The Occupational Pension Schemes (Preservation of Benefit) Regulations 1991

Computation of benefit-money purchase benefits

14.—(1) This regulation applies to “money purchase benefits”, as defined in section 66 of the Social Security Pensions Act 1975(1) (interpretation).

(2) This paragraph applies where long service benefit is related to bonuses which have been declared at, or before, the time when the member attains normal pension age. In such circumstances short service benefit that is computed on the same basis as long service benefit (in accordance with paragraph 10(1) of Schedule 16) must be correspondingly related to bonuses which have been declared at, or before, the time when the member’s pensionable service terminates.

(3) This paragraph applies where long service benefit is related to the value of securities at, or in a specified period before, the time when the member attains normal pension age. In such circumstances short service benefit that is computed on the same basis as long service benefit (in accordance with paragraph 10(1) of Schedule 16) must be correspondingly related to the value of securities at, or in the same period before, the time when the member’s pensionable service terminates. But, if the trustees or managers of the scheme so decide before, or not more than one month after, the member’s pensionable service terminates, short service benefit may be correspondingly related to the value of securities at, or in the same period before, the time when the benefit becomes payable.

(4) This paragraph applies where the rate at which long service benefit accrues increases after a certain age or length of service (for example, because the employer contributes more to the scheme in respect of older members). In such circumstances short service benefit must be computed on the basis of uniform accrual (in accordance with paragraph 11 of Schedule 16) except that the scheme may provide for short service benefit to be computed on the same basis as long service benefit (in accordance with paragraph 10(1) of Schedule 16) where the Occupational Pensions Board consider it is reasonable to do so.

(1)

1975 c. 60. The definition of “money purchase benefits” was inserted by paragraph 11 of Schedule 2 to the Social Security Act 1986 (c. 50).