The Financial Assistance Scheme Regulations 2005

Regulation 17(8)(g) to (k)and (16)(b)

[F1 SCHEDULE 4 U.K. Determination of annual payments where a present payment was being received on the coming into force of the Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010

Textual Amendments

F1 Sch. 4 added (2.4.2010) by The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2010 (S.I. 2010/1149), regs. 1, 18(b), Sch. 2

Introductory U.K.

1.— (1) This Schedule applies for the purposes of determining the amount of an annual payment payable to a beneficiary to whom regulation 17(8)(g) to (k) or (16)(b) applies.

(2) Where the scheme manager is satisfied that an amount is owed by the beneficiary to the Secretary of State as a result of the beneficiary owing, before a transfer notice is given, a debt to a qualifying pension scheme to which Part 7 applies, the scheme manager may determine how the annual payment which would otherwise be payable under this Schedule is to be reduced, having regard to the amount owed by the beneficiary and to such other matters as the scheme manager considers relevant.

(3) Sub-paragraph (5) applies where the scheme manager is satisfied that the sum of the interim pension paid to a beneficiary and any payment made under these Regulations in respect of any year in the period determined in accordance with sub-paragraph (4) is higher or lower than the sum of—

(a) the notional pension, or the survivor notional pension, as the case may be; and

(b) any annual increases or proportion of annual increases, which the scheme manager considers could have been paid in respect of that year, taking into account—

(i) the determination under regulation 27(1)(d); and

(ii) the proportion of that year which falls after the 1^st January.

(4) For the purposes of sub-paragraph (3), the period is the period from—

(a) the earlier of—

(i) the day on which the beneficiary became entitled to a payment under these Regulations; and

(ii) the day on which the beneficiary became entitled under the scheme rules to a pension or other benefit; or

(b) the day on which the qualifying pension scheme began to be wound up if that is later than the day determined in accordance with paragraph (a),

until the day on which the scheme manager gave a transfer notice to the scheme trustees or managers.

(5) Where this sub-paragraph applies, the scheme manager may—

(a) determine the amount by which the annual payment which would otherwise be payable under this Schedule in respect of the beneficiary is to be reduced, having regard to—

(i) the amount of interim pension which was paid to the beneficiary;

(ii) the amount of the sum of—

(aa) the notional pension or survivor notional pension; and

(bb) any annual increases, or proportion of annual increases, which the scheme manager considers could have been paid;

(iii) the amount of any payments made under these Regulations prior to the scheme manager giving the transfer notice; and

(iv) such other matters as the scheme manager considers relevant; and

(b) where the sum of the interim pension paid and any payments made under these Regulations in respect of any year is lower than the sum of the amounts referred to in sub-paragraph (3)(a) and (b) in respect of that year, make a payment to the beneficiary or, where the beneficiary has died prior to the scheme manager making this determination, to the beneficiary’s estate, having regard to—

(i) the amount of interim pension which was paid to the beneficiary;

(ii) the amount of the sum of—

(aa) the notional pension or survivor notional pension; and

(bb) any annual increases, or proportion of annual increases, which the scheme manager considers could have been paid;

(iii) the amount of any payments made under these Regulations prior to the scheme manager giving the transfer notice; and

(iv) such other matters as the scheme manager considers relevant.

(6) In this Schedule—

“relevant date” means the date from which the notional pension or survivor notional pension could have been payable as determined in accordance with regulation 27(3) and (4); and

“relevant proportion”, in relation to a beneficiary, means the proportion of the notional pension which relates to the beneficiary.

(7) Where—

(a) the beneficiary is a qualifying member to whom regulation 17H applied; and

(b) the scheme manager made a determination in accordance with paragraph 1(2) or (5) of Schedule 7, to reduce the payment under that Schedule by any amount,

the scheme manager shall reduce the amount of the annual payment payable under this Schedule by the same amount.

Qualifying members U.K.

2.   Where this Schedule applies, the annual payment payable to a qualifying member shall be the sum of—

(a) the notional pension determined in respect of the qualifying member; and

(b) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the day on which the transfer notice is given,

less any amount by which the scheme manager determines a payment is to be reduced under paragraph 1(2), (5) or (7).

Survivors U.K.

3.   Where this Schedule applies, the annual payment payable to a survivor of a qualifying member shall be—

(a) where regulation 17(8)(h) or (i) applies, the amount which is the sum of—

(i) the survivor notional pension determined in respect of that survivor; and

(ii) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the survivor notional pension from the day after the qualifying member died until the day on which the transfer notice is given,

less any amount by which the scheme manager determines a payment is to be reduced under paragraph 1(2) or (5);

(b) where regulation 17(8)(j) applies, the amount which is the sum of—

(i) the proportion of the notional pension which relates to a pension payable to the survivor;

(ii) the relevant proportion of the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the day on which the qualifying member died; and

(iii) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the relevant proportion of the notional pension from the day after the day on which the qualifying member died until the day on which the transfer notice was given;

(c) where regulation 17(8)(k) applies, the amount which is the sum of—

(i) the proportion of the notional pension which relates to a pension payable to the survivor;

(ii) the relevant proportion of the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the day on which transfer notice was given; and

(iii) the relevant proportion of the total amount of any annual increases to which the qualifying member was entitled on the day on which the qualifying member died; and

(d) where regulation 17(17)(b) applies, the relevant proportion of the payment to which the qualifying member was entitled in accordance with Schedule 7 immediately before the qualifying member died.

Surviving Dependants U.K.

