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The Stakeholder Pension Schemes Regulations 2000

Type Statutory-Instrument

Publication 2000-05-24

Last updated 2022-08-01

State In force

Department King's Printer of Acts of Parliament

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Made: 24th May 2000

Laid before Parliament: 25th May 2000

Coming into force

The Secretary of State for Social Security, in exercise of the powers conferred upon him by the provisions set out in Schedule 1 and of all other powers enabling him in that behalf, after consultation with such persons as he considers appropriate, hereby makes the following Regulations:—

PART I — GENERAL

Citation, commencement and interpretation

1

(1) These Regulations may be cited as the Stakeholder Pension Schemes Regulations 2000.

(2) Parts I to III and V of these Regulations shall come into force on 1st October 2000 and—

(a) regulation 23 shall come into force on 6th April 2001; and

(b) Part IV (except regulation 23) shall come into force on 8th October 2001.

(3) In these Regulations—

“the Act" means the Welfare Reform and Pensions Act 1999 ;

“the 1993 Act" means the Pension Schemes Act 1993;

“the 1995 Act" means the Pensions Act 1995;

“address” means postal address (except in the phrases “postal address”, “electronic address” and “website address”);

“beneficiary", in relation to a stakeholder pension scheme, means any person who has rights under the scheme which have arisen as a result of the death of a member of the scheme;

“dilution levy” has the meaning given by the FCA Handbook;

“electronic communication” has the same meaning as in section 15(1) of the Electronic Communications Act 2000;

“the FCA Handbook” means the Handbook made by the Financial Conduct Authority under the Financial Services and Markets Act 2000;

‘illustration date’ means, in relation to any information provided, or to be provided, under regulation 18A(2), the date specified by the trustees or manager as the date by reference to which amounts are calculated for the purpose of providing the information;

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

“lifestyling” has the meaning given by regulation 10A(5);

‘non-contributing member’ means—...... a member in respect of whom no further contributions to the scheme are due or expected after the illustration date;

“pension arrangement" means—an annuity contract;an insurance policy; or a qualifying recognised overseas pension scheme as defined in section 169 of the Finance Act 2004;which has effect, or is capable of having effect, so as to provide benefits on termination of employment or on death or retirement, to or in respect of earners;

“property" includes land;

“qualifying scheme" shall, in respect of an employer, include any stakeholder pension scheme which has at any time been designated by the employer under section 3(2);

“relevant guidance” means the document entitled “AS TM1: Statutory Money Purchase Illustrations” that is adopted or prepared, and from time to time revised, by the Financial Reporting Council Limited;

“reporting accountant" has the meaning given to it by regulation 11(3);

‘retirement date’ means, in relation to a member—the date which he has specified to the trustees or manager, and which is acceptable under the rules of the scheme, for the purpose of regulation 18A(2); orwhere no acceptable date has been specified for that purpose, the date specified by the trustees or manager as being the appropriate date for the purpose of regulation 18A(2) ;

“scheme instruments” means instruments establishing a stakeholder pension scheme;

“securities” means investments of the following kinds—shares,instruments creating or acknowledging indebtedness,government and public securities,instruments giving entitlements to investments,certificates representing securities,...;

“statement year” has the meaning given by regulation 18;

“tax relief” has the meaning given by Chapter 4 of Part 4 of the Finance Act 2004 (registered pension schemes: tax reliefs and exemptions);

“transfer payment" means a payment in respect of a person’s accrued rights under a pension scheme or pension arrangement made with a view to acquiring rights under another pension scheme or pension arrangement for that person; and

“with-profits fund" means a fund, maintained by an insurer in respect of a particular part of its long-term business for which—separate accounting records are maintained by the insurer in respect of all income and expenditure relating to that part of its business; andthe benefits payable in respect of policies allocated to that fund are determined partly by reference to a discretion exercisable by any person.

(3A) The definitions of “insurer” and “securities” 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

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

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

(5) Sections 249 and 435 of the Insolvency Act 1986 (connected and associated persons) and section 74 of the Bankruptcy (Scotland) Act 1985 (associated persons), apply for the purposes of regulation 4(3) as they apply for the purposes of those Acts respectively.

(6) For the purposes of these Regulations and section 1(8) and (9) (which provide that stakeholder pension schemes must have tax-exemption or tax-approval and must not refuse to accept transfer payments except in so far as necessary to ensure that the scheme has such exemption or approval) “tax-registration” and “tax-registered” mean registration or, as the case may be, registered under section 153 of the Finance Act 2004.

(7) In these Regulations, unless the context otherwise requires, references to a section are to a section of the Act.

(8) ...

PART II — CONDITIONS APPLYING TO STAKEHOLDER PENSION SCHEMES

Manner of establishment

2

(1) A stakeholder pension scheme may (where not established under a trust) be established by means of one or more instruments in writing which provide for one or more contracts to be entered into between the manager of the scheme and each member of the scheme, or a person acting on his behalf.

(2) The manager of the scheme must be a person who is mentioned in section 154(1)(b) of the Finance Act 2004 (persons by whom registered pension scheme may be established).

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

Requirements applying to all stakeholder pension schemes as regards instruments establishing such schemes

3

(1) Subject to paragraph (2), the scheme instruments must prohibit the acceptance of credits within the meaning of section 29 (pension sharing: creation of pension debits and credits), contributions and transfer payments to the scheme before 6th April 2001.

(2) Paragraph (1) shall not apply to a scheme in respect of which an application for registration under section 2 (registration of stakeholder pension schemes) is first made on or after 6th April 2001.

(3) The scheme instruments must require that no member is required to make any choice as regards the investment under the scheme of any payment made to it by him or on his behalf, any amount credited to the member’s account in respect of a credit within the meaning of section 29 (pension sharing: creation of pension debits and credits), or any income or capital gain arising from the investment of such a payment or credit.

(4) The scheme instruments must, except to the extent permitted under regulations 13, 14 or 14B, prohibit the use of—

(a) any payment made to the scheme by or on behalf of a member;

(b) any amount credited to a member’s account in respect of a credit within the meaning of section 29 (pension sharing: creation of pension debits and credits);

(d) the value of his rights under the scheme,

in any way which does not result in the provision of benefits for or in respect of the member.

(5) The scheme instruments must require that—

(a) if the scheme ceases to be registered under section 2 the winding-up of the scheme be commenced on the date on which it is notified in writing by the ... Authority that it is no longer so registered;

(b) if the trustees or manager fix a time for winding-up a scheme for any reason other than because the scheme ceases to be registered under section 2, the winding-up of the scheme be commenced at the earliest time fixed by the trustees or manager as the time from which steps for the purposes of winding-up are to be taken;

(c) within 2 weeks of the date of commencement of any winding-up, the trustees or manager notify in writing any employers whom they know to have designated the scheme for the purposes of section 3 (duty of employers to facilitate access to stakeholder pension schemes) of the fact of, and the reason for, the winding-up including, where the scheme has ceased to be registered under section 2, the reason for the cessation of registration;

(d) any contributions made to a scheme after the date of commencement of any winding-up must be repaid—

(i) to the member, to the extent of his contributions; and

(ii) as to any remainder, to his employer;

(e) subject to paragraphs (8) and (9) below, on any winding-up all rights under the scheme shall be discharged by the trustees or managers of the scheme within 12 months of the commencement of winding-up, or as soon thereafter as is practicable, by the making of transfer payments—

(i) to other stakeholder pension schemes, or schemes registered under Article 4 of the Welfare Reform and Pensions (Northern Ireland) Order 1999 ; or

(ii) in accordance with requests by one or more members or beneficiaries in respect of their rights, to the trustees or managers of pension schemes or pension arrangements which are not schemes mentioned in head (i) above,

in accordance with paragraphs (6) and (7) below and regulation 6 or, where regulation 7 applies, with regulation 7; and

(f) if the scheme fails to complete winding-up within 12 months of commencing winding-up proceedings, the trustees or manager notify the ... Authority of that fact within one month of so failing to complete the winding-up.

