The National Health Service Pension Scheme (Amendment) Regulations 2008

(M1) (1) A member who leaves pensionable employment with a preserved pension has the right to require the Secretary of State to transfer or buy-out the member’s rights under the scheme as described in this regulation. (2) Subject to the following provisions of this regulation, the member may require the Secretary of State to use the cash equivalent of the member’s rights under the scheme— (a) to purchase one or more buy-out policies from one or more insurance companies chosen by the member; or (b) to acquire rights under— (i) another occupational pension scheme; or (ii) a personal pension scheme, that satisfies the requirements of Chapter IV of Part IV of the 1993 Act; or (c) to acquire rights under an arrangement that is a qualifying recognised overseas pension scheme for the purposes of section 169(2) of the 2004 Act; or (d) in any combination of the ways described in sub-paragraphs (a), (b) and (c). (3) The member must exercise the member’s right in relation to each and every portion of the cash equivalent unless paragraph (4) applies. (4) The benefits attributable to— (a) the member’s accrued rights to a guaranteed minimum pension; or (b) the member’s accrued rights attributable to service in contracted-out employment on or after 6th April 1997, may be excluded from the cash equivalent transfer value payment if section 96(2) of the 1993 Act applies (trustees or managers of certain receiving schemes or arrangements able and willing to accept a transfer payment only in respect of the member’s other rights). (5) A member who requires the cash equivalent to be used to acquire rights under another pension scheme in accordance with paragraph (2) may exercise the right— (a) at any time before reaching age 60; or (b) at a later time if the member exercises the right to require a transfer on the transfer of the member’s employment to a new employer as a result of a transfer of an undertaking to that employer. (6) A member may require the Secretary of State to use the cash equivalent of the member’s rights under the scheme to purchase one or more buy-out policies or to acquire rights under a personal pension scheme only— (a) if the member leaves pensionable employment on or after 1st January 1986; and (b) if those rights are to be transferred to a personal pension scheme, in relation to any period of service of 2 years or more falling before 6th April 1988, only if a period of not less than one month has elapsed between the date the member left NHS employment and the date of commencement of any further NHS employment. (7) If a member— (a) leaves pensionable employment by opting-out; and (b) on so doing becomes entitled to a preserved pension under regulation L; and (c) has at least 2 years’ service before 6th April 1988, the member’s right to require a transfer or buy-out will be limited to the cash equivalent of the part of the member’s rights that is attributable to service after 5th April 1988 and the member will acquire a right to the cash equivalent of the member’s remaining rights only if the member actually leaves NHS employment before reaching age 60. (8) A member who leaves pensionable employment before reaching age 60, without becoming entitled to a pension under any of regulations E1 to E5 or a preserved pension under regulation L1 will be treated, for the purposes of regulations M1 to M5, as if the member left pensionable employment with a preserved pension, except that— (a) a member who requires the cash equivalent to be used to buy one or more buy-out policies must exercise the right to buy-out within 12 months after leaving pensionable employment; and (b) a member who requires the cash equivalent to be used to acquire rights under another occupational pension scheme, a personal pension scheme or a qualifying recognised overseas pension scheme must join that other scheme within 12 months after leaving pensionable employment and exercise the right to transfer within 12 months after joining that other scheme. (M2) (1) A member who wishes to exercise the member’s right to a transfer or a buy out must apply in writing to the Secretary of State for a statement of the amount of the cash equivalent of the member’s accrued benefits under the Scheme at the guarantee date (a “statement of entitlement”). (2) In these Regulations, “the guarantee date” means any date that— (a) falls within the required period; and (b) is chosen by the Secretary of State; and (c) is specified in the statement of entitlement; and (d) is within the period of 10 days ending with the date on which the member is provided with the statement of entitlement. (3) In counting the period of 10 days referred to in sub-paragraph (d), Saturdays, Sundays, Christmas Day, New Year’s Day and Good Friday are excluded. (4) In paragraph (2) “the required period” means— (a) the period of 3 months beginning with the date of the member’s application for a statement of entitlement; or (b) such longer period beginning with that date (but not exceeding six months) as may reasonably be required if, for reasons beyond the control of the Secretary of State, the requisite information cannot be obtained to calculate the amount of the cash equivalent. (5) The member may withdraw the application for a statement of entitlement by notice in writing at any time before the statement is provided. (M3) (1) Subject to the following provisions of this regulation, the member’s guaranteed cash equivalent will be equal to the capitalised value of all the member’s accrued rights to benefits under the scheme and any associated rights under Part I of the Pensions (Increase) Act 1971, calculated and verified as required by Chapter IV of Part IV of the 1993 Act. (2) Except in the case of a transfer payment accepted under regulation N3A (transfers in respect of members to whom regulation B5 applies who elect to join or rejoin the scheme), a member’s cash equivalent will be at least equal to the amount of any transfer payments accepted in respect of the member under regulation N1(4) (member’s right to transfer accrued benefits to the scheme), plus the amount of the member’s contributions to the scheme. (3) If a member’s cash equivalent is used to acquire rights under another occupational pension scheme, any part of the cash equivalent that relates to service before 29th January 1988 will be calculated as described in the previous Regulations as applicable immediately before that date, if this would be more favourable to the member. (4) If the transfer value payment is made under the public sector transfer arrangements, the amount of the transfer value payment is calculated— (a) in accordance with those arrangements rather than paragraphs (2) and (3); and (b) by reference to the guidance and tables provided by the Scheme Actuary for the purposes of this paragraph that are in use on the date used for the calculation. (5) In any case where the Secretary of State has directed, under regulation T6, that part of a member’s benefits under these Regulations shall be forfeited, the cash equivalent payable in respect of that member shall be reduced by the capitalised value of the forfeited part of those benefits. (M4) (1) A member who has applied for and received a statement of entitlement under regulation M2 may apply in writing to the Secretary of State for a transfer value payment to be made. (2) On making such an application a member becomes entitled to a payment of an amount equal, or amounts equal in aggregate, to the amount specified in the statement of entitlement (or such other amount as may be payable by virtue of regulation M5(2)). (3) In these Regulations such a payment is referred to as “the guaranteed cash equivalent transfer value payment”. (4) The application must specify the pension scheme or other arrangement to which the payment or payments should be applied. (5) The application must meet such other conditions as the Secretary of State may require. (6) An application under this regulation may be withdrawn by notice in writing to the Secretary of State, unless an agreement for the application of the whole or part of the guaranteed cash equivalent transfer value payment has been entered into with a third party before the notice is given. (M5) (1) Subject to paragraph (5), an application under regulation M4 must be made before the end of the period of 3 months beginning with the guarantee date, and the payment must be made no later than— (a) 6 months after that date; or (b) if it is earlier, the date on which the member reaches 60. (2) If the payment is made later than 6 months after the guarantee date, the amount of the payment to which the member is entitled must be increased by— (a) the amount by which the amount specified in the statement of entitlement falls short of the amount it would have been if the guarantee date had been the date on which the payment is made; or (b) if it is greater and there was no reasonable excuse for the delay in payment, interest on the amount specified in the statement of entitlement, calculated on a daily basis over the period from the guarantee date to the date when the payment is made at an annual rate of 1 per cent above the Bank of England base rate. (3) In this regulation “Bank of England base rate” means— (a) except where sub-paragraph (b) applies, the rate announced from time to time by the Monetary Policy Committee of the Bank of England as the official dealing rate, being the rate at which the Bank is willing to enter into transactions for providing short term liquidity in the money markets, and (b) if an order under section 19 of the Bank of England Act 1998 is in force, any equivalent rate determined by the Treasury under that section. (4) Paragraph (5) applies if— (a) disciplinary or court proceedings against the member are begun within 12 months after the member leaves the employment which qualified the member to belong to the Scheme; and (b) it appears to the Secretary of State that the proceedings may lead to all or part of the member’s benefits being forfeited under regulation T6. (5) The Secretary of State may defer doing what is needed to carry out what the member requires until the end of the period of 3 months beginning with the date on which those proceedings (including any proceedings on appeal) are concluded. (6) In any case where a direction is given under regulation T6 for the forfeiture of a member’s benefits, this regulation applies as if the amount specified in the statement of entitlement were reduced by an amount equal to the value of the benefits forfeited, as determined by the Scheme Actuary. (7) Subject to paragraph (8), if a transfer value payment is made in respect of a member’s rights under the Scheme, those rights are extinguished. (8) If the member’s rights described in regulation M1(4) have been excluded from the transfer payment, the Secretary of State will continue to be liable to provide the benefits described in regulation K2(7) (guaranteed minimum pension). (M6) (1) If one or more members (the transferring members)— (a) leave pensionable employment, (b) join another occupational pension scheme, and (c) exercise a right to transfer to that scheme under regulation M2, the Secretary of State may, after taking advice from the Scheme Actuary, make a single transfer payment to that scheme in respect of the transferring members. (2) The Secretary of State must calculate the amount of any transfer payment paid under this regulation after taking advice from the Scheme Actuary.

Amendment of regulation N1

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In paragraph (2)(b) of regulation N1 (member’s right to transfer accrued rights to benefits to the scheme) after “amount of the transfer payment”, insert “that relates to rights accrued in the transferring scheme before 6th April 1997”.

Omission of regulation N5

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Regulation N5 (waiver of transfer payment) shall be omitted.

