The Local Government Pension Scheme (Transitional Provisions, Savings and Amendment) Regulations 2014

• (i) by virtue of being awarded Tier 2 benefits under regulation 37(7)(b) or (10) of the 2013 Regulations, or

• (ii) for a different reason but who is awarded Tier 2 benefits following a request for review made by the eligible member under regulation 37(10) within 3 years of those benefits ceasing.

• (2) Where this regulation applies—

• (a) any final guarantee amount relating to the eligible member’s Tier 3 pension ceases to be payable;

• (b) the eligible member’s provisional assumed benefits and provisional underpin amount are recalculated (in accordance with regulations 4I and 4J respectively) from the date on which the eligible member became entitled to Tier 3 benefits as if the member was entitled to Tier 2 benefits from that date; and

• (c) the amounts recalculated under sub-paragraph (a) are to be used to recalculate the eligible member’s final assumed benefits and final underpin amounts (in accordance with regulations 4K and 4L respectively).

• (3) The recalculated final assumed benefits and final underpin amount are to be used to determine the eligible member’s final guarantee amount (“the recalculated final guarantee amount”).

• (4) The recalculated final guarantee amount is to have applied to it such revaluation adjustment or index rate adjustment as would have applied had it been in payment from the date the Tier 3 benefits commenced.

• (5) The recalculated final guarantee amount is to be added to the eligible member’s pension account.

• (6) Notwithstanding regulation 4B(3), the amount to be added under paragraph (5) is to be added from the date the eligible member is awarded Tier 2 benefits.

Statutory underpin: survivor’s guarantee amount calculation

4O

• (1) This regulation applies where—

• (a) an eligible member dies; and

• (b) as a result, a survivor member’s pension becomes payable under regulation 41, 42, 44, 45, 47 or 48 of the 2013 Regulations.

• (2) A proportion of a survivor guarantee amount is to be added to a survivor member’s pension account in accordance with this regulation on the day after the eligible member’s death.

• (3) A “survivor guarantee amount” is the amount by which an eligible member’s adjusted assumed benefits are exceeded by their adjusted underpin amount.

• (4) The eligible member’s adjusted assumed benefits are calculated by adjusting their provisional assumed benefits as follows—

• (a) where the eligible member’s date of death is the same as their underpin date, increase the eligible member’s provisional assumed benefits by an amount equivalent to 1/49th of their annual assumed pensionable pay, calculated in accordance with regulation 21(4) of the 2013 Regulations as at the date of the eligible member’s death;

• (b) where, in the opinion of an IRMP, the member was, at the date of their death, in part time service wholly or partly as a result of the condition that caused or contributed to their death, the increase referred to in sub-paragraph (a) is to take no account of any reduction in pensionable pay due to such reduction in service as is attributable to that condition; and

• (c) where the eligible member’s date of death is not the same date as their underpin date, apply any revaluation adjustment or index rate adjustment that would have applied to a deferred benefit in the 2014 Scheme as if the last day of scheme membership was the underpin date.

• (5) The increase referred to in paragraph (4)(a) applies in relation to the period—

• (a) beginning with the day after the eligible member’s death; and

• (b) ending with the earlier of—

• (i) 31st March 2022, and

• (ii) the date on which the eligible member would have attained—

• (aa) the normal retirement age applicable to them under the 2008 Scheme; or

• (bb) where the person was not a member of the 2008 Scheme, the age of 65.

• (6) The eligible member’s adjusted underpin amount is calculated by adjusting their provisional underpin amount as follows—

• (a) where the eligible member’s date of death is the same as their underpin date, increase the eligible member’s provisional underpin amount according to any additional period of membership that would have been added to the member’s total membership under regulation 20(2) of the Benefits Regulations up to and including 31st March 2022 if the member’s employment had been terminated on grounds of ill-health or infirmity of mind or body; and

• (b) add any increase that would apply were the adjusted underpin amount a pension to which the Pensions (Increase) Act 1971 applied, which relates to the period—

• (i) beginning with the day after the day on which the period used for the purposes of calculating the eligible member’s final pay under regulations 8 to 11 of the Benefits Regulations ends, and

• (ii) ending with the date of the eligible member’s death.

• (7) Where, in the opinion of the scheme manager, the eligible member was in part-time service at the date of their death wholly or partly as the result of the condition that caused or contributed to the member’s death, for the purposes of calculating the adjusted underpin amount, no account is to be taken of any reduction in membership due to such reduction in service as is attributable to that condition.

• (8) A survivor pension paid under a provision listed in column 2 of the following table is to be increased by the proportion of the survivor guarantee amount specified in the corresponding entry in column 3 of the table—

• (9) In this regulation, “IRMP” has the meaning given in Schedule 1 to the 2013 Regulations.

Statutory underpin: death grants

4P

• (1) This regulation applies where—

• (a) an eligible member who is a deferred member or deferred pensioner member of the 2014 Scheme dies; and

• (b) as a result, a death grant becomes payable under regulation 43 of the 2013 Regulations.

