Pension Schemes (Northern Ireland) Act 1993 (c. 49)

(The document as of February, 2008)

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whichever is the later.

(9) An application to the trustees or managers of the scheme under subsection (1) is to be taken to have been made if it is delivered to them personally, or sent by post in a registered letter or by the recorded delivery service.

92 Further provisions concerning exercise of option under s. 91

(1) A member may exercise the option conferred by subsection (1) of section 91 in different ways in relation to different portions of his cash equivalent, but a member who exercises that option must do so--

(a) in relation to the whole of his cash equivalent; or

(b) if subsection (2) applies, in relation to the whole of the balance mentioned in subsection (3).

(2) This subsection applies where--

(a) the trustees or managers--

(i) of an occupational pension scheme which is not a contracted-out scheme, or

(ii) of a personal pension scheme which is not an appropriate scheme, or

(iii) of a self-employed pension arrangement,

are able or willing to accept a transfer payment only in respect of a member's rights other than his accrued rights to guaranteed minimum pensions or his protected rights; and

(b) the member has not required the trustees or managers of the scheme from which he is being transferred to use the portion of his cash equivalent which represents those accrued or protected rights in any of the ways specified in subsection (2) or, as the case may be, subsection (3) of section 91.

(3) Where subsection (2) applies this section and sections 90, 91 and 93 are to be construed as conferring on the member an option only in respect of the balance of the cash equivalent to which the member would otherwise be entitled, after deduction of an amount sufficient for the trustees or managers of the scheme from which he is being transferred to meet their liability--

(a) in the case of a transfer from an occupational pension scheme, in respect of the member's and the member's widow's or, as the case may be, widower's guaranteed minimum pensions or the member's protected rights; and

(b) in the case of a transfer from a personal pension scheme, of the member's protected rights.

93 Calculation of cash equivalents

(1) Cash equivalents are to be calculated and verified in the prescribed manner.

(2) Regulations may provide--

(a) that in calculating cash equivalents account shall be taken--

(i) of any surrender, commutation or forfeiture of the whole or part of a member's pension which occurs before the trustees or managers of the scheme of which he is a member do what is needed to comply with what he requires under section 91;

(ii) in a case where subsection (2) of section 92 applies, of the need to deduct an appropriate amount to provide for the liabilities mentioned in subsection (3) of that section; and

(b) that in prescribed circumstances a cash equivalent shall be increased or reduced.

(3) Without prejudice to the generality of subsection (2), the circumstances that may be specified by virtue of paragraph (b) of that subsection include--

(a) in the case of an occupational pension scheme, the length of time which elapses between the termination of a member's pensionable service and his exercise of the option conferred by this Chapter or regulations made under it;

(b) failure by the trustees or managers of the scheme to do what is needed to carry out what a member of the scheme requires within 6 months of the date on which they receive an application from him under section 91; and

(4) Regulations under subsection (2) may specify as the amount by which a cash equivalent is to be reduced such an amount that a member has no right to receive anything.

94 Variation and loss of rights under s. 90

(1) Regulations may provide that a member of an occupational pension scheme who continues in employment to which the scheme applies after his pensionable service in that employment terminates--

(a) only acquires a right to the cash equivalent of such part of the benefits specified in section 90(1) as may be prescribed; or

(b) acquires no right to a cash equivalent.

(2) Regulations may provide for the purposes of subsection (1) that in prescribed circumstances a number of employments (whether or not consecutive) shall be treated as a single employment.

(3) Regulations may provide that where--

(a) by virtue of regulations under subsection (1) or (2), a member of an occupational pension scheme does not, on the termination of his pensionable service in an employment to which a scheme applies, acquire a right at the relevant date to the cash equivalent of the whole or a part of the benefits specified in section 90(1); and

(b) his employment terminates at least one year before normal pension age,

that right shall accrue to him on the date when that employment terminates and be valued accordingly.

(4) In relation to any case to which regulations under subsection (3) apply, they may substitute--

(a) a new definition of "the relevant date" for the definition in section 90(2); and

(b) a new definition of "the last option date" for the definition in section 91(8).

