The Police Pensions (Additional Voluntary Contributions) Regulations 1991

In these Regulations, unless the context otherwise requires, any reference to a numbered regulation or Schedule is to be construed as a reference to the regulation or Schedule which bears that number in these Regulations, and any reference to a numbered paragraph in a regulation of or a Schedule to these Regulations is to be construed as a reference to the paragraph bearing that number in that regulation or, as the case may be, that Schedule.

In these Regulations references to the Taxes Act are references to the Income and Corporation Taxes Act 1988^f1 F1, references to the 1999 Act are references to the Welfare Reform and Pensions Act 1999 and references to the 1987 Regulations are references to the Police Pensions Regulations 1987^f2.

In these Regulations, unless the context otherwise requires—

• F2“the 1993 Act” means the Pension Schemes Act 1993;

• “the 1999 Act” means the Welfare Reform and Pensions Act 1999;

• F3“the 2014 Act” means the Taxation of Pensions Act 2014;

• “the 2009 Regulations” means the Registered Pension Schemes (Authorised Payments) Regulations 2009;

• F4“approved additional voluntary contributions provider” means F5The Equitable Life Assurance Society Utmost Life and Pensions Limited F6or The Standard Life Assurance Company , The Standard Life Assurance Company or Utmost Life and Pensions Limited;

• F7...

• F8“the AVC scheme” means the occupational pension scheme (within the meaning of section 1 of the Pension Schemes Act 1993) established under section 1 of the Police Pensions Act 1976 and these Regulations;

• “basic contributions” means contributions paid pursuant to an election under regulation 4(1);

• “basic contributor” is to be construed in accordance with regulation 7;

• “cash equivalent” means a cash equivalent mentioned in paragraph 12(1) of Schedule 1A to the Social Security Pensions Act 1975^f3;

• “central police officer” has the same meaning as in the 1987 Regulations;

• “death benefit contributions” means contributions paid pursuant to an election under regulation 5(1);

• “death benefit contributor” is to be construed in accordance with regulation 7;

• “death benefit cover” is to be construed in accordance with regulation 5(1);

• “earnings” and “emoluments” mean earnings and emoluments in respect of service as a pensionable policeman, disregarding, except where regulation 3 or 5 of the Retirement Benefit Schemes (Tax Relief on Contributions) (Disapplication of Earnings Cap) Regulations 1990^f4 applies, any excess in any tax year over the figure which is the permitted maximum for that year for the purposes of section 592(8B) of the Taxes Act^f5 (that is to say, the figure specified for the year by an order made by the Treasury under section 590C(6) of that Act);

• “free-standing additional voluntary contributions scheme” means an approved scheme which falls within section 591(2)(h) of the Taxes Act;

• “the Index” means the index of retail prices published by the Department of Employment;

• F9F10“insurance company” means—

  1. (a)

     a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to effect or carry out contracts of long-term insurance, F11...

  2. (b)

     F12...

• “normal benefit age” means 60;

• “overseas policeman” has the same meaning as in the 1987 Regulations;

• “participator” means a basic contributor or a person who has ceased to be a basic contributor but has not exercised any right to take a cash equivalent or to be paid a lump sum under regulation 14(1);

• “pension credit” means a credit under section 29(1)(b) of the 1999 Act or under corresponding Northern Ireland legislation;

• “pension credit” means a credit under section 29(1)(b) of the 1999 Act, including a credit under corresponding Northern Ireland legislation;

• “pension credit benefits” means in relation to the AVC Scheme the benefits payable under that Scheme which are attributable (directly or indirectly) to a pension credit;

• “pension credit member” means a person who has rights under the AVC Scheme which are attributable (directly or indirectly) to a pension credit either solely or wholly separately from any other rights under the AVC Scheme;

• “pension credit member” has the meaning given by section 124(1) of the Pensions Act 1995;

• “pension credit rights” has the meaning given by section 101B of the 1993 Act;

