The Pension Protection Fund (General and Miscellaneous Amendments) Regulations 2006

Circumstances where the Board is not required to recover overpaid scheme benefits

6.—(1) Where the Board determines that an amount referred to in section 163(4)(a) of the Act has been paid to a member, or to a person in respect of a member, it shall notify that member or person in writing that—

(a) it has so determined;

(b) it has a duty to recover that amount; and

(c) if the person in receipt of that amount believes that recovery of that amount would cause hardship to that member or person with a right to scheme benefits, or his family he should—

(i) notify the Board in writing that he believes that hardship would be so caused (“the hardship notification”) within one month of the date the Board notifies him that such an amount has been paid to him; and

(ii) provide any supporting evidence to the Board that hardship would be so caused within one month of the date of the hardship notification.

(2) Where the Board receives a hardship notification in accordance with paragraph (1)(c)(i), it shall determine, having regard to any evidence provided under paragraph (1)(c)(ii), whether recovery of the overpayment would cause hardship to—

(a) the member or the member’s family; or

(b) in the case of a person who was in receipt of scheme benefits in respect of a member, to that person with a right to scheme benefits, or that person’s family.

(3) Where recovery would cause such hardship, the Board shall not recover that amount.

(4) The Board is not required to recover such an amount where recovery would not be conducive to the prudent management of its financial affairs.