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The Postal Services Act 2011 (Transfer of Accrued Pension Rights) Order 2012

Type Statutory-Instrument
Publication 2012-03-08
State In force
Department Queen's Printer of Acts of Parliament
Source legislation.gov.uk
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articles 8
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  • “Notional RMPP Final Pensionable Pay” means the RMPP Final Pensionable Pay that would have been determined in respect of a Member under the RMPP if that Member had retired at his or her Notional Retirement Date;
  • “Part Year Increase Factor” shall be calculated as the greater of: (a) one; and (b) (1+A%) divided by (1+B%), where— A%= the percentage increase granted under Rule 17 (Pension increases) to pensions in payment (in excess of any GMP) on the latest date prior to the Deemed RMPP Exit Date that such increases were granted (or, in case of zero or negative growth in the Retail Prices Index, that such increases would have been granted but for such zero or negative growth); and B%= (A% multiplied by (i) the number of complete months in the period from: (a) the Deemed RMPP Exit Date (or, in the case of amounts which are calculated by reference to the Member’s RMSPS Final Pensionable Pay, the end of the Calculation Year by reference to which the Member’s actual RMPP Final Pensionable Pay is determined in respect of the amount); to (b) the first date after the Deemed RMPP Exit Date on which an increase under Rule 17 (Pension increases) is due to be granted, plus (but only where the Member’s Notional Payment Date falls after his or her Final Deemed Increase Date) (ii) the number of complete months from: (a) the Final Deemed Increase Date in respect of the amount; to (b) the Member’s Notional Payment Date in respect of the amount) divided by 12, and an incomplete month is to be treated as a complete month if it is so treated for the purposes of determining the increases payable under Rule 17 (Pension increases) to pensions which have been in payment for less than a year;
  • “Relevant Percentage” means— if the Deemed RMPP Exit Date is between 1 January and 30 March (inclusive) in any year but the relevant Member’s birthday is between 31 March and 31 December (inclusive), the higher revaluation percentage which would have been specified for the revaluation period 1 January 2012–31 December 2012 in the Occupational Pensions (Revaluation) Order 2012 if the “inflation percentage” for the purposes of paragraph 2(3)(a) of Schedule 3 to the Pension Schemes Act 1993 were the percentage increase (if any) in the Government index of retail prices during the period which is the reference period in relation to that revaluation period; and otherwise, the higher revaluation percentage which would have been specified for the most recent single calendar year in the Occupational Pensions (Revaluation) Order coming into force at the start of the year of the Deemed RMPP Exit Date if the “inflation percentage” for the purposes of paragraph 2(3)(a) of Schedule 3 to the Pension Schemes Act 1993 were the percentage increase (if any) in the Government index of retail prices during the period which was the reference period in relation to that revaluation period;
  • “Relevant RMPP Margin Benefit” means, in respect of a Member’s RMSPS benefit or where appropriate benefit component, the Member’s RMPP benefit or where appropriate benefit component in the calculation of which the Corresponding RMPP Amount in relation to that RMSPS benefit or benefit component is being used;
  • “Retirement Revaluation Date” means the first day which is 1 April after the relevant Member’s RMSPS Retirement Date;
  • “Revaluation Laws” means the laws as to revaluation of accrued benefits set out in Chapter II of Part IV of the Pension Schemes Act 1993;
  • “Revaluation Order” means an order made under paragraph 2(1) of Schedule 3 of the Pension Schemes Act 1993;
  • “Revaluation Period” has the meaning given to it in paragraph 2(2) of Schedule 3 of the Pension Schemes Act 1993;
  • “RMPP Final Pensionable Pay” means the Member’s “Final Pensionable Pay” as determined under Section C of the RMPP Rules;
  • “RMSPS CSDB Benefits” means a Member’s— RMSPS NRA60 CSDB Benefits; and RMSPS NRA65 CSDB Benefits;
  • “RMSPS Final Salary Benefits” means a Member’s Section C benefits attributable to RMSPS Reckonable Service before 1 April 2008;
  • “RMSPS NRA60 CSDB Benefits” means a Member’s Section C benefits attributable to RMSPS Reckonable Service on and from 1 April 2008 up to and including 31 March 2010;
  • “RMSPS NRA65 CSDB Benefits” means a Member’s Section C benefits attributable to RMSPS Reckonable Service on and from 1 April 2010 up to and including the Cut-Off Date;
  • “RMSPS Retirement Date” means the date the Member’s RMSPS benefit or where appropriate benefit component comes into payment; and
  • “Statutory Underpin Amount” means such additional amount (if any) as may be required to ensure that at the time it is determined, the amount of the Member’s benefit or benefit component is no less than the amount it would have been had it been a benefit to which section 83(1)(a) of the Pension Schemes Act 1993 applied and the Member had been in pensionable service under the RMSPS that had ended at the end of the Cut-Off Date, and it had been increased over the relevant period in accordance with the Revaluation Laws, in relation to which the modifications set out in this Rule (other those set out in sub-paragraph (2)) will for these purposes not apply).

Pension increases

17

  • (1) That part of each pension in payment under the Section C Rules (together with the RMSPS Pension Supplement, if any) that exceeds any GMP will increase by the lower of 5% compound in each year or the increase in the Retail Prices Index over the preceding year on a date decided by the Secretary of State.
  • (2) The initial pension for a Member under this Section C, in respect of RMSPS Pensionable Service before 1 April 2008 only, whose RMPP Final Pensionable Pay is determined by reference to a Calculation Year (or a period of 3 consecutive tax years) which ended before the Deemed RMPP Exit Date will be adjusted to take into account the increases to which that Member would have been entitled under the RMPP from the later of—
  • (a) the last increase date decided by the RMPP Trustees under Rule 12B (Pensions Increases) of Section C of the RMPP Rules, and
  • (b) the end of the Calculation Year,

to the Deemed RMPP Exit Date.

  • (3) Pensions paid for less than a year may be increased by a smaller amount.
  • (4) Where GMP is payable, the part of the GMP that is attributable to earnings for the tax year 1988/1989 and subsequent tax years will increase in each year by the percentage specified in any order made by the Secretary of State under Section 109 of the Pension Schemes Act 1993. The remainder of the GMP will not increase.
  • (5) In this Rule—
  • “Calculation Year” means, in respect of a Member, the year (or period of 365 days of his or her RMPP Reckonable Service if that RMPP Reckonable Service is not continuous) ending on the Deemed RMPP Exit Date and each year (or period of 365 days) ending on a day which falls 91 days before the Deemed RMPP Exit Date or any multiple of 91 days before the Deemed RMPP Exit Date up to a maximum multiple of 8; and
  • “Deemed RMPP Exit Date” has the meaning given in Rule 16 (Revaluation of preserved pensions).

Deduction of tax

18

The Secretary of State may deduct from any payment under this Section C any tax for which he may be liable in respect of it.

PART VI — SECTION E RULES OF THE SCHEME

Application

1

These Section E Rules shall only apply to Members who are Section E Actives, and they do not apply to Members who are Cut-Off Date Non-Actives or to any other Wholly Transferred Beneficiaries. References to Member in these Section E Rules shall be read accordingly.

Interpretation

2

Terms defined in the RMSPS Rules shall have the same meaning in these Rules.

Definition

3

The following term shall have the following meaning in these Rules—

  • “Former Section” means whichever of Section A or Section B of the contributory part of the RMPP to which the Member was subject immediately prior to joining Section E of the RMPP.

Transfer of RMPP Reckonable Service

4

All RMPP Reckonable Service built up in a Member’s Former Section in relation to that Member’s period of service immediately prior to the date of joining Section E of the RMPP (which was transferred to Section E of the RMPP in accordance with the provisions of Section E of the RMPP Rules applying to the Member upon the date of that Member joining Section E of the RMPP) was treated as if it were RMPP Reckonable Service in Section E of the RMPP and was continuous with RMPP Reckonable Service accrued after joining Section E of the RMPP. All such continuous RMPP Reckonable Service accrued under a Former Section and accrued after joining Section E of the RMPP, up to the end of the Cut-Off Date, will be counted as RMSPS Reckonable Service for the purposes of these Section E Rules. For avoidance of doubt, no Section E Active has any rights under Section A or Section B of the RMSPS in relation to RMPP Reckonable Service accrued under a Former Section (unless the RMPP Reckonable Service under a Former Section was not treated under the RMPP Rules as continuous with that Member’s RMPP Reckonable Service under Section E and hence does not form part of that Member’s RMSPS Reckonable Service; in such a case, the Member will be treated as a Wholly Transferred Beneficiary in relation to that prior RMPP Reckonable Service).