(5) Where the whole or any part of the benefits payable to a member of a personal pension scheme under the scheme have become payable on or before the relevant date, the right which he acquires under section 90 is only to the cash equivalent of any of the benefits mentioned in that section which have not become payable.

(6) A member of an occupational pension scheme or a personal pension scheme loses the right to any cash equivalent under this Chapter if the scheme is wound up.

(7) A member of an occupational pension scheme also loses that right--

(a) if his pension or benefit in lieu of a pension or any part of it becomes payable before he attains normal pension age; or

(b) he fails to exercise the option conferred by section 91 on or before the last option date (within the meaning of subsection (7) of that section).

(8) In this section "the relevant date" has the same meaning as in section 90(2).

95 Trustees' duties after exercise of option

(1) Where--

(a) a member has exercised the option conferred by section 91; and

(b) the trustees or managers of the scheme have done what is needed to carry out what the member requires,

the trustees or managers shall be discharged from any obligation to provide benefits to which the cash equivalent related except, in such cases as are mentioned in section 92(2), to the extent that an obligation to provide such guaranteed minimum pensions or give effect to such protected rights continues to subsist.

(2) Subject to the following provisions of this section, if the trustees or managers of a scheme receive an application under section 91, they shall do what is needed to carry out what the member requires--

(a) within 12 months of the date on which they receive the application; or

(b) in the case of a member of an occupational pension scheme, by the date on which the member attains normal pension age if that is earlier.

(3) If--

(a) disciplinary proceedings or proceedings before a court have been begun against a member of an occupational pension scheme at any time before the expiry of the period of 12 months beginning with the termination date; and

(b) it appears to the trustees or managers of the scheme that the proceedings may lead to the whole or part of the pension or benefit in lieu of a pension payable to the member or his widow being forfeited; and

(c) the date before which they would (apart from this subsection) be obliged under subsection (2) to carry out what the member requires is earlier than the end of the period of 3 months after the conclusion of the disciplinary or court proceedings (including any proceedings on appeal),

then, subject to the following provisions of this section, they must instead do so before the end of that period of 3 months.

(4) The Board may grant an extension of the period within which the trustees or managers of the scheme are obliged to do what is needed to carry out what a member of the scheme requires--

(a) in any case where in the opinion of the Board--

(i) the scheme is being wound up or is about to be wound up;

(ii) the scheme is ceasing to be a contracted-out scheme or, as the case may be, an appropriate scheme;

(iii) the interests of the members of the scheme generally will be prejudiced if the trustees or managers of the scheme do what is needed to carry out what is required within that period; or

(iv) the member has not taken all such steps as the trustees or managers can reasonably expect him to take in order to satisfy them of any matter which falls to be established before they can properly carry out what he requires;

(b) in any case where the provisions of sections 48 to 50 apply; and

(c) in any case where a request for an extension has been made on a ground specified in paragraph (a) or (b), and the Board's consideration of the request cannot be completed before the end of that period.

(5) A request for an extension under subsection (4) may only be made by the trustees or managers.

(6) If the Board are satisfied--

(a) that there has been a relevant change of circumstances since they granted an extension, or

(b) that they granted an extension in ignorance of a material fact or on the basis of a mistake as to a material fact,

they may direct that the extension be shortened or revoke it.

96 Withdrawal of applications

(1) Subject to subsection (2), a member of a scheme may withdraw an application under section 91 by giving the trustees or managers of the scheme notice in writing that he no longer wishes them to do what is needed to carry out what he previously required.

(2) Such a notice shall be of no effect if it is given to the trustees or managers at a time when, in order to comply with what the member previously required, they have already entered into an agreement with a third party to use the whole or part of the member's cash equivalent in a way specified in subsection (2) or, as the case may be, subsection (3) of section 91.

(3) A member who withdraws an application may make another.

(4) A notice to the trustees or managers of a scheme under this section is to be taken to have been given if it is delivered to them personally, or sent by post in a registered letter or by recorded delivery service.

97 Supplementary provisions

In making any calculation for the purposes of this Chapter--

(a) any charge or lien on, and

(b) any set-off against,

the whole or part of a pension shall be disregarded.

