The Transport Act 2000 (Civil Aviation Authority Pension Scheme) Order 2001

SCHEDULE 1 TO APPENDIX 2 S Category Members

Applicability of Schedule

S1.  The Rules set out in this Schedule 1 apply in respect of S Category Members and override other Rules of the CAA Section as stated herein except those rules set out in Schedule 2 to the CAA Rules. Any provisions of the CAA Section which are not stated herein to be overridden shall apply to S Category Members.

Interpretation of Schedule

S2.  In this Schedule the expression defined in Appendix 1 shall have the meanings therein ascribed to them except for any such expressions which are defined in this Rule, the expressions Current Member and Member shall be taken to refer respectively to Current Members and Members who are S Category Members at the relevant time and the following expressions shall have the following meanings:

Final Pensionable Salary means in respect of each Member at any date his highest Fund Salary for any period of twelve consecutive calendar months as a Current Member within the three years ending on the day before that date disregarding in respect of a Class A Member any part of the amount so calculated which exceeds the Permitted Maximum at that date.

Fund Salary means in respect of each Member at any date his basic annual salary from the Employers at that date with the addition of any pay supplements from the Employers for the time being in payment excluding bonuses, commissions and other fluctuating emoluments.

Normal Pension Date means in respect of each Member the 1st day of the month which is coincident with or if not coincident with which next follows the attainment of age 65 and not as defined in Appendix 1.

Pensions Increase Act means the Pensions (Increase) Act 1971(1) and Orders made under section 59 and 59A of the 1975 Act(2) in relation to official pensions as though the pensions under the CAA Section were official pensions as defined in the Pensions (Increase) Act 1971 and the Sponsoring Section Employer and the Trustees were the pension authority as defined in the Pensions (Increase) Act 1971 so that on each occasion on which the Minister for the Civil Service shall make an order under section 59 of the 1975 Act (with or without giving directions under section 59A of the 1975 Act) containing provisions for increasing the annual rate of an official pension then the corresponding pensions payable under the CAA Section shall be increased in accordance with such order and any direction made.

Spouse means Spouse as defined in Appendix 1 except that:

(1)

the words “the widow or widower (if any) of his or her last or only marriage” are replaced by the words “the widow or widower (if any) of his or her last or only marriage which took place prior to his or her ceasing to be a Current Member or prior to the date (if any) of his or her making a repayment to the Trustees as described in the penultimate paragraph of Rule S14”, and

(2)

proviso (2) to the definition of “Spouse” in Appendix 1 shall not apply.

Option to cease S category membership

S3—(a) An S Category Member who is a Current Member may, by written notice to the Trustees in a form specified by the Trustees, opt to cease to be an S Category member whilst remaining a Current Member. Such notice must be given before the Member attains the age of 59.75 years and shall specify the effective date of such cessation which must not be later than the date of attainment by the Member of age 59.75 years. With effect from the specified date the Member shall become a Reclassified Member for the purposes of the CAA Section on and after that date and this Schedule shall cease to apply to such Member in respect of any of his Pensionable Service.

(b) An S Category Member who elected an option similar to the option described in paragraph (a) of this Rule in accordance with the Previous Scheme Provisions shall be deemed to have elected the option described in this Rule and have become a Reclassified Member with effect from the date specified in his notice to the Trustees.

Member’s contributions

S4—(a) On or after 1 April 1997 the contributions payable by each Current Member under Rule 23.1 and the equivalent provisions of the Previous Scheme Provisions shall be at the rate of 4.5% of Fund Salary or 2.5% in the case of Members who were contributing at the rate of 4% immediately prior to 1st April 1997 and not as stated in Rule 23.1, disregarding in respect of Class A Members any part of such Fund Salary which exceeds the Permitted Maximum; provided that prior to 1 April 1997 the corresponding rates were 6% and 4% respectively.

(b) A Member shall cease to pay contributions under Rule 23.1 on ceasing to be a Current Member or, if earlier, at Normal Pension Date and not as stated in Rule 23.5.

(c) With effect from 1 April 1995 Rule 23.8 shall apply to all S Category Members who are Current Members on that date except that compound interest shall not be charged on arrears of contributions as described in Rule 23.8(b) and:

(i) the phrase “7.5%” shall be replaced with “6%”.

