OpenLegislation

The Pensions Increase (Review) Order 1991

S.I. 1991/684 · Made 13 March 1991

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PENSIONS

Made 13th March 1991

Laid before Parliament 15th March 1991

Coming into force 8th April 1991

Whereas by virtue of section 23(2)f1 of the Social Security Pensions Act 1975f2 a direction has been givenf3 under section 63(2) and section 83(3)(d) of the Social Security Act 1986f4 by the Secretary of State for Social Services that the sums mentioned in section 63(1)(b) of the Social Security Act 1986 are to be increased;

Now therefore the Treasury, in exercise of the powers conferred by section 59(1), (2), (5) and (5ZA) of the Social Security Pensions Act 1975f5 and now vested in themf6, and all other powers enabling them in that behalf, hereby make the following Order:

Annotations to the whole text

Footnotes

f1

Section 23(2) was amended by Schedule 10, paragraph 91 to the Social Security Act 1986 (c. 50).

f2

1975 c. 60.

f3

The direction is contained in S.I. 1991/503.

f4

1986 c. 50; section 1 of the Social Security and Housing Benefits Act 1983 (c. 36) made provision for increases to reflect actual, rather than estimated, rises in the general level of prices.

f5

Section 59(1) was amended by the Social Security Act 1986, Schedule 10, paragraph 93 and section 1(7) of the Pensions (Miscellaneous Provisions) Act 1990 (c. 7). Section 59(5) was amended by section 11 of the Social Security Act 1979 (c. 18) and the Social Security Act 1985 (c. 53), Schedule 5, paragraph 33. Section 59 was also amended by the Social Security Act 1979, sections 11 and 21(4) and Schedule 3, paragraph 20, section 9(8) of the Social Security Act 1986 and section 5 of the Pensions (Miscellaneous Provisions) Act 1990, which inserted sub-section (5ZA). Section 59 is modified by section 59A, which was inserted by section 11 of the Social Security Act 1979 and amended by section 9(9) of the Social Security Act 1986.

f6

S.I. 1981/1670.

Contents

  1. 1Citation and commencement
  2. 2Interpretation
  3. 3Pension increases
  4. 4Increases in certain lump sums
  5. 5Reductions in respect of guaranteed minimum pensions
  6. 6Reductions in respect of guaranteed minimum pensions
  7. Signature
  8. Explanatory note

1Citation and commencement

This Order may be cited as the Pensions Increase (Review) Order 1991 and shall come into force on 8th April 1991.

2Interpretation

(1)

In this Order—

  • “the 1971 Act” means the Pensions (Increase) Act 1971f1;

  • “the 1974 Act” means the Pensions (Increase) Act 1974f2;

  • “the 1975 Act” means the Social Security Pensions Act 1975;

  • “basic rate” and “derivative pension” have the meanings given by section 17(1) of the 1971 Actf3;

  • “the existing Orders” means the Pensions Increase (Annual Review) Order 1972f4 the Pensions Increase (Annual Review) Order 1973f5, the Pensions Increase (Annual Review) Order 1974f6, the Pensions Increase (Annual Review) Order 1975f7, the Pensions Increase (Annual Review) Order 1976f8, the Pensions Increase (Annual Review) Order 1977f9, the Pensions Increase (Annual Review) Order 1978f10, the Pensions Increase (Review) Order 1979f11, the Pensions Increase (Review) Order 1980f12, the Pensions Increase (Review) Order 1981f13, the Pensions Increase (Review) Order 1982f14, the Pensions Increase (Review) Order 1983f15, the Pensions Increase (Review) Order 1984f16, the Pensions Increase (Review) Order 1985f17, the Pensions Increase (Review) Order 1986f18, the Pensions Increase (Review) Order 1987f19, the Pensions Increase (Review) Order 1988f20, the Pensions Increase (Review) Order 1989f21 and the Pensions Increase (Review) Order 1990f22;

  • “official pension” has the meaning given by section 5(1) of the 1971 Act;

  • “pension authority” has the meaning given by section 7(1) of the 1971 Act;

  • “qualifying condition” means one of the conditions laid down in section 3 of the 1971 Actf23;

  • “relevant injury pension”, “substituted pension” and “widows pension” have the meanings given by section 17(1) of the 1971 Act.

(2)

For the purposes of this Order the time when a pension “begins” is that stated in section 8(2) of the 1971 Act, and the “beginning date” shall be construed accordingly.

(3)

Where, for the purposes of this Order, it is necessary to calculate the number of complete months in any period an incomplete month shall be treated as a complete month if it consists of at least 16 days.

