{
  "url": "https://openlegislation.uk/transport-act-2000-civil-aviation-authority-pension-scheme-order-2001/schedule-1/appendix-5",
  "json_url": "https://openlegislation.uk/transport-act-2000-civil-aviation-authority-pension-scheme-order-2001/schedule-1/appendix-5.json",
  "legislation": "uksi/2001/853",
  "legislation_title": "The Transport Act 2000 (Civil Aviation Authority Pension Scheme) Order 2001",
  "legislation_url": "https://openlegislation.uk/transport-act-2000-civil-aviation-authority-pension-scheme-order-2001",
  "path": "schedule/1/appendix/5",
  "kind": "appendix",
  "number": "5",
  "heading": "CONTRACTING-OUT",
  "text": "Section A: Reference Scheme Test\n1.1 This Section of this Appendix 5 shall apply if any Member’s employment becomes contracted-out employment by reference to the relevant Section on or after 6 April 1997.\n1.2 The words and expressions used in this Section of this Appendix shall have the same meaning as in the Pension Schemes Act 1993.\n1.3 In relation to any period of contracting-out employment on or after 6 April 1997 the relevant Section must satisfy the provisions of section 9(2B) of the Pension Schemes Act 1993 and of such of the Contracting-out Regulations as are appropriate.\n1.4 In complying with paragraph 1.3 above, the Trustees must ensure, among other things, that the relevant Section:\n(a) satisfies the statutory standard as described in section 12A of the Pension Schemes Act 1993;\n(b) complies with the restriction on employer-related investments imposed under section 40 of the Pensions Act 1995;\n(c) satisfies the prescribed requirements as to the amount of the resources of the relevant Section; and\n(d) complies with any prohibition or restriction in relation to the transfer of liabilities or the payment of a lump sum instead of a pension.\nSection B: Guaranteed Minimum Pensions\n2.1 This Section of this Appendix 5 shall apply if any Member’s employment became contracted-out employment by reference to the relevant Section before 6 April 1997 and it shall then override any other provisions of the relevant Section except any which are required for approval of the Scheme under Chapter I of Part XIV of the Taxes Act and any person’s entitlement under this Rule shall be included in that person’s entitlement arising from Service prior to that date under any other provisions of the relevant Section.\n2.2 The words and expressions used in this Section of this Appendix shall have the same meaning as in the Pension Schemes Act 1993.\n2.3 (a) If a Member has a guaranteed minimum in relation to the pension provided for him or her under the relevant Section in accordance with section 14 of the Pension Schemes Act 1993, he or she shall be entitled to receive from the relevant Section a pension payable for life as follows:\n(i) the weekly rate of the pension provided under the relevant Section from age 65 for a male Member and age 60 for a female Member shall not be less than the said guaranteed minimum;\n(ii) if a male Member dies leaving a widow, the weekly rate of the pension provided for her under the relevant Section shall not be less than half of the Member’s Guaranteed Minimum Pension;\n(iii) if a female Member dies leaving a widower, the weekly rate of the pension provided for him under the relevant Section shall not be less than half of the Member’s Guaranteed Minimum Pension which is attributable to earnings for the tax year 1988/89 and subsequent tax years up to and including the tax year 1996/97.\nThe Guaranteed Minimum Pension in respect of a Member shall, in so far as it is attributable to earnings in the tax years from (and including) 1988/89, be increased in accordance with the requirements of section 109 of the Pension Schemes Act 1993 and to the extent of any orders made thereunder.\n(b) If the commencement of any Member’s Guaranteed Minimum Pension is postponed for any period his Guaranteed Minimum Pension shall be increased to the extent, if any, specified in section 15 of the Pension Schemes Act 1993.\n(c) The pension to which any person is entitled under this paragraph may be commuted in accordance with the provisions of Rule 29 provided that the aggregate of such pension and the annuity equivalent of all other retirement benefits to which such person is entitled from the Employers' Scheme does not exceed £260 per annum (or such higher amount as may have been prescribed by regulations made under section 21(1) of the Pension Schemes Act 1993 and is acceptable to the Board of Inland Revenue).\n2.4 Any period or part of a period of a Member’s service in an employment which was contracted-out employment by reference to another retirement benefits arrangement shall, in relation to any rights or benefits conferred upon a transfer in to the relevant Section in substitution for such Member’s accrued rights to guaranteed minimum pension benefits or Protected Rights under such other arrangement, be treated as a period or part of a period in Service during Contracted-out Membership under the relevant Section such that the part of his Guaranteed Minimum Pension in respect of such (if any) of his Contracted-out Membership which related to Protected Rights as aforesaid shall be equal to the guaranteed minimum to which he would have been treated as entitled by reason of his membership of the transferring arrangement if the transfer payment had not been made.