Pensions (Increase) Act 1971

9 Gratuities and lump sums

(1) References in this Act to a pension shall not apply to any payment made by way only of a return of contributions, with or without interest; but, subject to that, this Act shall apply in relation to any allowance, benefit or compensation whether it takes the form of periodical payments or of a gratuity or other lump sum.

(2) In relation to a lump sum—

(a) references to the time when a pension begins shall apply in accordance with section 8(2) above as in the case of a pension taking the form of periodical payments; and

(b) references to increasing a pension in respect of a period beginning at any time shall have effect as references to increasing any sum becoming payable at or after that time on account of the lump sum or any instalment of it; and

(c) references to the rate of a pension shall have effect as references to the amount of the lump sum or an instalment of it, as the case may require.

(3) In respect of any lump sum or instalment of a lump sum which becomes payable between 1st April and 1st September 1971 there may be paid under section 1 above on or after 1st September 1971 the same increase as if it became payable on that date.

(4) In respect of any lump sum or instalment of a lump sum which becomes payable in the half year ending with the day following the last day of a review period, or in any of the preceding half years beginning in the review period other than the first such half year, but for which the beginning date (as determined under section 8(2) above) fell before the half year in question, the order made under section 2 in respect of the review period shall authorise payment of an increase proportionate (to the nearest one-tenth of one per cent.) to any rise which the cost of living in that half year shows over the cost in the half year following the first day of the review period or, if the beginning date fell after the last-mentioned half year, then over the cost in the half year in which the beginning date fell.

The cost of living in any half year is to be taken for purposes of this subsection as the mean of the monthly figures.

(5) For purposes of section 4 above any addition to a lump sum which would have resulted from treating the length of the previous service as being increased by the length of the further service in accordance with section 4(1)(b) shall be supposed not to have become payable until the day following that on which the further service in fact terminated.

(6) Nothing in section 6 above shall apply to any lump sum.

(7) The provisions of this section relating to lump sums shall not apply to the gratuities specified in subsection (8) below, and in relation to those gratuities section 6 above shall have effect as if they had all been included in section 6(1) of the [1962 c. 2 (11 & 12 Eliz. 2).] Pensions (Increase) Act 1962 (and not only those payable in respect of local government service); but section 5(1) above shall not require a local authority to increase any such gratuity.

(8) The gratuities to which subsection (7) above applies are—

(a) any gratuity granted by way of periodical payments under any of the following enactments:—

(i) section 23 of the [1922 c. 59.] Local Government and other Officers' Superannuation Act 1922 ;

(ii) paragraph 4 of Part I of Schedule 1 to the [1931 c. 45.] Local Government (Clerks) Act 1931;

(iii) section 11 of the [1937 c. 68.] Local Government Superannuation Act 1937 or of the [1937 c. 69.] Local Government Superannuation (Scotland) Act 1937 ;

(b) any gratuity granted by way of periodical payments or by way of an annuity under section 18 of the [1953 c. 25.] Local Government Superannuation Act 1953 ;

(c) any gratuity granted by way of periodical payments or by way of an annuity under any local Act (or provisional order confirmed by Parliament) corresponding to any of the enactments mentioned in paragraphs (a) and (b) above.

Any question whether a local Act or provisional order corresponds to any of the enactments mentioned in paragraphs (a) and (b) above shall be determined, in the event of dispute, by the Secretary of State.