1. In this Schedule—N.I.
“Article 75 debt” means so much of the amount treated by Article 75(1) of the 1995 Order (deficiencies in the assets) as a debt due from the employer to the trustees or managers at the applicable time;
“contribution notice” means a notice issued under Article 34 (contribution notices where avoidance of employer debt), 43 (contribution notices where non-compliance with financial support direction) or 51 (contribution notice where failure to comply with restoration order);
“financial support direction” means a direction issued under Article 39 (financial support directions);
“pension credit rights” has the meaning given by Article 121(1)(2) of the 1995 Order (interpretation of Part II);
“pre-6th April 1997 contract of insurance” means a contract of insurance that—
falls within the definition of a relevant contract of insurance in Article 145(8) (effect of Board assuming responsibility for a scheme);
was taken out before 6th April 1997, and
the trustees or managers are, or should reasonably be aware of;
“relevant accounts” for the purposes of identifying and valuing the assets of a scheme, means audited accounts for the scheme which—
contain the information specified in Part 2 of this Schedule;
show [F1a true and fair view] of—
the financial transactions of the scheme during the period to which the accounts relate (“the accounting period”);
the amount and disposition of the assets at the end of the accounting period, and
the liabilities of the scheme, other than the liabilities to pay pensions and benefits, after the end of the accounting period;
include a report by the auditor in writing as to whether or not in his opinion the requirements of paragraphs (a) and (b) are satisfied, and
are prepared in respect of a period ending with the effective date of the valuation;
“restoration order” has the meaning given by Article 48 (restoration orders where transactions at an undervalue).
Textual Amendments
F1Words in Sch. Pt. 1 para. 1 substituted (1.4.2009) by The Pension Protection Fund (Miscellaneous Amendments) Regulations (Northern Ireland) 2009 (S.R. 2009/78), regs. 1, 6
Commencement Information
I1Sch. Pt. 1 para. 1 in operation at 6.4.2007, see reg. 1(1)
2. There shall be excluded from the value of the closed scheme’s assets—N.I.
(a)any amounts treated as a debt due to the trustees or managers which are unlikely to be recouped without disproportionate cost or unlikely to be recovered within a reasonable time, and
(b)an amount in respect of the value of any pre-6th April 1997 contract of insurance if—
(i)the trustees or managers have taken all reasonable steps to obtain information concerning that contract of insurance (whether by searching the records of the scheme or otherwise), and
(ii)the information they provide concerning that contract of insurance is insufficient, in the opinion of the appropriate person, to conduct a valuation.
Commencement Information
I2Sch. Pt. 1 para. 2 in operation at 6.4.2007, see reg. 1(1)
3. Subject to paragraph 6(3) and (4), where the Regulator issues a contribution notice or a financial support direction or makes a restoration order in relation to a scheme prior to the effective date of the valuation, any amount due under such a notice, direction or order shall be regarded as an asset of the scheme.N.I.
Commencement Information
I3Sch. Pt. 1 para. 3 in operation at 6.4.2007, see reg. 1(1)
4. Subject to paragraphs 2 and 6, in determining the value of the assets of a closed scheme for the purposes of an Article 140 valuation, the appropriate person shall adopt the value given of the assets of the scheme stated in the relevant accounts and that value shall be taken to be the value of those assets at the effective date.N.I.
Commencement Information
I4Sch. Pt. 1 para. 4 in operation at 6.4.2007, see reg. 1(1)
5.—(1) Subject to paragraph 6, in the case of protected liabilities the amount of a protected liability shall be the estimated cost of securing scheme benefits calculated in accordance with Schedule 6 to the Order (pension compensation provisions) to the member by means of an annuity purchased at the market rate at the effective date.N.I.
(2) Where paragraph 2(b) applies, the amount representing the value of a protected liability in respect of the benefits secured by a pre-6th April 1997 contract of insurance shall be excluded from the valuation of the scheme’s protected liabilities.