Part V Annual Increases of Pensions in Payment

I Pensions under Final Salary Schemes, etc.

98 Scope of Chapter I: annual increase of certain occupational pensions

(1) This Chapter shall have effect for the purpose of requiring the provision by schemes to which it applies of annual increases in the annual rates of pensions under those schemes.

(2) This Chapter applies to any occupational pension scheme--

(a) which is neither a public service pension scheme nor a money purchase scheme; and

(b) the rules of which do not require the annual rate of every pension to be increased each year by at least the appropriate percentage of that rate;

and in this Chapter such a scheme is referred to as a "qualifying scheme".

(3) In this Chapter--

"annual rate", in relation to a pension or a part of a pension, means the annual rate of the pension or that part of it, as previously increased under the rules of the scheme or under this Chapter;
"the appointed day" means the day on which this Chapter comes into operation;
"appropriate percentage", in relation to an increase in the annual rate of a pension or a part of a pension, means the percentage specified in the last revaluation order made before the increase is to take effect as the revaluation percentage for the last revaluation period of 12 months;
"pension", in relation to a scheme, means any pension which commences or has commenced under the scheme, but does not include--
(a)
a guaranteed minimum pension or any increase in such a pension under section 105; or
(b)
any money purchase benefit;
"revaluation order" means an order under paragraph 2(1) of Schedule 2;
"revaluation percentage" means a percentage specified for a revaluation period by a revaluation order;
"revaluation period" has the meaning given by paragraph 2(2) of Schedule 2.

99 Annual increase of later service component

(1) If, apart from this Chapter, the annual rate of a pension under a qualifying scheme would not be increased as mentioned in section 98(2)(b), the annual rate of its later service component shall be increased annually by at least the appropriate percentage of the annual rate of that component.

(2) In this section "later service component" means so much (if any) of the annual rate of the pension as is attributable to pensionable service on or after the appointed day.

(3) The first increase by virtue of this section in the rate of a pension shall take effect not later than the first anniversary of the commencement of the pension and subsequent increases shall take effect at intervals of not more than 12 months.

(4) This section is subject to sections 101 to 104 and 149.

100 Annual increase of earlier service component where scheme is in surplus

(1) If on any valuation day the value of a qualifying scheme's assets exceeds the value of its liabilities, the amount of the excess (the "valuation surplus") shall, in accordance with this section but subject to subsection (7), be applied in providing for annual increases in the annual rate of the earlier service component of each pension under the scheme that would not, apart from this Chapter, be increased as mentioned in section 98(2)(b).

(2) In this section "earlier service component" means so much (if any) of the annual rate of the pension as is attributable to pensionable service before the appointed day.

(3) Each annual increase to be provided in pursuance of this section shall be equal to the appropriate percentage of the annual rate of the earlier service component of the pension in question.

(4) Except in a case where regulations otherwise provide, the days which are "valuation days" for the purposes of this section are--

(a) the appointed day; and

(b) each subsequent day as at which the assets and liabilities of the scheme in question are actuarially valued for any purpose.

(5) Where, in consequence of a valuation surplus, this section requires provision to be made for annual increases in the annual rate of the earlier service component of a pension, the first of those increases shall take effect not later than the first anniversary of the later of--

(a) the valuation day as at which the valuation was made which disclosed the valuation surplus; or

(b) the commencement of the pension;

and subsequent increases shall take effect at intervals of not more than 12 months.

(6) In any case where--

(a) a valuation of the assets and liabilities of a qualifying scheme discloses a valuation surplus, but

(b) the amount of the surplus is insufficient to provide in full for the annual increases otherwise required by this section in pensions under the scheme,

the valuation surplus shall be applied in providing for those increases, but only at the percentage rate that would apply year by year in relation to those increases if, for the percentage of 5 per cent. specified in subsection (10), there were substituted such lower percentage as represents the greatest percentage by reference to which the valuation surplus is sufficient to provide for annual increases in the earlier service component of the pensions in question.