Amendment of regulation P2

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In regulation P2 (other leave of absence) for paragraphs (1) and (2), substitute—

(1) This regulation applies to a member who starts a leave of absence from work on, or after, 1st April 2008 for reasons other than those referred to in regulation P1. (2) A period of absence to which this regulation applies will count as pensionable service if for a continuous period not exceeding 6 months commencing with the member’s first day of leave of absence, the member contributes to the scheme.

Amendment of regulation Q1

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• (1) Regulation Q1 (right to buy additional service) shall be amended as follows.

• (2) After paragraph (1) insert—

(1A) A member may only increase the member’s rights to benefit by buying additional service, other than that to which paragraph (9) of this regulation refers, if— (a) the member has given notice of the member’s intention to exercise that right in writing or in such other form as the Secretary of State agrees to accept; and (b) that notice is received by the member’s employing authority or the scheme administrator on or before 31st March 2008; and (c) the Secretary of State accepts an election to pay for additional service under regulation Q3 and the member makes regular additional contributions in respect of that election from a birthday that falls between 1st April 2008 and 31st March 2009.

• (3) For paragraph (2) substitute—

(2) A member buying additional service to which paragraph (9) of this regulation refers, may choose to pay for that additional service by— (a) making a single payment in accordance with regulation Q4; or (b) making regular additional contributions in accordance with regulation Q6; or (c) a combination of (a) and (b). (2A) A member buying additional service other than that to which paragraph (9) of this regulation refers, must pay for that additional service by making regular additional contributions in accordance with regulation Q6.

• (4) In paragraph 4(a) for “(early retirement pension on grounds of ill health)”, substitute “or E2A”.

• (5) After paragraph (5A) insert—

(5B) For the purpose of regulation G14 (surviving nominated partner’s pension), if a member who has a nominated partner exercised the member’s right to buy additional service before 6 April 1988, the additional service bought as a result of the exercise of that right will be treated as service before 6th April 1988.

• (6) In paragraph (11) omit the definition of “tax year”.

Amendment of regulation Q2

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In paragraph (1)[^f00022] of regulation Q2 (right to buy an unreduced retirement lump sum) omit “or in a civil partnership”.

Amendment of regulation Q4

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• (1) Regulation Q4 (paying for additional service by single payment) is amended as follows.

• (2) For paragraph (1) substitute—

(1) A member who wishes to buy additional service for all or part of the member’s previous pensionable service in accordance with regulation Q1(9) by a single payment must elect to do so within 12 months of re-joining the scheme following the break in pensionable employment described in that regulation.

• (3) Omit paragraph (2).

• (4) For paragraph (3) substitute—

(3) The amount of a single payment for additional service will be one-half of the cost calculated in accordance with Table 1 of Schedule 1.

• (5) Omit paragraph (7).

Amendment of regulation Q5

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After paragraph (2A) of regulation Q5 (paying for unreduced lump sum by single payment) insert—

(2B) A member who has a nominated partner who wishes to pay for an unreduced lump sum by a single payment must elect to do so within 12 months after applying for the member’s nominated partner to receive a dependent surviving nominated partner’s pension under regulation G15.

Amendment of regulation Q6

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• (1) Regulation Q6 (paying for additional service or unreduced retirement lump sum by regular additional contributions) is amended as follows.

• (2) In paragraph (6) after “scheme” insert “before 1st April 2008” and for “the Inland Revenue” substitute “HM Revenue and Customs”.

• (3) After paragraph (6) insert—

(6A) The member’s total regular additional contributions made on or after 1st April under this regulation may not exceed— (a) in the case of a member paying contributions of 5 per cent of the member’s pensionable pay under regulation D1 on the member’s birthday immediately following the date of the election referred to in paragraph (3), 10 per cent of pensionable pay; (b) in the case of a member paying contributions of more than 5 per cent of the member’s pensionable pay under regulation D1 on the birthday referred to in (a), 9 per cent of pensionable pay, or (c) in any case referred to in (a) or (b) above, any other limit specified for the time being by HM Revenue and Customs.

Amendment of regulation Q7

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• (1) Regulation Q7 (part payment for additional service or unreduced retirement sum) is amended as follows.

• (2) In paragraph (2) for “(early retirement pension on grounds of ill health)”, substitute “or E2A”.

• (3) In paragraph (3) after “E2”, insert “or E2A”.

Insertion of new regulations Q8 to Q17

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After regulation Q7 (part payment for additional service or unreduced retirement sum) insert—

