Welfare Reform and Pensions Act 1999 (c. 30)

(The document as of February, 2008)

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" (ab) make, in relation to payment under a mistaken belief as to the continuation in force of a provision included by virtue of section 25B or 25C above in an order under section 23 above, provision about the rights or liabilities of the payer, the payee or the person to whom the payment was due, "

(d) after paragraph (b) there is inserted--

" (ba) make provision for the person responsible for a pension arrangement to be discharged in prescribed circumstances from a requirement imposed by virtue of section 25B or 25C above, "

(e) paragraphs (c) and (d) are omitted,

(f) for paragraph (e) there is substituted--

" (e) make provision about calculation and verification in relation to the valuation of--

(i) benefits under a pension arrangement, or

(ii) shareable state scheme rights,

for the purposes of the court's functions in connection with the exercise of any of its powers under this Part of this Act. " , and

(g) the words after paragraph (e) are omitted.

(4) After that subsection there is inserted--

" (2A) Regulations under subsection (2)(e) above may include--

(a) provision for calculation or verification in accordance with guidance from time to time prepared by a prescribed person, and

(b) provision by reference to regulations under section 30 or 49(4) of the Welfare Reform and Pensions Act 1999.

(2B) Regulations under subsection (2) above may make different provision for different cases.

(2C) Power to make regulations under this section shall be exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament. "

(5) For subsections (3) and (4) there is substituted--

" (3) In this section and sections 25B and 25C above--

"occupational pension scheme" has the same meaning as in the [1993 c. 48.] Pension Schemes Act 1993;
"the party with pension rights" means the party to the marriage who has or is likely to have benefits under a pension arrangement and "the other party" means the other party to the marriage;
"pension arrangement" means--
(a)
an occupational pension scheme,
(b)
a personal pension scheme,
(c)
a retirement annuity contract,
(d)
an annuity or insurance policy purchased, or transferred, for the purpose of giving effect to rights under an occupational pension scheme or a personal pension scheme, and
(e)
an annuity purchased, or entered into, for the purpose of discharging liability in respect of a pension credit under section 29(1)(b) of the Welfare Reform and Pensions Act 1999 or under corresponding Northern Ireland legislation;
"personal pension scheme" has the same meaning as in the Pension Schemes Act 1993;
"prescribed" means prescribed by regulations;
"retirement annuity contract" means a contract or scheme approved under Chapter III of Part XIV of the [1988 c. 1.] Income and Corporation Taxes Act 1988;
"shareable state scheme rights" has the same meaning as in section 21A(1) above; and
"trustees or managers", in relation to an occupational pension scheme or a personal pension scheme, means--
(a)
in the case of a scheme established under a trust, the trustees of the scheme, and
(b)
in any other case, the managers of the scheme.

(4) In this section and sections 25B and 25C above, references to the person responsible for a pension arrangement are--

(a) in the case of an occupational pension scheme or a personal pension scheme, to the trustees or managers of the scheme,

(b) in the case of a retirement annuity contract or an annuity falling within paragraph (d) or (e) of the definition of "pension arrangement" above, the provider of the annuity, and

Section 35.

SCHEDULE 5 Pension credits: mode of discharge

Funded pension schemes

1 (1) This paragraph applies to a pension credit which derives from--

(a) a funded occupational pension scheme, or

(b) a personal pension scheme.

(2) The trustees or managers of the scheme from which a pension credit to which this paragraph applies derives may discharge their liability in respect of the credit by conferring appropriate rights under that scheme on the person entitled to the credit--

(a) with his consent, or

(b) in accordance with regulations made by the Secretary of State.

(3) The trustees or managers of the scheme from which a pension credit to which this paragraph applies derives may discharge their liability in respect of the credit by paying the amount of the credit to the person responsible for a qualifying arrangement with a view to acquiring rights under that arrangement for the person entitled to the credit if--

(a) the qualifying arrangement is not disqualified as a destination for the credit,

(b) the person responsible for that arrangement is able and willing to accept payment in respect of the credit, and

(c) payment is made with the consent of the person entitled to the credit, or in accordance with regulations made by the Secretary of State.

(4) For the purposes of sub-paragraph (2), no account is to be taken of consent of the person entitled to the pension credit unless--

(a) it is given after receipt of notice in writing of an offer to discharge liability in respect of the credit by making a payment under sub-paragraph (3), or

(b) it is not withdrawn within 7 days of receipt of such notice.

