The Pensions (2012 Act) (Transitional, Consequential and Supplementary Provisions) Regulations (Northern Ireland) 2014

PART 5 N.I. Winding Up

Application of this Part in relation to multi-employer schemes N.I.

9.  Where, by virtue of regulation 12 of the Occupational Pension Schemes (Winding Up) Regulations (Northern Ireland) 1996 M1 (winding up of sectionalised schemes etc), Article 73 M2 of the 1995 Order (preferential liabilities on winding up) applied or applies to a scheme as if a section or part of the scheme were separate schemes (or would do or have done so, but for these Regulations), this Part also so applies.

Marginal Citations

M1 S.R. 1996 No. 621; regulation 12 was amended by paragraph 6 of the Schedule to S.R. 2005 No. 171 and paragraph 3(2) of Schedule 3 to S.R. 2005 No. 568

M2 Article 73 was substituted with prospective effect by Article 247(1) of the Pensions (Northern Ireland) Order 2005 for Article 73 as originally enacted, but the original form of that Article continues to have effect in relation to schemes which commenced winding up before 6th April 2005. There are no relevant amendments to Article 73 as originally enacted

Schemes treated as money purchase schemes: winding up commencing before 6th April 2005 N.I.

10.—(1) This regulation applies where—

(a) an occupational pension scheme began to wind up before 6th April 2005 (whether or not the scheme has completed winding up before the appointed day), and

(b) if it were not for this regulation, the trustees or managers of the scheme would have been required to wind up the scheme in accordance with Article 73 of the 1995 Order.

(2) Where the conditions specified in paragraph (3) are met in relation to the scheme, Article 73 of the 1995 Order (as it stood on the date that the scheme began to wind up) has effect in relation to the scheme as if after paragraph (1) there were inserted—

“(1A) In paragraph (1) “salary-related occupational pension scheme” does not include a scheme which provides—

(a) cash balance benefits;

(b) money purchase benefits, or

(c) pensions derived from money purchase or cash balance benefits,

and no benefits other than those specified in sub-paragraphs (a) to (c) or death benefits.

(1B) In paragraph (1A) “cash balance benefit” has the meaning given by regulation 2 of the Pensions (2012 Act) (Transitional, Consequential and Supplementary Provisions) Regulations (Northern Ireland) 2014.”.

(3) The conditions specified in this paragraph are that, immediately before the scheme began winding up—

(a) the scheme included cash balance benefits or pensions derived from money purchase or cash balance benefits;

(b) the scheme included no benefits other than those specified in sub-paragraph (a), money purchase benefits or death benefits, and

(c) the trustees or managers of the scheme treated the scheme as a money purchase scheme.

Non-money purchase schemes providing benefits treated as money purchase benefits: winding up commencing before 6th April 2005 N.I.

11.—(1) This regulation applies where an occupational pension scheme not treated by the trustees or managers of the scheme as a money purchase scheme began to wind up before 6th April 2005 (whether or not winding up has been completed by the appointed day).

(2) Where the conditions specified in paragraph (3) are met in relation to the scheme, regulation 13 M3 of the Occupational Pension Schemes (Winding Up) Regulations (Northern Ireland) 1996 (hybrid schemes) has effect in relation to the scheme as if—

(a) in paragraph (1)(b) after “relevant money purchase benefits” there were inserted “ or relevant cash balance benefits ”;

(b) in paragraph (2) for “ “relevant money purchase benefits” means money purchase benefits” there were substituted “ “relevant money purchase benefits” and “relevant cash balance benefits” means (as the case may be) money purchase benefits or cash balance benefits”;

(c) for paragraph (3) there were substituted—

“(3) In this regulation—

(a) “cash balance benefit” has the meaning given by regulation 2 of the Pensions (2012 Act) (Transitional, Consequential and Supplementary Provisions) Regulations (Northern Ireland) 2014, and

(b) “underpin benefits” means money purchase or cash balance benefits (as the case may be) which will only be provided in respect of a member if their value exceeds the value of other benefits in respect of the member under the scheme which are not money purchase or cash balance benefits.”.

