The Pension Protection Fund (Compensation) Regulations 2005

PART 1 Preliminary

Citation commencement and interpretation

1.—(1) These Regulations may be cited as the Pension Protection Fund (Compensation) Regulations 2005 and shall come into force on 6th April 2005.

(2) In these Regulations—

“the Act” means the Pensions Act 2004;

“early retirement age” means the age specified in the scheme rules as being the date on which a member may, subject to actuarial adjustment, become entitled to payment of a pension prior to attaining normal pension age;

“employer” in relation to an occupational pension scheme which has no active members, except in relation to a multi-employer scheme, or a section of a multi-employer scheme, includes every person who was the employer of persons in the description of employment to which the scheme relates immediately before the time at which the scheme ceased to have any active members in relation to it.

“employer” in relation to a multi-employer scheme, or a section of a multi-employer scheme, includes—

(a)

in the case of a scheme which has no active members, every person who was the employer of persons in the description of employment to which the scheme, or section, relates immediately before the time at which the scheme, or section ceased to have any active members in relation to it unless, after that time—

(i)

a debt under section 75 of the Pensions Act 1995(1) (deficiencies in the assets) becomes due from that person, to the scheme or section; and

(ii)

either—

(aa)

the full amount of the debt has been paid by that person to the trustees or managers of the scheme or section, or

(bb)

in circumstances where a legally enforceable agreement has been entered into between that person and the trustees or managers of the scheme, or section, the effect of which is to reduce the amount which is payable in respect of the debt, the reduced amount of the debt has been paid in full by that person to those trustees or managers; and

(b)

in any other case, any person who has ceased to be the employer of persons in the description of employment to which the scheme, or section, relates unless—

(i)

at the time when he so ceased, the scheme, or section was not being wound up and continued to have active members in relation to it; and

(ii)

a debt under section 75 of the Pensions Act 1995 became due at that time from that person to the scheme, or section, and either—

(aa)

the full amount of the debt has been paid by that person to the trustees or managers of the scheme, or section, or

(bb)

in circumstances where a legally enforceable agreement has been entered into between that person and the trustees or managers of the scheme, or section, the effect of which is to reduce the amount which is payable in respect of the debt, the reduced amount of the debt has been paid in full by that person to those trustees or managers;

“employment” means any trade, business, profession, office or vocation;

“pensionable service” has the meaning given by section 70(2) of the Pension Schemes Act 1993 (interpretation)(2);

“qualifying course” means a full time educational or vocational course at a recognised educational establishment where in pursuit of that course, the time spent receiving instruction or tuition, undertaking supervised study, examination or practical work or taking part in any exercise, experiment or project for which provision is made in the curriculum of the course, exceeds 12 hours per week in normal term time, and shall include any gaps between the ending of one course and the commencement of another, where the person is enrolled on and commences the latter course;

“retail prices index” means the general index (for all items) published by the Office for National Statistics or, if that index is not published for a relevant month, any substituted index or index figures published by that office(3);

“scheme” in the case of a section or a segregated part of a scheme, which for the purposes of Part 2 of the Act, is an eligible scheme, includes that section or segregated part of a scheme;

“scheme benefit age”, in relation to a scheme, means the earliest age at which a person who has pension credit rights under the scheme is entitled to receive a pension by virtue of those rights (disregarding any scheme rule making special provision as to early payment of pension on grounds of ill-health or otherwise);

“scheme pension age”, in relation to a scheme and a member’s pensionable service under it, means—

(a)

in a case where the scheme provides for the member only a guaranteed minimum pension, the earliest date at which the member is entitled to receive the guaranteed minimum pension on retirement from any employment to which the scheme applies; and

(b)

in any other case, the earliest age at which the member is entitled to receive benefits (other than a guaranteed minimum pension) on his retirement from such employment;

“surviving dependant” means—

(a)

a child of the family who is financially dependent on the member, and who is aged less than 18; or

(b)

a child of the family who is financially dependent on the member, who is aged less than 25 and who is—

(i)

either attending a qualifying course; or

(ii)

incapable of engaging in full time paid employment due to a condition that falls within the definition of a disability under the Disability Discrimination Act 1995(4);

“transferor” has the meaning given by section 29(8) of the Welfare Reform and Pensions Act 1999 (creation of pension credits and debits)(5);

“relevant partner” means a person of either sex who was not married to the member and who was living with the member as if that person and the member were husband and wife; and for the purposes of these Regulations, two adults of the same sex are to be regarded as living together as husband and wife if, but only if, they would be regarded as living together as husband and wife were they instead two adults of opposite sex.

(1)

1995 c. 26. Section 75 is amended by section 271 of the Pensions Act 2004.

(2)

1993 c 48.

(3)

The retail prices index is available from www.statistics.gov.uk.

(4)

1995 c. 50.

(5)

1999 c. 30.