The Parliamentary Pensions (Amendment) (Pension Sharing) Regulations 2001

7.  After Schedule 2 there shall be added:

REGULATION 17

“SCHEDULE 3

Pension sharing on divorce or nullity: transfers out of pension credits

1.   In this Schedule, unless the context otherwise requires—

“ex-spouse” means a person entitled to a pension credit giving rise to a liability upon the Trustees within the meaning of section 29(1)(b) of the Welfare Act 1999;

“implementation period” means the four month period specified in section 34(1) of the Welfare Act 1999 subject to any regulations made by the Secretary of State under section 34(4) or section 41(2)(a) of that Act(1) or any extension granted by the Occupational Pensions Regulatory Authority in accordance with section 33(4) of that Act;

“pension sharing order” means any provision or order specified in section 28 of the Welfare Act 1999 giving rise to a liability upon the Trustees in respect of a pension credit;

“qualifying arrangement” means an arrangement specified in paragraph 6 of Schedule 5 to the Welfare Act 1999 which is not disqualified by virtue of paragraph 7 of that Schedule.

Discharge of liability of pension credit

2.— (1) Following the making of a pension sharing order the Trustees shall, within the implementation period, pay the amount of the ex-spouse’s pension credit, as calculated in accordance with paragraph 3, to the person responsible for a qualifying arrangement with a view to acquiring rights under that arrangement for the ex-spouse if:

(a) the person responsible for that arrangement is able and willing to accept payment of the credit, and

(b) sub-paragraph (2) or (3) applies.

(2) The ex-spouse has consented to the Trustees making such payment to that qualifying arrangement.

(3) Where the ex-spouse has not given consent for the purposes of sub-paragraph (2), the qualifying arrangement is one which the Trustees have determined at their discretion.

(4) For the avoidance of doubt the Trustees must, before making a payment under sub-paragraph (3), attempt to make a payment under sub-paragraph (2).

Amount of pension credit: calculation of cash equivalent

3.   For the purposes of paragraph 2, the amount of pension credit shall be such sum as shall satisfy the requirements prescribed for the time being under section 30 of the Welfare Act 1999(2).

Death of ex-spouse before liability in respect of pension credit is discharged

4.— (1) If the ex-spouse dies before the Trustees have discharged their liability in respect of an ex-spouse’s pension credit, the Trustees shall discharge their liability in accordance with this paragraph.

(2) The ex-spouse may nominate in writing in such form as the Trustees may require one or more persons to receive his pension credit in accordance with the provisions of this paragraph.

(3) If the Trustees receive a nomination in accordance with sub-paragraph (2) they may, if they think fit, pay to the person or persons nominated by the ex-spouse a lump sum the aggregate of which is equal to 25% of the amount of pension credit calculated in accordance with paragraph 3.

(4) If the Trustees do not make any payment to a person or persons nominated by the ex-spouse in accordance with sub-paragraph (3), they shall pay to the deceased ex-spouse’s personal representatives a lump sum which is equal to 25% of the amount of pension credit calculated in accordance with paragraph 3.

(5) With the balance of the pension credit remaining after making a payment under sub-paragraph (3) or (4) the Trustees may, if they think fit, enter into an annuity contract or take out a policy of insurance on behalf of a dependant or dependants of the ex-spouse as defined in sub-paragraph (8), provided that such contract or policy satisfies the requirements of regulation 6(3) of the Pension Sharing (Implementation and Discharge of Liability) Regulations 2000(3).

(6) A pension paid to one or more dependants in consequence of an annuity contract or policy of insurance shall not exceed:

(a) in the case of a single dependant, two thirds of the amount of pension which could have been paid to the ex-spouse had the whole of the pension credit, calculated in accordance with paragraph 3, been used to enter into an annuity contract or to take out a policy of insurance on behalf of the ex-spouse and assuming, if the ex-spouse died before reaching the age of 50, that the ex-spouse had reached the age of 50 immediately before death;

(b) where a pension is paid to two or more dependants, the total amount of such pension which could have been paid to the ex-spouse calculated in accordance with paragraph (a).

(7) The balance of any pension credit held by the Trustees after applying the provisions of this paragraph shall be retained by the Parliamentary Contributory Pension Fund.

(8) In this paragraph “dependants” means any widow or widower of the ex-spouse or any child of the ex-spouse as defined in regulation K3 (5) of the principal scheme.

Charging

5.   The Trustees may recover charges incurred in connection with any of the activities prescribed for the time being under section 41 of the Welfare Act 1999 and in accordance with, and to the extent prescribed (4).”.

(1)

See S.I. 2000/1049, regulation 7.

(2)

See S.I. 2000/1052, regulations 3, 4 and 5.

(3)

S.I. 2000/1053 as amended by S.I. 2000/2691, regulation 11.

(4)

See S.I. 2000/1049.