The National Health Service Pension Scheme Regulations 2008

CHAPTER 1.B SCHEME REPORTS AND ACCOUNTS

1.B.1    Actuarial reports and accounts

(1) The following paragraphs apply to the National Health Service Pension Scheme as set out in these Regulations and the National Health Service Pension Scheme Regulations 1995(1).

(2) The Secretary of State shall keep accounts of all income and expenditure of the scheme in a form approved by the Treasury.

(3) The accounts shall be open to examination by the Comptroller and Auditor General.

(4) The Scheme actuary (as defined in Parts 2 and 3) must—

(a) prepare an actuarial report of the scheme liabilities and benefits under these Regulations and the scheme liabilities and benefits under the provisions of the National Health Service Pension Scheme Regulations 1995, at the 31st March 2012 and at the expiration of every period of 4 years after that date, and

(b) send a copy of that actuarial report of the scheme to the Secretary of State and the Treasury.

1.B.2    Cost Sharing

(1) The actuarial report referred to in regulation 1.B.1 (accounts and actuarial reports) shall specify—

(a) a recommended contribution rate (RCR), and

(b) a projected yield from members’ contributions (PYM).

(2) Paragraphs (3) to (10) apply in respect of the actuarial report covering the period commencing on 1st April 2004 and ending on 31st March 2008 (“the 2004-2008 Report”) and, unless otherwise stated, references to the RCR in those paragraphs are to the RCR specified in the 2004-2008 Report.

(3) Where the RCR differs from 20.5%, that difference shall be the cost change element (CCE).

(4) The Secretary of State shall, having taken advice from the scheme actuary determine—

(a) that part of the CCE which shall not be shared between the members and the employing authorities (the un-shared element (USE)), and

(b) that part of the CCE which shall be shared between the members and the employing authorities (the shared element (SE)),

but before making such a determination, the Secretary of State shall consider any advice relating to the elements referred to in (a) and (b) from such employee and employer representatives as appear to the Secretary of State to be appropriate.

(5) Where RCR minus PYM is less than 14%, contributions paid by employing authorities shall be equal to 14%.

(6) Where RCR minus PYM is equal to or greater than 14% but less than or equal to 14.2%, contributions paid by employing authorities shall be equal to RCR minus PYM.

(7) Where—

(a) RCR minus PYM is greater than 14.2%, and

(b) USE is greater than 0.0%,

contributions paid by employing authorities shall be equal to the lower of—

(i) RCR minus PYM, and

(ii) 14.2% + USE.

(8) Where—

(a) RCR minus PYM is greater than 14.2%, and

(b) USE is less than or equal to 0.0%,

contributions paid by employing authorities shall be equal to 14.2%.

(9) If RCR is greater than the sum of—

(a) the rate payable by employing authorities as determined under paragraphs (5) to (8), and

(b) PYM,

the Secretary of State may—

(i) after consultation with such representations of employees and employing authorities as appear to the Secretary of State to be appropriate, and

(ii) with the consent of the Treasury and on the advice of the scheme actuary,

amend member contributions and or benefits so that the rate payable by employing authorities is equal to amount A as determined under paragraphs (5) to (8).

(10) For the purposes of paragraph (9)—

(a) amount A is the difference between the adjusted RCR and the adjusted PYM, and

(b) adjusted RCR and adjusted PYM mean the RCR and PYM that would have been specified in the 2004-2008 Report had that Report been drawn up on the basis that any amendment to member contribution rates and scheme benefits made by the Secretary of State pursuant to paragraph (9) had already taken place.

(11) Paragraphs (12) to (17) apply in respect of the actuarial report covering the period commencing on 1st April 2008 and ending on 31st March 2012 and subsequent reports and, unless otherwise stated, references to RCR in those paragraphs are to the RCR recommended in the actuarial report for the relevant period.

(12) Where the RCR specified in the current actuarial report differs from 20.5%, that difference shall be the cost change element (CCE).

