PART 1Collective money purchase benefits

Triggering events and continuity options

44Pause orders

(1)

This section applies during a triggering event period for a collective money purchase scheme.

(2)

The Pensions Regulator may make a pause order in relation to the scheme if either of the following two conditions is met.

(3)

Condition 1 is that the Pensions Regulator is satisfied that making a pause order will help the trustees to carry out the implementation strategy.

(4)

Condition 2 is that the Pensions Regulator is satisfied that—

(a)

there is, or is likely to be if a pause order is not made, an immediate risk to the interests of members of the scheme or the assets of the scheme, and

(b)

it is necessary to make a pause order to protect the interests of the generality of the members of the scheme.

(5)

A pause order is an order that during the period for which it has effect one or more of the following directions has effect—

(a)

a direction that no new members (or no new members of a specified description) are to be admitted to the scheme;

(b)

a direction that no further payments (or no further payments of a specified description) are to be made towards the scheme—

(i)

by or on behalf of employers or relevant former employers (or employers or relevant former employers of a specified description), or

(ii)

by or in respect of members (or members of a specified description);

(c)

a direction that an amount (or specified amount) which—

(i)

corresponds to a payment that would be due to be made towards the scheme in respect of a member but for a direction under paragraph (b), and

(ii)

has been deducted from a payment of earnings in respect of an employment,

is to be repaid to the member in question by the employer;

(d)

a direction that no benefits (or no benefits of a specified description) are to be paid to or in respect of members (or members of a specified description) under the scheme rules;

(e)

a direction that—

(i)

no transfers (or no transfers of a specified description) of or in respect of a member's rights under the scheme rules are to be made from the scheme,

(ii)

no transfer payments (or no transfer payments of a specified description) in respect of a member's rights under the scheme rules are to be made from the scheme, or

(iii)

no other steps (or no other steps of a specified description) are to be taken to discharge a liability of the scheme to or in respect of a member of the scheme in respect of pensions or other benefits.

(6)

In subsection (5)(b)—

(a)

a reference to payments does not include payments due to be made before the order takes effect, and

(b)

a reference to payments towards a scheme includes payments in respect of pension credits where the person entitled to the credit is a member of the scheme.

(7)

A direction under subsection (5)(e) may provide that—

(a)

no transfers of or in respect of a member's rights under the scheme rules, or no such transfers of a specified description, may be made from the scheme, or

(b)

no transfer payments in respect of such rights, or no such transfer payments of a specified description, may be made from the scheme,

unless the amounts paid out from the scheme in respect of the transfers or transfer payments are determined in a specified manner and the transfers or transfer payments satisfy such other conditions as may be specified.

(8)

A pause order may also require the trustees of the scheme to obtain an actuarial valuation within a specified period.

(9)

A pause order containing such a requirement must specify—

(a)

the date by reference to which the matters to be set out in the valuation must be determined;

(b)

the information and statements that the valuation must contain;

(c)

any other requirements that the valuation must satisfy.

(10)

Schedule 2 makes further provision about pause orders.

(11)

In this section—

earnings” has the meaning given in section 181(1) of the Pension Schemes Act 1993;

pension credit” means a credit under section 29(1)(b) of the Welfare Reform and Pensions Act 1999 or Article 26(1)(b) of the Welfare Reform and Pensions (Northern Ireland) Order 1999 (S.I. 1999/3147 (N.I. 11));

specified” means specified in the pause order.