The Occupational Pension Schemes (Employer Debt) Regulations 2005

Preliminary U.K.

Citation, commencement, application and extent U.K.

1.—(1) These Regulations may be cited as the Occupational Pension Schemes (Employer Debt) Regulations 2005.

(2) These Regulations come into force on 6th April 2005.

(3) These Regulations do not apply to—

(a) any scheme other than a money purchase scheme if a debt to the trustees or managers of the scheme has been treated as arising under section 75(1) of the 1995 Act before that date;

(b) any scheme which immediately before that date was regarded by virtue of regulation 2 of the Occupational Pension Schemes (Winding Up) Regulations 1996 M1 as having begun to be wound up before that date for the purposes of those Regulations; or

(c) any scheme which according to the rules in section 124(3A) to (3E) of the 1995 Act M2 began to wind up before that date.

(4) These Regulations extend to England and Wales and Scotland.

Marginal Citations

M1 S.I. 1996/3126.

M2 Subsections (3) to (3E) were inserted in section 124 by section 49(2) of the Child Support, Pensions and Social Security Act 2000 (c. 19).

Interpretation U.K.

2.—(1) In these Regulations––

“the 1993 Act” means the Pension Schemes Act 1993M3 ;

“the 1995 Act” means the Pensions Act 1995;

“the 2004 Act” means the Pensions Act 2004;

“the 1996 Regulations” means the Occupational Pension Schemes (Deficiency on Winding Up etc.) Regulations 1996M4 ;

“the actuary” means the actuary appointed for the scheme in pursuance of subsection (1)(b) of section 47 of the 1995 Act or, in the case of a scheme to which that provision does not apply by virtue of regulations made under subsection (5) of that section, an actuary otherwise authorised by the trustees or managers to provide such valuations or certifications as may be required under these Regulations;

“the applicable time” means the time as at which the value of the assets of a scheme and the amount of its liabilities are to be determined, calculated and verified for the purposes of section 75 of the 1995 Act;

“employer” has the same meaning as in section 75 of the 1995 Act (but see paragraph (2) and regulations 9 and 13);

“employment-cessation event” has the meaning given in regulation 6(4);

“the MFR Regulations” means the Occupational Pension Schemes (Minimum Funding Requirement and Actuarial Valuations) Regulations 1996M5 ;

“money purchase scheme” means an occupational pension scheme under which all the benefits that may be provided other than death benefits are money purchase benefits;

“multi-employer scheme” means a scheme in relation to which there is more than one employer (including, except in regulation 8, any section of a scheme treated under that regulation as a scheme if there is more than one employer in relation to that section);

“the tax condition”, in relation to a scheme, means–

(a)

that the scheme has been approved by the Commissioners of the Board of Inland Revenue for the purposes of section 590 or 591 of the Taxes Act at any time before 6th April 2006; or

(b)

that the scheme is registered under section 153 of the Finance Act 2004M6 ;

“the Taxes Act” means the Income and Corporation Taxes Act 1988M7 .

[F1 “withdrawal arrangement” and “approved withdrawal arrangement” are to be read in accordance with paragraph 1(1) of Schedule 1A to these Regulations.]

(2) In these Regulations “scheme” must be read in appropriate cases in accordance with the modifications of section 75 of the 1995 Act made by regulation 8, 14 or 15, as the case may be; and “employer” and “member” must be read accordingly.

(3) References in these Regulations to the guidance in GN19 are to the guidelines on winding up and scheme asset deficiency (GN19), prepared and published by the Institute of Actuaries and the Faculty of Actuaries M8 and approved for the purposes of these Regulations by the Secretary of State, with such revisions as have been so approved at the applicable time.

(4) References in these Regulations to the guidance in GN 27 are to the guidelines on minimum funding requirement (GN 27), prepared and published by the Institute of Actuaries and the Faculty of Actuaries and approved for the purposes of the MFR Regulations by the Secretary of State, with such revisions as have been so approved at the applicable time.

(5) Subject to the previous provisions of this regulation, expressions used in these Regulations have the same meaning as in Part 1 of the 1995 Act (see section 124).