• “pension debit” means a debit under section 29(1)(a) of the 1999 Act or under corresponding Northern Ireland legislation;

• “pension debit member” means a person who has rights under the AVC Scheme and whose shareable rights under that Scheme are subject to a pension debit;

• “pension investments” means investments made under regulations 9(1) and 10(2);

• “pension sharing order” means a pension sharing order or other provision referred to in section 28(1) of the 1999 Act or Article 25(1) of the Welfare Reform and Pensions (Northern Ireland) Order 1999;

• “pension sharing order” means an order or provision mentioned in section 28(1) of the 1999 Act;

• “pensionable policemean” means a person by whom contributions are for the time being payable under regulation G2 of the 1987 Regulations;

• F13“pension provider” means a body listed in schedule 1,

• “Police Pensions Scheme” means the Police Pensions Scheme, the rules of which are set out in the Police Pensions Regulations 1987;

• F14“registered pension scheme” means a scheme registered under section 153 of the Finance Act 2004;

• “relevant F15police pension authority” has the meaning given by regulation L1(4) of the Police Pensions Regulations 1987;

• “retire” means become entitled to payment of a pension or gratuity under regulations B1 to B5 of the 1987 Regulations, and cognate expressions are to be construed accordingly;

• “shareable rights” means any rights a person has under the AVC Scheme except those rights referred to in regulation 2 of the Pension Sharing (Valuation) Regulations 2000;

• F16... and

• “tax year” means the 12 months beginning with 6th April in any year.

The definition of “insurance company” in paragraph (3) must be read with—

The definition of “insurance company” in paragraph (3) must be read with–

Any election under these Regulations—

No election under these Regulations is to be accepted if any limit imposed by regulation 8(4) F2(payment and amount of contributions) would be exceeded.

No election under regulation 4(1) (payment of basic contributions) or 5(1) (payment of death benefit contributions) made on or after 1st October 2010 is to be accepted.

 No election under regulation 6(1)(a) (alteration of amount of basic contributions) or 6(2)(a) (alteration of amount to be secured by death benefit contributions) made on or after 1st October 2010 is to be accepted if it would have the effect of increasing the amount of the basic contributions or the amount to be secured by the death benefit contributions, as the case may be.

No election under regulation 4(1) (election to pay basic contributions) or 5(1) (elections in respect of death benefit cover) made on or after 1st October 2010 is to be accepted.

 No election under regulation 6(1)(a) (election to alter amount of basic contributions) or regulation 6(2)(a) or 6(3) (elections to alter amount to be secured by death benefit contributions) made on or after 1st October 2010 is to be accepted if it would have the effect of increasing the amount of the basic contributions or the amount to be secured by the death benefit contributions, as the case may be.

An election falling within regulation 16(2) (death benefit cover, continued death benefit cover and increased death benefit cover) is not to be accepted if—

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The police authority police pension authority are to give effect as soon as is reasonably practicable to any election accepted by them.

A pensionable policeman may at any time F1before 1st October 2010 elect to pay basic contributions under these Regulations.

The notice of such an election is to specify—

A pensionable policeman may at any time F1before 1st October 2010 elect to pay death benefit contributions to secure death benefit cover, that is to say the payment of a lump sum in the event of his dying in the circumstances specified in paragraph (2).

The circumstances are that—

A pensionable policeman’s retirement date is the date on which he would be required by regulation A18(1) of the 1987 Regulations to retire assuming that there were no postponement under regulation A18(2) and no change of rank.

The notice of an election under paragraph (1) is to specify F2the approved additional voluntary contributions provider with which the contributions are to be invested and the amount to be secured F3....

An election under paragraph (1) ceases to have effect on the person’s retirement date, but if the time at which he is required by regulation A18(1) of the 1987 Regulations to retire becomes later by reason of—

• he may elect to pay further contributions to secure the continuance to the later date of he death benefit cover in force immediately before the change.