Unfunded public service pension schemes

2 (1) This paragraph applies to a pension credit which derives from an occupational pension scheme which is--

(a) not funded, and

(b) a public service pension scheme.

(3) If such a scheme as is mentioned in sub-paragraph (1) is closed to new members, the appropriate authority in relation to that scheme may by regulations specify another public service pension scheme as an alternative to it for the purposes of this paragraph.

(4) Where the trustees or managers of a scheme in relation to which an alternative is specified under sub-paragraph (3) are subject to liability in respect of a pension credit, they may--

(a) discharge their liability in respect of the credit by securing that appropriate rights are conferred on the person entitled to the credit by the trustees or managers of the alternative scheme, and

(b) for the purpose of so discharging their liability, require the trustees or managers of the alternative scheme to take such steps as may be required.

(5) In sub-paragraph (3), "the appropriate authority", in relation to a public service pension scheme, means such Minister of the Crown or government department as may be designated by the Treasury as having responsibility for the scheme.

Other unfunded occupational pension schemes

3 (1) This paragraph applies to a pension credit which derives from an occupational pension scheme which is--

(a) not funded, and

(b) not a public service pension scheme.

(a) the qualifying arrangement is not disqualified as a destination for the credit,

(b) the person responsible for that arrangement is able and willing to accept payment in respect of the credit, and

(c) payment is made with the consent of the person entitled to the credit, or in accordance with regulations made by the Secretary of State.

Other pension arrangements

4 (1) This paragraph applies to a pension credit which derives from--

(a) a retirement annuity contract,

(b) an annuity or insurance policy purchased or transferred for the purpose of giving effect to rights under an occupational pension scheme or a personal pension scheme, or

(2) The person responsible for the pension arrangement from which a pension credit to which this paragraph applies derives may discharge his liability in respect of the credit by paying the amount of the credit to the person responsible for a qualifying arrangement with a view to acquiring rights under that arrangement for the person entitled to the credit if--

(a) the qualifying arrangement is not disqualified as a destination for the credit,

(b) the person responsible for that arrangement is able and willing to accept payment in respect of the credit, and

(c) payment is made with the consent of the person entitled to the credit, or in accordance with regulations made by the Secretary of State.

(3) The person responsible for the pension arrangement from which a pension credit to which this paragraph applies derives may discharge his liability in respect of the credit by entering into an annuity contract with the person entitled to the credit if the contract is not disqualified as a destination for the credit.

(4) The person responsible for the pension arrangement from which a pension credit to which this paragraph applies derives may, in such circumstances as the Secretary of State may prescribe by regulations, discharge his liability in respect of the credit by assuming an obligation to provide an annuity for the person entitled to the credit.

(5) In sub-paragraph (1)(c), "pension credit" includes a credit under Northern Ireland legislation corresponding to section 29(1)(b).

Appropriate rights

5 For the purposes of this Schedule, rights conferred on the person entitled to a pension credit are appropriate if--

(a) they are conferred with effect from, and including, the day on which the order, or provision, under which the credit arises takes effect, and

(b) their value, when calculated in accordance with regulations made by the Secretary of State, equals the amount of the credit.

Qualifying arrangements

6 (1) The following are qualifying arrangements for the purposes of this Schedule--

(a) an occupational pension scheme,

(b) a personal pension scheme,

(d) an appropriate policy of insurance, and

(e) an overseas arrangement within the meaning of the [S.I. 1996/1462.] Contracting-out (Transfer and Transfer Payment) Regulations 1996.

(2) An annuity contract or policy of insurance is appropriate for the purposes of sub-paragraph (1) if, at the time it is entered into or taken out, the insurance company with which it is entered into or taken out--

(a) is carrying on ordinary long-term insurance business in the United Kingdom or any other member State, and

(b) satisfies such requirements as the Secretary of State may prescribe by regulations.

(3) In this paragraph, "ordinary long-term insurance business" has the same meaning as in the [1982 c. 50.] Insurance Companies Act 1982.

Disqualification as destination for pension credit

7 (1) If a pension credit derives from a pension arrangement which is approved for the purposes of Part XIV of the [1988 c. 1.] Income and Corporation Taxes Act 1988, an arrangement is disqualified as a destination for the credit unless--

(a) it is also approved for those purposes, or

(b) it satisfies such requirements as the Secretary of State may prescribe by regulations.