• (2) A deferred guarantee amount relating to the eligible member is to be included in the amount the eligible member would have been entitled to receive as retirement pension annually for the purposes of the calculation of a death grant under regulation 43(3) of the 2013 Regulations.

• (3) A deferred guarantee amount is the amount by which the eligible member’s deferred assumed benefits are exceeded by their deferred underpin amount.

• (4) An eligible member’s deferred assumed benefits are calculated by adjusting their provisional assumed benefits to apply any revaluation adjustment or index rate adjustment that would have applied to a deferred benefit in the 2014 Scheme as if the last day of scheme membership was the underpin date.

• (5) An eligible member’s deferred underpin amount is calculated by adjusting their provisional underpin to apply any amount by which it would be increased if it were a pension to which the Pensions (Increase) Act 1971 applied, which relates to the period—

• (a) beginning with the day after the day on which the final pay period used for the purposes of calculating the eligible member’s final pay under regulations 8 to 11 of the Benefits Regulations ends; and

• (b) ending with date of the eligible member’s death.

Statutory underpin: multiple pension accounts

4Q

• (1) This regulation applies to an eligible member who has an aggregated pension account.

• (2) Paragraphs (3) to (7) apply where the eligible member does not have a continuous break in active membership of a public service pension scheme of more than 5 years that began after the member’s active membership in respect of the inactive pension account that has been aggregated with the eligible member’s active pension account ceases.

• (3) The provisional assumed benefits and the provisional underpin amount calculated in relation to the eligible member’s inactive pension account prior to it being aggregated with the eligible member’s active pension account are extinguished.

• (4) The underpin date for the purpose of regulations 4I and 4J in their application to the aggregated account is the underpin date that relates to the active pension account.

• (5) Where the pension accounts were held concurrently before being aggregated, paragraphs (3) and (4) do not apply if the eligible member had attained, before they ceased to be an active member in relation to each inactive pension account that has been aggregated with the active pension account—

• (a) the normal retirement age applicable to them under the 2008 Scheme; or

• (b) where the eligible member was not a member of the 2008 Scheme, the age of 65.

• (6) Where the pension accounts were held consecutively before being aggregated, paragraphs (3) and (4) do not apply if the eligible member has attained, on the first day of their membership of the active pension account—

• (a) the normal retirement age applicable to them under the 2008 Scheme; or

• (b) where the eligible member was not a member of the 2008 Scheme, the age of 65.

• (7) Where paragraph (5) or (6) applies—

• (a) the provisional assumed benefits and provisional underpin amount calculated in relation to the inactive account prior to it being aggregated with the eligible member’s active pension account are applied to the active pension account; and

• (b) that provisional underpin amount and provisional assumed benefits are to be used as the basis for the calculations of the final underpin amount and final assumed benefits, adjusted assumed benefits and adjusted underpin amount under regulation 4O, or deferred assumed benefits and deferred underpin amount under regulation 4P, as the case may be, for the active pension account.

• (8) Paragraphs (9) and (10) apply where the eligible member has had a continuous break in active membership of a public service pension scheme of more than 5 years that began after the member’s active membership in relation to the inactive pension account that has been aggregated with the eligible member’s active pension account ceased.

• (9) The provisional assumed benefits and the provisional underpin amount calculated in relation to the eligible member’s inactive pension account prior to it being aggregated with the eligible member’s active pension account are extinguished.

• (10) Any remediable service built up in the inactive pension account is ignored for the purposes of regulations 4A to 4V.

• (11) In this regulation—

• (a) pension accounts are held concurrently if, immediately before the accounts are aggregated, the eligible member held active membership of the 2014 Scheme in relation to the pension account that becomes the active pension account at the same time as holding active membership of the 2014 Scheme in the pension account that becomes the inactive pension account;

• (b) pension accounts are held consecutively before being aggregated if they are not held concurrently.

• (12) In this regulation—

• “active pension account” means a pension account in respect of which the eligible member is an active member;

• “aggregated pension account” is a pension account that has been aggregated under regulation 22(5), (6), (7) or (8) of the 2013 Regulations;

• “inactive pension account” means a pension account in respect of which the eligible member is no longer an active member.

Statutory underpin: divorce and dissolution of civil partnership

4R

• (1) This regulation applies where the cash equivalent of an eligible member’s relevant benefits is, for the purpose of section 29 of the Welfare Reform and Pensions Act 1999¹⁹ (creation of pension debits and credits), calculated in accordance with regulation 4 of the Pension Sharing (Valuation) Regulations 2000 (manner of calculation and verification of cash equivalents: occupational pension schemes).

• (2) Where this regulation applies, the cash equivalent of the relevant benefits is to be calculated in accordance with actuarial guidance issued by the Secretary of State.

• (3) “Relevant benefits” has the same meaning as in section 29 of the Welfare Reform and Pensions Act 1999.

Payment of indirect compensation

4S

• (1) An administering authority may, in respect of a compensatable loss that is a Part 4 tax loss incurred by an eligible member—

• (a) not pay an amount under section 82 of PSPJOA 2022 by way of compensation in respect of the loss; and

• (b) instead pay the eligible member additional benefits under the 2014 Scheme.

