# The Occupational Pension Schemes (Transfer Values and Miscellaneous Amendments) Regulations 2003, Regulation 2: Amendment of the Occupational Pension Schemes (Transfer Values) Regulations 1996


(1) The Occupational Pension Schemes (Transfer Values) Regulations 1996 shall be amended as provided for by the following paragraphs of this regulation.
(2) In paragraph (2) of regulation (1) (interpretation), after the definition of “cash equivalent” there shall be inserted the following definition:
““effective date” in paragraph (4) or (4A) of regulation 8 means the date as at which the assets and liabilities are valued;”.
(3) In regulation 8 (further provisions as to calculation of cash equivalents and increases and reductions of cash equivalents (other than guaranteed cash equivalents)), for paragraph (4) there shall be substituted the following paragraphs:
“(4) Subject to paragraph (4A), where a scheme to which section 56 of the 1995 Act (minimum funding requirement) applies had, at the effective date of the actuary’s last report to the trustees of the scheme before the guarantee date in accordance with “Retirement Benefit Schemes—Transfer Values (GN 11)” published by the Institute of Actuaries and the Faculty of Actuaries and current at the guarantee date, assets that were not sufficient to pay the full amount of the cash equivalent in respect of all members, the trustees may reduce each part of the cash equivalent as shown in that report by an amount that is no greater than the percentage by which the assets are shown in the actuary’s report as being insufficient to pay the full amount of the corresponding part of the cash equivalent in respect of all members provided, in any case, that the amount of any cash equivalent after the reduction is not less than the minimum amount required under regulation 7(3)(b)(iv) to satisfy the liabilities referred to in section 73(3) of the 1995 Act (preferential liabilities on winding up) as modified by regulation 3 of the Occupational Pension Schemes (Winding Up) Regulations 1996.
(4A) In the case of a scheme to which section 56 of the 1995 Act applies which had, at the effective date of the last actuarial valuation under section 57 of the 1995 Act (valuation and certification of assets and liabilities) before the guarantee date, assets that were not sufficient to pay the minimum amount of the cash equivalent in respect of the liabilities referred to in section 73(3) of the 1995 Act (preferential liabilities on winding up) as modified by regulation 3 of the Occupational Pension Schemes (Winding Up) Regulations 1996, the trustees of the scheme may reduce each part of the minimum amount of the cash equivalent, as calculated under regulation 7(3)(b)(iv), by a percentage that is no greater than the percentage which is the difference between—
(a) 100 per cent; and
(b) the percentage of the liabilities mentioned in the paragraph of section 73(3) of the 1995 Act, as modified by the Winding Up Regulations, corresponding to that part which the actuarial valuation shows the scheme assets as being sufficient to satisfy.”.

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Source: https://www.legislation.gov.uk/uksi/2003/1727/regulation/2 (the official version)
Page: https://openlegislation.uk/occupational-pension-schemes-transfer-values-and-miscellaneous-amendments-regulations-2003/regulation-2
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.