(2) If the rights by reference to which the amount of a pension credit is determined are or include contracted-out rights or safeguarded rights, an arrangement is disqualified as a destination for the credit unless--

(a) it is of a description prescribed by the Secretary of State by regulations, and

(b) it satisfies such requirements as he may so prescribe.

(3) An occupational pension scheme is disqualified as a destination for a pension credit unless the rights to be acquired under the arrangement by the person entitled to the credit are rights whose value, when calculated in accordance with regulations made by the Secretary of State, equals the credit.

(4) An annuity contract or insurance policy is disqualified as a destination for a pension credit in such circumstances as the Secretary of State may prescribe by regulations.

(5) The requirements which may be prescribed under sub-paragraph (1)(b) include, in particular, requirements of the Inland Revenue.

(6) In sub-paragraph (2)--

"contracted-out rights" means such rights under, or derived from--
(a)
an occupational pension scheme contracted-out by virtue of section 9(2) or (3) of the [1993 c. 48.] Pension Schemes Act 1993, or
(b)
a personal pension scheme which is an appropriate scheme for the purposes of that Act,

as the Secretary of State may prescribe by regulations;
"safeguarded rights" has the meaning given by section 68A of the Pension Schemes Act 1993.

Adjustments to amount of pension credit

8 (1) If--

(a) a pension credit derives from an occupational pension scheme,

(b) the scheme is one to which section 56 of the [1995 c. 26.] Pensions Act 1995 (minimum funding requirement for funded salary related schemes) applies,

(d) such circumstances as the Secretary of State may prescribe by regulations apply,

paragraph 1(3) shall have effect in relation to the credit as if the reference to the amount of the credit were to such lesser amount as may be determined in accordance with regulations made by the Secretary of State.

(2) Whether a scheme is underfunded for the purposes of sub-paragraph (1)(c) shall be determined in accordance with regulations made by the Secretary of State.

(3) For the purposes of that provision, the valuation day is the day by reference to which the cash equivalent on which the amount of the pension credit depends falls to be calculated.

9 If--

(a) a person's shareable rights under a pension arrangement have become subject to a pension debit, and

(b) the person responsible for the arrangement makes a payment which is referable to those rights without knowing of the pension debit,

this Schedule shall have effect as if the amount of the corresponding pension credit were such lesser amount as may be determined in accordance with regulations made by the Secretary of State.

10 The Secretary of State may by regulations make provision for paragraph 1(3), 3(3) or 4(2) to have effect, where payment is made after the end of the implementation period for the pension credit, as if the reference to the amount of the credit were to such larger amount as may be determined in accordance with the regulations.

General

11 Liability in respect of a pension credit shall be treated as discharged if the effect of paragraph 8(1) or 9 is to reduce it to zero.

12 Liability in respect of a pension credit may not be discharged otherwise than in accordance with this Schedule.

13 Regulations under paragraph 5(b) or 7(3) may provide for calculation of the value of rights in accordance with guidance from time to time prepared by a person specified in the regulations.

14 In this Schedule--

"funded", in relation to an occupational pension scheme, means that the scheme meets its liabilities out of a fund accumulated for the purpose during the life of the scheme;
"public service pension scheme" has the same meaning as in the [1993 c. 48.] Pension Schemes Act 1993.

Section 50.

SCHEDULE 6 Effect of state scheme pension debits and credits

1 The Contributions and Benefits Act is amended as follows.

2 After section 45A there is inserted--

" 45B Reduction of additional pension in Category A retirement pension: pension sharing

(1) The weekly rate of the additional pension in a Category A retirement pension shall be reduced as follows in any case where--

(a) the pensioner has become subject to a state scheme pension debit, and

(b) the debit is to any extent referable to the additional pension.

(2) If the pensioner became subject to the debit in or after the final relevant year, the weekly rate of the additional pension shall be reduced by the appropriate weekly amount.

(3) If the pensioner became subject to the debit before the final relevant year, the weekly rate of the additional pension shall be reduced by the appropriate weekly amount multiplied by the relevant revaluation percentage.

(4) The appropriate weekly amount for the purposes of subsections (2) and (3) above is the weekly rate, expressed in terms of the valuation day, at which the cash equivalent, on that day, of the pension mentioned in subsection (5) below is equal to so much of the debit as is referable to the additional pension.