(3) The conditions specified in this paragraph are that immediately before the scheme began winding up—

(a) the scheme included cash balance benefits, and

(b) the trustees or managers of the scheme treated those benefits as if they were money purchase benefits.

Marginal Citations

M3 Regulation 13 applies in relation to schemes commencing wind-up before 6th April 2005. Regulation 13 was amended by regulation 4(4) of S.R. 2002 No. 64 and paragraph 3(3) of Schedule 3 to S.R. 2005 No. 568

Schemes treated as money purchase schemes: winding up commencing on or after 6th April 2005 but before the appointed day N.I.

12.—(1) This regulation applies where an occupational pension scheme which was treated as a money purchase scheme began to wind up on or after 6th April 2005 but before the appointed day (whether or not winding up has been completed by the appointed day).

(2) Where the conditions specified in regulation 10(3) are met in relation to the scheme, Article 73 of the 1995 Order has effect in relation to the scheme as if for paragraph (2) there were substituted—

“(2) This Article applies to an occupational pension scheme other than a scheme which is—

(a) a money purchase scheme;

(b) a cash balance scheme;

(c) a scheme which provides money purchase benefits and cash balance benefits and no other benefits except death benefits, or

(d) a prescribed scheme or a scheme of a prescribed description.

(2A) In this Article—

“cash balance benefit” has the meaning given by regulation 2 of the Pensions (2012 Act) (Transitional, Consequential and Supplementary Provisions) Regulations (Northern Ireland) 2014;

“cash balance scheme” means a scheme which provides—

(a)

cash balance benefits or pensions derived from cash balance benefits, and

(b)

no benefits other than—

(i)

those specified in paragraph (a);

(ii)

money purchase benefits or pensions derived from money purchase benefits, or

(iii)

death benefits;

“money purchase scheme” means a scheme which provides or may provide no benefits other than—

(a)

money purchase benefits or pensions derived from money purchase benefits, or

(b)

death benefits.”.

Non-money purchase schemes including benefits treated as money purchase benefits: winding up commencing on or after 6th April 2005 but before the appointed day N.I.

13.—(1) This regulation applies where an occupational pension scheme not treated by the trustees or managers of the scheme as a money purchase scheme began to wind up on or after 6th April 2005 but before the appointed day (whether or not winding up has been completed by the appointed day).

(2) Where the condition specified in paragraph (3) is met immediately before the scheme began winding up, Article 73 of the 1995 Order applies in relation to the winding up of the scheme as if the benefits specified in paragraph (4) of this regulation which the trustees or managers of the scheme treated as money purchase benefits were money purchase benefits.

(3) The condition specified in this paragraph is that the scheme included benefits specified in paragraph (4) which the trustees or managers of the scheme treated as money purchase benefits.

(4) The benefits specified in this paragraph are—

(a) cash balance benefits;

(b) a defined benefit minimum (in relation to money purchase underpin benefits or cash balance underpin benefits);

(c) top-up benefits;

(d) pensions derived from money purchase benefits; and

(e) pensions derived from any of the benefits specified in sub-paragraphs (a) to (c).

Schemes winding up after an assessment period N.I.

14.—(1) This regulation applies where an assessment period in relation to an occupational pension scheme began before the appointed day and either—

(a) that assessment period comes to an end (whether before, on or after the appointed day) and the trustees or managers of the scheme are required to wind up or continue to wind up the scheme in accordance with Article 138(1) of the 2005 Order (requirement to wind up schemes with sufficient assets to meet protected liabilities), or

(b) the Board ceases to be involved with the scheme in accordance with Article 133(1) of the 2005 Order (circumstances in which Board ceases to be involved with an eligible scheme) and the scheme is winding up.