(13) The Secretary of State shall, having taken advice from the scheme actuary determine —

(a) that part of the CCE which shall not be shared between the members and the employing authorities (the un-shared element (USE)), and

(b) that part of the CCE which shall be shared between the members and the employing authorities (the shared element (SE)),

but, before making such a determination, the Secretary of State shall consider any advice relating to the elements referred to in (a) and (b) from such employee and employer representatives as appear to the Secretary of State to be appropriate.

(14) Where RCR is equal to or greater than 20.5% + USE, contributions paid by employing authorities shall be equal to 14% + USE.

(15) Where RCR is less than 20.5% + USE, contributions paid by employing authorities shall be equal to—

Where—

X = and, where X is not a multiple of 0.1%, X is rounded to the nearest odd multiple of 0.1%.

(16) If RCR is not equal to the sum of—

(a) the rate payable by employing authorities as determined under paragraphs (14) and (15), and

(b) PYM,

the Secretary of State may—

(i) after consultation with such representations of employees and employing authorities as appear to the Secretary of State to be appropriate, and

(ii) with the consent of the Treasury and on the advice of the scheme actuary,

amend member contributions and or benefits so that the rate payable by employing authorities is equal to amount B as determined under paragraphs (14) to (15).

(17) For the purposes of paragraph (16)—

(a) amount B is the difference between the adjusted RCR and the adjusted PYM, and

(b) adjusted RCR and adjusted PYM mean the RCR and PYM that would have been specified in the 2004-2008 Report had that Report been drawn up on the basis that any amendment to member contribution rates and scheme benefits made by the Secretary of State pursuant to paragraph (16) had already taken place.

(18) In this regulation—

(a) RCR, PYM, CCE, USE and SE shall be expressed as percentages to the nearest 0.1 per cent,

(b) USE may include changes to RCR resulting from changes in—

(i) the financial assumptions, and

(ii) the actuarial methodology,

used to calculate RCR for the purposes of the immediately preceding actuarial report under regulation U3 where the current report is not the 2004-2008 Report, or where the 2004-2008 Report is the current report, that Report,

(c) SE may include changes to RCR resulting from changes in—

(i) the underlying membership data, and

(ii) the demographic assumptions,

used to calculate RCR for the purposes of the immediately preceding actuarial report under regulation U3 where the current report is not the 2004-2008 Report, or where the 2004-2008 Report is the current report, that Report,

(d) CCE, USE and SE may be positive or negative.

1.B.3    Provision of information relevant for tax purposes

(1) A person who is entitled to a benefit under these Regulations must give the Scheme administrator such information as will enable the Scheme administrator to determine—

(a) whether a lifetime allowance charge arises on the person becoming entitled to the benefit, and

(b) if any such charge arises, the amount of the tax payable.

(2) Paragraph (1) applies whether or not the person intends to rely on having given notice under any of the provisions specified in section 256(1) of the 2004 Act (enhanced lifetime allowance regulations).

(3) If a person applying for a benefit under these Regulations intends to rely on entitlement by virtue of any such notice, in addition to the information mentioned in paragraph (1) the person must give the Scheme administrator the reference number issued by the Commissioners under the Registered Pension Schemes (Enhanced Lifetime Allowance) Regulations 2006(2) in respect of that entitlement.

(4) The information that a person is required to give under this regulation must be given—

(a) at the time the person makes a claim for a benefit, or

(b) within such period ending after that time as the Scheme administrator specifies in writing.

(5) If a person fails to comply with paragraph (4)(b), the Scheme administrator may calculate and pay tax due in respect of the lifetime allowance charge on the basis that the whole benefit is chargeable.

(1)

S.I. 1995/300, amended by S.I. 1997/80 and 1888, 1998/666 and 2216, 2000/605, 2001/1428 and 3649, 2002/561 and 2469, 2003/631 and 2322, 2004/665 and 696, 2005/661 and 3074, 2006/600 and 2919, 2007/2054 and 3280 and 2008/ ... ... ... ..., and modified by S.I. 1996/971.

(2)

S.I. 2006/131.