(5A) Subject to paragraph (10) and to regulation 17(1) and (5), except to the extent necessary to ensure that the scheme maintains its tax-registration, the scheme instruments must preclude membership of the scheme being restricted by reference to—

(a) financial status;

(b) the amount of contributions to be made to the scheme;

(5B) The scheme instruments must, except to the extent necessary to ensure that the scheme maintains its tax-registration, permit as means of payment of contributions to the scheme payment from a bank account or building society account by—

(a) cheque;

(b) direct debit;

(d) direct credit (other than standing order),

and (for the avoidance of doubt) for the purposes of this paragraph, those means of payment do not include payment by cash, credit card or debit card (or by any combination thereof).

(6) A transfer payment referred to in paragraph (5)(e) must be of an amount not less than the cash equivalent of the member’s rights under the scheme, as calculated and verified in a manner consistent with regulations made under section 97 of the 1993 Act (calculation of cash equivalents) on the date on which the payment is made.

(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8) Paragraph (5)(e) does not apply to rights to which effect is given under the scheme by the payment of an annuity (not being a deferred annuity) or a lump sum either to the member or, on or after his death, to another person.

(9) For the purposes of paragraph (8), a deferred annuity is an annuity under the terms of which payment does not commence immediately but at a time in the future.

(10) Paragraph (5A) shall not preclude membership being restricted by reference to—

(a) employment with a particular employer or in a particular trade or profession; or

(b) membership of a particular organisation.

(11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Additional requirements as regards instruments establishing a stakeholder pension scheme established under a trust

4

(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) The scheme instruments of a scheme established under a trust (“the trust instruments”) must require that—

(a) unless sub-paragraph (b) applies, at least one trustee and at least one-third of the total number of trustees is neither connected with nor an associate of any person providing services to or otherwise managing the scheme (other than as a trustee);

(b) where a company is trustee of the scheme and there is no trustee of the scheme who is not a company, at least one of the directors of the company and at least one-third of the total number of its directors is neither connected with nor an associate of any person providing services to or otherwise managing the scheme (other than as a trustee).

(4) The trust instruments must not—

(a) enable any of the provisions required by regulation 3 , by this regulation or by regulation 6 to be modified or disapplied;

(b) have a condition that the trustees must obtain the consent of any person before making any decision about investments for the purposes of the scheme; or

(c) except in so far as otherwise required by or under any enactment, preclude the trustees from amending the trust instruments to provide for different investments to be held for the purposes of the scheme.

Additional requirements as regards instruments establishing a stakeholder pension scheme not established under a trust

5

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

Procedure for discharging rights on winding-up

6

(1) The scheme instruments must require that, where the winding-up of a stakeholder pension scheme has commenced, the trustees or manager must, except in cases where regulation 7 applies, make transfer payments in respect of members’ rights in accordance with the procedure set out in paragraphs (2) to (9) of this regulation.

(2) The trustees or manager shall no later than 4 months after the commencement of winding-up give notice to each member stating—

(a) that they propose to make a transfer payment in respect of his rights under the scheme to their choice of a stakeholder pension scheme or a scheme registered under Article 4 of the Welfare Reform and Pensions (Northern Ireland) Order 1999, that scheme to be named in the notice, unless the member applies for the transfer payment to be made to a pension scheme or pension arrangement of his choice;

(b) the value of the member’s rights at the date that the scheme commenced winding-up, being an amount not less than the cash equivalent of those rights on that date, as calculated and verified in a manner consistent with regulations made under section 97 of the 1993 Act (calculation of cash equivalents); and

(c) that, unless the member applies within 4 months of the date of the notice for a transfer payment to be made to a pension scheme or pension arrangement of his choice, a transfer payment may be made without his consent to the scheme named in the notice as the scheme of the trustees’ or manager’s choice.

(3) If any member makes an application for a transfer payment to be made to a pension scheme or pension arrangement of his choice (whether or not the application is made under section 95 of the 1993 Act (ways of taking right to cash equivalent) ) the trustees or manager shall, unless paragraph (4) of this regulation applies, do what is needed to carry out what the member requires within one month of receiving the member’s application.

(4) This paragraph applies where—

(a) it is not possible for the trustees or manager to do what is needed to carry out what the member requires within 12 months of the date of commencement of winding-up;

(b) it would contravene the terms of the scheme’s tax-registration, or any provision of the scheme required to be included as a condition of any such registration, for the trustees or manager to do what is needed to carry out what the member requires; or

(c) the member withdraws his application before the trustees have or the manager has done what is needed to carry out what he requires.

(5) Where paragraph (4)... applies in relation to the first such application made by the member as is mentioned in paragraph (3), the trustees or manager shall as soon as practicable give notice to the member stating—

(a) where sub-paragraph (a) or (b) of paragraph (4) applies, that they cannot carry out what he requires and the reasons why not;

(b) that if he does not make a further application such as is mentioned in paragraph (3) they propose to make a transfer payment in respect of his rights as set out in the notice given in accordance with paragraph (2); and

(c) that, unless he makes such further application within one month of the date of the notice given in accordance with this paragraph, such a transfer payment may be made without his consent.

(6) In any case where—

(a) the trustees do not or the manager does not receive any such application as is mentioned in paragraph (3) within 4 months of the date of the notice given in accordance with paragraph (2);

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(i) the trustees or manager, having given notice to the member in accordance with paragraph (5), do not receive any such further application as is mentioned in that paragraph within one month of the date of the notice; or

(ii) the trustees or manager, having given such notice, have received a further application such as is mentioned in paragraph (5) within one month of that date but paragraph (4) applies in respect of that further application,

the trustees or manager may make a transfer payment in respect of the member’s rights to the pension scheme named in the notice mentioned in paragraph (2) as the scheme of their choice.

(7) The trustees or manager shall, within one month of making a transfer payment under paragraph (3) or (6), give notice to the member stating the amount of the payment, the name and address of the scheme to which it has been made and the date on which it was made.

(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(9) For the purposes of this regulation “member" includes “beneficiary".

Procedure for discharging on winding-up rights of members with whom the trustees or manager have lost contact

7

(1) This regulation applies in respect of any member—

(a) whose present postal address and electronic address is not known to the trustees or manager;

(b) in respect of whom the trustees or manager have sent correspondence to their last known—

(i) postal address and that correspondence has been returned, or

(ii) electronic address and the trustees or manager are satisfied that that correspondence has not been delivered; and

(c) in respect of whom no contribution has been made to the scheme by or on behalf of the member during the two calendar years preceding the commencement of winding-up of the scheme.

(2) In cases where this regulation applies, the trustees or manager shall on the winding-up of the scheme make a transfer payment in respect of the member’s rights to their choice of a stakeholder pension scheme, or to a scheme registered under Article 4 of the Welfare Reform and Pensions (Northern Ireland) Order 1999 and need give no notice of the transfer payment to the member either before or after it is made.

Requirement applying to all stakeholder pension schemes as regards investments

8

(1) For the purposes of section 1(1)(b), it shall be a condition of a scheme being a stakeholder pension scheme that the requirements of this regulation are complied with.

(2) Except where monies are held temporarily on deposit in the course of dealing in assets for the purposes of the scheme, the trustees or manager must ensure that there is derived, from any part of the funds of the scheme that are held on deposit, a return accruing on a daily basis that is, net of any fees or charges, not less than the base rate minus 2 per cent. per annum.

(3) Where the base rate is increased, paragraph (2) shall apply as if the reference to the base rate in that paragraph were—

(a) within one calendar month of the date of the increase, a reference to the base rate immediately before the increase; and

(b) after that calendar month has elapsed, a reference to the base rate as increased.

(4) The trustees or manager shall not directly hold, for the purposes of the scheme, units or shares in a collective investment scheme (within the meaning of section 235 of the Financial Services and Markets Act 2000 (interpretation: definition of 'collective investment scheme’)) unless it is a requirement of the collective investment scheme that the purchase and sale price of those units or shares shall, at any given time, not differ from each other.

(5) The trustees or manager shall not directly hold, for the purposes of the scheme, rights under a contract of insurance which are expressed as units or shares in funds held by the insurer unless it is a requirement of the contract of insurance that the purchase and sale price of those units or shares shall, at any given time, not differ from each other.

