Explanatory note

These Regulations are all made under provisions of the Social Security Act 1986 (“the 1986 Act”), or provisions of the Social Security Pensions Act 1975 (“the 1975 Act”) as modified under powers conferred by the 1986 Act, before the end of the period of 12 months from the commencement of those provisions. Consequently, by virtue of section 61(5) of 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 require 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.

When a personal pension scheme ceases to be an appropriate scheme, within the meaning of the 1986 Act, a “personal pension protected rights premium” may become payable under section 5 of the 1986 Act in respect of each person in the categories described in subsection (4) of that section.

Under subsection (8) of that section, the amount of a personal pension protected rights premium is the cash equivalent of the protected rights of the person concerned, calculated and verified in the prescribed manner.

Regulation 2 provides for the manner in which protected rights, and other rights under the scheme, are to be calculated and verified.

In relation to a personal pension protected rights premium, regulation 3 specifies the circumstances in which it is not payable. Regulation 4 makes provision about the liability to pay it; regulation 5 about the time within which it is to be paid; regulation 6 about treating it as paid; and regulation 7 about re-allocation and refunding. Regulation 8 amplifies section 5(10) of the 1986 Act.

The publication “Retirement Benefit Schemes—Transfer Values (GN11)”, referred to in regulation 2(3)(b)(ii), may be obtained from the Institute of Actuaries, Staple Inn Hall, High Holborn, London WC1V 7QJ, and from the Faculty of Actuaries, 23 St. Andrew Square, Edinburgh EH2 1AQ.