Commencement Information
I5Sch. Pt. 1 para. 5 in operation at 6.4.2007, see reg. 1(1)
6.—(1) For the purposes of an Article 140 valuation, where for the purpose of giving effect to a pension sharing order or provision, arrangements are being made by the closed scheme for the transfer from it of any pension credit rights, until such time as the trustees or managers of the scheme to which the transfer is being made (“the receiving scheme”) have received assets of the full amount agreed by them as consideration for the transfer, it shall be assumed—N.I.
(a)that the rights have not been transferred, and
(b)that any assets transferred in respect of the transfer of those rights are assets of the scheme making the transfer and not of the receiving scheme.
(2) For the purposes of an Article 140 valuation, in the case of a pre-6th April 1997 contract of insurance, the value shall be—
(a)the amount of the liability secured where the contract of insurance falls within the definition of a relevant contract of insurance in Article 145(8), or where this is not the case either—
(b)the surrender value of the contract of insurance, or
(c)where it appears to the appropriate person that the surrender value of the contract of insurance does not accurately reflect the actual value at the effective date, then he shall adopt such a value as appears to him to be appropriate.
(3) In the case of an asset to which paragraph 3 applies, the appropriate person shall adopt as the value of the asset the amount due to the closed scheme given in the notice, direction or order.
(4) For the purposes of an Article 140 valuation—
(a)where the appropriate person, in accordance with guidance issued by the Board under Article 140(3), holds the opinion that any Article 75 debt falling due to the closed scheme will be recouped in the future, then he shall treat the proportion of the Article 75 debt that he believes will be recovered as an asset of the scheme;
(b)where an amount is due under a contribution notice, a financial support direction or a restoration order, and—
(i)a proportion of the amount due has been recouped before the effective date, and
(ii)the appropriate person, in accordance with any guidance issued by the Board in accordance with Article 140(3), holds the opinion that no further payments due under the notice, direction or order will be recouped by the closed scheme,
the appropriate person shall adjust the value of the asset contained in the notice, direction or order to the value recouped by the trustees or managers of the closed scheme before the effective date;
(c)if the appropriate person—
(i)has been given notice, or
(ii)holds the opinion,
that the value of any asset set out in the relevant accounts, that is not excluded from the actuarial valuation, is substantially different at the effective date from that set out in the relevant accounts, then he shall adjust the value of the asset to the market value of the asset at the effective date, or
(d)where the appropriate person—
(i)has been given notice, or
(ii)holds the opinion,
in accordance with any guidance issued by the Board in accordance with Article 140(3), that there exists an asset of the scheme which is not listed in the relevant accounts, and which is not excluded from the actuarial valuation, then he shall adopt such a value for the asset as he considers appropriate.
(5) The appropriate person shall not make an adjustment to the value of an interest in real property unless the adjustment reflects a more recent valuation given by a chartered surveyor in accordance with any relevant practice statements and guidance issued by the Royal Institution of Chartered Surveyors(3) current on the date the valuation is signed.
Commencement Information
I6Sch. Pt. 1 para. 6 in operation at 6.4.2007, see reg. 1(1)
7. An Article 140 valuation shall be verified by the Board if it is satisfied that the valuation was prepared in accordance with these Regulations and any guidance issued by the Board in accordance with Article 140(3).N.I.
Commencement Information
I7Sch. Pt. 1 para. 7 in operation at 6.4.2007, see reg. 1(1)
Article 75 was amended by Article 248 of the Pensions (Northern Ireland) Order 2005 and is modified in its application to multi-employer schemes by S.R. 2005 No. 168 as amended by S.R. 2005 No. 387
The definition of “pension credit rights” was inserted by paragraphs 50(3) of Schedule 9 to the Welfare Reform and Pensions (Northern Ireland) Order 1999 (S.I. 1999/3147 (N.I. 11))
The Royal Institution of Chartered Surveyors can be contacted at RICS Contact Centre, Surveyor Court, Westwood Way, Coventry CV4 8JE