(Q8) (1) A member who is in pensionable employment may opt to make additional periodical contributions during the contribution option period to increase by a specified amount— (a) the benefits payable to the member under Parts E, L and S (including if a member dies after a pension becomes payable, the benefits paid to a surviving partner and dependent children at the same rate as the member’s pension for three to six months under Part S, G and H); or (b) those benefits and the benefits otherwise payable in respect of surviving partners and dependent children under Parts S, G and H. (2) A member may exercise the option under paragraph (1) more than once. (3) If a member exercises an option under paragraph (1), the member’s employing authority must— (a) deduct the member’s contributions from the member’s earnings; and (b) pay them to the Secretary of State not later than the 19th day of the month following the month in which the earnings were paid. (4) The annual amount of the periodical contributions payable at the beginning of the contribution option period must not be— (a) an amount less than the minimum amount; or (b) an amount other than a multiple of the minimum amount. (5) In paragraph (4) “the minimum amount” means the amount that would, in accordance with tables prepared for the Secretary of State by the Scheme Actuary for the Scheme year in which the contributions are paid, be the amount of the contributions required to secure an increase in the member’s pension of— (a) £250; or (b) such other amount as the Secretary of State may for the time being determine assuming that the contributions are made in accordance with the option for the remainder of the option period. (6) The tables referred to in paragraph (5)— (a) may specify different amounts for different descriptions of members; and (b) may be amended during a Scheme year, but no such amendment affects the contributions payable under any option during that year, except an option under which contributions begin to be paid after the date on which the amendment takes effect. (7) The total increase in the member’s pension as a result of contributions made under this regulation, taken together with any increase as a result of— (a) contributions made under regulation Q10; or (b) contributions made under regulation Q11, may not exceed £5000 or such other amount as the Secretary of State may for the time being determine. (8) In these Regulations “the contribution option period”, in relation to an option under this regulation, means a period of whole years, that— (a) is specified in the option; (b) begins with the pay period in respect of which the first contribution is made under the option; (c) is not less than 1 year nor more than 20 years; and (d) does not end later than the member’s chosen birthday as specified in the option (9) For the purposes of this part, a member’s “chosen birthday” must be either the member’s 60th or 65th birthday. (Q9) (1) This paragraph applies if during the contribution option period a member who has exercised the option under regulation Q8— (a) is absent from work for any of the reasons described in regulation P1(2); or (b) is on a leave of absence in accordance with regulation P2. (2) If paragraph (1) applies— (a) the contributions under the option continue to be payable unless the member ceases paying contributions under regulation D1; and (b) where the member does so cease, the member may continue to make contributions in accordance with the option if the member resumes making contributions under regulation D1 before the end of the period of 12 months beginning with the day on which the member first ceased to pay those contributions. (3) This paragraph applies if a member— (a) exercises the option under regulation Q8; (b) leaves pensionable employment during the contribution option period; and (c) returns to pensionable employment within 12 months of leaving. (4) If paragraph (3) applies, the member may continue to make contributions in accordance with the option after returning to pensionable employment unless a refund of contributions has been made to the member under regulation L2. (5) For the purposes of paragraph (4) it does not matter whether the member has paid any of the repaid contributions to the Secretary of State in accordance with regulation L4(5) (early leavers returning to pensionable employment). (Q10) (1) A member who is in pensionable employment may opt to make a single lump sum contribution to increase by a specified amount— (a) the benefits payable to the member under parts E, L and S (including if a member dies after a pension becomes payable, the benefits paid to a surviving partner and dependent children at the same rate as the member’s pension for three to six months under Part S, G and H); or (b) those benefits and the benefits otherwise payable in respect of surviving partners and dependent children under Parts S, G and H. (2) A member may only make a contribution under this regulation of an amount— (a) that is not less than the minimum amount; or (b) a multiple of that amount. (3) In paragraph (2) “the minimum amount” means the amount that is, in accordance with tables prepared for the Secretary of State by the Scheme Actuary, the amount of the single contribution required at the time that the option is exercised to secure an increase in the member’s pension of— (a) £250, or (b) such other amount as the Secretary of State may for the time being determine. (4) A member may exercise the option under paragraph (1) more than once. (5) If a member exercises an option under paragraph (1) the additional contribution is payable by the member to the employing authority— (a) by deduction from the member’s earnings or otherwise; and (b) before the end of the period of 1 month beginning with the day on which the member is notified by the Secretary of State that the option is accepted; and (c) the employing authority must pay the additional contribution to the Secretary of State not later than the 19th day of the month following the month in which the earnings were paid or, as the case may be, the authority received payment of the contribution. (6) The total increase in the member’s pension as a result of contributions made under this regulation, taken together with any increase as a result of— (a) contributions made under regulation Q8; or (b) contributions made under regulation Q11, may not exceed £5000 or such other amount as the Secretary of State may for the time being determine. (Q11) (1) The employing authority of a member who is in pensionable employment may opt to make a single lump sum contribution to increase by a specified amount— (a) the benefits payable to the member under parts E, L and S (including, if a member dies after a pension becomes payable, the benefits paid to a surviving partner and dependent children at the same rate as the member’s pension for three to six months under Part S, G and H); or (b) those benefits and the benefits otherwise payable in respect of surviving partners and dependent children under Parts S, G and H. (2) An employing authority may only make a contribution under this regulation of an amount— (a) that is not less than the minimum amount (as defined in regulation Q10(3)); or (b) a multiple of that amount. (3) An employing authority may only exercise the option under paragraph (1) with the member’s consent, but may exercise it more than once in respect of the same member. (4) The total increase in the member’s pension as a result of contributions made under this regulation, taken together with any increase as a result of— (a) contributions made under regulation Q8; or (b) contributions made under regulation Q10, may not exceed £5000 or such other amount as the Secretary of State may for the time being determine. (5) A contribution under this regulation must be paid by the employing authority to the Secretary of State within one month of the date on which the authority gave the Secretary of State notice under regulation Q12(2). (Q12) (1) A member exercising an option under regulation Q8 or Q10 must do so by giving notice in writing to the employing authority, giving such information as may be required. (2) An employing authority exercising an option under regulation Q11 must do so by giving notice in writing to the Secretary of State, giving such information as may be required. (3) An option under regulation Q8, Q10 or Q11 may not be exercised during a period whilst the member is absent from work for any reason. (4) For the purposes of these Regulations— (a) a member is treated as exercising an option under regulation Q8 or Q10 on the date on which the employing authority receives the member’s notice under paragraph (1); and (b) an employing authority is treated as exercising an option under regulation Q11 on the date on which the Secretary of State receives the authority’s notice under paragraph (2). (5) The Secretary of State— (a) must refuse to accept an option exercised under— (i) regulation Q8 if not satisfied that that the member is in good health and there is no reason why the member’s health should prevent the member from paying the contributions for the whole contribution period; (ii) regulation Q10 or Q11 if not satisfied that the member is in good health, (b) may refuse to accept an option under regulation Q8, Q10 or Q11 in any other circumstances. (6) If the Secretary of State refuses to accept such an option, the Secretary of State must give notice in writing of that fact— (a) in the case of an option exercised under regulation Q8 or Q10, to the member; and (b) in the case of an option exercised under regulation Q11, to the employing authority and the member. (7) These Regulations apply as if an option— (a) under regulation Q8, Q10 or Q11 had not been exercised if the Secretary of State refuses to accept the option; (b) under regulation Q10 had not been exercised if the payment is not received by the employing authority— (i) before the end of the period of 1 month beginning with the day on which the Secretary of State notifies the member of the acceptance of the option; or (ii) if it is earlier, on or before the member’s chosen birthday, and (c) under regulation Q11 had not been exercised if the payment is not received by the Secretary of State on or before the member’s chosen birthday. (Q13) (1) A member may cancel an option under regulation Q8(1) by giving the employing authority notice in writing. (2) If a member cancels such an option, the additional periodical contributions cease to be payable for the first pay period beginning after the date on which the employing authority receives the notice and all subsequent pay periods. (3) If it appears to the Secretary of State that the requirement in regulation Q8(7) will not be met if the member continues to makes periodical contributions under an option exercised under regulation Q8, the Secretary of State may cancel the option by giving the member notice in writing. (4) If the Secretary of State cancels such an option, the additional periodical contributions cease to be payable for the first pay period beginning after the date specified in the notice and all subsequent pay periods. (Q14) (1) This regulation applies if— (a) an option is exercised by a member under regulation Q8 and all the contributions to be made under the option are made; (b) an option is exercised by a member under regulation Q10 or by a member’s employing authority under regulation Q11 and the lump sum payment is made. (2) Subject to paragraph (7), the member’s pension is increased by the full amount of the increase to be made in accordance with the terms of the option after the final adjustment in that amount in accordance with regulation Q17. (3) Paragraph (2) is without prejudice to any reduction falling to be made in accordance with regulation Q15(5) as a result of the member becoming entitled to payment of a pension before the member’s chosen birthday. (4) In the case of an option under regulation Q8(1)(b), Q10(1)(b) or Q11(1)(b), any benefit payable to a surviving partner or a dependent child in respect of the member under these regulations is increased by the appropriate amount. (5) In paragraph (4) subject to regulations Q15 and Q16(3) “the appropriate amount” means— (a) in the case of a surviving partner pension payable under regulation G2, G4 or S4A(10), 37.5 per cent of the amount of the increase mentioned in paragraph (2) that would have applied in the member’s case if the member had become entitled to the increase on the date of death (disregarding paragraph (3)); (b) in the case of a surviving partner pension payable under regulation G3, 37.5 per cent of the amount of the increase in the member’s pension as a result of the option; (c) in the case of a child allowance payable under regulation H3, H5 or S4A(17)(b), the appropriate fraction of 75 per cent of the amount of the increase mentioned in paragraph (2) that would have applied in the member’s case if the member had become entitled to the increase on the date of death (disregarding paragraph (3); (d) in the case of a child allowance payable under regulation H4, the appropriate fraction of 75 per cent of the amount of the increase in the member’s pension as a result of the option. (6) For the purposes of paragraph (5) the “appropriate fraction” means the same fraction as that applied to the member’s pension in order to calculate the amount of child allowance payable in respect of that member. (7) Paragraph (8) applies only to an option under Q8(1)(a), Q10(1)(a) or Q11(1)(a) where a pension is to be paid for either three or six months at the same rate as the member’s pension was being paid at the date of that member’s death. (8) Any increase in a member’s pension shall be included only in a benefit payable to a surviving partner or a dependent child in respect of the member under these regulations whilst it is being paid at the rate and for the duration of one of the periods referred to in paragraph (7). (Q15) (1) If a member in respect of whom an option under regulation Q8, Q10 and Q11 has been exercised dies before the end of the period of 12 months beginning with the date on which the option was exercised— (a) regulation Q14(4) does not apply, and (b) an amount equal to the contributions paid under the option must be paid— (i) in the case of an option under regulation Q8 or Q10, to the member’s personal representatives; and (ii) in the case of an option under regulation Q11, to the employing authority which made the contribution. (2) If a member in respect of whom an option under regulation Q8 has been exercised dies after the end of the period of 12 months beginning with the date on which the option was exercised and before the end of the contribution option period, regulation Q14(4) applies as if all contributions due after the date of death had been made. (3) If a member in respect of whom an option under regulation Q8, Q10 or Q11 has been exercised becomes entitled to a pension under regulation E2A as a result of a claim made before the end of the period of 12 months beginning with the date on which the option was exercised— (a) regulation Q14(2) and (4) does not apply; and (b) an amount equal to the contributions paid under the option must be paid— (i) in the case of an option under regulation Q8 or Q10, to the member, and (ii) in the case of an option under regulation Q11, to the employing authority which made the contribution. (4) If a member in respect of whom an option under regulation Q8 has been exercised becomes entitled to a pension under regulation E2A before the end of the contribution option period as a result of a claim made after the end of the period of 12 months beginning with the date on which the option was exercised, regulation Q14(2) and (4) applies as if all contributions under the option had been made. (5) If a member in respect of whom an option under regulation Q8, Q10 or Q11 has been exercised— (a) becomes entitled to a pension under regulation E3, E3A, or E5; or (b) becomes entitled to a pension under regulation E1 or L1 before reaching the age of 60; or (c) becomes entitled to a pension under regulation E1 after age 60 but before the member’s chosen birthday the increase in the member’s pension which would otherwise be due under regulation Q14(2) or regulation Q16 is reduced. (6) The amount of the reduction is such amount as the Secretary of State determines, after consulting the Scheme Actuary, to be appropriate by reason of the payment of the increase before the member reaches the member’s chosen birthday. (Q16) (1) This regulation applies if— (a) the full number and amount of contributions due under an option under regulation Q8 for the whole contribution option period are not made; and (b) paragraphs (1) to (4) of regulation Q15 do not apply. (2) The increase in the member’s pension is— (a) the appropriate proportion of the increase that would have been made under regulation Q14(2) if the full number and amount of contributions had been made; or (b) the appropriate proportion of the increase calculated in accordance with sub-paragraph (a) reduced in accordance with regulation Q15(6) if regulation 15(5) applies to the member. (3) In the case of an option under regulation Q8(1)(b), Q10(1)(b) or Q11(1)(b), the increase in any surviving partner or child allowance payable under parts G and H and S in respect of the member is— (a) the appropriate proportion of the increase that would have been made under regulation Q14(4) if the full number and amount of contributions had been made; or (b) the appropriate proportion of the increase calculated in accordance with sub-paragraph (a) reduced in accordance with regulation Q15(5) if that regulation applies to the member. (4) For the purposes of paragraphs (2) and (3), the appropriate proportion is calculated in accordance with such method as the Scheme Actuary may determine and specify in guidance given to the Secretary of State. (5) In making a determination under paragraph (4), the Scheme Actuary must have regard to— (a) the proportion that the total contributions paid bears to the full amount of contributions due under an option under regulation Q8 for the whole contribution option period; and (b) the preservation requirement (Q17) (1) This regulation applies for the purposes of determining the final amount of the increase in a member’s pension as a result of the exercise of an option under regulation Q8, Q10 or Q11. (2) The amount of that increase immediately before the beginning date for that pension is found as set out in paragraph (3). (3) Step 1 Calculate the amount of the increase in accordance with regulations Q14 to Q16 immediately before that date (“the basic amount”). Step 2 Multiply the basic amount by the retail prices index for the second month before that in which the person becomes entitled to it to find the Step 2 amount. Step 3 Divide the Step 2 amount by the retail prices index for the month in which the option was exercised to find the Step 3 amount. Step 4 Add to the Step 3 amount any amount by which the Step 3 amount would be increased under the Pensions (Increase) Act 1971 if it were the amount of the member’s pension to find the Step 4 amount. Step 5 Divide the Step 4 amount by the Step 3 amount to find the Step 5 factor. Step 6 Divide the Step 3 amount by the Step 5 factor to find the adjusted basic amount. (5) The amount of the increase in a member’s pension as a result of the exercise of an option under regulation Q8, Q10 or Q11as at the beginning date for that pension is— (a) if the adjusted basic amount is greater than the basic amount, the adjusted basic amount; and (b) otherwise the basic amount. (6) In this regulation “the beginning date”, in relation to a pension, means the date on which it is treated as beginning for the purposes of the Pensions (Increase) Act 1971 (see section 8(2) of that Act).