(6) In this regulation—

“base rate" means the rate for the time being quoted by the reference banks as applicable to sterling deposits or, where there is for the time being more than one such base rate, the rate which, when the base rate quoted by each bank is ranked in a descending sequence of seven, is fourth in the sequence;

“contract of insurance” means a contract—which, or any part of which, is of one or more of the following kinds—life and annuity,linked long term,pension fund management, andwhich is carried out by an insurer who has permission, as the case may be, under—Part 4 of the Financial Services and Markets Act 2000, orparagraph 15 of Schedule 3 to that Act,to effect or carry out contracts of insurance of that kind;

“reference banks” means the seven largest persons for the time being who—have permission under Part 4 of the Financial Services and Markets Act 2000 to accept deposits,are incorporated in the United Kingdom and carrying on there a regulated activity of accepting deposits; andquote a base rate applicable to sterling deposits,and for the purpose of this definition the size of a person at any time is to be determined by reference to the gross assets denominated in sterling of that person, together with any subsidiary (as defined in section 736 of the Companies Act 1985) , as shown in the audited end of year accounts last published before that time.

(7) References to a “deposit” in this regulation, together with the definitions of “contract of insurance” and “reference banks” in paragraph (6) must be read with—

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

(b) any relevant order under that section; and

Requirement for statement of investment principles for schemes not established under trust

9

(1) Subject to paragraph (2), for the purposes of section 1(1)(b), it shall be a condition of a scheme being a stakeholder pension scheme that the requirements of this regulation are complied with.

(2) This regulation does not apply to a scheme established under a trust.

(3) The manager of the scheme must secure that there is prepared, maintained and from time to time revised a written statement of the principles governing decisions about investments for the purposes of the scheme.

(4) The statement must cover the manager’s policy about the following matters—

(a) the kinds of investments to be held;

(b) the balance between different kinds of investments;

(d) the expected return on investments;

(e) the realisation of investments;

(f) the extent (if at all) to which social, environmental or ethical considerations are taken into account in the selection, retention and realisation of investments; and

(g) the exercise of the rights (including voting rights) attaching to investments.

(5) Subject to paragraph (6), where a copy of the latest statement mentioned in paragraph (3) is requested by a member, the statement shall, within 2 months of the request, be furnished to that member either—

(a) free of charge; or

(b) where a charge is made, at an amount that does not exceed the expense incurred in copying, posting and packing the statement.

(6) A copy of the statement mentioned in paragraph (3) need not be furnished to the same person within 12 months of the person last being given such a copy unless the statement has changed during that 12 month period.

(7) In this regulation “member" includes “beneficiary".

Requirement for manager of schemes not established under a trust to have regard to certain matters, and to take advice, relating to investment

10

(1) Subject to paragraph (2), for the purposes of section 1(1)(b), it shall be a condition of a scheme being a stakeholder pension scheme that the requirements of this regulation are complied with.

(2) This regulation does not apply to a scheme established under a trust.

(3) The manager of the scheme, and any person managing funds held for the purposes of the scheme, must, in investing such funds or in selecting investment options offered to members of the scheme, have regard to—

(a) the need for diversification of investments, in so far as appropriate to the circumstances of the scheme; and

(b) the suitability for the purposes of the scheme of any investment or investment option proposed.

(4) The manager of the scheme, and any person managing funds held for the purposes of the scheme, must, before making any investment or selecting any investment option for the purposes of the scheme, obtain and consider proper advice as to whether the investment or investment option is satisfactory having regard to the matters mentioned in paragraph (3) and the principles contained in the statement under regulation 9.

(4A) The manager of the scheme, and any person managing funds held for the purposes of the scheme, must, if retaining any investment or investment option for the purposes of the scheme—

(a) determine at what intervals the circumstances, and in particular the nature of the investment or investment option, make it desirable to obtain and consider in relation to that investment or investment option such advice as is mentioned in paragraph (4); and

(b) obtain and consider such advice accordingly.

(5) For the purposes of this regulation“proper advice" means—

(a) where the giving of advice constitutes a regulated activity of advising on investments (or would constitute such a regulated activity but for the identity of the person carrying on that activity), advice given by a person who may give that advice without contravening the prohibition imposed by section 19 of the Financial Services and Markets Act 2000;

(b) in any other case, the advice of a person whom the manager or person managing funds held for the purposes of the scheme reasonably believes to be qualified by his ability in and practical experience of financial matters and to have the appropriate knowledge and experience of the management of the investments of pension schemes.

(5A) Paragraph (5)(a) must be read with—

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

(b) any relevant order under that section; and

(6) Paragraphs (4) and (4A)(b) do not apply to the extent that the manager or the person managing the scheme’s funds is a person who may himself give proper advice.

(7) To the extent that paragraph (4) or (4A)(b) is disapplied by virtue of paragraph (6), the manager or person managing the scheme’s funds, being a person who may himself give proper advice—

(a) must—

(i) before making any investment or selecting any investment option for the purposes of the scheme, consider; and

(ii) if so retaining any investment or investment option, consider at such intervals as are determined by him in relation to that investment or investment option under paragraph (4A)(a),

whether the investment or investment option is satisfactory having regard to the matters mentioned in paragraph (3) and the principles contained in the statement under regulation 9; and

(b) must record in writing the reasons why he considers that any—

(i) investment he makes or retains; or

(ii) investment option he selects or retains,

is satisfactory having regard to those matters and principles.

(8) No person shall be regarded as having complied with—

(a) paragraph (4) unless the advice to be obtained and considered by him under that paragraph is given or (by the giver of the advice) confirmed in writing;

(b) paragraph (4A)(a) unless the determination to be made by him under that paragraph is recorded by him in writing;

(c) paragraph (4A)(b) unless the advice to be obtained and considered by him under that paragraph is given or (by the giver of the advice) confirmed in writing.

Requirement for manager of schemes not established under trust to appoint a reporting accountant

11

(1) For the purposes of section 1(1)(b), it shall be a condition of a scheme being a stakeholder pension scheme that the requirements of this regulation are complied with.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) There shall be appointed as reporting accountant for the scheme (“the reporting accountant”), by the trustees or manager of the scheme, a person who is eligible under paragraph (4) for such appointment.

(4) A person is eligible for appointment as the reporting accountant only if he is eligible (but subject to paragraph (10)) under section 25 of the Companies Act 1989 for appointment as a company auditor.

(5) The reporting accountant shall be appointed in writing and the notice of appointment shall specify—

(a) the date on which the appointment is due to take effect;

(b) to whom the reporting accountant is to report; and

(6) The trustees or manager shall procure from the reporting accountant by the end of one month beginning with the date he received his notice of appointment a statement—

(a) acknowledging in writing his receipt of his notice of appointment; and

(b) confirming in writing that he will notify the trustees or manager of any conflict of interest to which he is subject in relation to the scheme immediately he becomes aware of its existence.

(7) It shall be a condition of the appointment of the reporting accountant that he agrees, in the event of his resignation ..., to serve on the trustees or manager a written notice of resignation containing—

(a) a statement specifying any circumstances connected with the resignation which in his opinion significantly affect the interests of the members or prospective members of, or of beneficiaries under, the scheme, or

(b) a declaration that he knows of no such circumstances,

(7A) Where the reporting accountant is or becomes ineligible, by virtue of not or no longer being a person defined in paragraph (11) who satisfies the condition in paragraph (4), for his appointment as such—

(a) he shall not act as the reporting accountant (except if required to do so under paragraph (6), and except as required by his agreement under paragraph (7) and as required by sub-paragraphs (c) and (d));

(b) anything done for the purposes of these Regulations by him acting as such while ineligible in contravention of sub-paragraph (a) shall by the trustees or manager be taken for those purposes not to have been done;

(d) he shall state in that notice—

(i) that he is resigning by reason of ineligibility; and

(ii) the ground on which he is or has become so ineligible;

(e) ... if he is still in place when the trustees or manager ... become aware... that he is or has become so ineligible, the trustees or manager shall remove him immediately.

(8) Except in cases falling within paragraph (9), where the reporting accountant is removed by the trustees or manager or resigns or dies, the trustees or manager shall appoint, in accordance with this regulation, another reporting accountant—

(a) as soon as is required in order to ensure that the provisions of regulation 12(2)(b) and (8) are complied with; and

(b) in any event, by the end of 3 months beginning with the date of that removal, resignation or death.