4.   Where this Schedule applies, the annual payment payable to a surviving dependant of a qualifying member shall be—

(a) where regulation 17(8)(h) or (i) applies, the amount which is the sum of—

(i) the survivor notional pension determined in respect of that surviving dependant; and

(ii) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the survivor notional pension from the day after the qualifying member died until the day on which the transfer notice is given,

less any amount by which the scheme manager determines a payment is to be reduced under paragraph 1(2) or (5);

(b) where regulation 17(8)(j) applies, the amount which is the sum of—

(i) the proportion of the notional pension which relates to a pension payable to the surviving dependant;

(ii) the relevant proportion of the amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the day on which the qualifying member died; and

(iii) the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the relevant proportion of the notional pension, from the day after the day on which the qualifying member died until the day on which the transfer notice was given;

(c) where regulation 17(8)(k) applies, the amount which is the sum of—

(i) the proportion of the notional pension which relates to a pension payable to the surviving dependant;

(ii) the relevant proportion of the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension from the relevant date until the day on which transfer notice was given; and

(iii) the relevant proportion of the total amount of any annual increases to which the qualifying member was entitled on the day on which the qualifying member died; and

(d) where regulation 17(17)(b) applies, the relevant proportion of the payment to which the qualifying member was entitled in accordance with Schedule 7 immediately before the qualifying member died.

Redetermination U.K.

5.— (1) This paragraph applies where the notional pension or survivor notional pension includes an amount in respect of an amount which under scheme rules—

(a) would be payable for a period which is shorter than the period in respect of which the remainder of a pension would be payable; or

(b) would be payable as a result of a qualifying member dying within a period specified in scheme rules which begins on the day on which the member became entitled to a pension from the scheme, or the day on which the pension was first paid.

(2) Where this paragraph applies, the scheme manager shall redetermine the annual payment payable to the beneficiary with effect from the date on which the amount referred to in sub-paragraph (1)(a) would have ceased to be payable, or the period referred to in sub-paragraph (1)(b) would have ended.

(3) When redetermining an annual payment under sub-paragraph (2), the scheme manager shall redetermine the notional pension or survivor notional pension having regard to the amount referred to in sub-paragraph (1).

Rounding U.K.

6.   Where the amount of an annual payment determined in accordance with this Schedule results in a fraction of a penny, that fraction shall be treated as a penny.

Annual increases to an annual payment U.K.

7.— (1) Except where there is no percentage increase in the [F2 general level of prices] for the period of 12 months ending with 31st May last falling before the indexation date, where the asset share determined in respect of the beneficiary was sufficient to be applied to the amounts referred to in regulation 27(7)(a)(ii) or (10)(a)(ii), a beneficiary shall be entitled, on each indexation date after the day on which the transfer notice is given, to an increase of—

(a) the appropriate percentage of the amount of the underlying rate immediately before that date; or

(b) where the beneficiary first became entitled to an annual payment during the period of 12 months ending immediately before that date, one twelfth of that amount for each full month since the date on which the annual payment was first payable.

(2) In this paragraph—

“appropriate percentage” means the lesser of—

(a)

the percentage increase in the [F2 general level of prices] for the period of 12 months ending with 31st May last falling before the indexation date; and

(b)

2.5%;

“underlying rate” means—

(a)

where the beneficiary is a qualifying member or a survivor or surviving dependant in respect of whom a survivor notional pension has been determined, the aggregate of—

(i)

so much of the annual payments as the scheme manager determined under regulation 27(7)(a)(ii) or (10)(a)(ii) could be increased;

(ii)

the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the notional pension, or survivor notional pension, as the case may be, from the relevant date until the day on which the transfer notice is given; and

(iii)

any annual increases to which the beneficiary is entitled in accordance with sub-paragraph (1) immediately before the indexation date;

(b)

where the beneficiary is a survivor or surviving dependant of a qualifying member who died after the day on which the transfer notice was given, the aggregate of—

(i)

the relevant proportion of so much of the annual payments as the scheme manager determined under regulation 27(7)(a)(ii) could be increased;

(ii)

the relevant proportion of the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid to the qualifying member on the notional pension from the relevant date until the day on which the transfer notice is given;

(iii)

the relevant proportion of any annual increases to which the qualifying member was entitled in accordance with this Schedule on the day on which the qualifying member died; and

(iv)

any annual increases to which the beneficiary is entitled in accordance with sub-paragraph (1) immediately before the indexation date; and

(c)

where the beneficiary is a survivor or surviving dependant of a qualifying member who died after the calculation date but prior to the day on which the transfer notice was given, the aggregate of—

(i)

the relevant proportion of so much of the annual payments as the scheme manager determined under regulation 27(7)(a)(ii) could be increased;

(ii)

the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the relevant proportion of the notional pension from the relevant date until the day on which the qualifying member died;

(iii)

the total amount of any annual increases which the scheme manager has determined under regulation 27 could be paid on the relevant proportion of the notional pension from the day after the day on which the qualifying member died until the day on which the transfer notice was given; and

(iv)

any annual increases to which the beneficiary is entitled in accordance with sub-paragraph (1) immediately before the indexation date.

(3) In the definition of “underlying rate” in sub-paragraph (2), the reference to annual payments is to the amount of annual payment prior to any reduction made by the scheme manager under paragraph 1(2) or (5).]

Textual Amendments

F2 Words in Schs. 3-7 substituted (31.12.2011) by The Financial Assistance Scheme (Revaluation and Indexation Amendments) Regulations 2011 (S.I. 2011/839), regs. 1(2), 15