PART 1Collective money purchase benefits
Triggering events and continuity options
I1I244Pause orders
1
This section applies during a triggering event period for a collective money purchase scheme.
2
The Pensions Regulator may make a pause order in relation to the scheme if either of the following two conditions is met.
3
Condition 1 is that the Pensions Regulator is satisfied that making a pause order will help the trustees to carry out the implementation strategy.
4
Condition 2 is that the Pensions Regulator is satisfied that—
a
there is, or is likely to be if a pause order is not made, an immediate risk to the interests of members of the scheme or the assets of the scheme, and
b
it is necessary to make a pause order to protect the interests of the generality of the members of the scheme.
5
A pause order is an order that during the period for which it has effect one or more of the following directions has effect—
a
a direction that no new members (or no new members of a specified description) are to be admitted to the scheme;
b
a direction that no further payments (or no further payments of a specified description) are to be made towards the scheme—
i
by or on behalf of employers or relevant former employers (or employers or relevant former employers of a specified description), or
ii
by or in respect of members (or members of a specified description);
c
a direction that an amount (or specified amount) which—
i
corresponds to a payment that would be due to be made towards the scheme in respect of a member but for a direction under paragraph (b), and
ii
has been deducted from a payment of earnings in respect of an employment,
is to be repaid to the member in question by the employer;
d
a direction that no benefits (or no benefits of a specified description) are to be paid to or in respect of members (or members of a specified description) under the scheme rules;
e
a direction that—
i
no transfers (or no transfers of a specified description) of or in respect of a member's rights under the scheme rules are to be made from the scheme,
ii
no transfer payments (or no transfer payments of a specified description) in respect of a member's rights under the scheme rules are to be made from the scheme, or
iii
no other steps (or no other steps of a specified description) are to be taken to discharge a liability of the scheme to or in respect of a member of the scheme in respect of pensions or other benefits.
6
In subsection (5)(b)—
a
a reference to payments does not include payments due to be made before the order takes effect, and
b
a reference to payments towards a scheme includes payments in respect of pension credits where the person entitled to the credit is a member of the scheme.
7
A direction under subsection (5)(e) may provide that—
a
no transfers of or in respect of a member's rights under the scheme rules, or no such transfers of a specified description, may be made from the scheme, or
b
no transfer payments in respect of such rights, or no such transfer payments of a specified description, may be made from the scheme,
unless the amounts paid out from the scheme in respect of the transfers or transfer payments are determined in a specified manner and the transfers or transfer payments satisfy such other conditions as may be specified.
8
A pause order may also require the trustees of the scheme to obtain an actuarial valuation within a specified period.
9
A pause order containing such a requirement must specify—
a
the date by reference to which the matters to be set out in the valuation must be determined;
b
the information and statements that the valuation must contain;
c
any other requirements that the valuation must satisfy.
10
Schedule 2 makes further provision about pause orders.
11
In this section—
“earnings” has the meaning given in section 181(1) of the Pension Schemes Act 1993;
“pension credit” means a credit under section 29(1)(b) of the Welfare Reform and Pensions Act 1999 or Article 26(1)(b) of the Welfare Reform and Pensions (Northern Ireland) Order 1999 (S.I. 1999/3147 (N.I. 11));
“specified” means specified in the pause order.