Amendment of regulation R3

52

In paragraph (7) of regulation R3 (mental health officers)—

(a) in sub-paragraph (a) for “(early retirement pension on grounds of ill health)”, substitute “or E2A”, (b) in sub-paragraph (b) for “or surviving civil partner’s”, substitute “, surviving civil partner’s or surviving nominated partner’s”.

Amendment of regulation R4

53

In paragraph (5) of regulation R4 (members doing more than one job), for “70” substitute “75”.

Amendment of regulation R5

54

For paragraph (6) of regulation R5 (part-time employment) substitute—

(6) If a member with pensionable service in part-time employment becomes entitled to a pension under regulation E2, E2A, E3 or E3A (ill health pensions, pensions on redundancy and early retirement pensions)— (a) the member’s pensionable service in part-time employment will count at its full length for the purpose of calculating— (i) whether and (if so) to what extent, the pensionable service upon which the pension under regulation E2 or E2A is based should be increased under that regulation; or (ii) the qualifying service for the purposes of regulation E3(2)(a) or regulation E3A(2)(a), (b) the pension will be based on the whole-time equivalent of the period of part-time employment and, in the case of a pension under regulation E2 or E2A, the increase under that regulation will be limited to such amount as bears the same proportion to the amount that would have been paid had the pensionable service not been part-time as the whole-time equivalent bears to comparable whole-time employment.

Amendment of regulation R9

55

• (1) Regulation R9 (members whose earnings are reduced) is amended as follows.

• (2) For paragraphs (1) and (2) substitute—

(1) The Secretary of State may agree to pay a preserved pension under regulation L1 in respect of a member’s pensionable service before the member’s earnings were reduced if — (a) the member has at least two years qualifying service; and (b) within the three month period after the member’s earnings are reduced that member’s employer certifies that the reduction is due to the circumstances described in paragraph (2); or (c) the member satisfies all of the conditions specified in paragraph (2A). (2) The circumstances referred in paragraph (1)(b) are that the reduction is due to— (a) the member being transferred to other employment with an employing authority; or (b) the member taking up other employment with an employing authority, in circumstances approved by the Secretary of State; or (c) a change in the member’s duties, while continuing in the same employment, otherwise than at the member’s request or as a result of something done by the member. (2A) The conditions referred to in paragraph (1)(c) are that— (a) the member has attained normal minimum pension age or, where relevant, protected pension age; (b) the member makes an election and the Secretary of State has not previously accepted an election made by that member, and (c) the member’s employer has certified that— (i) the member’s pensionable pay is reduced by at least 10 per cent for a period of at least one year beginning with the first pay day on which the reduced pensionable pay was paid; (ii) for a period of at least 12 months ending immediately before the reduction referred to in (i), the member’s pensionable pay had not been subject to any other reduction; (iii) the reduction to the member’s pensionable pay is the result of a change to that member’s duties so that the member’s new, or remaining, duties are less demanding and carry less responsibility than the member’s previous duties.

• (3) For paragraph (4), substitute—

(4) An election referred to in paragraph (2A) of this regulation must be made— (a) in writing and addressed to the Secretary of State, and (b) within 15 months of the member’s pensionable pay being reduced.

• (4) In paragraph (5) for “exercising the option described in this regulation”, substitute “the Secretary of State agrees to pay a preserved pension under regulation L1 in accordance with paragraph (1)”.

• (5) In paragraph (6)(b) after “(early retirement pension on grounds of ill health)”, insert “or E2A”.

• (6) For paragraph (7), substitute—

(7) If the member leaves pensionable employment with a pension under regulation E2 or E2A and the member’s pensionable service falls to be increased as described in— (a) paragraphs (4) to (6) of regulation E2; or (b) paragraphs (4) to (6) of regulation E2A then, if the member’s pensionable service before and after the break is treated separately under paragraph (5), the increase will apply only in respect of benefits attributable to the period after the member’s earnings were reduced. (8) For the purposes of this regulation, “pensionable pay” in respect of part-time employment means the amount that the Secretary of State determines would have been paid in respect of a single comparable whole-time employment.

Amendment of regulation S1

56

For paragraph (4) of regulation S1 (suspension of pension on return to NHS employment) substitute—

(4) The pension referred to in paragraph (1) shall again become payable if the member either ceases to be in any NHS employment (or reduces the number of hours worked to 16 or less) for a period of one month or, if sooner— (a) from the date of the member’s 70th birthday if the pension referred to in paragraph (1) becomes payable on or before 31st March 2008; or (b) from the date of the member’s 75th birthday if the pension referred to in paragraph (1) becomes payable on or after 1st April 2008.

Amendment of regulation S2

57

• (1) Regulation S2 (reduction of pension on return to NHS employment) is amended as follows.

• (2) For paragraphs (1) and (1A), substitute—

(1) Subject to paragraph (15), this regulation applies to a member— (a) until the member attains the age of 60; and (b) who is in receipt of a relevant pension; and (c) who continues in, or subsequently returns to, NHS employment. (1A) A relevant pension for the purpose of this regulation is a pension payable,— (a) in respect of pensionable employment that ceased before 1st April 2008,— (i) under any or regulations E2 to E3C (pensions on ill health retirement and redundancy), or (ii) in accordance with L1(2)(b)(preserved pension), or (b) in respect of pensionable employment that ceased on or after 1st April 2008,— (i) any of regulations E2 to E3, or (ii) in accordance with E3A(2)(d)(ii)(early retirement pension (termination of employment by employing authority)) or (iii) except where paragraph (c) applies, in accordance with L1(2)(b), or (c) where the member is a special class officer — (i) regulation E1(normal retirement pension), or (ii) if regulation R2(3)(b)(nurses, physiotherapists, midwives and health visitors) applies to the member, in accordance with L1(2)(b).

• (3) For paragraph (3) substitute—

(3) If the relevant pension is one referred to in paragraph (1A)(a) or (c)— (a) the member’s pension will be reduced by the appropriate amount; (b) the appropriate amount is the difference between the member’s previous pay and the aggregate of— (i) the amount of the member’s pension (including in that amount any amount by which that pension has been reduced pursuant to an election under regulation E7); and (ii) the amount of the member’s pay from NHS employment for any financial year after the pension becomes payable. (3A) If the relevant pension is one referred to in paragraph (1A)(b), the member’s pension will be reduced in accordance with paragraphs (3B) to (3D) if Amount A exceeds the member’s previous pay. (3B) The reduction in that member’s pension shall be equal to the difference between amount A and the member’s previous pay, but shall not exceed Amount B. (3C) For the purposes of paragraphs (3A) and (3B), amount A is the aggregate of— (a) the amount of the member’s pay from NHS employment for any financial year after the pension becomes payable; and (b) Amount B. (3D) For the purposes of paragraphs (3B) and (3C), amount B is the difference between— (a) the amount of the member’s pension (including in that amount any amount by which that pension has been reduced pursuant to an election under regulation E7); and (b) the amount of an actuarially reduced pension.

• (4) In paragraph (14), in the appropriate place in alphabetical order insert—

• “actuarially reduced pension” means such annual amount as the Secretary of State determines, after consulting the Scheme Actuary, to be the amount that would have been payable to the member (regardless of whether the member has reached normal minimum pension age or protected minimum pension age) if the member become entitled to a pension—calculated in accordance with regulation E5 (early retirement pension with actuarial reduction) at the time he became entitled to a pension mentioned in paragraph (1A)(b), plusany increases to that amount payable under Part I of the Pensions (Increase) Act 1971 for that period;

• (5) For paragraph (15), substitute—

(15) This regulation does not apply to— (a) practice staff in respect of whom a pension is payable under any of regulations E1 to E5(retirement pensions) and L1 (preserved pension) who were employed by a registered medical practitioner on both 31st August 1997 and 1st September 1997 and who— (i) were ineligible to rejoin the scheme with effect from 1st September 1997; or (ii) made an election not to rejoin the scheme with effect from that date and who have not cancelled that election; and (b) members who are transferred into NHS employment as a result of a transfer of an undertaking to the employer.

Insertion of new regulation S3A

58

After regulation S3 (benefits in respect of pensionable employment after pension becomes payable) insert—

(S3A) (1) This regulation applies to a member in respect of whom a pension is payable under regulation E2A (ill health pension on early retirement) and who subsequently returns to pensionable employment. (2) For the purposes of this regulation— (a) the member’s “previous service” means the pensionable service in respect of which the member became entitled to receive a pension under regulation E2A; and (b) the member’s “later service” means any pensionable service which accrues after becoming so entitled. (3) Subject to paragraph (4), the member’s benefits in respect of later service shall be calculated without regard to the member’s previous service. (4) For the purposes of regulation C2 (meaning of pensionable service) and regulation D1(3) and (4) (contributions by members), the member’s previous service and later service shall be aggregated. (5) Subject to the following provisions of this regulation, a member who— (a) is entitled to a tier 1 pension in respect of the member’s previous service; and (b) satisfies the tier 1 condition or, as the case may be, the tier 2 condition in respect of the member’s later service, shall be entitled to the following benefits. (6) Those benefits are— (a) the member’s original tier 1 pension in respect of the member’s previous service; and (b) a tier 1 pension or, as the case may be, a tier 2 pension in respect of the member’s later service.