Section E benefits

5

Subject to Rule 7 (Benefits on redundancy), the benefits payable to a Member of Section E shall be of the same amount and payable in the same circumstances as would have applied to the Member if that Member had continued to be subject to the Rules of his or her Former Section up to the end of the Cut-Off Date and, as a consequence, become a Section A Active or a Section B Active under the RMSPS. For the avoidance of doubt, the RMSPS benefits payable to a Section E Active who was formerly subject to the Rules of Section A of the contributory part of the RMPP shall be calculated in accordance with the provisions of the Section A Rules, but subject to any election made or deemed to be made under General Rule 7 (Application of Sections A and B – election for Section B benefits) to be treated as being subject to the Section B Rules, and the RMSPS benefits payable to a Section E Active who was formerly subject to the Rules of Section B of the contributory part of the RMPP shall be calculated in accordance with the provisions of the Section B Rules.

Application of General Rules to Section E Members

6

In accordance with the provisions of General Rule 1 (Application of the General Rules), a reference in the General Rules to Members who are subject to the Section A Rules shall, where the context so admits, be deemed to include a Section E Member who was formerly subject to the Section A Rules of the contributory part of the RMPP and a reference in the General Rules to Members who are subject to the Section B Rules shall, where the context so admits, be deemed to include a Section E Member who was formerly subject to the Section B Rules of the contributory part of the RMPP.

Benefits on redundancy

7

Notwithstanding Rule 5 (Section E benefits), in the event that a Member is made redundant by an Employer no lump sum compensation will be payable to that Member on account of that Member’s redundancy including any such benefits which would otherwise be payable under the Section A Rules.

PART VII — TRUSTS, POWERS AND PROVISIONS UPON, WITH AND SUBJECT TO WHICH THE DESIGNATED SUM IS TO BE HELD IN PURSUANCE OF A DIRECTION GIVEN BY A MEMBER UNDER GENERAL RULE 6

1

  • (1) The persons appointed for such purposes by the Secretary of State in accordance with General Rule 6 (Member’s power to place benefits within the Secretary of State’s discretion) (hereinafter called “the Trustees of the Designated Sum”) shall stand possessed of the designated sum which a Member has directed to be paid to the Secretary of State of the Designated Sum and the income thereof upon the trusts and with and subject to the powers and provisions following (that is to say):
  • (2) During the period of 21 years from the death of the Member the Trustees of the Designated Sum may pay or apply the designated sum and the income thereof or any part thereof respectively to or for the benefit of all or any one or more exclusively of the other or others of the following persons—
  • (a) the widow or widower of such Member;
  • (b) the issue of such Member;
  • (c) his or her grandparents; the grandparents of his widow or her widower, the grandparents of any previous or deceased spouse of such Member;
  • (d) the issue of each of the grandparents of such Member and the issue of each of the grandparents of the widow or widower of such Member and the issue of each of the grandparents of any previous or deceased spouse of such Member; and
  • (e) the person or persons (if any and whether of full age or not) to whom such Member has at any time put himself or herself in loco parentis or of whose person or property such Member has at any time been guardian,

in such shares and in such manner as the Trustees of the Designated Sum shall in their absolute discretion from time to time determine and so that the Trustees of the Designated Sum may if they think fit pay any sum to the parent or guardian of any infant to be applied for the benefit of such infant without seeing to the application thereof.

  • (3) Further during the said period of 21 years the Trustees of the Designated Sum may at any time pay or apply the designated sum and the income thereof or any part thereof respectively to or for the benefit of any person who in the opinion of the Trustees of the Designated Sum was wholly or in part dependent on the earnings of such Member at his or her death in such manner as the Trustees of the Designated Sum shall in their absolute discretion think fit.
  • (4) Subject as aforesaid the designated sum and the income thereof or so much thereof respectively as shall not have been paid or applied under the foregoing powers shall be paid to such person or persons (other than the Crown, the Duchy of Lancaster or the Duke of Cornwall) as would at the death of such Member have become entitled thereto under the law of intestacy of the Member’s domicile at the date of his or her death (if that Member was domiciled in any part of the United Kingdom or the Isle of Man) or under the law of intestacy of England (if that Member was not so domiciled) if such Member had died intestate and solvent and (if not domiciled in some other part of the United Kingdom or the Isle of Man) domiciled in England such persons if more than one taking the same shares and interests as they would be entitled to under such law.
  • (5) The Trustees of the Designated Sum may at their discretion deduct the cost of funeral expenses from any lump sum death benefits and pay it to the person who incurred the funeral expenses.
  • (6) In sub-paragraph (1) of this Part VII the expression “grandparent” and “issue” shall be construed as if the step-child, adopted child or illegitimate child of any person were that person’s child.
  • (7) In sub-paragraph (2) of this Part VII the expression “earnings” shall mean any payments by way of salary or wages under any employment or of pension benefits under the Rules of the RMSPS.

PART VIII — LIST OF COUNTRIES AND PLACES TO WHICH SECTION B RULE 10 APPLIES

  • Admiralty Islands (Pacific Ocean); Afghanistan; Albania; Angola; Arabian Sub-Continent and Islands; Australia (West and North of latitude 31¹/₂o South and longitude 150° East); Port Darwin;
  • Bolivia; Brazil; British Honduras; Brunei; Bulgaria; Burma;
  • Cambodia [Indo-China]; Cameroon; Cape Verde Islands; Central African Republic; Chad; China; Christmas Island (Pacific Ocean); Cocos (or Keeling) Islands; Colombia; Congo [Belgian Congo]; Costa Rica; Cuba; Czechoslovakia;
  • Dahomey; Ecuador; Egypt (excluding Alexandria) [United Arab Republic]; Ethiopia; Fernando Po; Fiji; French Guiana; French Somaliland;
  • Gabon; Gambia; Ghana [Gold Coast]; Gilbert and Ellice Islands; Guatemala; Guyana [British Guiana]; Guinea;
  • Haiti; Honduras; Hong Kong; Hungary;
  • Iceland; India; Indonesia; Iraq; Iran – see Persia; Israel; Ivory Coast; Japan; Jordan; Kenya; Korea;
  • Laos [Indo-China]; Lebanon; Liberia; Libya [including territory previously known as Cyrenaica];
  • Macao; Malagasy Republic [Madagascar]; Malawi [Nyasaland]; Malaysia [Federation of Malaya, Sabah (North Borneo) and Sarawak]; Maiden Island; Maldive Islands; Mali; Martinique; Mauretania; Mauritius; Mexico; Mozambique;
  • Nauru; Nepal; Netherlands Antilles; New Hebrides; Nicaragua; Nicobar Islands; Niger; Nigeria; Norway (Narvik and Tromso only);
  • Pakistan; Panama; Paraguay; Penrhyn Island; Persia (Iran); Peru; Philippines; Poland; Portuguese Guinea; Puerto Rico [Porto Rico]; Reunion; Romania; Russia;
  • Sao Tome; Salvador; Samoan Islands; Senegal; Sierra Leone; Singapore; Solomon Islands; Somalia [Somaliland]; Spanish possessions in Africa (excluding N. Africa); Sri Lanka [Ceylon]; Sudan; Suriname [Dutch Guiana]; Sweden (Lulea only); Syria;
  • Tahiti; Taiwan [Formosa]; Tanzania [Tanganyika and Zanzibar]; Thailand [Siam]; Togo; Tonga; Trinidad and Tobago; Turkey in Asia (excluding lzmir);
  • Uganda; Upper Volta; USA (Houston, New Orleans and St. Louis only); Venezuela; Vietnam (North and South) [Indo-China]; Yugoslavia; and Zambia [Northern Rhodesia]
  • Ships operated by or on behalf of an Employer in the sea area bounded on the North by the Continents of Asia and America and the Arctic Circle, on the East by the Continent of America (including the Panama Canal) and Longitude 67 degrees West, on the South by the Antarctic Circle and on the West by the Continent of Africa (including Port Said and the Suez Canal) and Longitude 18 degrees East.

PART IX — OVERRIDING FINANCE ACT PROVISIONS

1

The provisions of this Part IX override any other provisions of the RMSPS Rules with which they are inconsistent and apply to all Members of the RMSPS who are Cut-Off Date Actives provided that—

  • (a) This Part IX shall not apply in relation to Section A Members (or those Section E Members who were Section A Members before joining Section E) and so shall not override the provisions of the Section A Rules (or, in the same manner, the Section E Rules).
  • (b) This Part IX shall only apply in part to Section B Members (or those Section E Members who were Section B Members before joining Section E) and so shall not override the following provisions of the Section B Rules (or, in the same manner, the Section E Rules)—
  • (i) Rule 2 (Definitions and interpretation), definition of “RMSPS Pensionable Salary”;
  • (ii) Rule 13(1) (Provisions applicable to Rules 11 and 12), for the purpose of applying the “first 91 days”;
  • (iii) Rule 15 (Dependants’ pensions), payment of dependants’ pension equivalent to widow’s or widower’s pension under Rule 11 (Spouse’s pension) (and, where applicable, Rule 12 (Spouse’s pension for Relevant Members)); and
  • (iv) Rule 19 (Pensions increase).
  • (c) For the purpose of this Part IX all Section B Members or those Section E Members who were Section B Members before joining Section E will be treated as if they had joined the RMPP before 17 March 1987 unless they elect otherwise subject to their not having a break in Post Office service (or service with an Employer) other than any period of temporary loan.