(9) Where under paragraph (7A) the reporting accountant resigns with immediate effect or is removed, the trustees or manager shall appoint, in accordance with this regulation, another reporting accountant—

(a) as soon as is required in order to ensure that the provisions of regulation 12(2)(b) and (8) are complied with; and

(b) in any event, by the end of one month beginning with the date of that resignation or removal.

(10) For the purposes of paragraph (4), a person is not eligible under section 25 of the 1989 Act for appointment as a company auditor if section 34 of that Act applies to him (individuals retaining only authorisation under section 13(1) of the Companies Act 1967).

(11) In this regulation references to a person are references to an individual, a body corporate or a partnership.

Requirement for annual declaration

12

(1) For the purposes of section 1(1)(b), it shall be a condition of a scheme being a stakeholder pension scheme that the requirements of this regulation are complied with.

(2) Subject to paragraph (11), the trustees or manager of the scheme shall, no later than the end of 6 months beginning with each reporting date—

(a) make a declaration in writing signed by the trustees or manager containing the statements set out in paragraph (5) in relation to the reporting period or, in so far as they are unable to make those statements, containing a statement explaining why they are unable to do so; and

(b) obtain from the reporting accountant appointed by virtue of regulation 11 the statement specified in paragraph (7) or, in so far as the reporting accountant is unable to make that statement, a statement from the reporting accountant explaining why he is unable to do so.

(3) Subject to paragraph (10), in this regulation “reporting date” means—

(a) in the case of the first reporting date, a date chosen by the trustees or manager that is no later than the last day of the period of 12 months beginning with the date on which the scheme is registered under section 2 of the Act; and

(b) in the case of each subsequent reporting date, a date chosen by the trustees or manager that is no later than the last day of the period of 12 months beginning with the date immediately following the previous reporting date.

(4) Subject to paragraph (10), in this regulation “reporting period” means—

(a) in the case of the first reporting period, the period beginning on the date of registration of the scheme under section 2 of the Act and ending on and including the first reporting date;

(b) in the case of subsequent reporting periods, the period beginning on the date immediately following the previous reporting date and ending on and including the reporting date.

(5) The statements specified in paragraph (2)(a) shall be—

(a) a statement that in the opinion of the trustees or manager there are systems and controls in place which provide reasonable assurance that—

(i) regulations 13, 14 and 14B have been complied with in relation to the scheme;

(ii) transactions for the purposes of the scheme in securities, property or other assets have occurred at a fair market value;

(iii) the value of members' rights has been determined in accordance with the provisions in the instruments establishing the scheme; and

(iv) adequate records have been maintained for the purposes of providing to members the statement required by regulation 18A(1);

(b) a statement describing the process that the trustees or manager have or has undertaken in order to arrive at the opinion expressed in the statement described in paragraph (5)(a);

(c) a statement that in the opinion of the trustees or manager there are systems and controls in place which provide reasonable assurance that the scheme has complied with the conditions in section 1(1) of the Act, apart from those conditions that are covered by the statement in paragraph (5)(a); and

(d) a statement which explains that—

(i) regulations 13, 14 and 14B impose limits on the amount of charges and deductions which may be made by a stakeholder pension scheme and on the manner in which charges may be made by such a scheme; and

(ii) regulation 18A(1) requires a stakeholder pension scheme to provide an annual benefit statement to each member.

(6) The trustees or manager shall provide the reporting accountant with documentation to demonstrate that the process described in the statement in paragraph (5)(b) has taken place.

(7) The statement specified in paragraph (2)(b) shall be a statement that—

(a) the reporting accountant has been provided with documentation as required by paragraph (6); and

(b) nothing has come to the attention of the reporting accountant that is inconsistent with the statement made in paragraph (5)(b).

(8) The trustees or manager shall make available to members and beneficiaries of the scheme on request the declaration made by the trustees or manager and the statement obtained from the reporting accountant in accordance with paragraph (2).

(9) If the statement to be obtained by the trustees or manager under paragraph (2)(b) is obtained from the reporting accountant acting as such while ineligible in contravention of regulation 11(7A)(a)—

(a) the trustees or manager shall not be regarded as having complied with paragraph (2)(b); and

(b) for the purposes of paragraph (8), the statement from the reporting accountant shall not be regarded as obtained in accordance with paragraph (2)(b).

(10) Where a scheme is registered under section 2 of the Act on or before 6th April 2001—

(a) the first reporting date shall be 5th April 2002; and

(b) the first reporting period shall be the period beginning on and including 6th April 2001 and ending on and including 5th April 2002.

(11) Where the reporting date is on or before 30th September 2002 the trustees or manager of the scheme shall make the declaration specified in paragraph (2)(a) and obtain the statement specified in paragraph (2)(b) from the reporting accountant—

(a) on or before 31st December 2002; or

(b) by the end of 6 months beginning with the reporting date,

whichever is later.

Expenses, commission etc.—principles

13

(1) Except to the extent permitted by regulation 14 or 14B—

(a) no payment made to a stakeholder pension scheme by or on behalf of any member;

(b) no income or capital gain arising from the investment of such a payment;

(c) no amount credited to a member’s account in respect of a credit within the meaning of section 29 (pension sharing: creation of pension debits and credits); and

(d) no amount representing the value of any rights of a member under the scheme,

shall be used in any way which does not result in the provision of benefits for or in respect of members.

(2) Paragraph (1) does not apply—

(a) to the extent that section 31 (pension sharing: pension debits), or any enactment in force in Northern Ireland corresponding to that section, applies to reduce the benefits or future benefits to which a member may be entitled under the scheme; or

(b) to prevent the trustees or manager of a scheme from complying with an order of the court

(2A) Nothing in paragraph (1) shall be taken to prevent that which is permitted by or under any of the provisions mentioned in paragraph (4).

(3) In this regulation and in regulations 14 and 14B below “member" includes “beneficiary".

(4) The provisions referred to in paragraph (2A) are—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) section 159 of the 1993 Act (inalienability of guaranteed minimum pension and protected rights payments);

(c) sections 91 to 94 of the 1995 Act and regulations under those sections (inalienability and forfeiture of occupational pensions); and

(d) in the case of a pension scheme established under a trust which—

(i) is not an occupational pension scheme; but

(ii) is or has been registered under section 2;

sections 91, 92 and 94 of the 1995 Act and the Occupational Pension Schemes (Assignment, Forfeiture, Bankruptcy etc.) Regulations 1997 (inalienability and forfeiture of occupational pensions) as those sections and Regulations have effect by virtue of section 6(3) of, and Schedule 1 to, the Act and of regulation 32.

(5) This regulation and regulations 14 to 14C do not apply in the circumstances set out in regulation 14D.

Charges etc.—permitted reductions in members' rights

14

(1) The value of a member’s rights under the scheme may be reduced in the circumstances, and to the extent, set out in paragraphs (2) to (5A) of this regulation.

(2) To the extent that a member’s rights are represented by a fund allocated to him to the exclusion of other members, the value of those rights may be reduced by the making of deductions from that fund which, when added to the amount of any indirect charges attributable to the member’s rights, are no greater than, at the choice of the trustees or manager—

(a) the relevant percentage of its value for each day on which it is held for the purposes of the scheme, or

(b) the proportion attributable to that fund of the relevant percentage of the value of all members' funds held for the purposes of the scheme for each day on which the fund is so held.

(3) To the extent that a member’s rights are represented by a share of funds held for the purposes of the scheme, the amount of that share not being determined by reference to a discretion exercisable by any person, the value of those rights may be reduced by the making of deductions from that share which, when added to the amount of any indirect charges attributable to the member’s share, are no greater than, at the choice of the trustees or manager—

(a) the relevant percentage of its value for each day on which it is held for the purposes of the scheme, or

(b) the proportion attributable to the member’s share of the relevant percentage of the value of the funds for each day on which the share is held.

(4) To the extent that a member’s rights are represented by rights in a with-profits fund, the value of those rights may be reduced by the making of deductions from the with-profits fund which, when added to the amount of any indirect charges attributable to the member’s rights, are no greater than, at the choice of the trustees or manager—

(a) the relevant percentage of the value of the member’s rights in the fund for each day on which it is held for the purposes of the scheme, or

(b) the proportion attributable to the member’s rights of the relevant percentage of the value of such part of the fund as is allocated to the rights of members for each day on which the member has rights in the fund.