Amendment of heading to regulation S4

59

In the heading to regulation S4 (benefits on death in pensionable employment after pension becomes payable) after “pension”, insert “under regulation E2”.

Amendment of regulation S4

60

In regulation S4 for paragraphs (4) to (9) substitute—

(4) If a member to whom this regulation applies leaves a surviving— (a) spouse or civil partner; or (b) nominated partner (if the member became entitled to the pension referred to in paragraph (1) on or after 1st April 2008), the amount of pension payable to the surviving spouse, civil partner or nominated partner shall be the aggregate of the amounts referred to in paragraphs (5) and (7). (5) Subject to paragraph (9), the amount payable in respect of the member’s previous service shall be equal to the amount of the member’s pension (if any) that was payable when he died. (6) The amount referred to in paragraph (5) shall be paid for— (a) the 3 months immediately following the member’s death; or (b) the 6 months immediately following the member’s death if he leaves a dependent child who is dependent on the surviving spouse, civil partner or nominated partner. (7) The amount payable in respect of the member’s later service shall be equal to the rate of the member’s pensionable pay when he died. (8) The amount referred to in paragraph (7) shall be paid for the 6 months immediately following the member’s death. (9) Paragraph (5) shall not apply if the aggregate of the spouse’s or civil partner’s pension and any child allowance which would otherwise be payable under these Regulations in respect of the member’s previous service is greater. (10) Upon expiry of the 3 month or, as the case may be, 6 month period referred to in paragraph (6), the amount of the surviving spouse’s, civil partner’s or nominated partner’s pension in respect of the member’s previous service shall be the amount determined in accordance with regulation G3. (11) Upon expiry of the 6 month period referred to in paragraph (8), the amount of the surviving spouse’s, civil partner’s or nominated partner’s pension in respect of the member’s later service shall be equal to one-half of the rate of pension mentioned in paragraph (3A) that would have been payable to the member. (12) If a member to whom this regulation applies leaves a dependent child but— (a) does not leave a surviving spouse or civil partner; and (b) a nominated partner pension is not payable in respect of the member’s later service, the child allowance, for the 6 months immediately following the member’s death, shall be equal to the aggregate of the member’s rate of pensionable pay when he died and the amount of the member’s pension (if any) that he was receiving at that time. (13) Subject to paragraph (14), except where a child allowance is payable at the rate mentioned in paragraph (12), the child allowance in respect of the member’s later service shall— (a) be paid as a proportion of the rate of pension mentioned in paragraph (3A) that would have been payable to the member; and (b) such proportion shall be determined in accordance with the circumstances as described in regulation H3 (member dies in pensionable employment). (14) If a member to whom this regulation applies leaves a child who was a dependent child both at the time the member terminated the member’s previous service and when he died, any child allowance payable under these Regulations shall be calculated according to— (a) regulation H4 (member dies after pension becomes payable) in respect of the pension already in payment; and (b) regulation H3 in respect of later pensionable employment. (15) If the aggregate of the pensionable service used in the calculation referred to in paragraph (14)(a) and that used in the calculation referred to in paragraph (14)(b) (“the member’s aggregated service”) is less than 10 years, additional service will be allocated to the later period of pensionable employment for the purpose of the calculation under regulation H3. (16) The amount of additional service referred to in paragraph (15) is the difference between 10 years pensionable service and the member’s aggregated service.

Insertion of new regulation S4A

61

After regulation S4 insert—

(S4A) (1) This regulation applies to a member in respect of whom a pension is payable under regulation E2A who— (a) returns to pensionable employment after that pension becomes payable; and (b) dies in pensionable employment. (2) For the purposes of this regulation, the member’s “previous service” means the pensionable service in respect of which the member became entitled to receive a tier pension under regulation E2A (ill health pension on early retirement) and the member’s “later service” means any pensionable service which accrues after becoming so entitled. (3) Subject to paragraph (4), the member’s benefits in respect of later service shall be calculated without regard to the member’s previous service. (4) For the purposes of regulation C2 (meaning of pensionable service) and regulation D1(3) and (4) (contributions by members), the member’s previous service and later service shall be aggregated. (5) If this regulation applies, a lump sum payable on the member’s death shall be payable in addition to any lump sum payable under regulation F2 (member dies after pension becomes payable). (6) The additional lump sum referred to in paragraph (5) shall be equal to 5 times the amount of the pension that would have been payable to the member had he left NHS employment and been entitled to a tier 2 pension based on the member’s later service under regulation E2A on the date of the member’s death. (7) If a member to whom this regulation applies leaves a surviving spouse, civil partner or nominated partner, the amount of pension payable to the surviving spouse, civil partner or nominated partner shall be the aggregate of the amounts referred to in paragraphs (8) and (10). (8) Subject to paragraph (12), the amount payable in respect of the member’s previous service shall be equal to the amount of the member’s pension (if any) that was payable when he died. (9) The amount referred to in paragraph (8) shall be paid for— (a) the 3 months immediately following the member’s death; or (b) the 6 months immediately following the member’s death if the member leaves a dependent child who is dependent on the surviving spouse, civil partner or nominated partner. (10) The amount payable in respect of the member’s later service shall be equal to the member’s rate of pensionable pay when the member died. (11) The amount referred to in paragraph (10) shall be paid for the 6 months immediately following the member’s death. (12) Paragraph (8) shall not apply if the aggregate of the spouse’s, civil partner’s or nominated partner’s pension and any child allowance which would otherwise be payable under these Regulations in respect of the member’s previous service is greater. (13) Upon expiry of the 3 month or, as the case may be, 6 month period referred to in paragraph (9), the amount of the surviving spouse’s, civil partner’s or nominated partner’s pension in respect of the member’s previous service shall be the amount determined in accordance with regulation G3 (member dies after pension becomes payable). (14) Upon expiry of the 6 month period referred to in paragraph (11), the amount of the surviving spouse’s, civil partner’s or nominated partner’s pension in respect of the member’s later service shall be equal to one-half of the rate of pension that would have been payable to the member had he become entitled to the pension mentioned in paragraph (6). (15) If a member to whom this regulation applies leaves a dependent child but does not leave a surviving spouse, civil partner, or nominated partner, the child allowance, for the 6 months immediately following the member’s death, shall be equal to the aggregate of— (a) the member’s rate of pensionable pay when the member died; and (b) the amount of the member’s pension (if any) that he was receiving at that time. (16) Subject to paragraph (17), except where a child allowance is payable at the rate mentioned in paragraph (15), the child allowance in respect of the member’s later service shall— (a) be paid as a proportion of the rate of pension that would have been payable to the member had he become entitled to the pension mentioned in paragraph (6); and (b) such proportion shall be determined in accordance with the circumstances as described in regulation H3 (member dies in pensionable employment). (17) If a member to whom this regulation applies leaves a child who was a dependent child both at the time the member terminated the member’s previous service and when he died, any child allowance payable under these Regulations shall be calculated according to— (a) regulation H4 (member dies after pension becomes payable) in respect of the pension already in payment; and (b) regulation H3 in respect of later pensionable employment. (18) If the aggregate of the pensionable service used in the calculation referred to in paragraph (17)(a) and that used in the calculation referred to in paragraph (17)(b) (“the member’s aggregated service”) is less than 10 years, additional service will be allocated to the later period of pensionable employment for the purpose of the calculation under regulation H3. (19) The amount of additional service referred to in paragraph (18) is the difference between 10 years pensionable service and the member’s aggregated service.

Amendment of regulation T2A

1

• (1) Regulation T2A (deduction of tax: further provisions) is amended as follows.

• (2) In paragraph (2) for “Where”, substitute “Subject to paragraph (2A), if”.

• (3) After paragraph (2) insert—

(2A) The member’s present or future benefits in respect of which any charge under paragraph (2) arises shall be reduced by an amount that fully reflects the amount of tax paid by the scheme administrator and shall be calculated by reference to advice provided by the Scheme Actuary for that purpose.