2

The RMSPS will be administered as a Registered pension scheme in accordance with the Finance Act 2004.

3

Subject to Clause 15(6) (Prevention of discrimination on grounds of age), the Secretary of State shall only make payments from the RMSPS which are authorised payments (as that term is used for the purposes of the Finance Act 2004) except that—

  • (a) if the Rules contain a provision which would require the Secretary of State to make a payment which would be an unauthorised payment, then the effect of Regulation 3 of the Registered Pension Schemes (Modification of the Rules of Existing Schemes) Regulations 2006 but without the limitation to the transitional period (as adopted in relation to the RMPP by clause 1(a) of the Interim Amending Deed for the RMPP dated 3 April 2006), applies to the RMSPS as if it were an “existing scheme” to which those regulations apply under Regulation 2 of those regulations, and the Secretary of State therefore has a discretion whether or not to make the payment, by virtue of that regulation; and
  • (b) the Secretary of State may, if he thinks fit in any particular circumstance, make a payment from the Scheme notwithstanding that it is or may be an unauthorised payment. The Secretary of State will where reasonably practicable obtain the consent of the Member or beneficiary (where applicable) before making any such payment. No person will, however, have any entitlement to such a payment.

4

The Secretary of State may use reasonable endeavours to rearrange any benefit that would not be an authorised payment so that the benefit actually paid is an authorised payment.

5

Except as otherwise mentioned in this Part IX, the benefits, rights and options of or in respect of all Members and other persons will, as a restriction imposed by the RMSPS Rules, be subject to—

  • (a) the same restrictions as applied to them immediately before 6 April 2006 (or would have applied had they then been entitled) by virtue of the previous provisions of the RMPP in force immediately before 6 April 2006; and
  • (b) the restrictions which applied as requirements of the approval of the RMPP by HMRC under IR12 (2001) (IR12),

in each case as increased, indexed or revalued where appropriate in such manner and at such dates as the Secretary of State decides (Scheme Limits) and neither the amount nor the nature of any benefit will be increased or varied as a result of the said restrictions having ceased to apply to the RMPP on or after 6 April 2006 or not having applied directly to the RMSPS, except where specified in the RMSPS Rules or this Part IX.

6

The Secretary of State may decide to waive or modify all or any part of the Scheme Limits whether conditionally or otherwise in respect of some or all Members.

7

Except as specified in paragraph 7(h) below, the following provisions (which were applied under the RMPP Rules with effect on and from 6 April 2006) will apply so as to vary the Scheme Limits under the RMSPS—

  • (a) When calculating the benefits of Members under the RMSPS, a Scheme-specific limit (the Scheme Earnings Cap) will apply. It applies to all Members (other than those who, as Members of the RMPP, were neither actually nor potentially subject to the permitted maximum immediately before 6 April 2006). The Scheme Earnings Cap is the “Scheme Earnings Cap” that applied under the RMPP as at the end of the Cut-Off Date, as set out in Schedule 13 (Overriding Finance Act provisions) of the RMPP Cut-Off Date Rules (the RMPP Scheme Earnings Cap). The RMPP Scheme Earnings Cap operated in the same manner as the permitted maximum (as that term was defined in Section 590C of the Income and Corporation Taxes Act 1988)[^f00034] and was £108,600 for tax year 2006/07. For subsequent tax years the RMPP Scheme Earnings Cap was the amount for the previous tax year increased by—
  • (i) the same percentage increase in the Index of Retail Prices for the 12 month period ending the previous September (rounded up to the nearest multiple of £600); or
  • (ii) such greater amount as the Principal Employer may at its absolute discretion from time to time have directed the RMPP Trustees.
  • (b) The maximum limit on lump sum benefits contained in paragraph 8.5 of IR12 will not apply and Members may draw such an amount of lump sum benefits in accordance with the Rules as they determine up to the lesser of—
  • (i) the maximum amount that would constitute a pension commencement lump sum under the Finance Act 2004; and
  • (ii) 25% of the standard lifetime allowance (as that term is used for the purposes of the Finance Act 2004).
  • (c) Benefits referable to additional voluntary contributions paid by a Member to the RMPP will be capable of commutation in so far as the payment would be an authorised payment under the Finance Act 2004 and the restriction in paragraph 8.3 of IR12 shall not apply.
  • (d) Additional voluntary contributions paid by a Member to the RMPP on a money purchase basis and transferred to the RMSPS under Clause 10 (Additional voluntary contributions transferred from the RMPP) will not be brought into account in applying the Scheme Limits.
  • (e) The maximum limits on benefits on death in service contained in paragraph 11.2 of IR12 will not apply (although, in accordance with Paragraph (a) above, the Scheme Earnings Cap will continue to apply for the calculation of any lump sum death benefit under the RMSPS which is calculated by reference (however expressed) to a multiple of salary).
  • (f) The restrictions in IR12 on the circumstances in which Members may take benefits whilst remaining in service will not apply to the RMSPS. Members may take benefits whilst remaining in service with an Employer in accordance with the provisions of the Rules.
  • (g) The requirements contained in IR12 to take account of retained benefits (as that term is used in Appendix I of IR12) will not apply when calculating the Scheme Limits.
  • (h) The requirements in IR12 providing that benefits were limited by reference to 40 years’ service (or 40 years’ service prior to normal retirement age and a further 5 years thereafter) shall not apply. For Members who were subject to this change under the RMPP, which was put into effect under the RMPP Rules on and from 1 December 2006, benefits under the RMPP were instead limited by reference to 45 years’ RMPP Reckonable Service (in accordance with the provisions of the RMPP Rules), and this limit also applies under the relevant provisions of the RMSPS Rules in respect of such Members.

8

The Secretary of State may arrange the benefits under the RMSPS (in respect of one or a number of Members) so that those benefits constitute a single or multiple arrangements for the purposes of the Finance Act 2004.

9

If any Member or any other person entitled to a benefit under the RMSPS is within any of the transitional provisions and savings in Schedule 36 of the Finance Act 2004 then the Secretary of State may apply those provisions including (without limitation) exercising the power to surrender the relevant excess under paragraph 12(5) of that schedule but so that the Secretary of State will not be liable for any loss or cost arising from failure to apply those provisions where they relate to primary or enhanced protection (as those terms are used for the purposes of the Finance Act 2004).

10

The Secretary of State may determine any matters of ambiguity or dispute arising out of this Part IX or the application of the Finance Act 2004 to the RMSPS.

