The Police Pensions (Additional Voluntary Contributions) Regulations 1991

Made: 4th June 1991

Laid before Parliament: 10th June 1991

Coming into force: 1st July 1991

In exercise of the powers conferred on me by sections 1 to 7 of the Police Pensions Act 1976[^f00001], and after consultation with the Police Negotiating Board for the United Kingdom, I hereby with the consent of the Treasury[^f00002] make the following Regulations:

Citation and commencement

1

These Regulations may be cited as the Police Pensions (Additional Voluntary Contributions) Regulations 1991, and shall come into force on 1st July 1991 but have effect as from 6th April 1990.

Interpretation

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• (1) In these Regulations, unless the context otherwise requires, any reference to a numbered regulation or Schedule is to be construed as a reference to the regulation or Schedule which bears that number in these Regulations, and any reference to a numbered paragraph in a regulation of or a Schedule to these Regulations is to be construed as a reference to the paragraph bearing that number in that regulation or, as the case may be, that Schedule.

• (2) In these Regulations references to the Taxes Act are references to the Income and Corporation Taxes Act 1988[^f00003] , references to the 1999 Act are references to the Welfare Reform and Pensions Act 1999 and references to the 1987 Regulations are references to the Police Pensions Regulations 1987[^f00004].

• (3) In these Regulations, unless the context otherwise requires—

• “the 1993 Act” means the Pension Schemes Act 1993;

• “the 1999 Act” means the Welfare Reform and Pensions Act 1999;

• “the 2014 Act” means the Taxation of Pensions Act 2014;

• “the 2009 Regulations” means the Registered Pension Schemes (Authorised Payments) Regulations 2009;

• “approved additional voluntary contributions provider” means The Equitable Life Assurance Society Utmost Life and Pensions Limited or The Standard Life Assurance Company , The Standard Life Assurance Company or Utmost Life and Pensions Limited;

• ...

• “the AVC scheme” means the occupational pension scheme (within the meaning of section 1 of the Pension Schemes Act 1993) established under section 1 of the Police Pensions Act 1976 and these Regulations;

• “basic contributions” means contributions paid pursuant to an election under regulation 4(1);

• “basic contributor” is to be construed in accordance with regulation 7;

• “cash equivalent” means a cash equivalent mentioned in paragraph 12(1) of Schedule 1A to the Social Security Pensions Act 1975[^f00005];

• “central police officer” has the same meaning as in the 1987 Regulations;

• “death benefit contributions” means contributions paid pursuant to an election under regulation 5(1);

• “death benefit contributor” is to be construed in accordance with regulation 7;

• “death benefit cover” is to be construed in accordance with regulation 5(1);

• “earnings” and “emoluments” mean earnings and emoluments in respect of service as a pensionable policeman, disregarding, except where regulation 3 or 5 of the Retirement Benefit Schemes (Tax Relief on Contributions) (Disapplication of Earnings Cap) Regulations 1990[^f00006] applies, any excess in any tax year over the figure which is the permitted maximum for that year for the purposes of section 592(8B) of the Taxes Act[^f00007] (that is to say, the figure specified for the year by an order made by the Treasury under section 590C(6) of that Act);

• “free-standing additional voluntary contributions scheme” means an approved scheme which falls within section 591(2)(h) of the Taxes Act;

• “the Index” means the index of retail prices published by the Department of Employment;

• “insurance company” means—a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to effect or carry out contracts of long-term insurance, ......

• “normal benefit age” means 60;

• “overseas policeman” has the same meaning as in the 1987 Regulations;

• “participator” means a basic contributor or a person who has ceased to be a basic contributor but has not exercised any right to take a cash equivalent or to be paid a lump sum under regulation 14(1);

• “pension credit” means a credit under section 29(1)(b) of the 1999 Act or under corresponding Northern Ireland legislation;

• “pension credit” means a credit under section 29(1)(b) of the 1999 Act, including a credit under corresponding Northern Ireland legislation;

• “pension credit benefits” means in relation to the AVC Scheme the benefits payable under that Scheme which are attributable (directly or indirectly) to a pension credit;

• “pension credit member” means a person who has rights under the AVC Scheme which are attributable (directly or indirectly) to a pension credit either solely or wholly separately from any other rights under the AVC Scheme;

• “pension credit member” has the meaning given by section 124(1) of the Pensions Act 1995;

• “pension credit rights” has the meaning given by section 101B of the 1993 Act;

• “pension debit” means a debit under section 29(1)(a) of the 1999 Act or under corresponding Northern Ireland legislation;

• “pension debit member” means a person who has rights under the AVC Scheme and whose shareable rights under that Scheme are subject to a pension debit;

• “pension investments” means investments made under regulations 9(1) and 10(2);

• “pension sharing order” means a pension sharing order or other provision referred to in section 28(1) of the 1999 Act or Article 25(1) of the Welfare Reform and Pensions (Northern Ireland) Order 1999;

