The Occupational Pension Schemes (Employer Debt) Regulations 2005

Money purchase schemes: fraud and levy deficiencies etc. U.K.

10.—(1) Notwithstanding subsection (1)(a) of section 75 of the 1995 Act, that section applies to money purchase schemes as if—

(a) subsection (2)—

(i) provided that if the levy deficit condition is met the levy deficit is to be treated as a debt due from the employer to the trustees or managers of the scheme; and

(ii) was not subject to subsection (3) of that section;

(b) subsection (4) provided that where the criminal reduction conditions are met the criminal deficit is to be treated as a debt due from the employer to the trustees or managers of the scheme; and

(c) subsections (4A) to (4C) and (6) were omitted.

(2) The levy deficit condition is that an amount payable by way of general levy [F1 or fraud compensation levy] in respect of any money purchase scheme exceeds the value of the unallocated assets of the scheme either—

(a) at the time when the amount first becomes payable to the Secretary of State; or

(b) at a later time designated by the trustees or managers of the scheme for the purposes of this paragraph.

(3) The criminal reduction conditions are that—

(a) a reduction in the aggregate value of the allocated assets of the scheme occurs;

(b) the reduction is attributable to an act or omission which—

(i) constitutes an offence prescribed for the purposes of [F2 section 182(1)(b) of the 2004 Act]; or

(ii) in the case of an act or omission which occurred outside England and Wales or Scotland, would constitute such an offence if it occurred in England and Wales or in Scotland; and

(c) immediately after the act or omission or, if that time cannot be determined, at the earliest time when the auditor of the scheme knows that the reduction has occurred, the amount of that reduction exceeds the value of the unallocated assets of the scheme.

(4) [F3 In this regulation]—

“allocated assets”, in relation to a scheme, means assets which have been specifically allocated for the provision of benefits to or in respect of members (whether generally or individually) or for the payment of the scheme's expenses (and “unallocated” is to be read accordingly);

“the criminal deficit” means the amount of the excess mentioned in paragraph (3)(c);

[F4 “the fraud compensation levy” means the levy imposed in accordance with section 189 of the 2004 Act;]

“the general levy” means the levy imposed under section 175 of the 1993 Act by regulation 3(1) or (2) of the Occupational and Personal Pension Schemes (General Levy) Regulations 2005M1 .

“the levy deficit” means the amount of the excess mentioned in paragraph (2);

[F5 “money purchase schemes” does not include a scheme or a section of a scheme that is a collective money purchase scheme for the purposes of Part 1 of the Pension Schemes Act 2021;]

Textual Amendments

F1 Words in reg. 10(2) inserted (1.4.2006) by The Occupational Pension Schemes (Fraud Compensation Levy) Regulations 2006 (S.I. 2006/558), regs. 1, 12(a)

F2 Words in reg. 10(3)(b)(i) substituted (6.4.2014) by The Occupational Pension Schemes (Miscellaneous Amendments) Regulations 2014 (S.I. 2014/540), regs. 1, 5

F3 Words in reg. 10(4) substituted (1.4.2006) by The Occupational Pension Schemes (Fraud Compensation Levy) Regulations 2006 (S.I. 2006/558), regs. 1, 12(b)(i)

F4 Words in reg. 10(4) inserted (1.4.2006) by The Occupational Pension Schemes (Fraud Compensation Levy) Regulations 2006 (S.I. 2006/558), regs. 1, 12(b)(ii)

F5 Words in reg. 10 inserted (1.8.2022) by The Occupational Pension Schemes (Collective Money Purchase Schemes) (Modifications and Consequential and Miscellaneous Amendments) Regulations 2022 (S.I. 2022/337), regs. 1(3), 7

Marginal Citations

M1 S.I. 2005/626.