3Pension increases

The annual rate of an official pension may, if a qualifying condition is satisfied or the pension is a derivative or substituted pension or a relevant injury pension, be increased by the pension authority in respect of any period on or after 8th April 1991 as follows—

(1)

a pension beginning before 9th April 1990 may be increased by 10.9 per cent of the basic rate as increased by the amount of any increase under section I of the 1971 Act or the existing Orders;

(2)

a pension beginning on or after 9th April 1990 and before 8th April 1991 may be increased by 10.9 per cent multiplied by

AB

where

a

  • A is the number of complete months in the period between the beginning date of the pension and 8th April 1991, and

    • b

  • B is 12.

    • 4Increases in certain lump sums

    In respect of any lump sum or instalment of a lump sum which became payable before 8th April 1991 but on or after 9th April 1990 there may be paid an increase of 10.9 per cent of the amount of the lump sum or instalment (as increased by the amount under section I of the 1971 Act or under the existing Orders) multiplied by

    AB

    where

    a

  • A is the number of complete months in the period between the beginning date for the lump sum or, if later, 9th April 1990 and the date on which it became payable; and

    • b

  • B is 12.

    • 5Reductions in respect of guaranteed minimum pensions

    The amount by reference to which any increase in the rate of an official pension provided for by this Order ’s to be calculated shall, in the case of a person—

    (a)

    who is entitled to a guaranteed minimum pension on 8th April 1991, and

    (b)

    whose entitlement to that guaranteed minimum pension arises from an employment from which (either directly or by virtue of the payment of a transfer credit) entitlement to the official pension also arises, be reduced by an amount equal to the rate of the guaranteed minimum pension unless the Treasuryf1 shall, in accordance with the provisions of section 59A of the 1975 Act, otherwise direct.

    6Reductions in respect of guaranteed minimum pensions

    The amount by reference to which any increase in the rate of a widow’s or widower’s pension provided for by this Order is to be calculated shall, where the pensioner becomes entitled on the death of the deceased spouse to a guaranteed minimum pension, be reduced in accordance with section 59(5ZA) of the 1975 Act.

    Signature

    Irvine Patnick

    Sydney Chapman

    Two of the Lords Commissioners of Her Majesty’s Treasury

    13th March 1991

    Explanatory note

    (This note is not part of the Order)

    Under section 59 of the Social Security Pensions Act 1975 as amended, and as modified by section 59A of the 1975 Act the Treasury (in whom the functions conferred by those provisions are now vested) are required to provide by order for the increase in the rates of public service pensions. The increase is the percentage (or in some circumstances a fraction of the percentage) by which the Secretary of State for Social Services has, by directions given under the provisions of section 23(2) of the Social Security Pensions Act 1975 (as amended by Schedule 10, paragraph 91 of the Social Security Act 1986), increased the sums referred to in section 63(1)(b) of the Social Security Act 1986. These are the sums which are the additional pensions in long term benefits, namely the additional pension entitlements accruing to employees in respect of earnings after 5th April 1978.

    For pensions which began before 9th April 1990 the increase is 10.9 per cent. For pensions which began on or after 9th April 1990 the increases are as follows—

    Pensions BeginningPercentage IncreasePensions BeginningPercentage Increase
    9th April 1990 to 23rd April 199010.9%24th September 1990 to 23rd October 19905.45%
    24th April 1990 to 23rd May 19909.99%24th October 1990 to 23rd November 19904.54%
    24th May 1990 to 23rd June 19909.08%24th November 1990 to 23rd December 19903.63%
    24th June 1990 to 23rd July 19908.18%24th December 1990 to 23rd January 19912.73%
    24th July 1990 to 23rd August 19907.27%24th January 1991 to 23rd February 19911.82%
    24th August 1990 to 23rd September 19906.36%24th February 1991 to 23rd March 19910.91%

    Deferred lump sums beginning on or before 23rd March 1991 and which become payable after 7th April 1991 receive the same percentage increase as pensions which began on the same date. Article 4 of the Order provides for increases on certain deferred lump sums which became payable on or after 9th April 1990 and before 8th April 1991.

    The Order also makes provision for the amount by reference to which any increase in the rate of an official pension is to be calculated to be reduced by the amount equal to the rate of the guaranteed minimum pension entitlement deriving from the employment which gives rise to the official pension. This is required by section 59(5) of the Social Security Pensions Act 1975 but by virtue of section 59A of that Act and the Transfer of Functions (Minister for the Civil Service and Treasury) Order 1981 the Treasury is empowered to direct that in respect of specified cases or classes of case either no such reduction be made or the reduction shall be less than the rate of the guaranteed minimum pension. Section 59(5ZA) was inserted into section 59 by section 5 of the Pensions (Miscellaneous Provisions) Act 1990. This applies section 59(5) to a widow’s or widower’s pension.