\n2.5 If a Member ceases to be in a contracted-out employment by reference to the relevant in circumstances in which he remains prospectively entitled to a Guaranteed Minimum Pension from the relevant Section from State Pensionable Age, such pension will be calculated on the basis that the Guaranteed Minimum Pension which has accrued under the relevant Section up to the date of such cessation will be increased in respect of the period from the date of such cessation up to State Pensionable Age or the previous death of the Member in accordance with one of the provisions set out in (a) or (b) below as the Trustees may decide and, if required, notify to the Department of Social Security as being the basis applicable for the time being to Guaranteed Minimum Pensions hereunder:\n(a) for each complete tax year after that in which contracted-out employment ceases up to and including the last complete tax year before State Pensionable Age or previous death by such rate of increase as regulations made for the purposes of section 16(3) of the Pension Schemes Act 1993 specify as being relevant to the date of cessation;\n(b) by a rate of increase equal to the percentage by which earnings factors for the tax year in which contracted-out employment ceases are increased by the last order under section 148 of the Social Security Administration Act 1992 to come into force before the tax year in which he reaches State Pensionable Age or dies (if earlier);\nprovided that\n(i) if such Member’s Guaranteed Minimum Pension includes amounts transferred to the relevant Section from another retirement benefits arrangement the Guaranteed Minimum Pension which has accrued up to the cessation of contracted-out employment by reference to the previous arrangement may (subject to the terms of the previous arrangement) be increased in accordance with either of the methods in this paragraph 2.5 which the Trustees on the advice of the Actuary determine to be appropriate and which complies with the requirements of regulations made in relation to section 16 of the Pension Schemes Act 1993, and\n(ii) if the Member’s Guaranteed Minimum Pension is transferred to another retirement benefits arrangement in accordance with Rule 34 the Guaranteed Minimum Pension which has accrued up to the cessation of Contracted-Out Membership may if the Trustees so agree be increased in accordance with either of the methods in paragraph 2.5 which would comply with the requirements of regulations made in relation to section 16 of the Pension Schemes Act 1993.\n2.6 Except as provided in sections 87 to 92 and 110 of the Pension Schemes Act 1993, no part of a Member’s or Spouse’s pension under the Scheme may be used to frank an increase in the Member’s or Spouse’s Guaranteed Minimum Pension under paragraphs 2.3(a), 2.3(b) and 2.5 of this Appendix 5.\n2.7 (a) Payment of a Guaranteed Minimum Pension may be suspended during any period when the person receiving the Guaranteed Minimum Pension is unable to act (by reason of mental disorder or otherwise) but the amount of the Guaranteed Minimum Pension must either be paid or applied for the maintenance of the recipient or his or her dependants or paid to the recipient when the recipient is again able to act or paid to the recipient’s estate after the recipient’s death.\n(b) Any instalment of a Guaranteed Minimum Pension may be forfeited if it is not paid within 6 years of the date on which the instalment became due for the reason that the Trustees were unaware of the existence or whereabouts of the recipient, but the Trustees may pay any such instalment if in their absolute discretion they think fit to do so.\n2.8 The Guaranteed Minimum Pension and Spouse’s Guaranteed Minimum Pension in respect of a Member shall not be payable in cases where the corresponding benefit is secured by payment of a Contributions Equivalent Pension in accordance with the provisions of section 55 of the Pension Schemes Act 1993, and in this event any benefits from the relevant Section payable to or in respect of a Member shall be reduced as the Trustees on the advice of the Actuary shall consider to be appropriate (having regard, among other things, to the benefit to which such Contributions Equivalent Premium relates) but not so as to infringe any of the provisions (including the preservation requirements) of the said Act.",
  "extent": null,
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "footnote",
      "label": "f1",
      "text": "1993 c. 48."
    },
    {
      "type": "footnote",
      "label": "f2",
      "text": "S.I. 1996/1172, amended by S.I. 1996/1577, 1996/1977, 1997/786, 1997/819, 1997/3038, 1998/1397."
    },
    {
      "type": "footnote",
      "label": "f3",
      "text": "Section 14 was amended by the Pensions Act 1995 (c. 26), sections 151 and 177 and Schedule 5, paragraphs 18 and 27 and Schedule 7, Part III and the Social Security Contributions (Transfer of Functions, etc) Act 1999 (c. 2), section 1(1) and Schedule 1, paragraph 38."
    },
    {
      "type": "footnote",
      "label": "f4",
      "text": "Section 109 was amended by the Pensions Act 1995 (c. 26), section 55."
    },
    {
      "type": "footnote",
      "label": "f5",
      "text": "Section 16 was amended by the Pensions Act 1995 (c. 26), section 151 and Schedule 5, paragraphs 18 and 28."
    },
    {
      "type": "footnote",
      "label": "f6",
      "text": "1992 c. 5; section 148 was amended by the Pension Schemes Act 1993 (c. 48), section 190 and Schedule 8, paragraph 27."
    },
    {
      "type": "footnote",
      "label": "f7",
      "text": "Section 110 was amended by the Pensions Act 1995 (c. 26), section 53(4)."
    },
    {
      "type": "footnote",
      "label": "f8",
      "text": "Section 55 was amended by the Pensions Act 1995 (c. 26), sections 141(1), 151 and 177, Schedule 5, paragaphs 18 and 50 and Schedule 7, Part III."
    }
  ],
  "outstanding_effects": [
    {
      "type": "words substituted",
      "affecting": "uksi/2002/1555",
      "affecting_title": "The Financial Services and Markets Act 2000 (Consequential Amendments) Order 2002"
    }
  ],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/uksi/2001/853/schedule/1/appendix/5",
    "retrieved_at": "2026-10-29T07:57:37.259654+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}