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Regulation 4 Conditions applying to pensions and annuities which give effect to protected rights

Changes not yet applied. Later legislation changes this provision in ways not yet written into the text below:

(1)

For the purposes of sub-paragraphs (1) (a) (effect may be given to protected rights by the provision by the scheme of a pension which among other things satisfies such conditions as may be prescribed) and (2)(ii) (effect may be given in certain circumstances to protected rights by the purchase by the scheme of an annuity which among other things satisfies such conditions as may be prescribed) of paragraph 9 of Schedule 1 to the Act, the prescribed conditions are that the pension or annuity gives effect to all the protected rights of the member, that in the case of an annuity it is one which is purchased on or after the date on which it commences, and that the terms on which the pension is provided, or the terms of the purchase of the annuity—

(a)

satisfy the requirements of paragraphs (2) to (5) of this regulation; and

(b)

make no provision other than such as—

(i)

is necessary to establish what the initial rate and the method of payment of the pension or annuity are to be, and that it shall continue to be paid at that rate (subject only to paragraphs (3) and (6)) throughout the lifetime of the member,

(ii)

is necessary to satisfy the requirements of paragraphs (2) to (5) and regulation 5, and

(iii)

is permitted by paragraphs (6) to (9).

(2)

The rate of the pension or annuity shall be determined without regard to the sex or marital status of the member.

(3)

The rate of the pension or annuity shall—

(a)

on a date (“the first date”) not later than the first anniversary of the date on which it becomes payable, and

(b)

on each anniversary of the first date,

be increased by the same percentage as that by which parts of guaranteed minimum pensions are increased, by the order (if any) made by the Secretary of State under section 37A of the Social Security Pensions Act 1975f1 and coming into operation on the first day of the tax year in which the date of the increase falls.

(4)

Except with the written consent of the person to whom the pension or annuity is payable, the pension or annuity, if paid in arrear, shall be paid no less frequently than by monthly instalments.

(5)

The pension or annuity shall be paid no less frequently than by annual instalments.

(6)

The pension or annuity may be increased, not more frequently than on the first date mentioned in paragraph (3) and on each of its anniversaries, but by larger percentages than paragraph (3) requires, so however that no increase is by more than 3 per cent.

(7)

When the member has died, the pension or annuity may continue to be paid, at a rate which satisfies the requirements of paragraph (8), to or for the benefit of other persons if the requirements of paragraph (9) are satisfied.

(8)

The requirements first referred to in paragraph (7) are that the rate shall not exceed—

(a)

at any given time during the period which is within 5 years of the date on which the pension or annuity commenced, the rate at which it would have been payable if the member had been living at that time; and

(b)

at any given time during any other period, one-half of the rate at which it would have been payable if the member had been living at that time.

(9)

The requirements secondly referred to in paragraph (7) are that the pension or annuity shall be paid only—

(a)

to the member’s widow or widower, in a case where immediately after the member’s death the pension or annuity is required by virtue of regulation 5 to be paid to her or him;

(b)

to any one person, in a case to which sub-paragraph (a) does not apply;

(c)

for the benefit of any child or children, if—

(i)

sub-paragraph (a) does not apply,

(ii)

the pension or annuity has not been paid in accordance with sub-paragraph (b), and

(iii)

immediately before the member’s death the member was entitled to child benefit in respect of that child or those children, or would have been so entitled if that child or one, some or all of those children had not been absent from Great Britain;

but only for so long as that child or at least one of those children is under the age of 18; and

(d)

to any one person, during any period—

(i)

which is within 5 years of the date on which the pension or annuity commenced, and

(ii)

which immediately follows the death of a person who died while the pension or annuity was being paid to him in accordance with sub-paragraph (a) or (b) or in accordance with this sub-paragraph, or which begins on the date on which the child or the last of the children in respect of whom the pension or annuity has been paid in accordance with sub-paragraph (c) attained the age of 18 or died under that age.

Annotations

Footnotes

f1

1975 c. 60; section 37A was inserted by section 9(7) of the Social Security Act 1986 (c. 50).