Explanatory note

These Regulations are made under provisions of the Social Security Pensions Act 1975 (“the 1975 Act”) inserted by the Social Security Act 1988 before the end of a period of 12 months from the commencement of those provisions as inserted. Consequently, by virtue of section 61(5) of the Social Security Act 1986 (“the 1986 Act”), the provisions of section 61(2) and (3) of the 1975 Act (as amended by section 86(1) of, and paragraph 94 of Schedule 10 to, the 1986 Act) which requires reference to the Occupational Pensions Board of, and a report by the Board on, proposals to make regulations for certain purposes of both Acts, do not apply to them.

Part II of Schedule 1A to the 1975 Act provides that, if the pensionable service of a member of an occupational pension scheme terminates at least one year before he attains the scheme’s normal pension age, he acquires a right to a cash equivalent of the benefits which have accrued to him, which may be used only in certain specified ways. Regulation 2A of the Occupational Pension Schemes (Transfer Values) Regulations 1985 (as inserted by the Occupational Pension Schemes (Transfer Values) Amendment Regulations 1987) provides that if, and for so long as, the member continues in employment to which the scheme relates after termination of his pensionable service, that right is restricted to that part of the benefits which have accrued since 6th April 1988. These Regulations insert a new regulation 2C into the 1985 Regulations which provides that, if in such a case the member’s employment subsequently terminates at least one year before he attains normal pension age, he then acquires a right to a further cash equivalent in respect of the benefits which accrued to him before 6th April 1988, which is to be valued at the date of such termination or the date when he applies for the cash equivalent, whichever is the later.