(5) The value of a member’s rights under the scheme may be reduced—

(a) where administrative expenses are incurred by the trustees or manager in—

(i) the purchase or provision of an annuity for the member in accordance with the scheme, or

(ii) the making of payments of income (otherwise than by way of an annuity) to a member under arrangements made in accordance with the scheme,

by the amount of those expenses;

(b) by such amount, and in such manner, as is permitted by regulations under section 24 or 41 (charges in respect of pension sharing costs);

(c) where an order of the court provides for the recovery by the trustees or manager of costs incurred in complying with the order, by the amount of those costs;

(d) where any charges are incurred by the trustees or manager, directly or indirectly, in connection with the sale or purchase of investments held for the purposes of the scheme, by the amount of such of those charges as—

(i) are attributable to the member’s rights, and

(ii) are not the subject of an election by the trustees or manager under regulation 14B(1)(b);

(e) where any charges or expenses are incurred by the trustees or manager directly or indirectly in maintaining or repairing any land or buildings in which the fund is invested, or in connection with the collection of rent, service charge or other sums due under the terms of a lease from occupiers of any such land or buildings, by the amount of such of those charges or expenses as—

(i) are attributable to the member’s rights, and

(ii) are not the subject of an election by the trustees or manager under regulation 14B(1)(b);

(f) by the amount of any dilution levy charged, or, in the case of rights represented by rights in a with-profits fund, by the amount of any market value adjustment occurring in relation to the fund; and

(g) where the member is the transferor for the purposes of section 29 (pension sharing: creation of pension debits and credits), by the amount of any payment made to discharge the liability of the trustees or manager in respect of a credit within the meaning of that section, ...

(h) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5A) The value of a member’s rights under the scheme may be reduced by the amount of any payment made to discharge the liability of the trustees or managers in respect of any tax liability under the Finance Act 2004 in relation to that member.

(6) In paragraphs (2) to (4), “indirect charges” means management charges deducted from a fund in which a fund held for the purposes of the scheme is invested, directly or indirectly.

(7) For the purposes of paragraphs (2) to (4), “the relevant percentage” means—

(a) in the case of an established member, 1/365 per cent.;

(b) in the case of a new member—

(i) during the period of 10 years beginning with the day on which the first payment is made to the scheme by or on behalf of the member, or, in a case where an amount is credited to the member’s account in respect of a credit within the meaning of section 29 before any payment is made, the day on which that amount is credited, 3/730 per cent.,

(ii) otherwise 1/365 per cent.

(8) In this regulation and regulation 14A—

“an established member” means a person who first acquired rights under the scheme before 6th April 2005 and has maintained rights under it since that date, and

“a new member” means a person who first acquired rights under the scheme on or after 6th April 2005, or who reacquired such rights after that date having previously transferred all of his accrued rights under the scheme to another pension scheme or arrangement.

(9) Where the value of any member’s rights is reduced by reference to an amount of charges or expenses of a kind referred to in paragraph (5)(d) or (e), then, for the purposes of calculating any reduction under paragraph (2), (3) or (4) above, the funds held by the scheme are to be calculated after the deduction of any such amount.

Requirement for trustees or manager to satisfy certain conditions in relation to with-profit funds

15

(1) Where all or any of a stakeholder pension scheme’s assets are invested in a with-profits fund it shall, for the purposes of section 1(1)(b), be a condition of the scheme being a stakeholder pension scheme that the requirements of this regulation are complied with.

(2) A stakeholder pension scheme shall not invest any assets in a with-profits fund that includes non-stakeholder pension scheme assets.

(3) Prior to entering into any agreement whereby any assets of the scheme will be invested in a with-profits fund, the trustees or manager of that scheme shall take such steps as are necessary to ensure that they obtain a written contract from the insurer maintaining the with-profits fund which provides that the insurer will, in respect of any period that the stakeholder pension scheme has assets invested in the with-profits fund—

(a) provide such information to the trustees or manager of the stakeholder pension scheme as is necessary to allow the trustees or manager to operate in compliance with the requirements of regulations 13 or 14;

(b) ensure that members of the stakeholder pension scheme will not be treated less favourably than any other members of stakeholder pension schemes who may have assets invested in the with-profits fund;

(c) provide to the trustees or manager of the stakeholder pension scheme any certificates from the auditor and actuary to the insurer that are necessary to allow the trustees or manager to make the declaration mentioned in regulation 12(2)(a);

(d) ensure that no investments are made in the fund other than the investment of stakeholder pension scheme assets; and

(e) take such steps as are necessary to comply with paragraph (4).

(4) The insurer must, at least annually, provide the trustees or manager of the stakeholder pension scheme with a certificate from ... the ... actuary to the insurer certifying that the insurer has systems which and controls which are of a design such that, and used such that—

(a) proper accounting records are maintained in respect of all income and expenditure relevant to regulations 13, 14 and 14B and the terms of the contract referred to in paragraph (3);

(b) the records referred to in sub-paragraph (a) are provided to the auditor of the scheme if requested by the auditor, trustees or manager ;

(c) no expenditure is charged to the with-profits fund where that expenditure would be contrary to the requirements of regulation 13 or 14; and

(d) the terms of the contract referred to in paragraph (3) have been complied with.

(5) Where the insurer does not comply with the agreement referred to in paragraph (3), the trustees or manager must take such steps as are necessary to ensure that the insurer does so comply.

(6) In this regulation the “actuary to the insurer” means a person appointed to perform, in relation to the insurer, either or both of the functions specified in paragraph 4.3.1 of the Supervision Sourcebook made by the Prudential Regulation Authority under the Financial Services and Markets Act 2000.

Requirements as regards the provision of other services

16

For the purposes of section 1(1)(b), it shall be a condition of a scheme being a stakeholder pension scheme that—

(a) the scheme does not provide any service other than the management of the scheme and its funds unless—

(i) any such service is provided under a contract separate from any contract of membership of the scheme, is provided free of charge or is consistent with regulations 13, 14 and 14B; and

(ii) any contract for such service is in writing and sets out the amount of any charge for the service and the terms on which it is to be paid; and

(b) it is not a condition of membership of the scheme that any person enter into any contract, whether with the trustees or manager of the scheme or any other person, other than the contract of membership of the scheme.

Restrictions on contributions

17

(1) Subject to paragraph (2), the scheme instruments may permit the trustees or manager to refuse to accept a payment to the scheme of less than £20.

(2) Paragraph (1) does not permit the trustees or manager to refuse to accept any payment made to the scheme by the Inland Revenue by way of tax relief....

(3) For the purposes of paragraph (1), amounts in respect of income tax deducted and retained by a member as permitted by section 192 of the Finance Act 2004 (relief at source) shall not be treated as payments to the scheme.

(4) The trustees or manager of a stakeholder pension scheme may refuse to accept any contribution if its acceptance would contravene the terms of the scheme’s tax-registration.

(4A) the trustees or manager of a stakeholder pension scheme may refuse to accept any contribution by, or on behalf of any member of the scheme who—

(a) has not given the declaration specified in regulation 5(2) of the Registered Pension Schemes (Relief at Source) Regulations 2005 (declaration of entitlement to tax relief in respect of net contributions); or

(b) is not a relevant UK individual for the purposes of section 189 of the Finance Act 2004 (relevant UK individual) for the tax year in respect of which the contribution is made.

(5) Subject to regulation 3(5B), the scheme instruments may permit restrictions on the means of payment of contributions to the scheme.

(6) The scheme instruments of an occupational pension scheme may permit the trustees or manager to refuse to accept, in respect of any member of the scheme who is not an active member of the scheme, any contribution by or on behalf of or in respect of that member.

(7) For the purposes of paragraph (6), “active member” has the meaning given by section 124 of the 1995 Act.

Disclosure of information to members

18

(1) For the purposes of section 1(1)(b), it is a condition of a scheme being a stakeholder pension scheme that the trustees or manager of the scheme comply with the requirements set out in regulations 18A and 18B in addition to such requirements of regulations under section 113 of the 1993 Act (disclosure of information about schemes to members etc.) as are applicable to the scheme.