• “pension sharing order” means an order or provision mentioned in section 28(1) of the 1999 Act;

• “pensionable policemean” means a person by whom contributions are for the time being payable under regulation G2 of the 1987 Regulations;

• “pension provider” means a body listed in schedule 1,

• “Police Pensions Scheme” means the Police Pensions Scheme, the rules of which are set out in the Police Pensions Regulations 1987;

• “registered pension scheme” means a scheme registered under section 153 of the Finance Act 2004;

• “relevant police pension authority” has the meaning given by regulation L1(4) of the Police Pensions Regulations 1987;

• “retire” means become entitled to payment of a pension or gratuity under regulations B1 to B5 of the 1987 Regulations, and cognate expressions are to be construed accordingly;

• “shareable rights” means any rights a person has under the AVC Scheme except those rights referred to in regulation 2 of the Pension Sharing (Valuation) Regulations 2000;

• ... and

• “tax year” means the 12 months beginning with 6th April in any year.

• (4) The definition of “insurance company” in paragraph (3) must be read with—

• (a) section 22 of the Financial Services and Markets Act 2000,

• (b) any relevant order under that section, and

• (c) Schedule 2 to that Act.

• (4) The definition of “insurance company” in paragraph (3) must be read with–

• (a) section 22 (the classes of activity and categories of investment) of the Financial Services and Markets Act 2000,

• (b) any relevant order under that section, and

• (c) Schedule 2 to that Act.

Making and acceptance of elections

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• (1) Any election under these Regulations—

• (a) is to be made by giving written notice to the police authority police pension authority, and

• (b) is, subject to paragraphs (2) to (4), to be accepted by the authority.

• (2) No election under these Regulations is to be accepted if any limit imposed by regulation 8(4) (payment and amount of contributions) would be exceeded.

• (2A) No election under regulation 4(1) (payment of basic contributions) or 5(1) (payment of death benefit contributions) made on or after 1st October 2010 is to be accepted.

• (2B) No election under regulation 6(1)(a) (alteration of amount of basic contributions) or 6(2)(a) (alteration of amount to be secured by death benefit contributions) made on or after 1st October 2010 is to be accepted if it would have the effect of increasing the amount of the basic contributions or the amount to be secured by the death benefit contributions, as the case may be.

• (2A) No election under regulation 4(1) (election to pay basic contributions) or 5(1) (elections in respect of death benefit cover) made on or after 1st October 2010 is to be accepted.

• (2B) No election under regulation 6(1)(a) (election to alter amount of basic contributions) or regulation 6(2)(a) or 6(3) (elections to alter amount to be secured by death benefit contributions) made on or after 1st October 2010 is to be accepted if it would have the effect of increasing the amount of the basic contributions or the amount to be secured by the death benefit contributions, as the case may be.

• (3) An election falling within regulation 16(2) (death benefit cover, continued death benefit cover and increased death benefit cover) is not to be accepted if—

• (a) any information required under regulation 16(2) is not given, or

• (b) the information given is such that the cover could not be secured by investment under regulation 9(3).

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

• (5) The police authority police pension authority are to give effect as soon as is reasonably practicable to any election accepted by them.

Election to pay basic contributions

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• (1) A pensionable policeman may at any time before 1st October 2010 elect to pay basic contributions under these Regulations.

• (2) The notice of such an election is to specify—

• (a) the amount of each contribution, and

• (b) the way in which the contributions are to be invested under regulation 9.

Elections in respect of death benefit cover

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• (1) A pensionable policeman may at any time before 1st October 2010 elect to pay death benefit contributions to secure death benefit cover, that is to say the payment of a lump sum in the event of his dying in the circumstances specified in paragraph (2).

• (2) The circumstances are that—

• (a) at the time of his death he is still a death benefit contributor, and

• (b) his death occurs before his retirement date and is not the result of an injury received in the execution of his duty (within the meaning of regulation A11 of the 1987 Regulations).

• (3) A pensionable policeman’s retirement date is the date on which he would be required by regulation A18(1) of the 1987 Regulations to retire assuming that there were no postponement under regulation A18(2) and no change of rank.

• (4) The notice of an election under paragraph (1) is to specify the approved additional voluntary contributions provider with which the contributions are to be invested and the amount to be secured ....

• (5) An election under paragraph (1) ceases to have effect on the person’s retirement date, but if the time at which he is required by regulation A18(1) of the 1987 Regulations to retire becomes later by reason of—

• (a) his being promoted, or

• (b) a postponement under regulation A18(2),

• he may elect to pay further contributions to secure the continuance to the later date of he death benefit cover in force immediately before the change.

• (6) Any continued death benefit cover secured by an election under paragraph (5) lapses if the person retires before the date to which the cover was continued.

Variation and cancellation of elections

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• (1) Subject to paragraph (4), a basic contributor may at any time elect—

• (a) to alter the amount of his basic contributions, or

• (b) to require them to be invested in future, under regulation 9, in a different way, or

• (c) to require the police authority police pension authority to realise any investment and to reinvest the proceeds, under regulation 9, in a different way, or

• (d) to cancel his election under regulation 4(1).

