Pensions Act 2004

Scheme rules, admissible rules etcE+W+S

35(1)In this Schedule, in relation to the scheme, the following expressions have the meaning given by this paragraph—E+W+S

  • “admissible rules”;

  • “recent rule changes”;

  • “recent discretionary increase”.

(2)The “admissible rules” means the scheme rules disregarding—

[F1(a)in the case of a scheme to which sub-paragraph (3) applies, any recent rule changes, and]

(b)in any case, any scheme rule which comes into operation on, or operates by reference, to the winding up of the scheme or any associated event.

[F2(3)This sub-paragraph applies to a scheme if, in calculating the protected liabilities in relation to the scheme at the relevant time, the effect of taking into account any recent rule changes is that those liabilities are greater than they otherwise would be.

(3A)This sub-paragraph applies to a scheme if, in calculating the protected liabilities in relation to the scheme at the relevant time, the effect of taking into account any recent discretionary increases is that those liabilities are greater than they otherwise would be.]

(4)In [F3sub-paragraphs (3) and (3A)] “the relevant time” means the time immediately before the assessment period which begins on the assessment date.

(5)Subject to sub-paragraph (6), “recent rule changes” means—

(a)changes to the scheme rules which took effect in the period of three years ending with the assessment date, or were made in that period and took effect by reference to an earlier time, and

(b)any scheme rules which come into operation on, or operate by reference to—

(i)an insolvency event in relation to the employer or any associated event, or

(ii)any prescribed event relating to the future of the employer as a going concern.

(6)“Recent rule changes” does not include—

(a)any scheme rules or changes attributable to paragraph 3 of Schedule 5 to the Social Security Act 1989 (c. 24), section 129 of the Pension Schemes Act 1993 (c. 48), section 117 of the Pensions Act 1995 (c. 26), section 31(4) of the Welfare Reform and Pensions Act 1999 (c. 30) or section 306 of this Act (overriding requirements),

(b)any enactment, or any scheme rules or changes which are required or reasonably necessary to comply with an enactment,

(c)any scheme rules or changes that come into operation on, or operate by reference to, the winding up of the scheme or any associated event, and

(d)any scheme rules or changes of a prescribed description.

(7)“Recent discretionary increase” means an increase in the rate of any pension in payment or postponed pension under the scheme rules which took effect in the period mentioned in sub-paragraph (5)(a).

(8)For the purposes of sub-paragraph (7) an increase (“the relevant increase”) in the rate of a pension in payment or postponed pension is to be disregarded to the extent that it does not exceed—

(a)the amount by which the pension in question is required to be increased by virtue of—

(i)the admissible rules, or

(ii)sections 13(1) and 109 of the Pension Schemes Act 1993 (requirement to index and pay guaranteed minimum pensions), or

(b)if greater, the appropriate percentage of the rate of that pension.

(9)For the purposes of sub-paragraph (8)(a), no increase in the rate of a pension which is made at the discretion of the trustees or managers of the scheme, the employer or any other person is to be regarded as an increase required by virtue of the admissible rules.

(10)For the purposes of sub-paragraph (8)(b), “the appropriate percentage” is the percentage increase in the general level of prices in Great Britain during the period—

(a)beginning when the rate of the pension was last increased or, if there has been no previous increase, the date the pension first became payable (or would have been payable but for its being postponed), and

(b)ending with the time the relevant increase was made.

Textual Amendments

F1Sch. 7 para. 35(2)(a) substituted (1.4.2009) by Pensions Act 2008 (c. 30), s. 149(1), Sch. 8 para. 17; S.I. 2009/809, art. 2(1)(b)(iv)

F2Sch. 7 para. 35(3)(3A) substituted for Sch. 7 para. 35(3) (3.1.2012) by Pensions Act 2011 (c. 19), s. 38(4), Sch. 4 para. 37(4)(a); S.I. 2011/3034, art. 3(i)(v)

F3Words in Sch. 7 para. 35(4) substituted (3.1.2012) by Pensions Act 2011 (c. 19), s. 38(4), Sch. 4 para. 37(4)(b); S.I. 2011/3034, art. 3(i)(v)

Modifications etc. (not altering text)

Commencement Information

I1Sch. 7 para. 35 in force at 6.4.2005 by S.I. 2005/275, art. 2(7), Sch. Pt. 7