Any continued death benefit cover secured by an election under paragraph (5) lapses if the person retires before the date to which the cover was continued.

F1Subject to paragraph (4), a basic contributor may at any time elect—

Subject to paragraph (4), a death benefit contributor may at any time elect—

Subject to paragraph (4), a person paying further contributions under regulation 5(5) (continuance of death benefit cover during service after retirement age) may at any time make any election that he could have made under paragraph (2)(a) above if he had been paying death benefit contributions.

An election may not be made under any of the preceding paragraphs of this regulation on or after 1st October 2010 if it would have the effect of increasing the amount of the basic contributions or the amount to be secured by the death benefit contributions, as the case may be.

Subject to paragraph (3), a person is a basic contributor while an election under regulation 4(1) (regular contributions) has effect.

Subject to paragraph (3), a person is a death benefit contributor while an election under regulation 5(1) has effect.

A person who has ceased to be a pensionable policeman ceases to be either a basic contributor or a death benefit contributor.

Basic contributions are payable to the F1police authority police pension authority at intervals of not less than 4 weeks.

Death benefit contributions and further contributions under regulation 5(5) (continuance of death benefit cover) are payable to the police authority police pension authority at the same times as basic contributions.

All contributions are to be deducted by the police authority police pension authority from the person’s pay.

The total of the contributions of all kinds paid in any tax year must not exceed the lesser of (A-B-C) and D, where—

• A is 15 per cent of the person’s emoluments for that year,

• B is the total of any contributions paid by him in the year to F2a registered pension scheme,

• C is the total of the contributions paid by him in the year under the 1987 Regulations, and

• D is the amount which would provide the maximum allowable benefits.

The maximum allowable benefits are the maximum amount that can be secured having regard to regulations 5(4) and 6(2)(a).

The maximum allowable benefits are the maximum amount that can be secured in accordance with regulations 5(4) and 6(2)(a).

Basic contributions are to be invested by the F1police authority police pension authority in accordance with any election for the time being having effect under regulation 4(1) or 6(1)(b) or (c).

In paragraph (1) “invested” means invested F2with such approved additional voluntary contributions providers and in such investments managed by those providers as may be selected by the basic contributor F3with such approved additional voluntary contributions provider and in such investments managed by such provider as may be selected by the basic contributor.

Death benefit contributions and further contributions under regulation 5(5) are to be invested by the police authority police pension authority F4with the approved additional voluntary contributions provider selected by the death benefit contributor F5with an approved additional voluntary contributions provider selected by the death benefit contributor so as to secure death benefit cover of the amount required by any election for the time being having effect under regulation 5(1) or (5) or 6(2) or (3).

F1At any time before 1st October 2010, a F2police authority police pension authority may accept a transfer value from the administrator of—

in respect of a basic contributor F4except if or to the extent that the transfer value relates to pension credit rights.

A transfer value accepted by a police pension authority is to be invested by them with such approved additional voluntary contribution providers and in such investments managed by those providers as may be specified in writing by the basic contributor.

A transfer value accepted by a police authority is to be invested by them with an approved additional voluntary contributions provider and in such investments managed by such provider such as may be specified in writing by the basic contributor.

This regulation applies where a F2police pension authority receive a request in writing from a participator that they are to apply to the approved additional voluntary contributions provider to realise the pension investment held by the provider in respect of the participator and pay an amount representing the value of the investments made in relation to the participator under these Regulations to the police pension authority for transmission to the administrator of a scheme or arrangement within paragraph (4) who is willing to receive such a payment in respect of him.

On receiving such a request the police pension authority shall transmit it to the approved additional voluntary contributions provider in question and on receiving that amount they shall pay it to the administrator of that scheme or arrangement.

the payment under paragraph (2) of an amount representing all pension investments in respect of the participator discharges the police pension authority from all liability in respect of the participator under these Regulations.