(5) The pension referred to above is a notional pension for the pensioner by virtue of section 44(3)(b) above which becomes payable on the later of--

(a) his attaining pensionable age, and

(b) the valuation day.

(6) For the purposes of subsection (3) above, the relevant revaluation percentage is the percentage specified, in relation to earnings factors for the tax year in which the pensioner became subject to the debit, by the last order under section 148 of the Administration Act to come into force before the end of the final relevant year.

(7) Cash equivalents for the purposes of this section shall be calculated in accordance with regulations.

(8) In this section--

"final relevant year" means the tax year immediately preceding that in which the pensioner attains pensionable age;
"state scheme pension debit" means a debit under section 49(1)(a) of the Welfare Reform and Pensions Act 1999 (debit for the purposes of this Part of this Act);
"valuation day" means the day on which the pensioner became subject to the state scheme pension debit. "

3 After section 55 there is inserted--

" Shared additional pension

55A Shared additional pension

(1) A person shall be entitled to a shared additional pension if he is--

(a) over pensionable age, and

(b) entitled to a state scheme pension credit.

(2) A person's entitlement to a shared additional pension shall continue throughout his life.

(3) The weekly rate of a shared additional pension shall be the appropriate weekly amount, unless the pensioner's entitlement to the state scheme pension credit arose before the final relevant year, in which case it shall be that amount multiplied by the relevant revaluation percentage.

(4) The appropriate weekly amount for the purposes of subsection (3) above is the weekly rate, expressed in terms of the valuation day, at which the cash equivalent, on that day, of the pensioner's entitlement, or prospective entitlement, to the shared additional pension is equal to the state scheme pension credit.

(5) The relevant revaluation percentage for the purposes of that subsection is the percentage specified, in relation to earnings factors for the tax year in which the entitlement to the state scheme pension credit arose, by the last order under section 148 of the Administration Act to come into force before the end of the final relevant year.

(6) Cash equivalents for the purposes of this section shall be calculated in accordance with regulations.

(7) In this section--

"final relevant year" means the tax year immediately preceding that in which the pensioner attains pensionable age;
"state scheme pension credit" means a credit under section 49(1)(b) of the Welfare Reform and Pensions Act 1999 (credit for the purposes of this Part of this Act);
"valuation day" means the day on which the pensioner becomes entitled to the state scheme pension credit.

55B Reduction of shared additional pension: pension sharing

(1) The weekly rate of a shared additional pension shall be reduced as follows in any case where--

(a) the pensioner has become subject to a state scheme pension debit, and

(b) the debit is to any extent referable to the pension.

(2) If the pensioner became subject to the debit in or after the final relevant year, the weekly rate of the pension shall be reduced by the appropriate weekly amount.

(5) The pension referred to above is a notional pension for the pensioner by virtue of section 55A above which becomes payable on the later of--

(a) his attaining pensionable age, and

(b) the valuation day.

(7) Cash equivalents for the purposes of this section shall be calculated in accordance with regulations.

(8) In this section--

"final relevant year" means the tax year immediately preceding that in which the pensioner attains pensionable age;
"state scheme pension debit", means a debit under section 49(1)(a) of the Welfare Reform and Pensions Act 1999 (debit for the purposes of this Part of this Act);
"valuation day" means the day on which the pensioner became subject to the state scheme pension debit.

55C Increase of shared additional pension where entitlement is deferred

(1) For the purposes of this section, a person's entitlement to a shared additional pension is deferred--

(a) where he would be entitled to a Category A or Category B retirement pension but for the fact that his entitlement to such a pension is deferred, if and so long as his entitlement to such a pension is deferred, and

(b) otherwise, if and so long as he does not become entitled to the shared additional pension by reason only of not satisfying the conditions of section 1 of the Administration Act (entitlement to benefit dependent on claim),

and, in relation to a shared additional pension, "period of deferment" shall be construed accordingly.

(2) Where a person's entitlement to a shared additional pension is deferred, the rate of his shared additional pension shall be increased by an amount equal to the aggregate of the increments to which he is entitled under subsection (3) below, but only if that amount is enough to increase the rate of the pension by at least 1 per cent.

(3) A person is entitled to an increment under this subsection for each complete incremental period in his period of enhancement.

(4) The amount of the increment for an incremental period shall be 1/7th per cent. of the weekly rate of the shared additional pension to which the person would have been entitled for the period if his entitlement had not been deferred.