(2) For the purposes of these Regulations “statement year” means, in relation to a person, the period of 12 months beginning—

(a) in the case of a person who becomes a member after 6th April 2001, on a date chosen, in respect of that person, by the trustees or manager which falls—

(i) on or before the day on which that person becomes a member; but

(ii) no earlier than 6th April 2001; and

(b) in any other case, on 6th April 2001,

and, subject to paragraph (4), each subsequent period ending on and including the anniversary of the last day of the first statement year.

(3) The date to be chosen, in respect of a person, under paragraph (2)(a) must be chosen on or before the day on which that person becomes a member.

(4) For the purposes of paragraph (2), the trustees or manager may, in respect of any person, choose a new date for the ending of the statement year relating to that person if—

(a) the date chosen—

(i) is specified in writing; and

(ii) falls before the end of the statement year relating to that person during which the trustees or manager specify the new date; and

(b) no other date has been chosen in respect of that person by the trustees or manager under this paragraph during the previous period of 12 months.

(5) If a new date is chosen under paragraph (4), “statement year” means, in relation to the person in respect of whom the new date is chosen, the period of 12 months ending on and including that new date (except that, in relation to the first statement year relating to that person, “statement year” means, in relation to that person, the period beginning with the day which is, by virtue of paragraph (2)(b) or of a choice under paragraph (2)(a), the first day of that first statement year and ending on and including that new date) and each subsequent period ending on and including the anniversary of that new date.

(6) For the purposes of paragraphs (2)(a) and (4), different dates may be chosen in respect of different persons.

(7) For the purposes of this regulation, regulations 18A and 18B and Schedule 3, “member” does not include any member—

(a) whose present postal address and electronic address is not known to the trustees or manager; and

(b) in respect of whom the trustees or manager have sent correspondence to their last known—

(i) postal address and that correspondence has been returned, or

(ii) electronic address and the trustees or manager are satisfied that that correspondence has not been delivered; ...

(8) For the purposes of this regulation, regulations 18A and 18B and Schedule 3, “member” includes a dependant making income withdrawals from the scheme in accordance with paragraph 21 of Schedule 28 to the Finance Act 2004 (dependants’ income withdrawal).

Requirement for trustees of a stakeholder pension scheme established under a trust

19

For the purposes of section 1(1)(b), it shall be a condition of a scheme which is established under a trust being a stakeholder pension scheme that the scheme comply with sections 35 and 36 (functions of trustees) of the 1995 Act ....

PART III — REGISTRATION OF STAKEHOLDER PENSION SCHEMES

Persons who may apply for registration of stakeholder pension schemes not established under trust

20

For the purposes of subsections (2) and (4) of section 2 (prescribed persons may apply for registration of stakeholder pension schemes and will be liable to penalties in certain circumstances connected with such application) the prescribed person in relation to a scheme not established under a trust is the manager of the scheme.

Access to the register

21

(1) The ... Authority shall supply the most recent copy of the register to any person on request either—

(a) free of charge; or

(b) where a charge is made, at an amount that does not exceed the expense incurred in copying, posting and packing the statement.

(2) The Authority may publish the register in any way.

PART IV — EMPLOYER REQUIREMENTS

Exemptions from employer access and consultation requirements

22

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

Definition of relevant employees

23

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

Payroll deduction of contributions

24

(1) Subject to paragraphs (2) and (2A), where an employee requests an employer to ... vary (but not cease) deductions of the employee’s contributions to a qualifying scheme from his remuneration (“the request"), the employer must comply with the request as soon as possible, but no later than the end of—

(a) the pay period following that in which the request is made; or

(b) where the request relates to a pay period later than the one following that in which the request is made, that later pay period.

(2) Where an employee makes the request within 6 months of requesting the same employer to vary deductions of the employee’s contributions to a qualifying scheme from the employee’s remuneration, the employer need not comply with the request but, where he does not do so, he must give notice to the employee in writing—

(a) that—

(i) he is not complying with the request; and

(ii) the reason he is not complying with it is that it was made within 6 months of the employee requesting him to vary such deductions and the employer is permitted by these Regulations not to comply with it in such circumstances;

(b) informing him of the date (which must be no later than 6 months after the date of the employee’s previous request to vary such deductions) that the employee can make a new request to ... vary deductions of the employee’s contributions; and

(i) he may require the employer to cease such deductions ... (if deductions are being made at the time of the request) but, if the employee makes such a request, the employer is not required to comply with any further request to make such deductions ...; and

(ii) the employee may be able to make payments, (subject to the trustees or manager refusing to accept them as permitted by or under these Regulations) at a rate of his choosing, directly to the qualifying scheme.

(2A) Where the trustees or manager of the scheme in relation to which the request is made inform the employer that they will refuse, in accordance with regulation 17, to accept payment—

(a) of a contribution to which the request relates, the employer need not comply with the request so far as the request relates to that contribution;

(b) of contributions of a particular type, the employer need not comply with the request so far as the request relates to a contribution of that particular type.

(2B) Where the employer, on a ground mentioned in paragraph (2A), does not comply with the request, he must give notice to the employee in writing—

(a) that, and of the extent to which, he is not complying with the request;

(b) that the reason he is not complying with the request to that extent is that—

(i) the trustees or manager have informed the employer that they will refuse, in accordance with regulation 17, to accept payment of a contribution to which the request relates or of contributions of a particular type; and

(ii) the employer is permitted by these Regulations not to comply with the request so far as the request relates to that contribution or to a contribution of that particular type;

(c) where the trustees or manager cite to the employer the ground of refusal in regulation 17 on which they will rely to refuse that contribution or contributions of that particular type, informing him that the trustees or manager have cited that ground of refusal in relation to that contribution or to contributions of that particular type; and

(d) informing him that—

(i) he may require the employer to cease such deductions (if deductions are being made at the time of the request) but, if the employee makes such a request, the employer is not required to comply with any further request to make such deductions ...; and

(ii) the employee may be able to make payments, (subject to the trustees or manager refusing to accept them as permitted by or under these Regulations) at a rate of his choosing, directly to the qualifying scheme.

(3) Where an employee requests an employer to cease to make deductions from the employee’s remuneration on account of contributions to a qualifying scheme, the employer must—

(a) comply with that request as soon as possible, but no later than the end of—

(i) the pay period following that in which that request is made; or

(ii) where that request relates to a pay period later than the one following that in which that request is made, that later pay period; ...

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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

(5) Where an employer is notified that a stakeholder pension scheme that has been designated by him for the purposes of section 3(2) of the Act has commenced winding-up, the employer must immediately cease making deductions from the employee’s remuneration on account of contributions to that scheme and notify the employee in writing as soon as is practicable that those deductions have ceased.

(5A) Where an employer has withdrawn their designation of a stakeholder pension scheme that has been designated by him for the purposes of section 3(2) of the Act for reasons beyond their control, the employer must immediately cease deducting contributions from the employee’s remuneration and notify the employee in writing as soon as is practicable that designation of that scheme has been withdrawn and deduction of contributions has ceased.

(5B) Where an employer—

(a) is notified that a stakeholder pension scheme that has been designated by the employer for the purposes of section 3(2) of the Act has commenced winding up; or

(b) withdraws designation of a stakeholder pension scheme that has been designated by the employer for the purposes of section 3(2) of the Act for reasons beyond the employer’s control,

the employer need not comply with the requirement in section 3(5) of the Act.

(6) Any notice to be given under any of paragraphs (2) and (2B) must be given prior to the end of—

(a) the pay period following that in which the request to which the notice relates is made; or

(b) where that request relates to a pay period later than the one following that in which that request is made, that later pay period.

(7) In this regulation ... references, in relation to an employer, to an employee are references to a relevant employee of that employer where that relevant employee is a member of a qualifying scheme.

Disclosure of information to relevant employees

25

(1) Where an employee for the first time requests an employer to make (but not vary or cease) deductions of the employee’s contributions to a qualifying scheme from his remuneration, the employer must, within 2 weeks of receiving that request, give notice in writing to the employee containing the information referred to in paragraph (2).