Amendment of regulation U1A

2

In regulation U1A (determinations by medical practitioners)—

• (a) in sub-paragraph (a) after “E2”, insert “or E2A”;

• (b) after sub-paragraph (e) insert—

(f) permanently incapable of regular employment because of physical or mental infirmity for the purposes of regulation E2A(2)(b)(ii),

Insertion of new regulation U4

3

After regulation U3 (accounts and actuarial reports) insert—

(U4) (1) The actuarial report referred to in regulation U3 (accounts and actuarial reports) shall specify— (a) a recommended contribution rate (RCR), and (b) a projected yield from members’ contributions (PYM). (2) Paragraphs (3) to (10) apply in respect of the actuarial report covering the period commencing on 1st April 2004 and ending on 31st March 2008 (“the 2004-2008 Report”) and, unless otherwise stated, references to the RCR in those paragraphs are to the RCR specified in the 2004-2008 Report. (3) Where the RCR differs from 20.5 per cent, that difference shall be the cost change element (CCE). (4) The Secretary of State shall, having taken advice from the scheme Actuary determine— (a) that part of the CCE which shall not be shared between the members and the employing authorities (the un-shared element (USE)), and (b) that part of the CCE which shall be shared between the members and the employing authorities (the shared element (SE)), but before making such a determination, the Secretary of State shall consider any advice relating to the elements referred to in (a) and (b) from such employee and employer representatives as appear to the Secretary of State to be appropriate. (5) Where RCR minus PYM is less than 14 per cent, contributions paid by employing authorities shall be equal to 14 per cent. (6) Where RCR minus PYM is equal to or greater than 14 per cent but less than or equal to 14.2 per cent, contributions paid by employing authorities shall be equal to RCR minus PYM. (7) Where— (a) RCR minus PYM is greater than 14.2 per cent, and (b) USE is greater than 0.0 per cent contributions paid by employing authorities shall be equal to the lower of— (i) RCR minus PYM and (ii) 14.2 per cent + USE. (8) Where— (a) RCR minus PYM is greater than 14.2 per cent, and (b) USE is less than or equal to 0.0 per cent, contributions paid by employing authorities shall be equal to 14.2 per cent. (9) If RCR is greater than the sum of— (a) the rate payable by employing authorities as determined under paragraphs (5) to (8), and (b) PYM, the Secretary of State may— (i) after consultation with such representatives of employees and employing authorities as appear to the Secretary of State to be appropriate, and (ii) with the consent of the Treasury and on the advice of the Scheme Actuary, amend member contributions and or benefits so that the rate payable by employing authorities as determined under paragraphs (5) to (8) is equal to Amount A. (10) For the purposes of paragraph (9)— (a) Amount A is the difference between the adjusted RCR and the adjusted PYM, and (b) adjusted RCR and adjusted PYM mean the RCR and PYM that would have been specified in the 2004-2008 Report had that Report been drawn up on the basis that any amendment to member contribution rates and scheme benefits made by the Secretary of State pursuant to paragraph (9) had already taken place. (11) Paragraphs (12) to (17) apply in respect of the actuarial report covering the period commencing on 1st April 2008 and ending on 31st March 2012 and subsequent reports and, unless otherwise stated, references to RCR in those paragraphs are to the RCR recommended in the actuarial report for the relevant period. (12) Where the RCR specified in the current actuarial report differs from 20.5 per cent, that difference shall be the cost change element (CCE). (13) The Secretary of State shall, having taken advice from the scheme Actuary determine — (a) that part of the CCE which shall not be shared between the members and the employing authorities (the un-shared element (USE)), and (b) that part of the CCE which shall be shared between the members and the employing authorities (the shared element (SE)), but before making such a determination, the Secretary of State shall consider any advice relating to the elements referred to in (a) and (b) from such employee and employer representatives as appear to the Secretary of State to be appropriate. (14) Where RCR is equal to or greater than 20.5 per cent + USE, contributions paid by employing authorities shall be equal to 14 per cent + USE. (15) Where RCR is less than 20.5 per cent +USE, contributions paid by employing authorities shall be equal to; $RCR−6.5%+X$ Where— X = $( 20.5%+USE−RCR ) 2$ and, where X is not a multiple of 0.1 per cent, X is rounded to the nearest odd multiple of 0.1 per cent. (16) If RCR is not equal to the sum of— (a) the rate payable by employing authorities as determined under paragraphs (14) and (15), and (b) PYM, the Secretary of State may— (i) after consultation with such representatives of employees and employing authorities as appear to the Secretary of State to be appropriate, and (ii) with the consent of the Treasury and on the advice of the Scheme Actuary, amend member contributions and or benefits so that the rate payable by employing authorities under paragraphs (14) to (15) is equal to Amount B. (17) For the purposes of paragraph (16)— (a) Amount B is the difference between the adjusted RCR and the adjusted PYM, and (b) adjusted RCR and adjusted PYM mean the RCR and PYM that would have been specified in the 2004-2008 Report had that Report been drawn up on the basis that any amendment to member contribution rates and scheme benefits made by the Secretary of State pursuant to paragraph (16) had already taken place. (18) In this regulation— (a) RCR, PYM, CCE, USE and SE shall be expressed as percentages to the nearest 0.1 per cent, (b) USE may include changes to RCR resulting from changes in— (i) the financial assumptions, (ii) the actuarial methodology, used to calculate RCR for the purposes of the immediately preceding actuarial report under regulation U3 where the current report is not the 2004-2008 Report, or where the 2004-2008 Report is the current report, that Report, (c) SE may include changes to RCR resulting from changes in— (i) the underlying membership data, (ii) the demographic assumptions, used to calculate RCR for the purposes of the immediately preceding actuarial report under regulation U3 where the current report is not the 2004-2008 Report, or where the 2004-2008 Report is the current report, that Report, (d) CCE, USE and SE may be positive or negative.

Amendment of Schedule 2

4

• (1) Schedule 2 is amended as follows.

• (2) In paragraph 1 (additional definitions used in this Schedule), in sub-paragraph (b) of the definition of “commissioned services”—

• (a) in sub-sub-paragraph (iii), for “paragraph 13 of Schedule 2 to the National Health Service and Community Care Act 1990 (National Health Service trusts—specific powers)” substitute “paragraph 18 of Schedule 4 to the 2006 Act or paragraph 18 of Schedule 3 to the 2006 (Wales) Act”;

• (b) in sub-sub-paragraph (iv), for “section 18(2)(b) of the Health and Social Care (Community Health and Standards) Act 2003” substitute “section 47(2)(b) of the 2006 Act”.

• (3) In paragraph 2(1) (application of Regulations with modifications) omit “Health Authority or” (where twice occurring).

• (4) In paragraph 2A (Membership: locum practitioners)—

• (a) sub-paragraph (4) is omitted;

• (b) in sub-paragraph (5) for “Except where sub-paragraph (4) applies, no”, substitute “No”.

• (5) In paragraph 3(2B)(a)(ii) (meaning of pensionable earnings) after “paternity leave”, insert “, parental leave”.

• (6) In paragraph 5(4), (5) and (6)[^f00023] (elections relating to calculation of pensionable earnings in medical partnerships) omit “Health Authority or”.

• (7) In paragraph 8[^f00024] (limit on pensionable earnings—dental practitioners)—

• (a) in sub-paragraph (2) after “1995”, insert “and ending before 1st April 2008”;

• (b) in sub-paragraph (3) omit “Health Authority, or”.

• (8) In paragraph 9[^f00025] (officer service treated as practitioner service)—

• (a) in sub-paragraph (1) omit “Health Authority,” (where twice occurring);

• (b) in sub-paragraph (5) after “E2”, insert “or E2A”;

• (c) in sub-paragraph (5A)(b) omit “Health Authority,”;

• (d) in sub-paragraph (8) omit “Health Authority or”;

• (9) For paragraph 10(2) (contributions to the scheme) substitute—

(2) The contribution rate for practitioners and non-GP providers is as set out in the following tables.

Column 1	Column 2
Amount of pensionable earnings	Contribution rate
Up to £19,682	5%
£19,683 to £65,002	6.5%
£65,003 to £102,499	7.5%
£102,500 to any higher amount	8.5%
Column 1	Column 2
---	---
Amount of pensionable earnings	Contribution rate
Up to £19,165	5%
£19,166 to £63,416	6.5%
£63,417 to £99,999	7.5%
£100,000 to any higher amount	8.5%
Column 1	Column 2
---	---
Amount of pensionable earnings	Contribution rate
Up to £18,697	5%
£18,698 to £61,869	6.5%
£61,870 to £97,560	7.5%
£97,561 to any higher amount	8.5%