SCHEDULE 2 — Restrictions on amendments to the RMSPS

1

  • (1) In this Schedule—
  • “Actuarial Equivalence Requirements” has the meaning given in paragraph 9;
  • “Actuarial Equivalence Statement” has the meaning given in paragraph 13;
  • “Actuarial Equivalence Statement Requirement” has the meaning given in paragraph 12;
  • “Actuarial Value Requirement” has the meaning given in paragraph 11;
  • “Actuary” has the meaning given in the RMSPS Rules;
  • “Affected Member” is a person who is, at the time a Regulated Modification or RMPP Restricted Modification takes effect, a member of the RMSPS, a survivor of a member of the RMSPS or a survivor of a member of the RMPP who died on or before the Cut-Off Date with benefits under the RMSPS, and— the Regulated Modification is a Protected Modification and, on taking effect, the Protected Modification would or might affect any of that person’s RMSPS Subsisting Rights as mentioned in paragraph (a) or (b) of the definition of “Protected Modification”; the Regulated Modification is a Detrimental Modification that is not a Protected Modification and, on taking effect, the Detrimental Modification would or might adversely affect any of that person’s RMSPS Subsisting Rights; or the RMPP Restricted Modification would, on taking effect, affect the person or the person’s benefits as mentioned in paragraph (b), (c) or (d) of the definition of “RMPP Restricted Modification”;
  • “Consent Requirements” means the requirements consisting of— the Informed Consent Requirement; and the Timing Requirement;
  • “Cut-Off Date” means 31 March 2012;
  • “Cut-Off Date Active” has the meaning given in the RMSPS Rules;
  • “Cut-Off Date Non-Active” has the meaning given in the RMSPS Rules;
  • “Detrimental Modification” means an amendment or modification to the RMSPS which on taking effect would or might adversely affect any RMSPS Subsisting Rights;
  • “Equivalent Correction” has the meaning given in sub-paragraph (3) below;
  • “Equivalent Scheme” means an occupational pension scheme, where the power to modify that scheme is subject to the “subsisting rights provisions” within the meaning of section 67 of the Pensions Act 1995[^f00035];
  • “Information Requirement” has the meaning given in paragraph 10;
  • “Informed Consent Requirement” has the meaning given in paragraph 6;
  • “Protected Modification” means an amendment or modification to the RMSPS which— on taking effect would or might result in any RMSPS Subsisting Right of a member of the RMSPS or a survivor of a member of the RMSPS or the RMPP which is not a right or entitlement to money purchase benefits becoming, or being replaced with, a right or entitlement to money purchase benefits under the Relevant RMSPS Rules (and for these purposes, the reference in the definition of “money purchase benefits” in section 181(1) of the Pension Schemes Act 1993[^f00036] to the widow or widower of a member of an occupational pension scheme is to be read as including any other survivor of the member); would or might result in a reduction in the prevailing rate of any pension in payment under the Relevant RMSPS Rules; or if the RMSPS were an Equivalent Scheme would be a “protected modification” for the purposes of the “subsisting rights provisions” referred to in section 67 of the Pensions Act 1995 by reason of an order made under section 67A(3)(c) of that Act;
  • “Regulated Modification” means an amendment or modification to the RMSPS which is— a Protected Modification; or a Detrimental Modification;or is both;
  • “relevant legislative provision” means any of the provisions referred to in section 67A(9) of the Pensions Act 1995, if and to the extent that the provision applies to the RMSPS under Schedule 4;
  • “Relevant RMSPS Rules” means— the RMSPS Rules, except so far as overridden by a relevant legislative provision; the relevant legislative provisions, to the extent that they have effect in relation to the RMSPS and are not reflected in the RMSPS Rules; and any provision which the RMSPS Rules do not contain but which the RMSPS must contain if it is to conform with the requirements of Chapter 1 of Part 4 of the Pension Schemes Act 1993 (preservation of benefit under occupational pension schemes);
  • “Reporting Requirement” has the meaning given in paragraph 19;
  • “RMPP Cut-Off Date Rules” has the meaning given in the RMSPS Rules;
  • “RMPP Restricted Modification” means an amendment or modification which— would alter the primary purpose of the RMSPS; would reduce the benefits of any person who is at the date of the amendment or modification already entitled to the receipt of a pension or annuity under the RMSPS; would, in respect of a person in what was immediately prior to 28 August 1987 category (a) in rule 1 of the non-contributory part of the RMPP (as set out in the third supplemental deed to the RMPP dated 19 November 1971), depart from the Civil Service Scheme for the time being in force as prescribed by rule 2 of the non-contributory section rules of the RMPP Cut-Off Date Rules; would, in respect of a person in what was immediately prior to 28 August 1987 category (a) in general rule 1 of the RMPP as set out in the third supplemental deed to the RMPP dated 19 November 1971 who was subject to the section A rules of the RMPP Cut-Off Date Rules, deprive that person of the following— if the person is a Cut-Off Date Non-Active, any of the benefits referred to in rule 1 of the section A rules of the RMPP Cut-Off Date Rules; or if the person is a Cut-Off Date Active, any of the benefits provided for in the Section A Rules of the RMSPS Rules;
  • “RMSPS Subsisting Rights” means— in relation to a member of the RMSPS, at any time— any right (including any pension credit right) which at that time has accrued or been provided to or in respect of the member to future benefits under the Relevant RMSPS Rules; or any entitlement to the present payment of a pension or other benefit which the member has at that time, under the Relevant RMSPS Rules; and in relation to the survivor of a member of the RMSPS or of the RMPP, at any time, any entitlement to benefits, or right to future benefits, which that survivor has at that time under the Relevant RMSPS Rules in respect of such member;
  • “survivor”, in relation to a member of the RMSPS or the RMPP, means a person who— is the widow or widower of the member; or has survived the member and has any entitlement to benefit, or right to future benefits, under the Relevant RMSPS Rules in respect of the member;
  • “Timing Requirement” has the meaning given in paragraph 8.
  • (2) A modification would or might adversely affect a person’s RMSPS Subsisting Rights if it would alter the nature or extent of the entitlement or right so that the benefits, or future benefits, to which the entitlement or right relates would or might be less generous.
  • (3) An amendment or modification to a rule or provision of the RMSPS will be an “Equivalent Correction” where—
  • (i) any rule or provision of the RMPP Rules has been subject to rectification or correction which would not be subject to or restricted by the restrictions on the power to amend the RMPP Rules or the “subsisting rights provisions” within the meaning of section 67 of the Pensions Act 1995 at that time (or such rectification or correction would be available in relation to that rule or provision);
  • (ii) the rule or provision of the RMSPS corresponds to or is derived from that rule or provision of the RMPP Rules; and
  • (iii) the amendment or modification to the rule or provision of the RMSPS is consistent with such rectification or correction of that rule or provision of the RMPP, and does no more than implement a corresponding correction to the terms of the rule or provision of the RMSPS.

2

  • (1) A Regulated Modification may be made to the RMSPS by the Secretary of State if—
  • (a) it is an amendment or modification which, if the RMSPS were an Equivalent Scheme would not, at the time the amendment or modification is being made, have been subject to or restricted by the “subsisting rights provisions” within the meaning of section 67 of the Pensions Act 1995 at that time, including without limitation an amendment or modification which—
  • (i) comes within section 67(3) of the Pensions Act 1995;
  • (ii) could have been made by resolution under section 68 of the Pensions Act 1995 or section 24G of the Pension Schemes Act 1993;
  • (iii) reflects legislative requirements that have overriding effect in relation to the scheme and are not reflected in the scheme rules;
  • (iv) includes in the scheme rules any provision which those rules do not contain but which the scheme must contain if it is to conform with legislative requirements, if those legislative requirements do not have overriding effect in relation to the scheme;
  • (b) it is an Equivalent Correction; or
  • (c) the following requirements are satisfied in respect of the modification in the case of each Affected Member—
  • (i) if the modification is a Protected Modification, the Consent Requirements;
  • (ii) if the modification is not a Protected Modification, either the Actuarial Equivalence Requirements (if the Secretary of State determines that they are to apply in the case of that Affected Member) or the Consent Requirements; and
  • (iii) the Reporting Requirement.
  • (2) If the Regulated Modification is also an RMPP Restricted Modification, the requirements of paragraph 3 must be satisfied if the modification is to be made.

3

  • (1) An RMPP Restricted Modification (other than a modification within paragraph (a) of the definition of “RMPP Restricted Modification”) may be made to the RMSPS by the Secretary of State if the modification satisfies either (a) or (b) below—
  • (a) The modification—
  • (i) is required to reflect legislative requirements that have overriding effect in relation to the RMSPS (and are not otherwise reflected in the RMSPS Rules);
  • (ii) is required to include in the RMSPS Rules any provision which those rules do not contain but which they must contain if that scheme is to conform with legislative requirements (where those legislative requirements apply but do not have overriding effect in relation to the RMSPS);
  • (iii) were it being made under the RMPP, could have been made by trustee resolution under either section 68 of the Pensions Act 1995 or section 24G of the Pension Schemes Act 1993 provided that, in each case, the Secretary of State complies with any procedural requirements relevant to the resolution which would have had to be complied with by the trustee of the RMPP were the modification being made under that scheme; or
  • (iv) is an Equivalent Correction.
  • (b) The following requirements are satisfied in respect of the modification in the case of each Affected Member —
  • (i) the Consent Requirements; and
  • (ii) the Reporting Requirement.
  • (2) If the RMPP Restricted Modification is also a Regulated Modification, the requirements of paragraph 2 must be satisfied if the modification is to be made.

4

If a Regulated Modification or an RMPP Restricted Modification is made to the RMSPS by the Secretary of State and a member of the RMSPS dies before the requirements mentioned in paragraph 2(1)(c) or 3(1)(b), so far as they apply in that member’s case, have been complied with in respect of the modification, paragraph 5 will apply to that modification if the member—

  • (a) before the member died, had given his or her consent to the modification in accordance with the Consent Requirements, or
  • (b) before the member died, or before the Secretary of State had become aware that the member had died, the Secretary of State had complied with the Information Requirement (other than paragraph 10(c)) in respect of the modification in that member’s case.

5

Any of the requirements mentioned in paragraphs 2(1)(c) and 3(1)(b) as it applies in respect of the modification—

  • (a) which is satisfied in the case of the member; or
  • (b) which would have been satisfied in the member’s case had the member not died before it was satisfied,

is to be taken to be satisfied in the case of any survivor of the member in respect of the modification.

6

Subject to paragraph 7, the “Informed Consent Requirement” is satisfied in the case of an Affected Member if before the modification is made—

  • (a) the Secretary of State has—
  • (i) given that person information in writing adequate to explain the nature of the modification and its effect on the member;
  • (ii) notified that person in writing that he or she may make representations to the Secretary of State about the modification;
  • (iii) afforded that person a reasonable opportunity to make such representations; and
  • (iv) notified that person in writing that the Consent Requirements apply in that person’s case in respect of the modification; and
  • (b) after the Secretary of State has complied with paragraph (a)(i), (ii) and (iv), the Affected Member has given consent in writing to the modification.

