PART 1SMembership, contributions and benefits

Ill-health retirementS

Calculation of ill-health pension amountsS

37.—(1) Subject to paragraphs (5) and (6), Tier 1 benefits are calculated by adjusting the active member's pension account as follows—

(a)an amount is added to the balance in the account for the year in which the member's employment was terminated, equivalent to the amount of earned pension the member would have accrued between the day following the date of termination and normal pension age, if that member had been treated as receiving assumed pensionable pay, calculated in accordance with regulation 21(4) (assumed pensionable pay) or, as appropriate regulation 21(7) for each year and fraction of a year in that period and treating any election under regulation 10 (temporary reduction in contributions) as lapsed at the date of the termination of the member's employment; and

(b)retirement pension is payable to the member as if the member had reached normal pension age on the date the member's employment was terminated.

(2) Subject to paragraphs (5) and (6), Tier 2 benefits are calculated by adjusting the active member's pension account as follows—

(a)for the year in which the member's employment was terminated, one quarter of the sum calculated in accordance with paragraph (1)(a) is added; and

(b)retirement pension is payable to the member as if the member had reached normal pension age on the date the member's employment was terminated.

(3) Benefits payable under regulation 36 (early payment of retirement pension on ill-health grounds: deferred members) are the retirement pension that would be payable to the member as if that member had reached normal pension age on the date the member made a request under regulation 36.

(4) Where a member entitled to Tier 1 benefits subsequently becomes an active member, no addition is to be made under paragraph (1)(a) or (2)(a) to any Tier 1 or Tier 2 benefits that the member becomes entitled to after that subsequent period of membership.

(5) Where a member entitled to Tier 2 benefits (“the initial ill-health retirement”) subsequently becomes an active member, the addition made under paragraph (1)(a) or (2)(a) to any Tier 1 or Tier 2 benefits that the member becomes entitled to after that subsequent period of membership is modified in accordance with paragraph (6).

(6) The number of years for which a member to whom paragraph (5) applies is treated as having received assumed pensionable pay for the purposes of paragraph (1)(a) or (2)(a) shall not exceed—

(a)the number of years at the date of the initial ill health retirement up to normal pension age; less

(b)a quarter of the number of years calculated in accordance with sub-paragraph (a); less

(c)the number of years during which the member has been an active member after the initial ill-health retirement.

(7) No adjustment is to be made to any sum by virtue of regulation [F121(8)] for any period after the date of termination of employment under regulation 34 (early payment of retirement pension on ill-health grounds: active members).

[F2(8) For the purposes of this regulation, regulations 38, 39 and 40, in calculating assumed pensionable pay in accordance with regulation 21(4) (assumed pensionable pay), no account is to be taken of any reduction in the pensionable pay the member incurred if the member was working reduced contractual hours as a consequence of ill-health or infirmity of mind or body.]

Textual Amendments