• (2) This regulation is subject to the requirements of regulation 4T (applications for compensation).

• (3) When exercising the power in paragraph (1) to pay additional benefits, the administering authority must comply with the requirements contained in direction 33(1) of the PSP Directions 2022 in relation to the exercise of those powers as those requirements apply to the power to pay amounts by way of compensation by virtue of section 82(1) of PSPJOA 2022 (and the reference in direction 33(1)(f)(iii) to direction 34 is to be read accordingly).

• (4) The administering authority must obtain actuarial advice before determining what additional benefits to pay to a member.

• (5) When determining what additional benefits to pay to a member under this regulation, the administering authority must, in accordance with the actuarial advice obtained under paragraph (4), apply any actuarial factors that were in force when the pension debit was calculated originally.

• (6) Direction 36 of the PSP Directions 2022 (indirect compensation) applies to this regulation for the purpose of determining whether a Part 4 tax loss is compensatable.

Applications for compensation

4T

• (1) An administering authority may pay compensation to a person in respect of the 2014 Scheme under section 82(1) of PSPJOA 2022 (power to pay compensation to members or personal representatives in respect of compensatable losses) or additional benefits payable by virtue of regulation 4S only after the appropriate person has made an application to the administering authority in such form and manner as determined by the administering authority, subject to paragraph (2).

• (2) Where compensation payable under section 82(1) or 83(1) (indirect compensation) of PSPJOA 2022 is in respect of a Part 4 tax loss mentioned in direction 34(4)(a) or (b) or 36(3)(a) or (b) of the PSP Directions 2022, the application mentioned in paragraph (1) must include the following—

• (a) a calculation obtained by the appropriate person from HMRC (by virtue of HMRC’s compensation function by virtue of section 104 of PSPJOA 2022), of any compensation or indirect compensation paid by the scheme to the person in relation to each out-of-scope tax year;

• (b) a signed declaration by the appropriate person that the information provided to HMRC in order to obtain the calculation mentioned in sub-paragraph (a), and the calculation itself, is correct and complete to the best of their knowledge and belief; and

• (c) a warning that, if false information is given, the appropriate person signing the declaration mentioned in sub-paragraph (b) may face civil action or prosecution, or both.

• (3) The administering authority must determine the relevant amounts (if any) owed by the scheme to a person by virtue of section 82(1) or 83(1) of PSPJOA 2022 following receipt of the application mentioned in paragraph (1).

• (4) The administering authority must provide the appropriate person with an explanation of how the relevant amounts (if any) have been determined under paragraph (3).

• (5) The appropriate person may appeal against a determination by the administering authority under paragraph (3) by notice in writing to the administering authority, together with a reasoned explanation of a proposed alternative amount, supported by any evidence the appropriate person considers relevant.

• (6) If an appeal is made under paragraph (5), the administering authority must decide whether to alter its determination, and provide to the appropriate person—

• (a) an altered determination, or confirmation that the original determination stands;

• (b) a reasoned explanation of its decision; and

• (c) a description of the dispute resolution arrangements that apply to the scheme under section 50 of the Pensions Act 1995.

• (7) In this regulation, a tax year is “out-of-scope” in relation to an individual where—

• (a) that individual is unable to recover from HMRC the amount of overpaid income tax paid in relation to that tax year by that individual that gives rise to their Part 4 tax loss, and

• (b) the reason for that is because the individual may no longer make a claim under the Income Tax Acts to recover from HMRC the amount of overpaid income tax because the statutory time limit has passed.

• (8) In this regulation—

• “HMRC” means His Majesty’s Revenue and Customs;

• “the appropriate person” means the eligible member or, if they are deceased, their personal representatives.

Payment of compensation or indirect compensation out of pension fund

4U

An administering authority may pay compensation to a person in respect of the 2014 Scheme under section 82(1) of PSPJOA 2022 (power to pay compensation to members or personal representatives in respect of compensatable losses) or additional benefits payable by virtue of regulation 4S from the pension fund concerned.

Interest on indirect compensation

4V

• (1) This regulation applies where an administering authority pays additional benefit to an eligible member under regulation 4S (indirect compensation).

• (2) Interest is to be paid in respect of the additional benefit in accordance with regulation 14 of the Local Government Pension Scheme (Amendment) (No. 3) Regulations 2023.

Membership of the 2014 Scheme

Admission agreements

Qualifying service for the 2014 Scheme

Pensionable pay

Transfers

Interfund adjustments etc.

Retirement benefits

Ill-health retirement

Lump sum commutation

Contributions

Additional contributions

Annual allowance

Survivor benefits

The 85 year rule

Appropriate funds

Pension sharing

Mis-sold personal pensions

Scheme employers’ obligations

Decisions and adjudications of disagreements

Special cases

Pension increases under the Pensions (Increase) Acts

Employer contributions for historic liabilities

Councillor pensions