7

If—

  • (a) the modification is not a Protected Modification; and
  • (b) before the modification is made the Secretary of State notifies an Affected Member in writing that—
  • (i) if that person gives consent to the modification for the purposes of the Consent Requirements, those requirements apply in that person’s case in respect of the modification, but
  • (ii) otherwise, the Actuarial Equivalence Requirements apply in that person’s case in respect of the modification,

the Secretary of State is to be taken to have complied with paragraph 6(a)(iv) in respect of that member.

8

The Timing Requirement is satisfied in the case of an Affected Member if the modification takes effect within a reasonable period after that person has given consent to the modification in accordance with paragraph 6(b).

9

The Actuarial Equivalence Requirements consist of—

  • (a) the Information Requirement;
  • (b) the Actuarial Value Requirement; and
  • (c) the Actuarial Equivalence Statement Requirement.

10

The Information Requirement is satisfied in the case of an Affected Member if before the modification is made the Secretary of State has taken all reasonable steps to—

  • (a) give that person information in writing adequate to explain the nature of the modification and its effect on that person;
  • (b) notify that person in writing that he or she may make representations to the Secretary of State about the modification;
  • (c) afford that person a reasonable opportunity to make such representations; and
  • (d) notify that person in writing that the Actuarial Equivalence Requirements apply in that person’s case in respect of the modification.

11

The Actuarial Value Requirement is satisfied in the case of an Affected Member if before the modification is made the Secretary of State has made such arrangements, or taken such steps, as are adequate to secure that actuarial value will be maintained, in accordance with paragraph 14.

12

The Actuarial Equivalence Statement Requirement is satisfied in the case of an Affected Member if the Secretary of State has, within a reasonable period beginning with the date on which the modification takes effect, obtained an Actuarial Equivalence Statement relating to the Affected Member in respect of the modification.

13

An Actuarial Equivalence Statement means a statement in writing which—

  • (a) is given by the Actuary or another person who is approved by the Secretary of State and is a Fellow of the Faculty of Actuaries or a Fellow of the Institute of Actuaries; and
  • (b) certifies that actuarial value has been maintained, in accordance with paragraph 14.

14

For the purposes of paragraphs 11 and 13 as they apply in relation to an Affected Member, actuarial value is maintained if the actuarial value, immediately after the time at which the modification takes effect, of the Affected Member’s RMSPS Subsisting Rights is equal to or greater than the actuarial value of that person’s RMSPS Subsisting Rights immediately before that time.

15

The Information Requirement is to be taken to have been satisfied in relation to the revised modification where—

  • (a) the Information Requirement has been satisfied in the case of an Affected Member in respect of a proposed modification (“the original modification”);
  • (b) before the Secretary of State has made a modification to the RMSPS in relation to the original modification, the original modification has been revised; and
  • (c) the modification as so revised (“the revised modification”) does not differ from the original modification in any material respect.

16

The Secretary of State is to be regarded as having taken all reasonable steps to notify an Affected Member as mentioned in paragraph 10(d) if he has taken all reasonable steps to notify that person in writing that—

  • (a) if that person gives consent to the modification for the purposes of the Consent Requirements, those requirements apply in that person’s case in respect of the modification, but
  • (b) otherwise, the Actuarial Equivalence Requirements apply in that person’s case in respect of the modification.

17

When making any calculation for the purposes of paragraphs 11, 13 and 14 of the actuarial value of an Affected Member’s RMSPS Subsisting Rights at any time, the Actuary must—

  • (a) calculate the value of the RMSPS Subsisting Rights of an Affected Member by adopting methods and making assumptions which are consistent with methods and assumptions used by the Secretary of State as at the date of the modification to calculate a cash equivalent transfer value from the RMSPS in accordance with regulations 7 to 7C and 7E(1) to (3) as appropriate of the Occupational Pension Schemes (Transfer Values) Regulations 1996 (manner of calculation and verification of cash equivalents), as those regulations apply to the RMSPS under Schedule 4;
  • (b) ensure that the calculation of the actuarial value of an Affected Member’s RMSPS Subsisting Rights is made in accordance with any guidance that is adopted or prepared, and from time to time revised, by the Board for Actuarial Standards (being the operating body of that name of the Financial Reporting Council) which is current on the date that the Actuarial Equivalence Statement is obtained by the Secretary of State;
  • (c) exclude from the RMSPS Subsisting Rights calculation—
  • (i) the value of any RMSPS Subsisting Rights that have been surrendered, commuted or forfeited before the date on which the modification of the RMSPS takes effect;
  • (ii) the value of any amounts paid, or due to be paid, in respect of any pension or other benefit in payment to an Affected Member in respect of a period prior to the date on which the modification takes effect;
  • (iii) the value of discretionary benefits that have not been awarded to an Affected Member or are not in payment on the date on which the modification takes effect; and
  • (d) exclude any RMSPS Subsisting Rights which consist wholly or partly of rights to money purchase benefits where—
  • (i) those benefits are not valued in a manner which involves making estimates of the value of the rights, and
  • (ii) the modification has no effect on the value of those rights.

18

Nothing in paragraphs 12 and 13 precludes Actuarial Equivalence Statements relating to—

  • (a) two or more Affected Members, or
  • (b) Affected Members of any particular description, in respect of a modification being given in a single document.

19

The Reporting Requirement is satisfied in relation to the exercise of a power to which paragraph 2 or 3 applies if the Secretary of State has, in accordance with paragraph 20—

  • (a) notified each Affected Member in whose case the Consent Requirements apply in respect of the modification, and
  • (b) taken all reasonable steps to notify each Affected Member in whose case the Actuarial Equivalence Requirements apply in respect of the modification,

that he has made an order to modify the RMSPS.

20

The Secretary of State must give (or, where the Actuarial Equivalence Requirements apply, take all reasonable steps to give) the notification mentioned in paragraph 19—

  • (a) within a reasonable period beginning with the date of the order modifying the RMSPS mentioned in paragraph 19; and
  • (b) before the date on which the modification made by that order takes effect.

Interpretation

1

In this Schedule—

  • “Attachment of Earnings Order” means— an order made under section 1 of the Attachment of Earnings Act 1971[^f00037]; an order made under Articles 73 or 99 of the Judgments Enforcement (Northern Ireland) Order 1981[^f00038];
  • “Cut-Off Date” means 31 March 2012;
  • “Deductions from Earnings Order” means— an order made under section 31 of the Child Support Act 1991[^f00039]; or an order made under Article 31 of the Child Support (Northern Ireland) Order 1991[^f00040];
  • “Earnings Arrestment Schedule” has the meaning given in section 47(2) of the Debtors (Scotland) Act 1987[^f00041];
  • “money purchase benefits” has the meaning given in the RMSPS Rules;
  • “Pension Attachment Order” means— an order made under section 23 of the Matrimonial Causes Act 1973[^f00042] or section 17 of the Matrimonial and Family Proceedings Act 1984[^f00043] by virtue of section 25B or section 25C of the Matrimonial Causes Act 1973, an order made under Part 1 of Schedule 5 or paragraph 9 of schedule 7 of the Civil Partnership Act 2004[^f00044] by virtue of Part 6 of Schedule 5 of that Act, an order made under Article 25 of the Matrimonial Causes (Northern Ireland) Order 1978[^f00045] or Article 21 of the Matrimonial and Family Proceedings (Northern Ireland) Order 1989[^f00046] by virtue of Article 27B or 27C of the Matrimonial Causes (Northern Ireland) Order 1978, an order made under Part 1 of Schedule 15 or paragraph 9 of Schedule 17 of the Civil Partnership Act 2004 by virtue of Part 5 of Schedule 15 of that Act, an order made under section 8 of the Family Law (Scotland) Act 1985[^f00047] by virtue of section 12A of that Act, an order made under Part IV of the Matrimonial and Family Proceedings Act 1984[^f00048] corresponding to such order as is mentioned in paragraph (v), or an order made under paragraph 2 of Schedule 11 of the Civil Partnership Act 2004 corresponding to such order as is mentioned in paragraph (v);
  • “Pension Credit” means a credit under section 29(1)(b) of the Welfare Reform and Pensions Act 1999[^f00049];
  • “Pension Sharing Order” means an order made under section 24B of the Matrimonial Causes Act 1973[^f00050] or other order or provision mentioned in section 28(1) of the Welfare Reform and Pensions Act 1999;
  • “person responsible” means a person responsible under— section 25D(1) of the Matrimonial Causes Act 1973[^f00051], Article 27D(1) of the Matrimonial Causes (Northern Ireland) Order 1978, paragraph 27 of Schedule 5 of the Civil Partnership Act 2004, paragraph 22 of Schedule 15 of the Civil Partnership Act 2004, or section 12A(6) of the Family Law (Scotland) Act 1985;
  • “Relevant Scottish Order” has the meaning given in paragraph 4;
  • “shareable rights” has the meaning given in section 27(2) of the Welfare Reform and Pensions Act 1999[^f00052] and Article 23A(a) of the Matrimonial Causes (Northern Ireland) Order 1978;
  • “Voluntary Deduction from Earnings Arrangement” means an arrangement whereby one person gives authority for payments to be made on their behalf to another person or to an account of that other person in accordance with section 28J of the Child Support Act 1991[^f00053] or the Child Support (Voluntary Payments) Regulations 2000[^f00054].

