3.—(1) The National Health Service Pension Scheme Regulations 2008(1) are amended as follows.
(2) In regulation 2.C.17 (revaluation of increases bought under options: members’ pensions)—
(a)in paragraph (3), for “paragraph (5)” substitute “whichever of paragraphs (5) or (5A) applies”;
(b)in paragraph (5), for “The calculation” substitute “If the member exercised the option on or before 31 March 2011, the calculation”;
(c)after paragraph (5), add—
“(5A) If the member exercised the option on or after 1 April 2011, the calculation referred to in paragraph (3) is as follows—
| Step 1 – | Calculate the basic amount of the increase in accordance with regulations 2.C.14 to 2.C.16, to find the Step 1 amount. |
| Step 2 – | Multiply the Step 1 amount by the prices index for the second month before the month in which the increase in pension will become payable, to find the Step 2 amount. |
| Step 3 – | Divide the Step 2 amount by the prices index for the month in which the option was exercised, to find the Step 3 amount. |
| Step 4 – | Take the greater of the Step 1 amount and Step 3 amount, to find the Step 4 amount. |
| Step 5 – | Add to the Step 4 amount an amount that is equal to any increases that would be due under the Pensions (Increase) Act 1971 on a pension of the same amount as the Step 4 amount when it first falls into payment, to find the Step 5 amount. |
| Step 6 – | Divide the Step 5 amount by the Step 4 amount, to find the Step 6 factor. |
| Step 7 – | Divide the Step 4 amount by the Step 6 factor to find the final amount referred to in paragraph (1).;” |
(d)in paragraph (6), after “that Act)” insert “and “the prices index” means, as regards any month, the change in the general level of prices for that month used to determine increases to official pensions for the purposes of that Act”.
(3) In regulation 3.C.15 (revaluation of increases bought under options: members’ pensions)—
(a)in paragraph (3), for “paragraph (5)” substitute “whichever of paragraphs (5) or (5A) applies”;
(b)in paragraph (5), for “The calculation” substitute “If the member exercised the option on or before 31 March 2011, the calculation”;
(c)after paragraph (5), add—
“(5A) If the member exercised the option on or after 1 April 2011, the calculation referred to in paragraph (3) is as follows—
| Step 1 – | Calculate the basic amount of the increase in accordance with regulations 3.C.12 to 3.C.14, to find the Step 1 amount. |
| Step 2 – | Multiply the Step 1 amount by the prices index for the second month before the month in which the increase in pension will become payable, to find the Step 2 amount. |
| Step 3 – | Divide the Step 2 amount by the prices index for the month in which the option was exercised, to find the Step 3 amount. |
| Step 4 – | Take the greater of the Step 1 amount and Step 3 amount, to find the Step 4 amount. |
| Step 5 – | Add to the Step 4 amount an amount that is equal to any increases that would be due under the Pensions (Increase) Act 1971 on a pension of the same amount as the Step 4 amount when it first falls into payment, to find the Step 5 amount. |
| Step 6 – | Divide the Step 5 amount by the Step 4 amount, to find the Step 6 factor. |
| Step 7 – | Divide the Step 4 amount by the Step 6 factor to find the final amount referred to in paragraph (1).;” |
(d)in paragraph (6), after “that Act)” insert “and “the prices index” means, as regards any month, the change in the general level of prices for that month used to determine increases to official pensions for the purposes of that Act”.
S.I. 2008/653 as amended by S.I. 2008/2263, 2009/381, 1298 and 2446 and 2010/492 and 1634.