(2) Subject to paragraph (4), where the condition specified in paragraph (3) is met the trustees or managers of the scheme may determine that the benefits specified in regulation 13(4) which the trustees or managers treated as money purchase benefits are to be treated as money purchase benefits for the purposes of winding up the scheme in accordance with Article 73 of the 1995 Order.

(3) The condition specified in this paragraph is that, immediately before the assessment period referred to in paragraph (1) began, the scheme included any of the benefits specified in regulation 13(4), which the trustees or managers of the scheme treated as money purchase benefits.

(4) Where the Board has previously made a determination under regulation 53(1) that benefits specified in regulation 43(3) should, or should not, be discharged as money purchase benefits, the trustees or managers of the scheme must wind up or continue to wind up the scheme in accordance with that determination.

(5) Where the trustees or managers of the scheme—

(a) determine in accordance with paragraph (2) that benefits specified in regulation 13(4) which the trustees or managers of the scheme treated as money purchase benefits should be treated as money purchase benefits for the purposes of winding up the scheme, or

(b) are required to wind up or continue to wind up the scheme in accordance with paragraph (4),

Article 73 of the 1995 Order applies in relation to the benefits treated as money purchase benefits as if those benefits were money purchase benefits.

Closed schemes: further assessment periods N.I.

15.—(1) This regulation applies where—

(a) an assessment period in relation to an occupational pension scheme began before the appointed day;

(b) the scheme is authorised (whether before, on or after that day) to continue as a closed scheme under Article 137(5) of the 2005 Order (closed schemes);

(c) there is a further assessment period in relation to the scheme, and

(d) that further assessment period ends because the conditions specified in Article 138(5) M4 of the 2005 Order are met.

(2) Where the conditions specified in paragraph (3) are met, the trustees or managers of the scheme must wind up or continue the winding up of the scheme as if the benefits specified in regulation 13(4) which the trustees or managers of the scheme treated as money purchase benefits were money purchase benefits.

(3) The conditions specified in this paragraph are that—

(a) the scheme included any of the benefits specified in regulation 13(4), and

(b) the trustees or managers of the scheme have either—

(i) in accordance with regulation 51(2), determined that benefits specified in regulation 51(4) treated as money purchase benefits should continue to be treated as money purchase benefits, or

(ii) in accordance with regulation 51(5)(b), treated benefits specified in regulation 13(4) as money purchase benefits in accordance with a determination or a direction made by the Board.

(4) Where the trustees or managers of the scheme are required to wind up or continue to wind up the scheme in accordance with paragraph (2), Article 73 of the 1995 Order applies in relation to the benefits treated as money purchase benefits as if those benefits were money purchase benefits.

Marginal Citations

M4 Article 138(5) was amended by paragraph 10 of Schedule 4 to the Pensions Act (Northern Ireland) 2012

Discharge of pensions in payment derived from voluntary contributions treated as money purchase benefits: scheme commencing winding up on or after the appointed day N.I.

16.—(1) Subject to paragraph (3), where the conditions specified in paragraph (2) are met in relation to a member's pension or part of a pension in payment, the trustees or managers of an occupational pension scheme may determine that the pension or part of a pension should be discharged as if it were money purchase benefits.

(2) The conditions are that—

(a) the scheme commences winding-up on or after the appointed day;

(b) the pension or part of a pension—

(i) is derived from voluntary contributions;

(ii) is, or is derived from (as the case may be), any of the benefits specified in regulation 13(4) which were before the appointed day treated by the trustees or managers of the scheme as money purchase benefits, and

(iii) comes into payment on or before 1st April 2015, and

(c) the trustees or managers of the scheme are satisfied that it is reasonable in the circumstances to treat the pension or part of a pension as money purchase benefits.

(3) Where an assessment period or further assessment period in relation to an eligible scheme has begun, the power of the trustees or managers of the scheme under paragraph (1) is subject to a direction by the Board under regulation 56(1) that the pension or part of the pension should, or should not, be discharged as money purchase benefits.