Textual Amendments

F1 Words in reg. 2(1) added (2.9.2005) by The Occupational Pension Schemes (Employer Debt etc.) (Amendment) Regulations 2005 (S.I. 2005/2224), regs. 1(2), 2(1)

Marginal Citations

M3 1993 c. 48.

M4 S.I. 1996/3128.

M5 S.I. 1996/1536.

M6 2004 c. 12.

M7 1988 c. 1.

M8 The publications GN19 and GN27 may be obtained from the Institute of Actuaries, Staple Inn Hall, High Holborn, London WC1V 7QJ and from the Faculty of Actuaries, Maclaurin House, 18 Dublin Street, Edinburgh EH1 3PP.

Disapplication of the 1996 Regulations U.K.

3.  The 1996 Regulations do not apply in any case where these Regulations apply (and accordingly they only apply to a scheme as respects which regulation 1(3)(a), (b) or (c) applies).

Schemes to which section 75 of the 1995 Act does not apply U.K.

4.—(1) Section 75 of the 1995 Act does not apply to any scheme which is—

(a) a public service pension scheme under the provisions of which there is no requirement for assets related to the intended rate or amount of benefit under the scheme to be set aside in advance (disregarding requirements relating to additional voluntary contributions);

(b) a scheme which is made under section 7 of the Superannuation Act 1972 M9 (superannuation of persons employed in local government etc.) and provides pensions to local government employees;

(c) a scheme which is made under section 2 of the Parliamentary and Other Pensions Act 1987 M10 (power to provide for pensions for Members of the House of Commons etc.);

(d) a scheme in respect of which a relevant public authority, as defined in section 307(4) of the 2004 Act, has given a guarantee or made any other arrangements for the purposes of securing that the assets of the scheme are sufficient to meet its liabilities;

(e) a scheme which does not meet the tax condition;

(f) a scheme which—

(i) has been categorised by the Commissioners of the Board of Inland Revenue for the purposes of its approval as a centralised scheme for non-associated employers;

(ii) which is not contracted-out; and

(iii) under the provisions of which the only benefits that may be provided on or after retirement (other than money purchase benefits derived from the payment of voluntary contributions by any person) are lump sum benefits which are not calculated by reference to a member's salary;

(g) a scheme with such a superannuation fund as is mentioned in section 615(6) of the Taxes Act (fund established to provide superannuation benefits in respect of persons' employment in a trade or undertaking wholly outside the United Kingdom);

(h) a scheme with fewer than two members;

(i) a scheme with fewer than twelve members where all the members are trustees of the scheme and either—

(i) the rules of the scheme provide that all decisions are made only by the trustees who are members of the scheme by unanimous agreement; or

(ii) the scheme has a trustee who is independent in relation to the scheme for the purposes of section 23 of the 1995 Act M11 (power to appoint independent trustees) (see subsection (3) of that section) and is registered in the register maintained by the Authority in accordance with regulations made under subsection (4) of that section;

(j) a scheme with fewer than twelve members where all the members are directors of a company which is the sole trustee of the scheme and either—

(i) the rules of the scheme provide that all decisions are made only by the members of the scheme by unanimous agreement, or

(ii) one of the directors of the company is independent in relation to the scheme for the purposes of section 23 of the 1995 Act and is registered in the register maintained by the Authority in accordance with regulations made under subsection (4) of that section;

(k) the Chatsworth Settlement Estate Pension Scheme; or

F2 (l) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) Before 6th April 2006 paragraph (1)(e) applies with the addition at the end of the words “and is not a relevant statutory scheme providing relevant benefits”; and for the purposes of that paragraph “relevant statutory scheme” and “relevant benefits” have the same meaning as in Chapter 1 of Part 14 of the Taxes Act (see sections 611A and 612(1) of that Act).

Textual Amendments

F2 Reg. 4(1)(l) omitted (2.9.2005) by virtue of The Occupational Pension Schemes (Employer Debt etc.) (Amendment) Regulations 2005 (S.I. 2005/2224), regs. 1(2), 4(1)

Marginal Citations

M9 1972 c. 11.

M10 1987 c. 45.

M11 Section 23 is substituted by section 36(3) of the Pensions Act 2004.