(7) If a valuation surplus is disclosed on a valuation at any time when either--

(a) provision has already been made by the scheme for the annual rate of the earlier service component of every such pension as is mentioned in subsection (1) to be increased annually in the aggregate by at least the appropriate percentage of that rate, or

(b) the application of part only of the valuation surplus would be sufficient to secure that result,

this section does not require that surplus or, as the case may be, the remaining part of it to be applied in the provision of increases under this section.

(8) The value of a qualifying scheme's assets and liabilities for the purposes of subsection (1) and the percentage to be substituted under subsection (6) shall be determined in accordance with regulations.

(9) This section is subject to sections 101 to 104 and 149.

(10) The maximum percentage of 5 per cent. referred to in subsection (5) is the maximum percentage which may be specified as the revaluation percentage in the case of a revaluation period of 12 months by a revaluation order.

101 Proportional increase where first period is less than 12 months

(1) Where the first increase of a pension required under section 99 is to take effect on a date when the pension has been in payment for a period of less than 12 months, that increase shall be of an amount equal to one twelfth of the amount of the increase so required (apart from this subsection) for each complete month in that period.

(2) This section shall apply in relation to the first increase of a pension by virtue of section 100 in consequence of each successive valuation surplus as it applies in relation to the first increase of a pension under section 99.

102 Restriction on increase where member is under 55

(1) Subject to subsection (2), no increase under section 99 or 100 is required to be paid to or for a member of a scheme whose pension has commenced but who has not attained the age of 55 at the time when the increase takes effect.

(2) Subsection (1) does not apply if the member--

(a) is permanently incapacitated by mental or physical infirmity from engaging in regular full-time employment, or

(b) has retired on account of mental or physical infirmity from the employment in respect of which, or on retirement from which, the pension is payable.

(3) The rules of a scheme may provide that if, in a case where a pension has been paid to or for a member under the age of 55 at an increased rate in consequence of subsection (2), the member--

(a) ceases to suffer from the infirmity in question before he attains the age of 55, but

(b) continues to be entitled to the pension,

any increases subsequently taking effect under section 99 or 100 in the annual rate of the pension shall not be paid or shall not be paid in full.

(4) In any case where--

(a) by virtue only of subsection (1) or (3), increases are not paid to or for a member or are not paid in full, but

(b) the member attains the age of 55 or, in a case falling within subsection (3), again satisfies the condition set out in subsection (2)(a) or (b),

his pension shall then become payable at the annual rate at which it would have been payable apart from subsection (1) or (3).

103 Application of Chapter I to pensions not attributable to pensionable service

Regulations may provide that the provisions of this Chapter shall apply in relation to any pension under a qualifying scheme as if so much of the annual rate of the pension as would not otherwise be attributable to pensionable service were attributable--

(a) to pensionable service before the appointed day;

(b) to pensionable service on or after that day; or

104 No payments to employers from non-complying schemes

(1) No payment shall be made out of the resources of a qualifying scheme which is constituted by trust deed to or for a person who is or has been the employer of persons in the description or category of employment to which the scheme relates until such time as provision has been made by the scheme for every pension which commences or has commenced under it to be increased as mentioned in section 98(2)(b).

(2) Nothing in subsection (1) applies in relation to payments made to or for a person by virtue of his or any other person's membership of the scheme in question.

Chapter II Guaranteed Minimum Pensions

105 Annual increase of guaranteed minimum pensions

(1) Whenever the Secretary of State makes an order under section 109 of the [1993 c. 48.] Pension Schemes Act 1993 specifying a percentage by which there is to be an increase of the rate of that part of guaranteed minimum pensions which is attributable to earnings factors for the tax year 1988-89 and subsequent tax years for--

(a) earners who have attained pensionable age; and

(b) widows and widowers,

the Department may make a corresponding order for Northern Ireland.

(2) Where the benefits mentioned in section 42(1) to (7) are not increased on the day on which an order under this section takes effect, the order shall be treated for the purposes of that section as not taking effect until the day on which those benefits are next increased.