A scheme or arrangement is within this paragraph if—

A participator may apply some or all of the proceeds of an investment made under regulation 9 to an arrangement with a pension provider for one or more of the following—

Paragraph (1) is subject to paragraphs (8), (11) and (12).

The pension provider must provide a participator with an option to receive benefits under paragraph (1)(a) to (c) in accordance with paragraphs (4) and (5).

Any annuity payable under paragraph (1)(a) or (b) must—

A lump sum commutation payment referred to in paragraph (1)(c) may be paid in respect of benefits payable under paragraph (1)(a), (b) or (d).

The pension provider may, in addition to providing a participator with benefits under paragraph (3), provide a participator with alternative benefits options under paragraph (1)(d).

A participator must, no earlier than 3 months before the date from which the participator wishes benefits under these Regulations to be provided, make a benefits election to the police pension authority specifying—

If there are exceptional circumstances of serious ill-health, the police pension authority may in their discretion realise the investments made under regulation 9 without purchasing any annuity, and in that event the amount obtained becomes payable as a lump sum.

More than one benefits election may be made under paragraph (7) and an election must—

Upon receipt of a notice of election under paragraph (7), the police pension authority must, as soon as reasonably practicable, realise the investments made under regulation 9 and apply the proceeds in the manner specified in it.

Where a participator dies before retirement or after retirement but before benefits under this regulation are paid, the police pension authority must realise the investments made under regulation 9 which are to be payable as a lump sum in accordance with regulation 15(2).

The police pension authority must realise the investments made under regulation 9 and apply the proceeds to the purchase of benefits under these Regulations from a pension provider in such form as appears to the police pension authority to be suitable where the conditions in paragraph (13) are satisfied.

Those conditions are—

In this regulation—

A participator may apply some or all of the proceeds of an investment made under regulation 9 to arrange with F3a pension provider—

Paragraph (1) is subject to paragraphs (10) to (13).

Subject to paragraphs (4) and (5), the approved additional voluntary contributions provider must provide a participator with an option to receive benefits under paragraph (1)(a) to (c).

Any annuity payable in accordance with paragraph (1)(a) or (b) must—

A lump sum commutation payment referred to in paragraph (1)(c) may be paid in respect of benefits payable under paragraph (1)(a), (b) or (d).

The approved additional voluntary contributions provider may, in addition to providing a participator with benefits under paragraph (3), provide a participator with alternative benefit options under paragraph (1)(d).

A participator must, not earlier than 3 months before the date from which the participator wishes those benefits under these Regulations to be provided, make a benefits election to the police authority specifying—

If there are exceptional circumstances of serious ill-health, the police authority may in their discretion realise the pension investments without purchasing any pension, and in that event the amount obtained becomes payable as a lump sum.

More than one benefits election may be made under paragraph (7) and an election must—

Upon receipt of a notice of election under paragraph (7), the police authority must, as soon as reasonably practicable, realise the investments made under regulation 9 and apply the proceeds in the manner specified in it.

Where a participator dies before retirement or after retirement but before the benefits under this regulation are paid, the investments made under regulation 9 must be realised and are payable as a lump sum in accordance with regulation 15(2).

The police authority may realise the investments made under regulation 9 and apply the proceeds to the purchase of benefits under these Regulations from an insurer in such form as appears to the police authority to be suitable where the conditions in paragraph (13) are satisfied.

Those conditions are—

Pension sharing within the meaning of Part IV of the 1999 Act is available under the AVC scheme in respect of all or part of a person’s shareable rights as set out in this Regulation except as otherwise provided, and a police authority shall discharge its liability in respect of a pension credit which derives from the AVC Scheme in accordance with paragraph 1 of Schedule 5 to the 1999 Act (pension credits: mode of discharge: funded pension schemes).

Upon the taking effect of a pension sharing order, an amount representing the pension credit member’s share of the pension debit member’s accumulated additional voluntary contributions calculated in accordance with regulation 10(4) of the Pension Sharing (Implementation and Discharge of Liability) Regulations 2000 shall be invested by the police authority in accordance with the wishes of the pension credit member in one or more of the ways prescribed in regulation 9(2).

