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59.—(1) Regulation 185 (General option to exchange part of pension for lump sum) is amended as provided by paragraphs (2) to (4).
(2) In paragraph (1) for “other than a pension credit member”, substitute “(other than a pension credit member whose rights under the Scheme are attributable to a disqualifying pension credit for the purpose of paragraph 2 of Schedule 29 to the Finance Act 2004 )”.
(3) In paragraph (7) at the end, add (as full-out words) “This is subject to paragraphs (8) and (9).”.
(4) After paragraph (7), add—
“(8) If the pension is an ill-health pension under regulation 182, the option under this regulation may only be exercised by giving notice in writing to the Department in such form as it requires—
(a)where the member is awarded—
(i)a tier 1 ill-health pension under paragraph (2) of that regulation, at the time of claiming that tier 1 ill-health pension,
(ii)a tier 2 ill-health pension under paragraph (3) of that regulation, at the time of claiming that tier 2 ill-health pension; or
(b)before such later time as the Department specifies in writing.
(9) If the pension is a tier 2 ill-health pension under regulation 183, in substitution for a tier 1 ill-health pension under regulation 182, the option under this regulation may only be exercised—
(a)in relation to the difference between the tier 1 ill-health pension that ceases to be payable in accordance with paragraph (3) of regulation 183 and the tier 2 ill-health pension to which the member becomes entitled under that paragraph; and
(b)by giving notice in writing to the Department in such form as it requires—
(i)at the time of award of the tier 2 ill-health pension under that paragraph, or
(ii)before such later time as the Department specifies in writing.”.
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