Pension Sharing Orders

2

A Pension Sharing Order made on or before the Cut-Off Date in respect of shareable rights under the RMPP which has not been implemented on or before the Cut-Off Date in relation to any person who is a pensioner or deferred pensioner of the RMPP at the end of the Cut-Off Date shall be implemented in the RMSPS.

3

A Pension Sharing Order made on or before the Cut-Off Date in respect of shareable rights under the RMPP which has not been implemented on or before the Cut-Off Date in relation to any person who is an active member of the RMPP at the end of the Cut-Off Date has effect as if a separate Pension Sharing Order had been made in respect of the RMSPS in relation to the rights accrued by that member and shall accordingly be implemented in the RMSPS in relation to those rights, with the order being deemed to be subject to any adjustments that are necessary to provide under the RMSPS a pension credit of the same value as would have been provided under the RMPP had the transfers implemented by article 5 of this Order not occurred.

4

A Pension Sharing Order made after the Cut-Off Date in respect of shareable rights under the RMPP in relation to any person who is an active member of the RMPP at the end of the Cut-Off Date has effect—

  • (a) as if it had been made in respect of the RMPP in relation to the rights of that member under the RMPP other than those transferred by article 5 of this Order and shall accordingly be implemented in the RMPP in respect of those rights, and
  • (b) as if a separate Pension Sharing Order had been made in respect of the RMSPS in relation to the rights of that member under the RMPP transferred by article 5 of this Order and shall accordingly be implemented in the RMSPS in relation to those rights,

but any such Pension Sharing Order which is comprised in an order or provision made in Scotland pursuant to Section 29(3) of the Welfare Reform and Pensions Act 1999 specifying an amount to be transferred (a “Relevant Scottish Order”) shall be dealt with in the manner set out in paragraphs 5 and 6.

5

The amount specified by a Relevant Scottish Order shall be apportioned in the ratio of the cash equivalent of the rights mentioned in paragraph 4(a) to the cash equivalent of the rights mentioned in paragraph 4(b) and

  • (a) the proportion of the said amount which corresponds to the rights mentioned in paragraph 4(a) shall be implemented in the RMPP, and
  • (b) the proportion of the said amount which corresponds to the rights mentioned in paragraph 4(b) shall be implemented in the RMSPS.

6

Cash equivalents shall be calculated for the purposes of paragraph 5 by the person responsible for the RMPP on the same basis as the cash equivalent is calculated for the purposes of section 29 of the Welfare Reform and Pensions Act 1999.

Pension Attachment Orders

7

A Pension Attachment Order made on or before the Cut-Off Date in respect of a person responsible for the RMPP in relation to any person who is a pensioner or deferred pensioner of the RMPP at the end of the Cut-Off Date has effect as if it had been made instead in respect of the person responsible for the RMSPS in relation to that pensioner or deferred pensioner.

8

A Pension Attachment Order made on or before the Cut-Off Date in respect of a person responsible for the RMPP in relation any person who is an active member of the RMPP at the end of the Cut-Off Date has effect—

  • (a) as if it had been made in respect of the person responsible for the RMPP in relation to the rights of that member under the RMPP other than those transferred by article 5 of this Order; and
  • (b) as if a separate order had been made in respect of the person responsible for the RMSPS in relation to the rights of that member under the RMPP transferred by article 5 of this Order, except insofar as the Pension Attachment Order relates to any lump sum payable on death.

9

A Pension Attachment Order made on or before the Cut-Off Date in respect of a person responsible for the RMPP in relation to rights in respect of any lump sum payable on death has effect—

  • (a) as if it had been made in respect of the person responsible for the RMPP, in relation to a lump sum payable on death in respect of a member of the RMPP under the RMPP Rules after the Cut-Off Date, calculated by reference to the rights of that member under the RMPP other than those transferred by article 5 of this Order; and
  • (b) as if a separate order had been made in respect of the person responsible for the RMSPS, in relation to a lump sum payable on death in respect of a member of the RMSPS under the RMSPS Rules after the Cut-Off Date, calculated by reference to the rights of the relevant member under the RMPP transferred by article 5 of this Order.

Orders for deductions from earnings

10

  • (1) Where any of the orders at sub-paragraph 2 are made on or before the Cut-Off Date and the order directs the RMPP or the trustee of the RMPP to make deductions in relation to any person who is a member of the RMPP at the end of the Cut-Off Date, the order is to have effect as if it directed the Secretary of State in his capacity as the person responsible for the management of the RMSPS to make deductions specified in the order in relation to the rights of that member under the RMSPS.
  • (2) The orders referred to in sub-paragraph (1) are—
  • (a) an Attachment of Earnings Order;
  • (b) a Deductions from Earnings Order;
  • (c) an Earnings Arrestment Schedule; or
  • (d) a Voluntary Deduction from Earnings Arrangement.

Money purchase benefits

11

This Schedule does not apply so as to transfer or modify any obligations of the person responsible for the RMPP under any—

  • (a) Pension Sharing Order;
  • (b) Pension Attachment Order;
  • (c) Attachment of Earnings Order;
  • (d) Deductions from Earnings Order;
  • (e) Earnings Arrestment Schedule; or
  • (f) Voluntary Deduction from Earnings Arrangement

to the extent that the order or arrangement relates to money purchase benefits.

No further obligations of the RMPP

12

The trustee of the RMPP shall have no further obligation in relation to—

  • (a) a Pension Sharing Order to which paragraph 2 or paragraph 3 applies;
  • (b) a Pension Sharing Order to which paragraph 4 or paragraph 5 applies, in respect of the rights of the relevant member under the RMPP transferred by article 5 of this Order;
  • (c) a Pension Attachment Order to which paragraph 7 applies;
  • (d) a Pension Attachment Order to which paragraph 8 or paragraph 9 applies, in respect of the rights of the relevant member under the RMPP transferred by article 5 of this Order, and
  • (e) an Attachment of Earnings Order, a Deductions from Earnings Order, an Earnings Arrestment Schedule or a Voluntary Deduction from Earnings Arrangement to which paragraph 10 applies,

except to the extent that any such order or arrangement has effect in relation to money purchase benefits.

SCHEDULE 4

PART I — OCCUPATIONAL PENSIONS LEGISLATION APPLICABLE TO RMPS

Interpretation

1

The provisions referred to in article 9 are those set out in Part 1 of this Schedule and the secondary legislation made under them from time to time.

Matrimonial Causes Act 1973

2

The following provisions of the Matrimonial Causes Act 1973[^f00055]—

  • (a) section 24B (Pension sharing orders in connection with divorce proceedings etc);
  • (b) section 24C (Pension sharing orders: duty to stay);
  • (c) section 24D (Pension sharing orders: apportionment of charges);
  • (d) section 25B (Pensions);
  • (e) section 25C (Pensions: lump sum); and
  • (f) section 25D (Pensions: supplementary).

Matrimonial Causes (Northern Ireland) Order 1978

3

The following provisions of the Matrimonial Causes (Northern Ireland) Order 1978[^f00056]—

  • (a) Article 23A (Pension sharing orders);
  • (b) Article 27B (Pensions);
  • (c) Article 27C (Pensions: lump sums); and
  • (d) Article 27D (Pensions: supplementary).

Family Law (Scotland) Act 1985

4

The following provisions of the Family Law (Scotland) Act 1985)[^f00057]—

  • (a) section 8 (Orders for financial provision);
  • (b) section 8A (Pension sharing orders: apportionment of charges); and
  • (c) section 12A (Orders for payment of capital sum: pensions lump sums).

Pension Schemes Act 1993

5

The following provisions of the Pension Schemes Act 1993[^f00058]—

  • (a) Chapter IV of Part IV (Transfer Values). For these purposes, Chapter IV of Part IV shall apply to the RMSPS on the basis that it is a scheme to which regulation 7B(6) of The Occupational Pensions Schemes (Transfer Values) Regulations 1996[^f00059] applies;
  • (b) Chapter I of Part IVA (Pension Credit Under Occupational Schemes);
  • (c) section 113 (Disclosure of information about schemes to members etc); and
  • (d) Part X (Investigations: the Pensions Ombudsman).