(ii) the phrase “6%” shall be replaced with “4%”,

(iii) the phrase “1.5%” shall be replaced with “2%”, and

with effect from 1 April 1997 the reduced rate of 4% applicable (as described above) under paragraph (a) of Rule 23.8 to an S Category Member shall be 2.5% and the rate of 6% applicable (as described above) under paragraph (b) or Rule 23.8 shall be 4.5%.

Amount of members' pensions at normal pension date

S5—(a) The amount of pension payable under Rule 24.1 to a Member who ceases to be a Current Member at Normal Pension Date shall be 1/59th of Final Pensionable Salary for each complete year of Pensionable Service with a proportionate amount for each complete month where such Pensionable Service is not an integral number of years subject to a maximum of two-thirds of Final Pensionable Salary.

(b) Rule 24.2 is modified so that the reference to Final Pensionable Earnings is read as “Final Pensionable Salary”.

(c) Rule 24.2 is further modified so that the increases described in the second paragraph thereof shall be equal to the increases at the same annual rate as is provided by the Pensions Increase Act in respect of official pensions (as defined in that Act) of the same amount as the pensions under Rule 24.2.

Amount of death benefits

S6—(a) Rule 25.1 is modified so that the lump sum death benefit in respect of S Category members who are Current Members shall be whichever of the following is applicable:-

(i) in the case of a married Member who is not a Lower Rate Contributor and who joined the A D Scheme on or before 26 February 1970, the amount by which five times his Fund Salary at the date of death exceeds the capital cost (determined by the Trustees with the advice of the Actuary) of providing the pension described in sub-paragraph (a)(ii) or (a)(iii) in paragraph 2.3 in Section B of Appendix 5 (Contracting-out); or

(ii) in the case of a married Member who is not a Lower Rate Contributor and who joined the A D Scheme after 26 February 1970, the amount by which four times his Fund Salary at the date of death is greater than the amount by which the capital cost (determined by the Trustees with the advice of the Actuary,) of providing the pension described in sub-paragraph (a)(ii) or (a)(iii) in paragraph 2.3 in Section B of Appendix 5 (Contracting-out) exceeds his Fund Salary at the date of death; or

(iii) in the case of a married Member who is a Lower Rate Contributor the amount by which three time his Fund Salary, at the date of death exceeds the capital cost (determined by the Trustees with the advice of the Actuary) of providing the pension described in subparagraph (a)(ii) or (a)(iii) in paragraph 2.3 in Section B of Appendix 5 (Contracting-out); or

(iv) in the case of all unmarried Members an amount equal to three times Fund Salary at the date of death;

disregarding for the above purpose in respect of a Class A Member any part of his Fund Salary, which exceeds the Permitted Maximum at the date of the Member’s death.

(b) Proviso (ii) to Rule 25.2 shall not apply and the following shall be substituted for that proviso in respect of S Category Members:-

(ii) if the Member’s Spouse was born more than ten years after him the pension payable to such Spouse under Rule 28 shall be reduced by not more than 2.5% for each complete year of age disparity in excess of ten.

(c) Rule 25.3 shall not apply.

(d) Rule 25.4 is modified so that only sub-paragraph (c) thereof applies.

Death before payment of retirement benefit

S7—(a) For S Category Members Rule 26.2 is replaced by the following provisions of this paragraph.

• If a Member dies before Normal Pension Date and before any pension has become payable to him from the CAA Section, the Trustees shall, subject as hereinafter provided, pay in accordance with Rule 37 an amount equal to the total of the contributions paid by him to the CAA Section under Rule 23.1 (and under the Previous Scheme Provisions) and his Transferred Contributions (if any);

provided that where there has been an increase to the benefit in respect of a Member as described in the second paragraph in Rule S7(b) the amount described above in this Rule shall be reduced by the capital cost (determined by the Trustees with the advice of the Actuary) of the relevant increase.

