The National Health Service (Pension Scheme and Compensation for Premature Retirement) Amendment Regulations 2000

Insertion of new regulation in Part T

14.  In Part T (general rules about benefits), after regulation T7 there shall be inserted the following regulation:–

“Interest on late payment of benefits

T8.— (1) Subject to paragraph (2) below, where the whole or any part of a qualifying payment under these Regulations is not paid by the end of the period of one month beginning with the due date, the Secretary of State shall pay interest, calculated in accordance with paragraph (3) below, on the unpaid amount to the person to whom the qualifying payment should have been made.

(2) Interest under paragraph (1) above shall not be payable where the Secretary of State is satisfied that the qualifying payment was not made on the due date by reason of some act or omission on the part of the member or other recipient of the qualifying payment.

(3) The interest referred to in paragraph (1) above shall be calculated at the base rate on a day to day basis from the due date to the date of payment, and shall be compounded with three-monthly rests.

(4) In this regulation–

“base rate” means the rate for the time being quoted by the reference banks as applicable to sterling deposits or, where there is for the time being more than one such rate, the rate which, when the base rate quoted by each reference bank is ranked in a descending sequence, is the first in the sequence;

“due date” means–

(a)

in the case of a lump sum under Part F above, the day immediately following the day of the member’s death, unless the lump sum falls to be paid to the member’s personal representative, in which case it means–

(i)

the date on which probate or letters of administration are produced to the Secretary of State, or

(ii)

the Secretary of State is satisfied that the lump sum may be paid as provided in regulation F5(4), whichever is the earlier;

(b)

in the case of a pension payable on a member’s death, the day immediately following the day of his death;

(c)

in the case of a pension under regulation L1, the day on which the pension becomes payable in accordance with that regulation;

(d)

in the case of a refund of contributions, the day after that on which the Secretary of State receives from the Commissioners of Inland Revenue the information he requires for the purposes of compliance with paragraphs (3) to (5) of regulation L2; and

(e)

in any other case, the day immediately following that of the member’s retirement from pensionable employment;

“qualifying payment” means any amount payable by way of a pension or lump sum, or by way of a refund of contributions, under these Regulations;

“reference banks” means the four largest institutions for the time being which–

(a)

are authorised by the Financial Services Authority under the Banking Act 1987(1);

(b)

are incorporated in the United Kingdom and carrying on within it a deposit-taking business (as defined in section 6, but subject to any order under section 7 of that Act); and

(c)

quote a base rate applicable to sterling deposits.”.

(1)

1987 c. 22, as amended by the Bank of England Act 1998 (c. 11).