Pensions Act 1995

6

The following provisions of the Pensions Act 1995[^f00060]—

  • (a) section 50 (Requirement for dispute resolution arrangements);
  • (b) section 50A (Meaning of “person with an interest in the scheme”);
  • (c) section 50B (The dispute resolution procedure);
  • (d) section 51 (Annual increase in rate of pension);
  • (e) section 51ZA (Meaning of “the appropriate percentage”);
  • (f) section 52 (Restriction on increase where member is under 55);
  • (g) section 53 (Effect of increases above the statutory requirement); and
  • (h) section 54 (Sections 51 to 53: supplementary).

Welfare Reform and Pensions Act 1999

7

The following provisions of the Welfare Reform and Pensions Act 1999[^f00061]—

  • (a) section 11 (Effect of bankruptcy on pension rights: approved arrangements);
  • (b) section 13 (Sections 11 and 12: application to Scotland);
  • (c) section 23 (Supply of pension information in connection with divorce etc);
  • (d) section 24 (Charges by pension arrangements in relation to earmarking orders); and
  • (e) Part IV (Pension Sharing).

Welfare Reform and Pensions (Northern Ireland) Order 1999

8

The following provisions of the Welfare Reform and Pensions (Northern Ireland) Order 1999[^f00062]—

  • (a) article 12 (Effect of bankruptcy on pension rights: approved arrangements);
  • (b) Part IV (Pensions on Divorce etc); and
  • (c) Part V (Pension Sharing).

Civil Partnership Act 2004

9

The following provisions of the Civil Partnership Act 2004[^f00063]—

  • (a) Part 6 of Schedule 5 (Financial Relief in the High Court or a County Court); and
  • (b) Part 5 of Schedule 15 (Financial Relief in the High Court or a County Court etc: Northern Ireland).

Equality Act 2010

10

The following provisions of the Equality Act 2010[^f00064]—

  • (a) Chapter 2 of Part 5 (Occupational pension schemes);
  • (b) paragraphs 1 and 2 of Schedule 22 (Statutory provisions);
  • (c) paragraph 1 of Schedule 23 (General exceptions); and
  • (d) Schedule 24 (Harmonisation: exceptions).

Interpretation

11

In this Schedule—

  • “1993 Act” means the Pension Schemes Act 1993;
  • “Contracted-out Beneficiary” means a beneficiary under the RMSPS who, but for the transfers, amendments and discharge under articles 5, 7 and 11 of this Order, would at any time have had rights and entitlements under the RMPP to or in respect of GMPs or section 9(2B) rights (or both);
  • “Contracting-out Regulations” means the Occupational Pension Schemes (Contracting-out) Regulations 1996[^f00065];
  • “earner” has the meaning given in the 1993 Act;
  • “GMP” means the guaranteed minimum pension of a member, widow, widower or surviving civil partner as defined in section 8(2) of the 1993 Act;
  • “predecessor scheme” means any occupational pension scheme from which rights and entitlements in respect of GMPs and section 9(2B) rights were transferred to the RMPP before the qualifying time;
  • “relevant earner” means the following: in relation to a Contracted-out Beneficiary who is a member of the RMSPS, that member; and in relation to a Contracted-out Beneficiary who is not a member of the RMSPS, the member of the RMPP or RMSPS in respect of whom the Contracted-out Beneficiary has rights and entitlements to or in respect of GMPs or section 9(2B) rights (or both); and
  • “section 9(2B) rights” has the meaning given in the Contracting-out Regulations.

Application of contracting-out legislation to the RMSPS

12

Subject to paragraph 14, the provisions of the 1993 Act that are set out in paragraph 13 and the regulations made under them that are set out in paragraph 15 apply to the RMSPS, and the Secretary of State as the person responsible for the management of the RMSPS shall comply with them, in respect of—

  • (a) any rights or entitlements of a Contracted-out Beneficiary to or in respect of GMPs that were accrued or provided under the RMPP in respect of the relevant earner’s contracted-out employment by reference to the RMPP or any predecessor scheme or, but for the transfers, amendments and discharge under articles 5, 7 and 11 this Order, would have been accrued or provided under the RMPP in respect of the relevant earner’s contracted-out employment by reference to the RMPP after the qualifying time; and
  • (b) any section 9(2B) rights of a Contracted-out Beneficiary that were accrued or provided under the RMPP in respect of the relevant earner’s contracted-out employment by reference to the RMPP or any predecessor scheme,
  • as if such contracted-out employment had been carried out by the relevant earner by reference to the RMSPS and those rights and entitlements had been accrued or provided under the RMSPS in respect of that contracted-out employment.

13

The provisions of the 1993 Act referred to in paragraph 12 are—

  • (a) section 12C (Transfer, commutation, etc);
  • (b) section 12D (Entitlement to benefit);
  • (c) section 13 (Minimum pensions for earners);
  • (d) section 14 (Earner’s guaranteed minimum);
  • (e) section 15 (Increase of guaranteed minimum where commencement of guaranteed minimum pension postponed);
  • (f) section 15A (Reduction of guaranteed minimum in consequence of pension debit);
  • (g) section 16 (Revaluation of earnings factors for purposes of s 14: early leavers etc);
  • (h) section 17 (Minimum pensions for widows and widowers);
  • (i) section 18 (Treatment of insignificant amounts);
  • (j) section 19 (Discharge of liability where guaranteed minimum pensions secured by insurance policies or annuity contracts);
  • (k) section 20 (Transfer of accrued rights);
  • (l) section 21 (Commutation, surrender and forfeiture);
  • (m) section 23(7) (Securing of benefits);
  • (n) section 24A (Conversion of guaranteed minimum pension into other benefits: introduction );
  • (o) section 24B (The conversion conditions);
  • (p) section 24C (Actuarial equivalence);
  • (q) section 24D (Survivors’ benefits);
  • (r) section 24E(1), (3) and (4) (Procedural requirements);
  • (s) section 24F (Transfer out);
  • (t) section 24G (Powers to amend schemes);
  • (u) section 24H (Enforcement of GMP conversion conditions);
  • (v) section 37 (Alteration of rules of contracted-out schemes);
  • (w) section 50 (Powers of Inland Revenue to approve arrangements for scheme ceasing to be certified), as if the RMSPS were a scheme which had been certified as a contracted-out scheme and had ceased to be such a scheme;
  • (x) section 51 (Calculation of guaranteed minimum pensions preserved under approved arrangements), as if the RMSPS were a scheme which had been certified as a contracted-out scheme and had ceased to be such a scheme;
  • (y) Chapter III of Part IV (Protection of Increases in Guaranteed Minimum Pensions (“Anti-Franking”));
  • (z) Chapter II of Part V (Guaranteed Minimum Pensions);
  • (aa) section 155 (Requirement to give information to the Secretary of State or the Board for the purposes of certain provisions);
  • (bb) section 156 (Information for purposes of contracting-out); and
  • (cc) section 159 (Inalienability of guaranteed minimum pension and protected rights payments).

14

In its application to the RMSPS, section 13(5) of the 1993 Act is modified such that—

  • (a) for the purposes of paragraph (a) of that section, employment to which the RMPP or any New POL Scheme (as that term is defined in the RMSPS Rules) relates shall be treated as employment to which the RMSPS relates; and
  • (b) the requirement in paragraph (b) of that section, for the earner’s consent to be required for any postponement of the earner’s guaranteed minimum pension after the expiration of five years from the date on which the earner attains pensionable age, shall be subject to any exceptions as may be provided for under the RMSPS Rules.

15

The regulations referred to in paragraph 12 are—

  • (a) the following provisions of the Contracting-out Regulations:
  • (i) regulation 19 (Lump sum benefits and salary related contracted-out schemes);
  • (ii) regulation 20 (Payment of a lump sum instead of a pension payable under a relevant scheme);
  • (iii) regulation 20A (Suspension of section 9(2B) rights);
  • (iv) regulation 21 (Payable age in salary-related contracted-out schemes);
  • (v) regulation 42 (Alteration of rules of contracted-out schemes);
  • (vi) regulation 44(4) and (7) (Notifications to the Secretary of State);
  • (vii) regulation 45 (Approval of arrangements for schemes ceasing to be contracted-out); and
  • (viii) Part VII (Guaranteed Minimum Pensions); and
  • (b) the provisions of the Contracting-out (Transfer and Transfer Payment) Regulations 1996[^f00066].