(2A) The Secretary of State may make a determination substituting any or all of the amounts of pensionable earnings or contribution rates specified in the tables in sub-paragraph (2) with effect from the date specified in the determination, and before making a determination the Secretary of State must consider— (a) the advice of the Scheme Actuary, and (b) in accordance with regulation U4 (cost sharing), advice from such employee and employer representatives as the Secretary of State considers appropriate. (2B) If, apart from this paragraph, the earnings for a scheme year in respect of a member’s Practitioner or non-GP provider service would not be a whole number of pounds, those earnings will be rounded down to the nearest whole pound. (2C) If, in the 2008-2009 scheme year a member is in practitioner and non-GP provider service as well as (concurrently) employment other than as a practitioner in respect of which he is liable to pay contributions in accordance with regulation D1, the contributions payable in respect of the member’s— (a) practitioner or non-GP provider service, shall be determined in accordance with the provisions of these regulations that apply to a practitioner or non-GP provider, and (b) employment as an officer, shall be determined in accordance with the provisions of these regulations that apply to an officer. (2D) For the purposes of this paragraph, “zero hours contract” means pensionable employment as an officer in respect of a contract under which— (a) an employing authority does not guarantee to provide work for the member; (b) there are no specified working hours or working patterns; (c) the member is paid only for work actually done under it. (2E) Sub-paragraphs (2F) to (2O) apply to practitioners (other than a dentist performer) and non-GP providers. (2F) If the practitioner or non-GP provider— (a) was in pensionable employment throughout the 2007–2008 scheme year or began such employment during that year; and (b) was in such employment on 1st April 2008, sub-paragraphs (2G) to (2I) apply. (2G) If the practitioner or non-GP provider— (a) was engaged in pensionable employment as a practitioner or non-GP provider throughout the whole of the 2006-2007 scheme year; and (b) has, in accordance with paragraph 23, certified the member’s pensionable earnings for the 2006–2007 scheme year and forwarded a record of those earnings to the host Trust or Board, or is not required to certify earnings in accordance with that paragraph but the host Trust or Board has the member’s final pensionable earnings figure, the contributions payable for the 2008-2009 scheme year shall be those specified in column 2 of Table 2 in respect of the amount of pensionable earnings referred to in column 1 of that Table which correspond to the certified or final earnings for the aggregated total of all practitioner or provider sources for the 2006-2007 scheme year. (2H) If (2G) does not apply and a practitioner or non-GP provider— (a) was engaged in pensionable employment as practitioner or non-GP provider throughout the whole of the 2005–2006 scheme year; and (b) has, in accordance with paragraph 23, certified the member’s pensionable earnings for the 2005–2006 scheme year and forwarded a record of those earnings to the host Trust or Board, or is not required to certify earnings in accordance with that paragraph but the host Trust or Board has the member’s final pensionable earnings figure, the contributions payable for the 2008-2009 scheme year shall be those specified in column 2 of Table 3 in respect of the amount of pensionable earnings referred to in column 1 of that Table which correspond to the certified or final earnings for the aggregated total of all practitioner or provider sources for the 2005-2006 scheme year. (2I) If paragraphs (2G) or (2H) do not apply— (a) that practitioner’s or, as the case may be, the non-GP provider’s pensionable earnings in respect of the 2008-2009 scheme year shall be the amount agreed between the host Trust or Board on the one hand and the practitioner or provider on the other as representing their estimate of the practitioner’s or non-GP provider’s earnings from all practitioner or provider sources for that year, and (b) contributions payable for that year shall be those specified in column 2 of Table 1 in respect of the amount of pensionable earnings referred to in column 1 of that Table which corresponds to those estimated earnings. (2J) If the practitioner or non-GP provider commences pensionable employment for the first time (having no earlier practitioner or non-GP provider service) at any time during the 2008–2009 scheme year — (a) that practitioner’s or, as the case may be, the non-GP provider’s pensionable earnings for that scheme year shall be the amount agreed between the host Trust or Board on the one hand and the practitioner or provider on the other as representing their estimate of the practitioner’s or non-GP provider’s earnings from all practitioner or provider sources for that year, and (b) contributions payable for the 2008-2009 scheme year shall be those specified in column 2 of Table 1 in respect of the amount of pensionable earnings referred to in column 1 of that Table which corresponds to those estimated earnings. (2K) If a practitioner or non-GP provider— (a) commences further pensionable employment as a practitioner or non-GP provider at any time during the 2008-2009 scheme year (“the later employment”); (b) has existing or previous employment during that scheme year as a practitioner or as a non-GP provider in respect of which he is, or was, liable to pay contributions in accordance with this paragraph (“the earlier employment”), and (c) regardless of whether or not the practitioner or non-GP provider also is, or previously was, in NHS employment other than as a practitioner during the 2008-2009 scheme year, that practitioner or non-GP provider shall pay contributions in respect of the later employment at the same rate as that which applied to the earlier employment. (2L) If a practitioner or non-GP provider— (a) commences employment as a practitioner or non-GP provider at any time during the 2008-2009 scheme year (“the later employment”); (b) has previous employment during that scheme year in respect of which he was liable to pay contributions to the scheme as a dentist performer in accordance with this paragraph (“the earlier employment”); and (c) has ceased the earlier employment prior to commencing the later employment, and (d) regardless of whether or not the practitioner or non-GP provider also is, or previously was, in NHS employment other than as a practitioner during the 2008-2009 scheme year, that practitioner or non-GP provider shall pay contributions in respect of the later employment at the same rate determined in accordance with paragraph (2J). (2M) If a practitioner or non-GP provider— (a) commences employment as a practitioner or non-GP provider at any time during the 2008-2009 scheme year (“the later employment”); (b) has no previous practitioner or non-GP provider employment in that scheme year; (c) has previous employment as an officer on a whole-time or part-time basis employment during that scheme year (excluding any employment under a zero hours contract) in respect of which he was liable to pay contributions to the scheme in accordance with regulation D1 (“the earlier employment”), and (d) has ceased the earlier employments prior to commencing the later employment, that practitioner or non-GP provider shall pay contributions in respect of the later employment at the same rate as that which applied to the earlier employment. (2N) Where (2M) applies and the practitioner or non-GP provider had two or more earlier officer employments, that practitioner or non-GP provider shall pay contributions in respect of the later employment at the same rate as that which applied to whichever of the earlier officer employments was the last to cease. (2O) Where (2N) applies and all of the earlier officer employments or the last two of them cease on the same day— (a) that practitioner’s or non-GP provider’s pensionable earnings in respect of the later employment referred to in paragraph (2M)(a) shall be the amount agreed between the host Trust or Board on the one hand and the practitioner or provider on the other as representing their estimate of the practitioner’s or provider’s pensionable earnings from all practitioner or provider sources for that year, and (b) contributions payable for the 2008-2009 scheme year shall be those specified in column 2 of Table 1 in respect of the amount of pensionable earnings referred to in column 1 of that Table which corresponds to those estimated earnings. (2P) If a dentist performer— (a) was in pensionable employment as a dentist performer throughout the 2007–2008 scheme year or began such employment during that year, and (b) was in such employment on 1st April 2008, sub-paragraphs (2Q) or (2R) apply. (2Q) If a dentist performer was in pensionable employment as a dentist performer during any part of the 2006–2007 scheme year— (a) that performer’s pensionable earnings shall be determined by applying the formula— $PER NDPE ×365$ where— - PER is the total of all dentist performer pensionable earnings received during that part of the scheme year referred to in sub-paragraph (a); - NDPE is the number of days of pensionable employment, and (b) the contributions payable for the 2008-2009 scheme year shall be those specified in column 2 of Table 2 in respect of the amount of pensionable earnings referred to in column 1 of that Table corresponding to the practitioner’s pensionable earnings for the 2006–2007 scheme year calculated in accordance with sub-paragraph (a). (2R) If (2Q) does not apply and the dentist performer was engaged in pensionable service as a dentist performer during any part of the 2007–2008 scheme year— (a) that performer’s pensionable earnings shall be determined by applying the formula— $PER NDPE ×365$ where— - PER is the total of all dentist performer pensionable earnings received during that part of the scheme year referred to in paragraph (2R)(a); - NDPE is the number of days of pensionable employment, and (b) the contributions payable for the 2008-2009 scheme year shall be those specified in column 2 of Table 1 in respect of the amount of pensionable earnings referred to in column 1 of that Table which correspond to the performer’s pensionable earnings for the 2007-2008 scheme year calculated in accordance with sub-paragraph (a). (2S) If a dental performer commences pensionable employment for the first time (having no earlier dentist performer employment) at any time during the 2008–2009 scheme year— (a) that performer’s pensionable earnings shall be determined by applying the formula— $EPE NDPE ×365$ where— - EPE is an estimate of the practitioner’s pensionable earnings from all sources for the days of pensionable employment in the 2008–2009 scheme year; and - NDPE is the number of days of pensionable employment, and (b) contributions payable shall be those specified in column 2 of Table 1 in respect of the amount of pensionable earnings referred to in column 1 of that Table corresponding to the practitioner’s pensionable earnings for the 2008–2009 scheme year calculated in accordance with this sub-paragraph. (2T) If a dentist performer— (a) commences further pensionable employment as a dentist performer at any time during the 2008-2009 scheme year (“the later employment”);and (b) has existing or previous pensionable employment during that scheme year as a dentist performer in respect of which he is, or was, liable to pay contributions in accordance with this paragraph (“the earlier employment”), that dentist performer shall pay contributions in respect of the later employment at the same rate as that which applied to the earlier employment. (2U) If a dentist performer— (a) commences employment as a dentist performer at any time during the 2008-2009 scheme year (“the later employment”); (b) has previous employment during that scheme year in respect of which he was liable to pay contributions to the scheme as a practitioner (other than a dentist performer) or a non-GP provider in accordance with this paragraph (“the earlier employment”); (c) has ceased the earlier employment prior to commencing the later employment, and (d) regardless of whether or not the practitioner or non-GP provider also is, or previously was, in NHS employment other than as a practitioner during the 2008-2009 scheme year, that dentist performer shall pay contributions in respect of the later employment at the same rate determined in accordance with paragraph (2J). (2V) If a dentist performer— (a) commences employment as a practitioner or non-GP provider at any time during the 2008-2009 scheme year (“the later employment”); (b) has no dentist performer employment in that scheme year; (c) has previous employment as an officer on a whole-time or part-time basis during that scheme year (excluding any employment under a zero hours contract) in respect of which he was liable to pay contributions to the scheme in accordance with regulation D1 (“the earlier employment”), and (d) has ceased the earlier officer employments prior to commencing the later employment, that dentist performer shall pay contributions in respect of the later employment at the same rate as that which applied to the earlier officer employment. (2W) Where (2V) applies and the dentist performer had two or more earlier officer employments, that dentist performer shall pay contributions in respect of the later employment referred to in (2V)(a) at the same rate as that which applied to whichever of the earlier officer employments was the last to cease. (2X) Where (2V) applies and all of the earlier officer employments referred to in (2V)(c) or the last two or more of them cease on the same day— (a) that performer’s pensionable earnings shall be determined by applying the formula— $EPE NDPE ×365$ where— - EPE is an estimate of the total of all dentist performer pensionable earnings received for the days of pensionable employment in the 2008–2009 scheme year; and - NDPE is the number of days of pensionable employment, and (b) contributions payable shall be those specified in column 2 of Table 1 in respect of the amount of pensionable earnings referred to in column 1 of that Table corresponding to the practitioner’s pensionable earnings for the 2008–2009 scheme year calculated in accordance with this sub-paragraph. (2Y) Where, at any time during the 2008-2009 scheme year, a practitioner (other than a dentist performer) also commences employment as a dentist performer (or vice versa) the employment as a practitioner (other than as a dentist performer) and the employment as a dentist performer will be treated separately under this paragraph. (2Z) If none of the previous sub-paragraphs of this paragraph apply, for the purpose of determining a member’s relevant contribution rate the Secretary of State must determine the amount of the member’s pensionable pay to be attributed to the 2008-2009 scheme year and, in so doing shall, in addition to the matters referred to in paragraph (2A), have regard to the pensionable pay attributable to pensionable employment comparable to the member’s employment, prevailing pay scales and prevailing rates of pensionable allowances.