• (2) Subject to paragraph (4), a death benefit contributor may at any time elect—

• (a) to alter the approved additional voluntary contributions provider with which the contributions are to be invested and the amount to be secured ..., or

• (b) to cancel his election under regulation 5(1).

• (3) Subject to paragraph (4), a person paying further contributions under regulation 5(5) (continuance of death benefit cover during service after retirement age) may at any time make any election that he could have made under paragraph (2)(a) above if he had been paying death benefit contributions.

• (4) An election may not be made under any of the preceding paragraphs of this regulation on or after 1st October 2010 if it would have the effect of increasing the amount of the basic contributions or the amount to be secured by the death benefit contributions, as the case may be.

Basic and death benefit contributors

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• (1) Subject to paragraph (3), a person is a basic contributor while an election under regulation 4(1) (regular contributions) has effect.

• (2) Subject to paragraph (3), a person is a death benefit contributor while an election under regulation 5(1) has effect.

• (3) A person who has ceased to be a pensionable policeman ceases to be either a basic contributor or a death benefit contributor.

Payment and amount of contributions

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• (1) Basic contributions are payable to the police authority police pension authority at intervals of not less than 4 weeks.

• (2) Death benefit contributions and further contributions under regulation 5(5) (continuance of death benefit cover) are payable to the police authority police pension authority at the same times as basic contributions.

• (3) All contributions are to be deducted by the police authority police pension authority from the person’s pay.

• (4) The total of the contributions of all kinds paid in any tax year must not exceed the lesser of (A-B-C) and D, where—

• A is 15 per cent of the person’s emoluments for that year,

• B is the total of any contributions paid by him in the year to a registered pension scheme,

• C is the total of the contributions paid by him in the year under the 1987 Regulations, and

• D is the amount which would provide the maximum allowable benefits.

• (5) The maximum allowable benefits are the maximum amount that can be secured having regard to regulations 5(4) and 6(2)(a).

• (5) The maximum allowable benefits are the maximum amount that can be secured in accordance with regulations 5(4) and 6(2)(a).

Investment of contributions

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• (1) Basic contributions are to be invested by the police authority police pension authority in accordance with any election for the time being having effect under regulation 4(1) or 6(1)(b) or (c).

• (2) In paragraph (1) “invested” means invested with such approved additional voluntary contributions providers and in such investments managed by those providers as may be selected by the basic contributor with such approved additional voluntary contributions provider and in such investments managed by such provider as may be selected by the basic contributor.

• (3) Death benefit contributions and further contributions under regulation 5(5) are to be invested by the police authority police pension authority with the approved additional voluntary contributions provider selected by the death benefit contributor with an approved additional voluntary contributions provider selected by the death benefit contributor so as to secure death benefit cover of the amount required by any election for the time being having effect under regulation 5(1) or (5) or 6(2) or (3).

Inward transfers

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• (1) At any time before 1st October 2010, a police authority police pension authority may accept a transfer value from the administrator of—

• (a) a free-standing additional voluntary contributions scheme, or

• (b) a registered pension scheme which provides additional benefits but does not fall within section 591(2)(h) of the Taxes Act,

in respect of a basic contributor except if or to the extent that the transfer value relates to pension credit rights.

• (2) A transfer value accepted by a police pension authority is to be invested by them with such approved additional voluntary contribution providers and in such investments managed by those providers as may be specified in writing by the basic contributor.

• (2) A transfer value accepted by a police authority is to be invested by them with an approved additional voluntary contributions provider and in such investments managed by such provider such as may be specified in writing by the basic contributor.

Retirement pensions

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• (1) A participator may apply some or all of the proceeds of an investment made under regulation 9 to arrange with a pension provider—

• (a) payment of a lifetime annuity;

• (b) payment of a lifetime annuity and a pension commencement lump sum;

• (c) a lump sum commutation payment that—

• (i) reflects the value of benefits referred to in sub-paragraph (a) or (b); and

• (ii) meets the requirements of regulations 11 and 12 of the 2009 Regulations;

• (d) any payment to the participator that complies with the requirements of the 2014 Act.

• (2) Paragraph (1) is subject to paragraphs (10) to (13).

• (3) Subject to paragraphs (4) and (5), the approved additional voluntary contributions provider must provide a participator with an option to receive benefits under paragraph (1)(a) to (c).

• (4) Any annuity payable in accordance with paragraph (1)(a) or (b) must—

• (a) be incapable, in whole or in part, of surrender, assignation or commutation;

• (b) commence not earlier than the participator’s normal minimum pension age (within the meaning of section 279(1) of the Finance Act 2004);

• (c) be payable to the participator for life.

• (5) A lump sum commutation payment referred to in paragraph (1)(c) may be paid in respect of benefits payable under paragraph (1)(a), (b) or (d).