106 Requirement as to resources for annual increase of guaranteed minimum pensions

(1) Except as permitted by subsection (2) or (3), the trustees or managers of a scheme may not make an increase in a person's pension which is required by virtue of section 105 out of money which would otherwise fall to be used for the payment of benefits under the scheme to or in respect of that person unless--

(a) the payment is to an earner in respect of the tax year in which he attains pensionable age and the increase is the one required to be made in the next tax year; or

(b) the payment is to a person as the widow or widower of an earner who died before attaining pensionable age and is in respect of the tax year in which the person became a widow or widower, and the increase is the one required to be made in the next tax year.

(2) Where in any tax year the trustees or managers of an occupational pension scheme make an increase otherwise than in pursuance of section 105, they may deduct the amount of the increase from any increase which, but for this subsection, they would be required to make under that section in the next tax year.

(3) Where in any tax year the trustees or managers of a scheme make an increase which is partly made otherwise than in pursuance of section 105, they may deduct the part of the increase so made from any increase which, but for this subsection, they would be required to make under that section in the next year.

(4) Where by virtue of subsection (2) or (3) guaranteed minimum pensions are not required to be increased in pursuance of section 105, or not by the full amount that they otherwise would be, their amount shall be calculated for any purpose as if they had been increased in pursuance of that section or, as the case may be, by that full amount.

Part VI Further Requirements for Protection of Scheme Members

107 Voluntary contributions

(1) Except in such cases as may be prescribed, and except so far as is necessary to ensure that an occupational pension scheme or a personal pension scheme has, or may be expected to qualify for, tax-exemption or tax-approval, the rules of the scheme--

(a) must not prohibit, or allow any person to prohibit, the payment by a member of voluntary contributions;

(b) must not impose, or allow any person to impose, any upper or lower limit on the payment by a member of voluntary contributions;

(c) must secure that any voluntary contributions paid by a member are to be used by the trustees or managers of the scheme to provide additional benefits for or in respect of him; and

(d) must secure that the value of the additional benefits is reasonable, having regard--

(i) to the amount of the voluntary contributions; and

(ii) to the value of the other benefits under the scheme.

(2) The requirements specified in this section are in this Act referred to as "the voluntary contributions requirements".

(3) This section does not apply in relation to any pension payable under--

(a) Part II of the [1951 c. 20 (N.I.).] Judicial Pensions Act (Northern Ireland) 1951;

(b) Part XIII of the [1959 c. 25 (N.I.).] County Courts Act (Northern Ireland) 1959;

(d) section 2 of the [1969 c. 7 (N.I.).] Superannuation (Miscellaneous Provisions) Act (Northern Ireland) 1969;

(e) the [1981 c. 20.] Judicial Pensions Act 1981; or

(f) the [1993 c. 8.] Judicial Pensions and Retirement Act 1993;

and accordingly none of the provisions of this Act shall, in so far as it has effect in relation to the voluntary contributions requirements, apply to any such pension.

108 Restrictions on investment of scheme's resources in employer-related assets

(1) An occupational pension scheme shall comply with such restrictions as may be prescribed with respect to the proportion of its resources that may at any time be invested in, or in any description of, employer-related investments.

(2) In this section--

"employer-related investments" means--
(a)
shares or other securities issued by the employer or by any person who is connected with, or an associate of, the employer;
(b)
land which is occupied or used by, or subject to a lease in favour of, the employer or any such person;
(c)
property (other than land) which is used for the purposes of any business carried on by the employer or any such person;
(d)
loans to the employer or any such person;
"the employer" means the employer of persons in the description or category of employment to which the scheme in question relates;
"securities" means any asset, right or interest falling within paragraph 1, 2, 4 or 5 of Schedule 1 to the [1986 c. 60.] Financial Services Act 1986.

(3) If and to the extent that any sums due and payable by a person to the trustees or managers of a scheme remain unpaid--

(a) those sums shall be regarded for the purposes of this section as loans made to that person by the trustees or managers, and

(b) resources of the scheme shall be regarded as invested accordingly.

(4) Articles 4 and 7 of the [S.I. 1989/2405 (N.I. 19).] Insolvency (Northern Ireland) Order 1989 (connected and associated persons) shall apply for the purposes of this section as they apply for the purposes of that Order.