(2) The information to be provided under paragraph (1) is—

(a) the manner in which the employer will accept requests to make, vary or cease such deductions;

(b) advice that, where an employee requests an employer to make or vary deductions of the employee’s contributions to a qualifying scheme from the employee’s remuneration, the employer need not comply with that request within—

(i) . . . 6 months of the date of any previous request to make, vary or cease such deductions; or

(ii) where the employer is agreeable to complying with the request within a lesser period than 6 months of a previous request, that lesser period;

(d) advice that, where the employer is required to comply with a request to make, vary or cease such deductions, that request will be complied with as soon as possible but no later than the end of—

(a) the pay period following that in which that request is made; or

(b) where that request relates to a pay period later than the one following that in which that request is made, that later pay period.

and

(e) advice that—

(i) the trustees or manager of the scheme may refuse to accept a contribution if accepting it would contravene the scheme’s tax-registration;

(ii) if the instruments establishing the scheme allow it, the trustees or manager may also refuse to accept payments of less than £20; and

(iii) where an employee requests an employer to make or vary deductions of the employee’s contributions to a qualifying scheme from the employee’s remuneration, the employer need not comply with that request so far as that request relates to any particular contribution, if the trustees or manager of the scheme inform the employer that they will refuse, in accordance with the regulation which allows them to refuse payments on the grounds referred to in sub-paragraphs (i) and (ii) (and on other grounds), to accept that contribution or contributions of that particular type.

PART V — AMENDMENT OF REGULATIONS UNDER THE PENSION SCHEMES ACT 1993 AND THE PENSIONS ACT 1995

Amendment of the Personal Pension Schemes (Disclosure of Information) Regulations 1987

26

(1) The Personal Pension Schemes (Disclosure of Information) Regulations 1987 shall be amended as set out in this regulation.

(2) After regulation 2 there shall be inserted:

(2A) In the case of a scheme which is a stakeholder pension scheme within the meaning of section 1 of the Welfare Reform and Pensions Act 1999, regulation 5 shall have effect as if paragraph (2) were omitted.

(3) In regulation 5—

(a) in paragraph (1) for the words “regulation 2" there shall be substituted “ regulations 2 and 2A ”; and

(b) the following paragraph shall be inserted after paragraph (7)—

(7A) Where a stakeholder pension scheme within the meaning of section 1 of the Welfare Reform and Pensions Act 1999 (meaning of “stakeholder pension scheme") is removed from the register of such schemes kept under section 2 of that Act (registration of stakeholder pension schemes) the trustees shall— (a) within 2 weeks of being notified of the removal from the register inform each member of the scheme except an excluded person that the scheme has been removed from the register of stakeholder pension schemes and is no longer a stakeholder pension scheme and that it is required to commence winding-up under the scheme rules; (b) as soon as practicable and in any event not more than 4 months after such removal provide each member of the scheme except an excluded person with the information mentioned in paragraphs 1, 2 and 7 of Schedule 2; and (c) where the scheme is unable to meet in full its liabilities to its members, as soon as is practicable and in any event not more than 4 months after such removal provide each member except an excluded person with the information mentioned in paragraph 8 of Schedule 2.

Amendment of the Occupational Pension Schemes (Preservation of Benefit) Regulations 1991

27

In regulation 12 of the Occupational Pension Schemes (Preservation of Benefit) Regulations 1991 —

(a) after paragraph (1) there shall be added—

(1A) For the purposes of section 73(4) of the Act, a scheme may provide for a transfer payment to be made to another occupational or personal pension scheme (as described in section 73(2)(a)(i) of the Act) without the member’s consent where the conditions set out in paragraph (6) of this regulation are satisfied.

and

(b) after paragraph (5) there shall be added—

(6) The conditions set out in this paragraph are that— (a) the transferring scheme is or has been a stakeholder pension scheme, within the meaning of section 1 of the Welfare Reform and Pensions Act 1999 or Article 3 of the Welfare Reform and Pensions (Northern Ireland) Order 1999 , and the receiving scheme is such a scheme; (b) the transferring scheme has commenced winding-up; and (c) the transfer payment is of an amount at least equal to the cash equivalent of the member’s rights under the scheme, as calculated and verified in a manner consistent with regulations made under section 97 of the 1993 Act (calculation of cash equivalents).

Amendment of the Occupational Pension Schemes (Disclosure of Information) Regulations 1996

28

(1) The Occupational Pension Schemes (Disclosure of Information) Regulations 1996 shall be amended as set out in this regulation.

(2) In regulation 1—

(a) in the definition of “prospective member" for “and the scheme rules" there shall be substituted “ or the scheme rules or both ”; and

(b) the following paragraph shall be added at the end of the definition of “ tax-approved schemes ”

(c) approved by the Commissioners of the Inland Revenue under Chapter IV of Part XIV of that Act;

(3) In regulation 2—

(a) in paragraph (1) for the words “paragraphs (2) and (3)" there shall be substituted “ paragraphs (2), (3) and (3A) ”; and

(b) after paragraph (3) there shall be inserted—

(3A) In the case of a scheme which is a stakeholder pension scheme within the meaning of section 1 of the Welfare Reform and Pensions Act 1999, regulation 5 shall have effect as if paragraph (5) were omitted.

(4) In regulation 5—

(a) at the beginning of paragraph (5) for “In" there shall be substituted “ Subject to paragraph (3A) of regulation 2, in ”; and

(b) the following paragraph shall be inserted after paragraph (10)—

(11) Where a stakeholder pension scheme within the meaning of section 1 of the Welfare Reform and Pensions Act 1999 is removed from the register of such schemes kept under section 2 of that Act the trustees shall within 2 weeks of being notified of that removal inform each member of the scheme except an excluded person that the scheme has been removed from the register of stakeholder pension schemes and is no longer a stakeholder pension scheme, and that it is required to commence winding-up under the scheme rules.

Amendment of the Protected Rights (Transfer Payment) Regulations 1996

29

(1) The Protected Rights (Transfer Payment) Regulations 1996 shall be amended as set out in this regulation.

(2) In regulation 3(a) after “consents in writing" there shall be inserted “ or regulation 3A applies ”.

(3) After regulation 3 there shall be inserted—

(3A) This regulation applies where— (a) a transfer payment is made to a scheme, which is registered as a stakeholder pension scheme under section 2 of the Welfare Reform and Pensions Act 1999 or under Article 4 of the Welfare Reform and Pensions (Northern Ireland) Order 1999 , from a scheme which is or was so registered and which has commenced winding-up; and (b) regulation 6 of the Stakeholder Pension Schemes Regulations 2000 is complied with.

Amendment of the Occupational Pension Schemes (Member-nominated Trustees and Directors) Regulations 1996

30

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

Amendment of the Occupational Pension Schemes (Investment) Regulations 1996

31

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

Application of other Regulations to stakeholder pension schemes

32

The regulations listed in Schedule 2 shall apply to a pension scheme established under a trust which—

(a) is not an occupational pension scheme; but

(b) is or has been registered under section 2

as if it were an occupational pension scheme.

