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

Section B: Guaranteed Minimum Pensions

2.5  If a Member ceases to be in a contracted-out employment by reference to the relevant in circumstances in which he remains prospectively entitled to a Guaranteed Minimum Pension from the relevant Section from State Pensionable Age, such pension will be calculated on the basis that the Guaranteed Minimum Pension which has accrued under the relevant Section up to the date of such cessation will be increased in respect of the period from the date of such cessation up to State Pensionable Age or the previous death of the Member in accordance with one of the provisions set out in (a) or (b) below as the Trustees may decide and, if required, notify to the Department of Social Security as being the basis applicable for the time being to Guaranteed Minimum Pensions hereunder:

(a) for each complete tax year after that in which contracted-out employment ceases up to and including the last complete tax year before State Pensionable Age or previous death by such rate of increase as regulations made for the purposes of section 16(3) of the Pension Schemes Act 1993(1) specify as being relevant to the date of cessation;

(b) by a rate of increase equal to the percentage by which earnings factors for the tax year in which contracted-out employment ceases are increased by the last order under section 148 of the Social Security Administration Act 1992(2) to come into force before the tax year in which he reaches State Pensionable Age or dies (if earlier);

provided that

(i) if such Member’s Guaranteed Minimum Pension includes amounts transferred to the relevant Section from another retirement benefits arrangement the Guaranteed Minimum Pension which has accrued up to the cessation of contracted-out employment by reference to the previous arrangement may (subject to the terms of the previous arrangement) be increased in accordance with either of the methods in this paragraph 2.5 which the Trustees on the advice of the Actuary determine to be appropriate and which complies with the requirements of regulations made in relation to section 16 of the Pension Schemes Act 1993, and

(ii) if the Member’s Guaranteed Minimum Pension is transferred to another retirement benefits arrangement in accordance with Rule 34 the Guaranteed Minimum Pension which has accrued up to the cessation of Contracted-Out Membership may if the Trustees so agree be increased in accordance with either of the methods in paragraph 2.5 which would comply with the requirements of regulations made in relation to section 16 of the Pension Schemes Act 1993.

(1)

Section 16 was amended by the Pensions Act 1995 (c. 26), section 151 and Schedule 5, paragraphs 18 and 28.

(2)

1992 c. 5; section 148 was amended by the Pension Schemes Act 1993 (c. 48), section 190 and Schedule 8, paragraph 27.