Explanatory note
(This note is not part of the Regulations)
These Regulations make provision for the payment of additional voluntary contributions by teachers who are members of the Superannuation Scheme as constituted by the Teachers' Superannuation (Consolidation) Regulations 1988, in order to secure additional benefits financed by investment of those contributions. They revoke and re-enact the Teachers Superannuation (Additional Voluntary Contributions) Regulations 1989 (“the 1989 Regulations”) with amendments.
The Regulations provide for the making of elections of various kinds. Regulation 3 contains general provisions as to their making and acceptance; regulation 4 provides for elections to pay lump sum and periodical contributions so as to secure additional retirement and dependants' pensions and further provides for elections to pay periodical contributions so as to secure a lump sum death benefit in the event of death while paying such contributions; regulation 5 permits teachers who have elected to provide a lump sum death benefit to apply that sum, either in whole or in part, to the purchase of dependants' pensions; regulation 6 allows elections made under regulation 4 to be varied or cancelled.
When an election has effect a person is a contributor for the purpose of these Regulations but, generally, ceases to be a contributor if he is no longer in pensionable employment (regulation 7).
Regulation 8 deals with the payment of contributions and imposes a limit on their total amount.
Regulation 9(1) requires the Secretary of State to invest contributions with the selected insurance company in one or more of the specified funds in accordance with any wishes expressed by the contributor. Regulation 9(2), referring to an election to provide a lump sum death benefit, requires contributions to be invested so as to secure payment of the amount specified. Regulation 10 requires a transfer value accepted from another additional voluntary contributions scheme also to be invested as appropriate, while regulation 11 sets out the provisions regarding payment of a transfer value (representing the value of the investments) to an insurance company or a superannuation scheme.
On retirement, investments (except those providing for a lump sum death benefit) are to be realised and retirement or dependants' pensions, or both, are to be purchased with the proceeds from an authorised provider chosen by the participator to provide the benefits specified in the notice of election. Such pensions are payable for life, and are not able to be commuted or assigned, but provision is made to allow the proceeds of the realisation of investments to be paid as a lump sum in some circumstances (regulation 12).
Regulation 13 provides for the payment of lump sum death benefits secured by contributions under regulation 4.
Regulation 14, with the Schedule, imposes limits on benefits payable under the Regulations; where benefits exceed the prescribed limits the investments applicable to the purchase of the excess shall not be used for that purpose and shall be returned to the teacher after deduction of tax (regulation 15).
Regulation 15 provides for the realisable value of investments to be repaid where contributions under the 1988 regulations are repaid.
Regulation 16, provides that the Secretary of State is not responsible for payments under a pension policy purchased from an authorised provider except in the circumstances specified in regulation 16(2) and makes provision for the payment of lump sums. Regulation 17 requires him to be given information needed for the purposes of his functions under the Regulations. Regulation 18 provides for any payments, up to a prescribed maximum (currently £5,000), payable to the personal representatives of deceased persons, to be made without confirmation or proof of title. Regulation 19 provides for questions to be determined by the Secretary of State.
Regulation 20 revokes the 1989 Regulations and makes transitional provisions.
In addition to minor and drafting amendments these Regulations make the following changes of substance from the 1989 Regulations:—
the definition of “contributor” has been altered (regulation 7);
provisions for payment of a transfer value has been included (regulation 11);
the authorised provider who is to provide retirement or dependants' pensions is selected by the participator (regulation 12(7)); where the authorised provider is not the insurance company referred to in regulation 9 the Secretary of State is not responsible for payment;
the benefit limits in the Schedule have been altered.