• (10) In paragraph 10(3)(a) omit “and reaches age 65”.

• (11) For paragraph 11(2) (Normal retirement pension) substitute—

(2) In respect of — (a) any scheme year prior to the 2008-2009 scheme year, the member’s uprated earnings have been uprated in the manner determined by the Secretary of State having consulted such professional organisations as the Secretary of State considered appropriate; (b) the 2008-2009 scheme year and any later scheme year, the member’s uprated earnings are to be calculated by uprating the member’s pensionable earnings by the amount of the annual increase due under the provisions of the Pensions (Increase) Act 1971 and section 59 of the Social Security Pensions Act 1975, plus 1.5 per cent annually. (3) Nothing in this paragraph shall be taken to require the Secretary of State to revisit the calculation of uprated earnings referred to in sub-paragraph (2)(a).

• (12) In paragraph 12—

• (a) for “regulation E2 (early retirement pension on grounds of ill health) is”, substitute “regulations E2 and E2A are”;

• (b) for “that regulation”, substitute “regulation E2 or paragraphs (4) to (6) of regulation E2A”.

• (c) after sub-paragraph (2), insert—

(3) Regulation E2A is modified so that the definition of “regular employment of like duration” in paragraph (18) of that regulation means such employment as the Secretary of State considers would involve a similar level of engagement in the member’s current pensionable service as a practitioner.

• (13) After paragraph 16A (increased surviving civil partner’s pension) substitute—

(16B) In the case of a member who made a nomination under regulation G15 (dependent surviving nominated partner’s pension) that regulation is modified so that the lump sum payable on the member’s retirement will be reduced by 1.96 per cent of uprated earnings for each complete year of practitioner service before 6 April 1988 plus the relevant daily proportion for each additional day. (16C) In the case of a member who made an election under regulation G17 (increased surviving partner’s pension) that regulation is modified so that the lump sum payable on the member’s retirement will be reduced by 1.96 per cent of uprated earnings for each complete year of practitioner service before 6 April 1988 plus the relevant daily proportion for each additional day.

• (14) For paragraph 17 (child allowance—member dies in pensionable employment) substitute—

(17) In the case of members who die in pensionable employment as practitioners— (a) paragraphs (4C), (4D), (6) and (7) of regulation H3 (member dies in pensionable employment) are modified so that the references to the rate of the member’s pensionable pay when he died is treated, in relation to the member’s employment as a practitioner, as references to the average rate of the member’s pensionable earnings during the last complete quarter before the member died; (b) paragraphs (10) and (12) of that regulation is modified so that the reference to the member’s final year’s pensionable pay when he died is treated as a reference to the yearly average of the member’s uprated earnings at the date of death.

• (15) After paragraph 17 (child allowance – member dies in pensionable employment), insert—

(17A) Regulation L1 is modified so that the definition of “regular employment of like duration” in paragraph (14) of that regulation means such employment as the Secretary of State considers would involve a similar level of engagement to the member’s pensionable service as a practitioner immediately before that service ceased.

• (16) Paragraph 19(6) (members absent from work) is omitted.

• (17) After paragraph 22 (reduction of pension on return to NHS employment) insert—

(22A) The following provisions are modified so that the reference to the member’s rate of pensionable pay when he dies is treated as a reference to the average rate of the member’s pensionable earnings during the last complete quarter before the member died— (a) paragraphs (7) and (12) of regulation S4 (benefits on death in pensionable employment after pension under regulation E2 becomes payable); and (b) paragraphs (10) and (15)(a) of regulation S4A (benefits on death in pensionable employment after pension under regulation E2A becomes payable).

Amendment of Schedule 2A

5

• (1) Schedule 2A[^f00026] is amended as follows.

• (2) In paragraph 1(2)(a) (discharge of liability in respect of a pension credit following the death of the person entitled to the pension credit) for “paragraph 11”, substitute “paragraph 9”.

• (3) In paragraph 9 (payment of lump sum on death)—

• (i) in sub-paragraph (c) omit “and (3B)”;

• (ii) for sub-paragraph (d) substitute—

(d) the reference in paragraph (3C) to “the member who is in pensionable service under the scheme” shall be a reference to “person entitled to a pension credit or, as the case may be, a pension credit member

• (4) In paragraph 9 for sub-paragraphs (b), (c) and (d) substitute—

(b) the reference in paragraphs (2), (3), (4) and (5) of that regulation to “member” shall be a reference to “person entitled to a pension credit or, as the case may be, the pension credit member”; (c) the reference in paragraphs (2), (3), (4) and (10) of that regulation to “member’s personal representative” shall be a reference to “personal representative of the person entitled to a pension credit or, as the case may be, the pension credit member.”; (d) for paragraph (6) substitute— (6) A nomination shall be given only by a person entitled to a pension credit, or as the case may be, a pension credit member under the scheme. (e) for paragraph (9) substitute— (9) A person entitled to a pension credit, or as the case may be, a pension credit member whose credit was implemented on, or after, 1st April 2008 cannot give a notice referred to in paragraph (3)(a). (f) in paragraph (12) omit sub-paragraph (d)

Signed

Signed by authority of the Secretary of State for Health.

Ann Keen — Parliamentary Under-Secretary of State — Department of Health — 11th March 2008

We consent

Alan Campbell — Frank Roy — Two of the Lords Commissioners of Her Majesty’s Treasury — 11th March 2008

Explanatory note

(This note is not part of the Regulations)

EXPLANATORY NOTE

This Instrument further amends the National Health Service Pension Scheme Regulations 1995 (S.I.1995/300) (“the 1995 Regulations”).

Regulation 2 amends Part A of the 1995 Regulations by inserting new definitions including a definition of “scheme year”.

Regulations 3 and 4 amend Part B of the 1995 Regulations. Regulation 3 provides for new restrictions on membership of the 1995 NHS Pension Scheme and, in particular, provides that a person over the age of 75 or a person over the age of 70 on or before 31 March 2008 cannot be a member of the Scheme. Regulation 4 makes consequential amendments.

Regulations 5 and 6 amend Part C of the 1995 Regulations. Regulation 5 provides for the calculation of pensionable pay and makes provision for the calculation of pay of a member credited with pensionable service under another public sector pension scheme. Regulation 6 provides that benefits are to be calculated by a maximum period of pensionable service (45 years in most cases) and provides that pensionable service in excess of the maxima will be ignored.

Regulations 7 and 8 amend Part D of the 1995 Regulations. Regulation 7 introduces new contribution rates linked to bands of pensionable pay. Those rates run from 5 per cent to 8.5 per cent (depending on the pay band). Regulation 8 makes consequential amendments to regulation D2 in respect of contributions payable by employing authorities.

Regulations 9 to 14 amend Part E of the 1995 Regulations. Regulation 9 amends regulation E1 so as to provide that the Secretary of State can discharge her liability for a pension by the payment of a lump sum and in doing so has to have regard to the life expectancy of a member. Regulation 10 amends regulation E2 so as to limit its application to a member who retires from pensionable employment on or after 1 April 2008 but submitted an application for the benefit prior to that date.

Regulation 11 inserts new regulations E2A to E2C which introduce a new two tier ill health pensions on early retirement, reassessment of an ill health pension awarded on early retirement and the effect of further employment on such a benefit. Regulation 12 makes a consequential amendment to regulation E3, regulation 13 omits regulation E4 and regulation 14 inserts a new regulation (E7) which enables a member to opt to exchange part of a pension for a lump sum payment.

Regulations 15 to 17 amend Part F of the 1995 Regulations. Regulation 15 amends regulation F1 so as to provide when a lump sum on death is payable, regulation 16 amends regulation F2 to take account of the new two tier ill health pension and regulation 17 substitutes regulation F5 to provide for an order of priority in respect of the payment of a lump sum death benefit.

Regulations 18 to 29 amend Part G of the 1995 Regulations. In particular, they make provision for the period over which a widow’s pension is paid and the rate at which is payable.

Regulation 21 amends regulation G3 to take account of the new two tier ill health pension. Regulation 22 amends regulation G4 to provide that where a member dies with a preserved pension, the rate of the dependant’s will be determined by reference to an ill health pension he would have received had he retired through ill health on the day he left pensionable employment. Regulation 23 amends regulation G7 to provide that the whole of the member’s pensionable service will be taken into account when calculating a widower’s pension. Regulation 24 amends regulation G8 to take account of the new two tier ill health pension. Regulation 25 amends regulation G9 to provide for the payment of a pension to a surviving partner of a female member. Regulation 26 amends regulation G10 to take account of the two tier ill health pension. Regulation 27 amends regulation G11 to take account of the two tier ill health pension. Regulation 28 amends regulation G13 to provide for the devolution of a surviving civil partner’s pension in cases where the member dies without leaving a civil partner but leaving a surviving widower or nominated partner.