezing orders), in paragraph (4)(g), for “salary related schemes” substitute “ benefits other than money purchase ”.

83

In Article 20 (consequences of freezing order), in paragraph (7), for sub-paragraphs (a) and (b) substitute—

(a) Chapter 1 of Part 4ZA of the Pension Schemes Act (transfer rights: general), or (b) Chapter 2 of that Part (early leavers: cash transfer sums and contribution refunds),

.

84

In Article 68 (inspection of premises), in paragraph (2)(d)—

• (a) for “Chapter 4 of Part IV” substitute “ Chapter 1 of Part 4ZA ”;

• (b) for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

85

In Article 119 (restrictions on winding up, discharge of liabilities etc.), in paragraph (6)(b), for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

86

In Article 122 (payment of scheme benefits), in paragraph (3)(b), for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

87

• (1) Schedule 6 (pension compensation provisions) is amended as follows.

• (2) In paragraph 20(1)(c), for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

• (3) In paragraph 32(1)(b), for “Chapter 5 of Part IV” substitute “ Chapter 2 of Part 4ZA ”.

SCHEDULE 5

Pensions (Increase) Act 1971 (c. 56)

1

The Pensions (Increase) Act 1971 is amended as follows.

2

In section 19(2)(a) (extent to Northern Ireland)—

• (a) after “or section” insert “ 18A or ”;

• (b) after “section 10 of that Act” insert “ or provision made under section 18A of that Act that is corresponding or similar to the provision that may be made by regulations under section 10 of that Act ”.

3

In Schedule 2 (official pensions), after paragraph 4A insert—

(4AA) A pension payable under a scheme made under section 18A of the Judicial Pensions and Retirement Act 1993, other than a pension payable under or by virtue of provision that is corresponding or similar to the provision that may be made by regulations under section 10 of that Act.

Judicial Pensions and Retirement Act 1993 (c. 8)

4

The Judicial Pensions and Retirement Act 1993 is amended as follows.

5

In section 22 (application of the Pensions (Increase) Act 1971 to Northern Ireland), in subsection (2)—

• (a) after “shall include” insert

— (a)

;

• (b) at the end insert

; and (b) pensions payable under a scheme made under section 18A above, other than pensions payable under or by virtue of provision that is corresponding or similar to the provision that may be made by regulations under section 10 above.

6

• (1) Section 28 (funding arrangements) is amended as follows.

• (2) In subsection (2) (benefits payable out of money provided by Parliament), after paragraph (a) (but before the “and” at the end) insert—

(aa) any pension or other benefits payable under a scheme made under section 18A above,

.

• (3) In subsection (7), for “section 10 above” substitute

— (a) section 10 above, or (b) provision made under section 18A above that is corresponding or similar to the provision that may be made by regulations under section 10 above.

7

In section 28A (contributions in respect of Northern Ireland judges), at the end insert “ or as a fee-paid judge in Northern Ireland (within the meaning given by section 18A) ”.

8

• (1) Section 29 (regulations and orders) is amended as follows.

• (2) In subsection (2), after “other than” insert “ regulations under section 18A above or ”.

• (3) After subsection (2) insert—

(2A) A statutory instrument which contains regulations under section 18A may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

Introduction

Pensions promise obtained from third party

Extension of preservation of benefit under occupational pension schemes

Pensions guidance

Power to require employer to arrange advice for purposes of section 51

Independent advice: consequential amendments: Northern Ireland

Independent advice: income tax exemption

Restriction on payment of lump sums during PPF assessment period: Great Britain

Sections 55 to 57: consequential amendments

Restriction on payment of lump sums during PPF assessment period: Northern Ireland

Sections 61 to 63: consequential amendments

Reduction of cash equivalents: funded public service defined benefits schemes: Great Britain

Sections 68 and 69: consequential amendments

Restriction on transfers out of unfunded public service defined benefits schemes: Northern Ireland

Reduction of cash equivalents: funded public service defined benefits schemes: Northern Ireland

Sections 71 and 72: consequential amendments

Meaning of “flexible benefit”

Payments into Remploy Limited Pension and Assurance Scheme

Judicial pensions: pension sharing on divorce etc

Public service pension schemes

Regulations

Power to make consequential amendments

Pension Schemes Act 1993 (c. 48)

Pensions Act 1995 (c. 26)

Welfare Reform and Pensions Act 1999 (c. 30)

Financial Services and Markets Act 2000 (c. 8)

Pensions Act 2004 (c. 35)

Pensions Act 2008 (c. 30)

Pensions Act 2014 (c. 19)

Judicial Pensions Act 1981 (c. 20)

Judicial Pensions and Retirement Act 1993 (c. 8)

Pension Schemes Act 1993 (c. 48)

Pensions Act 1995 (c. 26)

Learning and Skills Act 2000 (c. 21)

Pensions Act 2004 (c. 35)

Scottish Parliamentary Pensions Act 2009 (asp 1)

Pensions Act 2014 (c. 19)

Judicial Pensions Act 1981 (c. 20)

Judicial Pensions and Retirement Act 1993 (c. 8)

Pension Schemes (Northern Ireland) Act 1993 (c. 49)

Pensions (Northern Ireland) Order 1995 (S.I. 1995/3213 (N.I. 22))

Pensions (Northern Ireland) Order 2005 (S.I. 2005/255 (N.I. 1))

Pensions (Increase) Act 1971 (c. 56)

Judicial Pensions and Retirement Act 1993 (c. 8)

Editorial notes