The benefits that may be provided in accordance with this regulation under a pension policy purchased as described in F2regulation 11(12) as it applies in the circumstances of this regulation are a pension and one or more dependant’s pensions.

The pension will commence not earlier than the date on which the pension credit member attains the age of 60 and is payable for life.

A dependant’s pension is a pension which would become payable to a dependant on the death of the pension credit member after his pension has commenced as provided in paragraph (4) and is payable for life, except that, in the case of a dependant to whom Part D of the 1987 regulations would apply if the pension credit member were a member of the Police Pensions Scheme, it shall cease to be payable when a child’s allowance would cease to be payable under that Part.

Upon the death of a person after a pension sharing order has been made but before a police authority has discharged its liability in respect of the pension credit to which that person would otherwise be entitled, a lump sum equal to the value of the pension credit at the date of that person’s death shall be paid to his personal representatives.

F3Regulation 11 applies in the circumstances of this regulation, with the following modifications wherever the words to be modified appear:–

In regulation 15, wherever regulation 11 is referred to, it shall include a reference to that regulation as modified by this regulation in relation to pension credits.

If a person—

the appropriate lump sum becomes payable.

If a participator dies before retirement the appropriate lump sum becomes payable.

The appropriate lump sum is the realisable value of the pension investments.

Retirement pensions shall be paid by the responsible person to the persons entitled to them.

Lump sums payable—

shall be paid by the responsible person to the deceased’s widow or widower F5or surviving civil partner or, if there is no widow or widower or surviving civil partner, to the personal representatives.

Lump sums payable under F6regulation 11(8) regulation 10C(8) or 14(1) shall be paid by the responsible person to the former basic contributor.

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The amount of any tax chargeable under the Taxes Act on a payment under this regulation F8or Schedule 1A (pension sharing) shall be deducted by the responsible person before payment.

For the purposes of this regulation “the responsible person” means—

For the purposes of this regulation “the responsible person” means–

A person making an election under these Regulations is to give the F1police authority police pension authority such information as they may reasonably require for the purposes of their functions under these Regulations.

A person making—

is, in particular, to give the police authority police pension authority such information about his health as they may reasonably require having regard to regulation 9(3) (investment so as to secure death benefit cover).

A person who is aggrieved by the refusal of the F1police authority police pension authority to admit a claim to receive as of right a pension, or a larger pension than that granted, under these Regulations may, subject to paragraph (2), appeal—

Paragraph (1) does not confer a right of appeal against anything done by the police authority police pension authority in the exercise of a power conferred by these Regulations which is rexpressly declared by these Regulations to be a power which they are to exercise in their discretion.

In this regulation “pension” includes any lump sum payable under these Regulations.

Any notice given after 5th April 1990 and before 1st July 1991 which, if these Regulations had been in force, would have constituted notice of an election under these Regulations is to be treated as having constituted notice of such an election.

These regulations shall be treated as having come into force on 1st March 1990 in relation to any sum paid by a pensionable policeman in anticipation of these Regulations, and any such sum shall be treated as forming part of his pension investments.

A sum is one paid in anticipation of these Regulations if—

Where a relevant F2police pension authority discharge their liability in respect of a pension credit which derives from the scheme constituted by these Regulations (“a scheme pension credit”) in accordance with paragraph 1(2) of Schedule 5 to the 1999 Act (pension credits: mode of discharge: funded pension schemes— conferring rights under the scheme from which the rights derive), they must do so by investing the amount of the credit to provide for the purchase from an insurance company of an annuity which meets the conditions in sub-paragraph (4).

The investment shall be made by the authority, in accordance with an election made by the person entitled to the pension credit, in one or more funds managed by a pension provider meeting the requirements referred to in regulations 12 to 14 of the Pension Sharing (Pension Credit Benefit) Regulations 2000.

