Part IIRestrictions on Right to Cash Equivalent

Right to further cash equivalent on termination of employment to which the scheme applies4.

(1)

This regulation applies to a case where regulation 3 (or regulation 2A of the 1985 Regulations15) has operated to restrict a member’s cash equivalent and subsequently the member’s employment terminates on a date which is at least one year earlier than the date on which the member would attain the age which is the normal pension age for the scheme or, where the normal pension age is earlier than 60, the age of 60.

(2)

Where this regulation applies, a right to any cash equivalent or any part of a guaranteed cash equivalent to which the member has not acquired a right but would, but for the operation of regulation 3 (or regulation 2A of the 1985 Regulations), have acquired a right by the date when the member’s employment terminates shall accrue to the member on that date.

(3)

Where a right to any part of a guaranteed cash equivalent accrues to a member under paragraph (2), the cash equivalent of the benefits to which that part relates shall be recalculated as at—

(a)

the date on which the member’s employment terminates; or, if later,

(b)

the date on which the member applies to take that part,

and that part shall be increased or reduced by the amount by which it falls short of or exceeds the value of the cash equivalent of those benefits as so recalculated.

(4)

In relation to any case to which this regulation applies, for the definitions of “the relevant date” in section 90(2) (right to cash equivalent) and “the last option date” in section 91(8) (ways of taking right to cash equivalent) there shall be substituted respectively the following definitions—

““the relevant date” means the date when the member’s employment terminates or the date of the relevant application, whichever is the later;” and

  • ““the last option date” means the date which falls—

    1. (a)

      one year before the date on which the member attains normal pension age; or

    2. (b)

      six months after the date when his employment terminates,

    whichever is the later.”.

(5)

In this regulation “employment” means employment to which the scheme applies.