SCHEDULE 2Scheme flexibilities
PART 4Election to buy out the standard reduction
CHAPTER 1Making a buy-out election
Eligible to make buy-out election
29.
(1)
A member (P) who has a normal pension age over 65 may elect to pay contributions to buy out the standard reduction (“buy-out election”) for a period of up to 3 years.
(2)
A buy-out election has effect from the day on which the scheme manager accepts the election.
(3)
A buy-out election ceases to have effect when the earliest of the following occurs—
(a)
P reaches normal pension age;
(b)
a retirement pension other than a phased retirement pension becomes payable to P;
(c)
P revokes the election or is taken to revoke the election.
(4)
A buy-out election may only be made within 6 months after P enters pensionable service under this scheme.
(5)
When making a buy-out election, P must be—
(a)
in pensionable service; and
(b)
under normal pension age.
(6)
P may by written notice to the scheme manager vary a buy-out election if P’s normal pension age changes before a retirement pension becomes payable to P.
Making a buy-out election
30.
(1)
A buy-out election made by a member (P) must state the number of years in respect of which the standard reduction is to be bought out.
(2)
A buy-out election must be made by written notice to the scheme manager.
(3)
The notice of election must specify—
(a)
if P is in more than one eligible employment, the name of the employer who is to deduct the contributions;
(b)
P’s name;
(c)
P’s date of birth;
(d)
P’s normal pension age;
(e)
the date on which P entered pensionable service;
(f)
P’s annual rate of pensionable earnings for that employment.
(4)
The scheme manager may ask P to provide further information.
Accepting a buy-out election
31.
(1)
The scheme manager may accept a buy-out election by giving written notice to the person who made the election (P).
(2)
The notice must state the buy-out value.
(3)
A buy-out election is accepted when P receives notice that the scheme manager has accepted the election.
Determination of the buy-out value
32.
(1)
The buy-out value is an amount determined by the scheme manager.
(2)
If an additional pension election or a faster accrual election is subsequently made in respect of a person (P), the scheme manager may—
(a)
re-determine the buy-out value; and
(b)
send a written notice to P stating the re-determined buy-out value.