Regulation 6 Payments made in anticipation

England, Wales and Scotland

(1)

The prescribed class of liabilities referred to in section 84(1)(b) (liabilities the trustees would not otherwise be able to meet) are—

(a)

any liability for payment of pensions which has arisen at the application date;

(b)

any liability which arises between the application date and the settlement date for payment of—

(i)

guaranteed minimum pensions,

(ii)

pensions, other than guaranteed minimum pensions, payable to persons reaching normal pension age,

(iii)

pensions payable to beneficiaries,

(iv)

ill-health retirement pensions;

(c)

in the case of a scheme where some or all of the benefits that may be provided are money purchase benefits, any liability such as is specified in paragraph (2).

(2)

The liability referred to in paragraph (1)(c) is the approximate amount of any monthly pension that would have been payable in respect of money purchase benefits prior to the settlement date but for the loss.

(3)

Except where any liability for payment of a pension arises in connection with terminal illness, such liability shall not for the purposes of this regulation include any liability for payment of a lump sum, whether or not deriving from the commutation of pension rights.

(4)

For the purposes of paragraph (3), a person shall be regarded as terminally ill where his expectation of life is less than one year, and the expression terminal illness shall be construed accordingly.

(5)

Payments made in anticipation shall be calculated—

(a)

so that, so far as the Board is reasonably able to achieve, the extent to which liabilities specified in paragraph (1) are satisfied after the Board has made a payment under section 83, is undiminished;

(b)

so as to counter-balance any payments in anticipation made previously which were too great or too small;

(c)

so as not to exceed the amount required to enable the trustees of the scheme, prior to the settlement date, to meet such liabilities as are specified in paragraph (1); and

F1(d)

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

(6)

For the purposes of section 84(3), the prescribed circumstances in which any payment made under section 84(1) may not be recovered, in whole or in part, are where such recovery would cause pensions in payment to be reduced.

Annotations

Textual amendments

F1: Reg. 6(5)(d) omitted (16.12.2004) by virtue of The Pensions Act 2004 (Commencement No. 1 and Consequential and Transitional Provisions) Order 2004 (S.I. 2004/3350), art. 3(3)