(5) Amounts under subsection (4) above shall be rounded to the nearest penny, taking any 1/2p as nearest to the next whole penny.

(6) Where an amount under subsection (4) above would, apart from this subsection, be a sum less than 1/2p, the amount shall be taken to be zero, notwithstanding any other provision of this Act, the [1995 c. 26.] Pensions Act 1995 or the Administration Act.

(7) Where one or more orders have come into force under section 150 of the Administration Act during the period of enhancement, the rate for any incremental period shall be determined as if the order or orders had come into force before the beginning of the period of enhancement.

(8) The sums which are the increases in the rates of shared additional pensions under this section are subject to alteration by order made by the Secretary of State under section 150 of the Administration Act.

(9) In this section--

"incremental period" means any period of six days which are treated by regulations as days of increment for the purposes of this section in relation to the person and pension in question; and
"period of enhancement", in relation to that person and that pension, means the period which--
(a)
begins on the same day as the period of deferment in question, and
(b)
ends on the same day as that period or, if earlier, on the day before the 5th anniversary of the beginning of that period. "

Section 59.

SCHEDULE 7 Joint claims for jobseeker's allowance

Jobseekers Act 1995 (c. 18)

1 The Jobseekers Act 1995 has effect subject to the following amendments.

2 (1) Section 1 (entitlement to jobseeker's allowance) is amended as follows.

(2) In subsection (2) (conditions of entitlement), for paragraph (d) (claimant must satisfy conditions set out in section 2 or 3) substitute--

" (d) satisfies the conditions set out in section 2; " .

(3) After subsection (2) insert--

" (2A) Subject to the provisions of this Act, a claimant who is not a member of a joint-claim couple is entitled to a jobseeker's allowance if he satisfies--

(a) the conditions set out in paragraphs (a) to (c) and (e) to (i) of subsection (2); and

(b) the conditions set out in section 3.

(2B) Subject to the provisions of this Act, a joint-claim couple are entitled to a jobseeker's allowance if--

(a) a claim for the allowance is made jointly by the couple;

(b) each member of the couple satisfies the conditions set out in paragraphs (a) to (c) and (e) to (i) of subsection (2); and

(2C) Regulations may prescribe circumstances in which subsection (2A) is to apply to a claimant who is a member of a joint-claim couple.

(2D) Regulations may, in respect of cases where a person would (but for the regulations) be a member of two or more joint-claim couples, make provision for only one of those couples to be a joint-claim couple; and the provision which may be so made includes provision for the couple which is to be the joint-claim couple to be nominated--

(a) by the persons who are the members of the couples, or

(b) in default of one of the couples being so nominated, by the Secretary of State. "

(4) In subsection (4)--

(a) in the definition of "an income-based jobseeker's allowance", at the end insert "or a joint-claim jobseeker's allowance;" and

(b) after that definition insert--

" "a joint-claim couple" means a married or unmarried couple who--

(a) are not members of any family whose members include a person in respect of whom a member of the couple is entitled to child benefit, and

(b) are of a prescribed description;

"a joint-claim jobseeker's allowance" means a jobseeker's allowance entitlement to which arises by virtue of subsection (2B). "

3 In section 2(1) (the contribution-based conditions), for "section 1(2)(d)(i)" substitute "section 1(2)(d)".

4 (1) In subsection (1) of section 3 (the income-based conditions), for "section 1(2)(d)(ii)" substitute "section 1(2A)(b)".

(2) After that section insert--

" 3A The conditions for claims by joint-claim couples

(1) The conditions referred to in section 1(2B)(c) are--

(a) that the income of the joint-claim couple does not exceed the applicable amount (determined in accordance with regulations under section 4) or the couple have no income;

(b) that no member of a family of which the couple are members is entitled to income support;

(d) that at least one member of the couple has reached the age of 18; and

(e) that if only one member of the couple has reached the age of 18, the other member of the couple is a person--

(i) in respect of whom a direction under section 16 is in force; or

(ii) who has, in prescribed circumstances to be taken into account for a prescribed period, reached the age of 16.

(2) Subsections (2) and (4) of section 3 shall apply in relation to a member of the couple to whom subsection (1)(e)(i) or (ii) above applies as they apply in relation to a claimant to whom subsection (1)(f)(ii) or (iii) of that section applies.

(3) In subsection (1)(e)(ii) above "period" shall be construed in accordance with section 3(3).

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