SCHEDULE 5 — Release of security

Interpretation

1

In this Schedule—

  • “Escrow Framework Deed” means the Escrow Framework Deed between RMG, Royal Mail Estates Limited and the Trustee dated 24 March 2011;
  • “RMES” means Royal Mail Estates Limited (registered number 05770587);
  • “RMES Mortgages” means the three legal mortgages dated 24 March 2011 made between RMES and the Trustee;
  • “RMG Mortgage” means the legal mortgage dated 24 March 2011 made between RMG and the Trustee;
  • “RMG Security Agreement” means the security agreement between RMG and the Trustee dated 23 March 2007;
  • “RMG Security Assets” means the assets secured in favour of the Trustee in accordance with the terms of the RMG Security Agreement, together with any interest or other income accrued thereon;
  • “RMG” means Royal Mail Group Limited (registered number 04138203);
  • “RMGES Mortgages” means such of the RMES Mortgages and the RMG Mortgage as shall not have been redeemed by the time at which the Transfer takes effect;
  • “RMGES Real Property” means the real property that is subject to the security provided for by the RMGES Mortgages;
  • “RMH” means Royal Mail Holdings plc (registered number 04074919);
  • “RMH Escrow Reserve” means the “Holdings Escrow Reserve” established under the directions given by the Secretary of State under section 72 of the Postal Services Act 2000[^f00067] on 19 March 2007;
  • “RMH Security Agreement” means the security agreement between RMH and the Trustee dated 23 March 2007;
  • “RMH Security Assets” means the assets secured in favour of the Trustee in accordance with the terms of the RMH Security Agreement, including amounts held in the RMH Escrow Reserve, together with any interest or other income accrued thereon;
  • “Security” means the security interests granted pursuant to the RMG Security Agreement, the RMH Security Agreement and the RMGES Mortgages;
  • “Security Agreements” means the RMH Security Agreement, the RMG Security Agreement, the Escrow Framework Deed and the RMGES Mortgages;
  • “Security Assets” means the RMH Security Assets, the RMG Security Assets and the RMGES Real Property;
  • “Transfer” means the transfer of qualifying accrued rights to the RMSPS under article 5 and the transfer of assets of the RMPP under article 5 of the Assets Order; and
  • “Trustee” means Royal Mail Pensions Trustees Limited, or any other person(s) who is the trustee or trustees of the RMPP at the time that is applicable under any provision of this Schedule.

Amendments to Security Agreements

2

The Security Agreements are amended such that the Security is released immediately upon the Transfer taking effect.

3

The Trustee, RMH, RMES and RMG shall be required as soon as reasonably practicable following the Transfer taking effect to take all such steps as may be required promptly to give effect to the release of the Security.

RMH Escrow Reserve

4

As soon as reasonably practicable after the Security Assets are released from the Security, RMH shall credit to the RMH Escrow Reserve an amount equal to the value of the RMH Security Assets, as at the date they are released.

Signed

Norman Lamb — Parliamentary Under Secretary of State for Employment Relations, Consumer and Postal Affairs — Department for Business, Innovation and Skills — 7th March 2012

Michael Fabricant — James Duddridge — Department for HM Treasury — 8th March 2012

Explanatory note

(This note is not part of the Order)

EXPLANATORY NOTE

This Order implements sections 17, 18, 19 and 20 of the Postal Services Act 2011 (c. 5) (“the Act”).

Article 1 provides for the commencement of different Articles of the Order at different times, so that after article 1, articles 2 to 12 will come into force first, and articles 13 and 14 immediately after.

Article 2 defines terms in the Order, in particular, prescribing the qualifying time as required by section 16(1) of the Act, as the time immediately before which the relevant accrued pension rights are to transfer under this Order.

Article 3 and Schedule 1 establish the Royal Mail Statutory Pension Scheme (“RMSPS”), and article 4 and Schedule 2 restrict the future amendments that can be made to the RMSPS. Article 5 transfers accrued pension rights from the Royal Mail Pension Plan (“RMPP”) to the RMSPS. The transferring rights include all components of those accrued rights, for example the rights and entitlements in relation to Guaranteed Minimum Pensions, which will become the responsibility of the RMSPS.

Article 6 and Schedule 3 make provision for the transfer of obligations and liabilities relating to pension sharing orders, pension attachment orders and other orders related to earnings.

Article 7 discharges the RMPP Trustee from any liability in respect of the rights that transfer under article 5.

Article 8 provides a specific definition of the RMPP Trustee for the purposes of the discharge. Article 9 and Part 1 of Schedule 4 provide that the RMSPS will be treated as if it were an occupational pension scheme for the purposes of the occupational pensions legislation at Schedule 4, Part I. Article 10 and Part II of Schedule 4 provide that the RMSPS will be treated as a salary-related contracted out scheme for the purposes of Part 3 of the Pension Schemes Act [1993 (c. 48)](https://www.legislation.gov.uk/ukpga/1993/48), and modifies that legislation in its application to the RMSPS.

Article 11 gives effect to the commensurate amendments to the RMPP to remove the rights that transfer to the RMSPS. The amendments to the RMPP documentation are so voluminous that they are contained in an external document, the Statement of Amendments, which is available as described in the definition of that document at article 2, and below. Article 12 amends documents relating to financial security for the RMPP.

Article 13 gives effect to those amendments to the RMPP which divide it into different sections so as to create a new section for the employees of Post Office Limited. Article 14 makes further provision about the division of the RMPP into sections and the relationship between the new section and the rest of the RMPP.

An Explanatory Memorandum accompanying this Order is available alongside the instrument on the OPSI website (www.opsi.gov.uk). Copies have also been placed in the Libraries of the House of Commons and the House of Lords.

The document referred to as the Statement of Amendments, which sets out the amendments to the RMPP, and the documents relating to the financial security of the RMPP which are referred to in Schedule 5, have been placed in the Libraries of the House of Commons and the House of Lords and are being made available on the BIS website.

An impact assessment has not been produced for this Order as a full impact assessment was prepared for the enabling provisions in the Act, the findings of which have not changed.

Footnotes

[^f00001]: 2011 c.5.

[^f00002]: S.I. 2012/688.

[^f00003]: Qualifying time is defined at section 16(1) of the Postal Services Act 2011.

[^f00004]: RMPP is defined in the Postal Services Act 2011 as the Royal Mail Pension Plan.

[^f00005]: Qualifying accrued rights are defined at section 16(1) of the Postal Services Act 2011.

[^f00006]: 1993 c.48.

[^f00007]: 2011 c.5.

[^f00008]: S.I. 2012/687.

[^f00009]: 1993 c.48.

[^f00010]: 2011 c.19.

[^f00011]: 2004 c.12.

[^f00012]: 2004 c.33.

[^f00013]: 2011 c.5.

[^f00014]: 2004 c.12.

[^f00015]: 1999 c.30.

[^f00016]: 1993 c.48.

[^f00017]: 1995 c.26.

[^f00018]: 1993 c.48.

[^f00019]: 2004 c.12.

[^f00020]: 2009 c.10.

[^f00021]: 1965 c.74.

[^f00022]: 1972 c.11.

[^f00023]: 1949 c.44.

[^f00024]: 1972 c.11.

[^f00025]: 1971 c.56.

[^f00026]: 1975 c.60.

[^f00027]: 1992 c.5.

[^f00028]: 1971 c.56.

[^f00029]: 1975 c.60.

[^f00030]: 1992 c.5.

[^f00031]: 1995 c.26.

[^f00032]: 2004 c.12.

[^f00033]: 1993 c.48.

[^f00034]: 1988 c.1.

[^f00035]: 1995 c.26.

[^f00036]: 1993 c.48.

[^f00037]: 1971 c.32.

[^f00038]: S.I. 1981/225 (N.I. 6).

[^f00039]: 1991 c.48.

[^f00040]: S.I. 1991/2628 (N.I. 23).

[^f00041]: 1987 c.18.

[^f00042]: 1973 c.18. Section 23 amended by Family Law Act 1996, section 15, schedule 2, paragraph 5.

[^f00043]: 1984 c.42.

[^f00044]: 2004 c.33.

[^f00045]: S.I. 1978/1045 (N.I. 15).

[^f00046]: S.I. 1989/677 (N.I. 4).

[^f00047]: 1985 c.37. Section 12A inserted by the Pensions Act 1995, section 167(3).

[^f00048]: 1984 c.42.

[^f00049]: 1999 c.30.

[^f00050]: Section 24B inserted by the Welfare Reform and Pensions Act 1999, s 19, schedule 3, paragraphs 1 and 4.

[^f00051]: Section 25D inserted with savings by the Pensions Act 1995, s 166(1).

[^f00052]: 1999 c.30.

[^f00053]: 1991 c.48.

[^f00054]: S.I. 2000/3177.

[^f00055]: 1973 c.18. Relevant amendments made by Pensions Act 1995, s 166(1), Welfare Reform and Pensions Act 1999, section 21 and Schedule 4.

[^f00056]: S.I. 1978/1045 (N.I. 15).

[^f00057]: 1985 c.37.

[^f00058]: 1993 c.48.

[^f00059]: S.I 1996/1847. Relevant amendments made by S.I. 2008/2450 reg 3.

[^f00060]: 1995 c.26. Relevant amendments made by the Pensions Act 2004, sections 273 and 278.

[^f00061]: 1999 c.30.

[^f00062]: 1999/3147 (N.I. 11).

[^f00063]: 2004 c.33

[^f00064]: 2010 c.15.

[^f00065]: S.I. 1996/1172.

[^f00066]: S.I. 1996/1462.

[^f00067]: 2000 c.26.

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