SCHEDULE 1 — PROVISIONS CONFERRING POWERS EXERCISED IN MAKING THESE REGULATIONS

Title of Act	Powers
Pension Schemes Act 1993	section 28(2)(b)
	section 73(4)
	section 113
	section 181(1)
Pensions Act 1995	section 3(2)
	section 10(1) and (2)(b)
	section 17(4)(b)
	section 19(4)
	section 27(3) and (5)
	section 32(2)(b) and (3)
	section 35(7)
	section 41(1)(a) and (b) and (6)
	section 47(5)(a) and (b), (6) and (9)(b)
	section 49(1), (2) and (4)
	section 50(1), (2)(a), (3) and (7)
	section 81(1)(c) and (2)
	section 83(2) and (3)(a)
	section 84(1)(b), (2) and (3)
	section 86
	section 91(5)(c) and (e)
	section 92(3) and (6)
	section 94(1)
	section 124(1)
	section 174(2) and (3)
Welfare Reform and Pensions Act 1999	section 1(1)(b), (2), (3), (4), (5) and (7)
	section 2(2), (4) and (7)
	section 3(1), (3)(b), (5) and (9)
	section 8(1) and (2)
	section 83(4), (5) and (6)(a) and (b)

SCHEDULE 2 — REGULATIONS APPLYING TO SCHEMES WHICH ARE OR HAVE BEEN REGISTERED UNDER SECTION 2

Statutory Instrument	Regulations applying
The Occupational Pension Schemes (Assignment, Forfeiture, Bankruptcy etc.) Regulations 1997	The whole of the Regulations except regulations 3, and 8(1) and (1A)
The Occupational Pension Schemes (Disclosure of Information) Regulations 1996	Regulations 1, 2, 6 and 7 and Schedule 3 (except paragraph 16 of that Schedule)
The Occupational Pension Schemes (Internal Dispute Resolution Procedures Consequential and Miscellaneous Amendments) Regulations 2008	The whole of the Regulations
The Occupational Pension Schemes (Investment) Regulations 1996	Regulations 1 and 10
The Occupational and Personal Pension Schemes (Levy) Regulations 1997	Regulations 5 to 8 and regulation 1 so far as relevant to those regulations
The Occupational Pension Schemes (Pensions Compensation Provisions) Regulations 1997	The whole of the Regulations except regulation 8
The Occupational Pension Schemes (Prohibition of Trustees) Regulations 1997	The whole of the Regulations
The Occupational Pension Schemes (Requirement to obtain Audited Accounts and a Statement from the Auditor) Regulations 1996	The whole of the Regulations except regulations 2(1)(b) and 4 and paragraph 5 of the Schedule to the Regulations
The Occupational Pension Schemes (Scheme Administration) Regulations 1996	Regulations 1, 3(2)(a), (3) and (5) to (7), 4(1) and (2)(a) and (b), 5(1) to (10), 6(3), 7 to 11, 12(1) except sub-paragraph (b)(ix), 13(1) and 14

Signed

Signed by authority of the Secretary of State for Social Security.

Jeff Rooker — Minister of State, — Department of Social Security — 2000-05-24

Explanatory note

(This note is not part of the Regulations)

Footnotes

[^f00001]: See section 185(1) of the Pension Schemes Act 1993 (c. 48) and section 120(1) of the Pensions Act 1995 (c. 26).

[^f00002]: 1999 c. 30.

[^f00003]: 1988 c. 1.

[^f00004]: 1982 c. 50.

[^f00005]: Section 842 was amended by section 117(1) and (4) of the Finance Act 1998 (c. 39), section 55 of the Finance Act 1990 (c. 29), paragraphs 14(1) and 55 of Schedule 10 to the Taxation of Chargeable Gains Act 1992 (c. 12), paragraph 8 of Schedule 17 to the Finance Act 1994 (c. 9), paragraphs 2 and 3 of Schedule 30 to the Finance Act 1996 (c. 8) and paragraph 7 of Schedule 38 to that Act.

[^f00006]: Section 43(1) was amended by paragraph 42 of Schedule 5 to the Pensions Act 1995 and paragraph 47(2) of Schedule 1 to the Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2). Section 43(4) to (6) was amended by paragraph 47(2) of Schedule 1 to the Social Security Contributions (Transfer of Functions, etc.) Act 1999.

[^f00007]: Section 8(1) was amended by section 136(2) of the Pensions Act 1995 and paragraph 21 of Schedule 5 to that Act and by paragraph 33 of Schedule 1 to the Social Security Contributions (Transfer of Functions, etc.) Act 1999.

[^f00008]: 1986 c. 60. Investments falling within paragraphs 1 to 5 of Schedule 1 to the Financial Services Act 1986 comprise shares and stock in the share capital of a company, debentures and other instruments creating or acknowledging indebtedness, government and public securities, instruments entitling the holder to subscribe for any of the above, and certificates representing securities. These are further defined in those paragraphs.

[^f00009]: 1986 c. 45. Section 249 was amended by section 90, Schedule 15 to the Building Societies Act 1986 (c. 53) and section 23, Schedule 102 to the Friendly Societies Act 1992 (c. 40).

[^f00010]: Section 632(1) was amended by the Personal Pension Schemes (Establishment of Schemes) Order 1988 (S.I. 1988/993) and the Personal Pension Schemes (Establishment of Schemes) Order 1997 (S.I. 1997/2388).

[^f00011]: S.I. 1999/3147 (N.I. 11).

[^f00012]: Section 97 was amended by paragraph 4(a) to (c) of Schedule 6 to the Pensions Act 1995.

[^f00013]: Section 10 was amended by paragraph 25 of Schedule 5 to the Pensions Act 1995 and paragraph 36 of Schedule 1 to the Social Security Contributions (Transfer of Functions, etc.) Act 1999.

[^f00014]: Section 28 was amended by sections 142 and 146 of the Pensions Act 1995 and paragraph 34 of Schedule 5, and Part III of Schedule 7, to that Act.

[^f00015]: Section 95 was amended by paragraph 3 of Schedule 6 to the Pensions Act 1995.

[^f00016]: 1986 c. 60. Relevant amending instruments are S.I. 1988/803, 1990/349, 1995/3275, 1996/2996 and 1997/32.

[^f00017]: 1982 c. 50.

[^f00018]: 1987 c. 22.

[^f00019]: 1987 c. 22, as amended by the Bank of England Act 1998 (c. 11).

[^f00020]: Section 7 was amended by section 23(1) of, and paragraphs 1 and 4 of Schedule 5 to, the Bank of England Act 1998 (c. 11).

[^f00021]: 1985 c. 6. Section 736 was substituted by section 144(1) of the Companies Act 1989 (c. 40).

[^f00022]: 1986 c. 60. Section 1 defines “investment business” as the business of engaging in one or more of the activities falling within Part II of Schedule 1 to that Act if that business is not excluded by Part III to Schedule 1 of that Act.

[^f00023]: Paragraph 27 was amended by article 10 of S.I. 1996/2958 and article 2(4) of S.I. 1996/1322.

[^f00024]: S.I. 1992/3218. Regulation 5 was amended by regulation 2(e) and 2(f) of S.I. 1993/3225 and regulation 55 of, and Schedule 9 paragraph (3) to, S.I. 1195/3275.

[^f00025]: 1973 c. 18. Section 23(6) was inserted by section 16 of the Administration of Justice Act 1982 (c. 53) and sections 25B and 25C were inserted with savings by the Pensions Act 1995.

[^f00026]: S.I. 1978/1045 (N.I. 15). Articles 27B and 27C were inserted by Article 162(1) of the Pensions (Northern Ireland) Order 1995 and are amended by paragraphs 1 and 2 respectively of Schedule 4 to the Welfare Reform and Pensions (Northern Ireland) Order 1995.

[^f00027]: 1985 c. 37. Section 12A was inserted by section 167 of the Pensions Act 1995 and is amended by paragraph 6 of Schedule 12 to the Act.

[^f00028]: Section 97 was amended by paragraph 4(a) to 4(c) of Schedule 6 to the Pensions Act 1995.

[^f00029]: Section 634A was inserted by paragraphs 1 and 4 of Schedule 11 to the Finance Act 1995 (c. 4) and section 636A was inserted by paragraphs 1 and 7 of that Schedule.

[^f00030]: S.I. 1987/1110; to which there are amendments not relevant to this instrument.

[^f00031]: S.I. 1991/167.

[^f00032]: S.I. 1999/3147 (N.I. 11).

[^f00033]: S.I. 1996/1655; to which there are amendments not relevant to this instrument.

[^f00034]: S.I. 1996/1461; to which there are amendments not relevant to this instrument.

[^f00035]: S.I. 1999/3147 (N.I. 11).

[^f00036]: S.I. 1996/1216; regulation 6(1) was amended by regulation 5(6)(a) of S.I. 1997/786. There are other amendments not relevant to this instrument.

[^f00037]: S.I. 1996/3127; to which there are amendments not relevant to this instrument.

[^f00038]: 1993 c. 48.

[^f00039]: 1995 c. 26.

[^f00040]: 1999 c. 30.

[^f00041]: S.I. 1997/785; as amended by S.I. 1999/1849.

[^f00042]: S.I. 1996/1655; as amended by S.I. 1997/786.

[^f00043]: S.I. 1996/1270.

[^f00044]: S.I. 1996/3127.

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