109 Disclosure of information about schemes to members, etc

(1) The Department may by regulations specify requirements to be complied with in the case of an occupational pension scheme or a personal pension scheme with respect to keeping the persons mentioned in subsection (2) informed--

(a) of its constitution;

(b) of its administration and finances;

(d) of any other matters that appear to the Department to be relevant to occupational pension schemes or personal pension schemes in general or to schemes of a description to which the scheme in question belongs.

(2) The persons referred to in subsection (1) are--

(a) members and, in the case of an occupational pension scheme, prospective members of the scheme;

(b) spouses of members and, in the case of an occupational pension scheme, of prospective members;

(d) in the case of an occupational pension scheme, independent trade unions recognised to any extent for the purposes of collective bargaining in relation to members and to prospective members of the scheme.

(3) Without prejudice to the generality of section 177(2), the regulations may distinguish between--

(a) cases in which information is to be given as of course; and

(b) cases in which information need only be given on request or in other prescribed circumstances.

(4) The regulations shall make provision for referring to an industrial tribunal any question whether an organisation is such a trade union as is mentioned in subsection (2)(d).

110 Additional documents for members, etc. and Registrar

(1) Without prejudice to the generality of the power conferred on it by section 109(1), the Department may by regulations require the trustees of an occupational pension scheme or, if there are no trustees, the managers--

(a) to obtain at such times as may be prescribed documents to which this subsection applies; and

(b) to make copies of them available to the persons specified in section 109(2).

(2) In relation to any scheme, the documents to which subsection (1) applies are--

(a) its audited accounts;

(b) an auditor's statement about contributions under it;

(d) an actuary's statement concerning such aspects of any such valuation as may be prescribed.

(3) The Department may by regulations--

(a) prescribe the persons who may act as auditors or actuaries for the purposes of this section; or

(b) provide that the persons who may so act shall be--

(i) persons with prescribed professional qualifications or experience; or

(ii) persons approved by the Department.

(4) The Department may by regulations make provision as to the form and content of any such document as is mentioned in subsection (2).

111 Powers as respects failure to comply with information requirements

(1) If the trustees or managers of an occupational pension scheme or a personal pension scheme, having made default in complying with regulations under section 109 or 110(1)(b), fail to make good the default within 14 days after the service on them of a notice requiring them to do so, an order may be made under this subsection.

(2) The Department may by regulations specify forms for notices under subsection (1).

(3) An order under subsection (1) is an order directing the trustees or managers to make good the default within such time as may be specified in the order.

(4) The power to make such an order shall be exercisable by a county court on the application of any person mentioned in subsection (5).

(5) The persons referred to in subsection (4) are--

(a) the Department;

(b) any person authorised by the Department to make an application under this section; and

(6) An order under this section may provide that all costs of and incidental to the application shall be borne personally by any of the trustees or managers of the scheme.

112 Regulations as to auditors

The Department may by regulations make provision as to--

(a) the appointment, resignation and removal of auditors of occupational pension schemes;

(b) the duty of employers and auditors of employers to disclose information to the trustees or managers of occupational pension schemes and the auditors of such schemes;

(c) the duty of trustees or managers of an occupational pension scheme to disclose information and to make documents available to the auditors of the scheme.

113 Regulations as to form and content of advertisements

Regulations may be made relating to the form and content of advertisements and such other material as may be prescribed issued by or on behalf of the trustees or managers of a personal or occupational pension scheme for the purposes of the scheme.

114 Equal access requirements

(1) Subject to section 149(3), the equal access requirements in relation to an occupational pension scheme are that membership of the scheme is open to both men and women on terms which are the same as to age and length of service needed for becoming a member.

(2) A rule does not contravene the equal access requirements only because it confers on the scheme's trustees or managers, or others, a discretion whose exercise may result in a person being more or less favourably treated than he otherwise would be, so long as it does not provide for the discretion to be exercised in any discriminatory manner as between men and women.

(3) The equal access requirements have effect in relation to any occupational pension scheme whose resources are derived in whole or in part from--

(a) payments made or to be made by one or more employers of earners to whom the scheme applies, being payments either--

(i) under an actual or contingent legal obligation; or

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