The pension credit member may vary an election under sub-paragraph (2) by a further election at any time before the authority have completed the arrangements for the investment of the amount of the credit.

The conditions referred to in sub-paragraph (1) are that—

If the dependant to whom the annuity is payable is within sub-paragraph (4)(b)(iii), the pension must cease to be payable when he ceases to be a dependent child.

For the purposes of sub-paragraph (5), a person ceases to be a dependent child at the time when, if he were the child of a pensionable policeman, he would cease to be eligible for any allowance under Part D of the 1987 Regulations.

In this paragraph “dependant”, in relation to a pension credit member, means a person who at the date of the member’s death—

If the person entitled to a scheme pension credit dies before liability in respect of it has been discharged, the relevant F2police pension authority shall discharge their liability in respect of it by making a payment of a lump sum in accordance with regulation 6(2)(a)(i) of the Pension Sharing (Implementation and Discharge of Liability) Regulations 2000.

The lump sum payable under this paragraph is to be of an amount equal to the realisable value of the investments made under paragraph 1 and shall be paid in accordance with regulation 15.

The benefit to which a pension credit member is entitled under the scheme constituted by these Regulations shall be a pension.

The pension shall be payable not earlier than when the pension credit member reaches normal benefit age and shall be payable to him for life.

The value of the pension referred to in this paragraph shall equal the value of the pension credit rights which have accrued to or in respect of the pension credit member.

Not earlier than one month before the pension credit member reaches normal benefit age, a pension credit member shall, by giving notice to the relevant F2police pension authority, make a benefits election specifying—

On receipt of a notice of election under sub-paragraph (4) the police pension authority must, as soon as is reasonably practicable, realise the investments made under paragraph 1 and apply the proceeds to the purchase from the specified pension provider of the benefits specified in the notice of election.

If a pension credit member who reached normal benefit age after 1st December 2000 has—

the relevant police pension authority may realise the investments made under paragraph 1 and apply the proceeds to the purchase of a pension policy which meets the requirements of regulations 12 to 14 of the Pension Sharing (Pension Credit Benefit) Regulations 2000 from an insurance company in order to provide such benefits as appear to them to be suitable having regard to the pension credit member’s family circumstances, age and health.

The relevant F2police pension authority shall, upon receipt of a notice in writing under section 101F(1) of the 1993 Act (power to give transfer notice), pay a transfer value in respect of the member’s pension credit rights in accordance with the provisions of Chapter II of Part IVA of the 1993 Act (requirements relating to pension credit benefit: transfer values) and Part III of the Pension Sharing (Pension Credit Benefit) Regulations 2000 (transfer values).

That transfer value must be calculated in accordance with regulation 24 of the Pension Sharing (Pension Credit Benefit) Regulations 2000 (manner of calculation and verification of cash equivalents).

A pension credit member shall be entitled to the commutation of the whole of the benefits payable to or in respect of him under the scheme constituted by these Regulations by virtue of rights attributable (directly or indirectly) to a pension credit before reaching normal benefit age if the pension credit member is suffering from serious ill-health before normal benefit age.

In sub-paragraph (1) “serious ill-health” means ill-health giving rise to a life expectancy of less than one year from the date on which commutation is applied for.

In the case of such a member the relevant F2police pension authority may realise the investments made under paragraph 1 without purchasing an annuity and pay the proceeds to the pension credit member as a lump sum.

A pension credit member shall be entitled to the commutation of the whole of the benefits payable to or in respect of him under the scheme constituted by these Regulations by virtue of rights attributable (directly or indirectly) to a pension credit at normal benefit age in the following circumstances.

They are if—

In the case of such a pension credit member the relevant F2police pension authority may realise the investments made under paragraph 1 without purchasing an annuity and pay the proceeds to the member as a lump sum.

In sub-paragraph (2)(a) “serious ill-health” means ill-health giving rise to a life expectancy of less than one year from the date on which notice is given under paragraph 3(4).