(b) Rule 26.4 is modified to provide that the benefit payable under that Rule to a Member’s Spouse shall be equal to the Spouse’s Guaranteed Minimum Pension in respect of him at the date of his death or if greater, but in respect only of a married Current Member who joined the A D Scheme after 26 February 1970 and who is not a Lower Rate Contributor, a Spouse’s pension determined by the Trustees with the advice of the Actuary to be the pension equivalent of a sum equal to the Member’s Fund Salary at the date of his death, disregarding in the case of a Class A Member any part of such Fund Salary which exceeds the Permitted Maximum at that date.

Where the benefit payable under Rule 26.4 in respect of an S Category Member, modified as described above in this Rule S7(b), would be less than the amount (if any) payable in respect of the Member under paragraph 1.3 in Section A of Appendix 5 (contracting-out) on the assumption that the benefits of all such Members are equal to those which would be provided by a reference scheme as described in section 12B of the Pension Schemes Act 1993(3) that benefit shall be increased so as to be equal to such amount.

(c) Rules 26.5, 26.6, 26.7, 26.8 and 26.9 shall not apply.

Commencement of member’s pension

S8—(a) For S Category Members sub-paragraph (a) in Rule 27.1 is replaced by the following provisions of this paragraph.

• A Current Member of the CAA Section who attains Normal Pension Date shall be entitled to receive a pension from the Scheme at Normal Pension Date calculated in accordance with Rule 24.1.

(b) Rule 27.2 shall not apply except for sub-paragraph (a) thereof.

(c) For S Category Members Rule 27.2(a) is amended so that the reduction to a Member’s pension under that Rule which commences before Normal Pension Date shall not apply to a pension which commences after 17 May 1990 on or after attainment by the Member of age 60 and shall, at the discretion of the Employer and with the consent of the Member, instead of being calculated as described in the second paragraph of Rule 27.2(a) be at the rate of 0.25 per cent for each complete month by which the date of commencement of the pension precedes the Member’s 60th birthday.

(d) Rule 27.3 shall not apply.

Death after commencement of pension

S9—(a) Rules 28.1 and 28.2 shall not apply.

(b) For S Category Members Rule 28.3 is replaced by the following provisions of this paragraph.

If a Member dies after a pension has become payable to him under these Rules and is survived by a Spouse, the pension described in Rule 25.2 shall become payable to the Spouse from the date of death. Such pension shall

(i) for the balance (if any) of the period of five years beginning at the commencement of payment of the Member’s pension from the CAA Section be equal to one-twelfth of the Member’s Relevant Pension for each month in the said period, and

(ii) thereafter or from the date of the Member’s death if it occurred more than five years from the commencement of payment of his pension, be equal to 60 per cent of the Member’s Relevant Pension;

provided always that notwithstanding the provisions of the proviso to Rule 25.4 the Member’s Relevant Pension for the purpose of sub-paragraph (i) above shall not include any amount surrendered or commuted under Rule 29.2 or Rule 29.3.

Where the benefit payable under Rule 28.3 in respect of an S Category Member, modified as described above in this Rule S9(b), would be less than the amount (if any) payable in respect of the Member under paragraph 1.3 in Section A of Appendix 5 (Contracting-out) on the assumption that the benefits of all such Members are equal to those which would be provided by a reference scheme as described in section 12B of the Pension Schemes Act 1993 that benefit shall be increased so as to be equal to such amount.

(c) Rule 28.4 shall not apply.

For S Category Members Rule 28.5 is replaced by the following provisions of this paragraph.

If a Member dies after a pension has become payable to him under these Rules and is survived by one or more Qualifying Children (but not by a Spouse), a pension equal to the pension which would have become payable from the CAA Section to the Member’s Spouse shall become payable from the date of the Member’s death and shall be paid or applied by the Trustees to or for the benefit of such one or more of the Qualifying Children in such manner and in such shares as the Trustees shall decide.

(e) Rules 28.7 and 28.8 shall not apply.

Cash sum in lieu of pension

S10—(a) In respect of S Category Members Rule 29.2 is modified so that no more than one-quarter of the Member’s pension from the CAA Section may be surrendered for a cash sum in accordance with that Rule.

(b) the amount of cash sum provided in respect of an S Category Member in accordance with Rule 29.2 shall be at the rate of £10.40 for each £1 per annum pension surrendered and not as described in Rule 29.4.

Application of death benefits

S11.  For S Category Members any benefit which is expressed to be payable in accordance with Rule 37 shall not be payable on the basis described in that Rule but shall be payable as described below in this Rule.

A Member may nominate a beneficiary to receive such benefit and may revoke such nomination and may make subsequent nominations in accordance with the detailed provisions set out in Regulation 9 in the Regulations attached to the Deed of Consolidation. In the absence of such nomination such benefit shall become payable in accordance with Rule 37.

Payment of Spouse’s Pension and Variable Pension Option

S12—(a) In respect of S Category Members Rule 38.3 is modified so that a pension payable from the Scheme to a Member’s Spouse (other than a pension provided by surrender of pension under Rule 30) shall cease with the last instalment falling due before the date of death of the Spouse except that if there is a Qualifying Child of the Member living at such date such pension shall continue to be paid to the Qualifying Child until the date described in Rule 38.4 as modified by paragraph (b) of this Rule.

(b) In respect of S Category Members Rule 38.4 is modified so that the words “age 25” are replaced by “age 21”.

(c) Paragraph (b) of Rule 38.5 shall not apply.

Increases in pensions in payment

S13—(a) Rule 39 is modified so that pensions in course of payment from the CAA Section to or in respect of S Category Members which are to be increased in accordance with that Rule shall be increased at the same rate as is provided in the Pensions Increase Act and not at the rate stated in Rule 39.

(b) In respect of S Category Members Rule 39 shall not apply in respect of that proportion of a Member’s pension from the CAA Section which results from the payment of additional voluntary contributions to the AD Scheme and that proportion of such pensions shall not be increased hereunder.

Repayments to members

S14.  For S Category Members Rule 48 is replaced by this Rule S14.

If a Current Member is unmarried at the date on which his pension from the CAA Section commences to be paid there shall be payable to such Member, subject to any deduction in accordance with Rule 43 and subject as provided below to this Rule, the cash sum described in the next following paragraph.

The said cash sum in respect of such a Member shall be an amount equal to the aggregate of:

(i) that proportion of such Member’s contributions to the CAA Section (and under the Previous Scheme Provisions) which the Trustees with the advice of the Actuary consider to have been contributions to secure a Spouse’s pension, and

(ii) an amount equal to one-third of the contributions (if any) paid by the Member to the A D Scheme while such Member was unmarried and had no child who might have qualified for benefit under the A D Scheme if the Member had died as a pensioner thereunder, such contributions being contributions paid at the full rate applicable under that scheme to married contributors.

Alternatively and in lieu of such amount, if the Member so requests and the Trustees agree, there may be payable an additional amount of pension determined by the trustees on the advice of the Actuary as the equivalent of the said amount, subject always to the provisions of Appendix 4 (Inland Revenue Limits).

Except where the Trustees agree otherwise, if a Member who has received a refund or an additional amount of pension as described above subsequently marries such Member shall inform the Trustees and shall repay to the Trustees the amount so received (or in the case of an additional pension, the total of the instalments thereof so received) together with compound interest thereon as determined by the Trustees with the advice of the Actuary.

In consideration of such repayment the CAA Section shall accept a liability to provide such pension for the Member’s Spouse as shall be notified by the Trustees to the Member.

(1)

1971 c. 56.

(2)

1975 c. 60; section 59 was amended by the Social Security Act 1979 (c. 18), sections 11(1) to (3) and 21(4) and Schedule 3, paragraph 20, the Social Security Act 1985 (c. 53), section 29(1) and(2), Schedule 5, paragraph 33 and Schedule 6, the Social Security Act 1986 (c. 50), section 9(8), the Pensions (Miscellaneous Provisions) Act 1990 (c. 7), sections 1(7) and (5ZA) and 5, the Social Security (Consequential Provisions) Act 1990 (c. 18), section 4 and Schedule 2, paragraph 34 and the Pension Schemes Act 1993 (c. 48), section 190 and Schedule 8, paragraph 9(1)(a) and(b); section 59A was amended by the Pensions Schemes Act 1993 (c. 48), section 190 and Schedule 8, paragraph 9(2).

(3)

1993 c. 48; section 12B was amended by S.I. 1997/819, regulation 2.