154.—(1) An IP guarantee is a guarantee by an independent provider which—
(a)is in such form as the scheme manager approves;
(b)guarantees payment to the scheme manager of the required level of cover;
(c)is underwritten by one or more bodies approved of by the scheme manager;
(d)takes effect on the date the independent provider is granted employing authority status for the purposes of this Part.
(2) The scheme manager may, as a condition of granting employing authority status to an independent provider, require the independent provider to provide an IP guarantee.
(3) The scheme manager may at any other time require an independent provider to provide an IP guarantee and may do so in particular—
(a)if an independent provider fails to meet any of its liabilities under these Regulations as an employing authority;
(b)if, before it was granted employing authority status under this Part, failed in any other capacity to meet such liabilities;
(c)if the scheme manager has reasonable grounds to believe that the independent provider is unable, or is likely to become unable, to meet such liabilities.
(4) The scheme manager may in exceptional cases specify additional requirements for an IP guarantee.
(5) An independent provider must review each IP guarantee currently having effect—
(a)not later than one month before the start of a scheme year;
(b)not later than one month after the date on which employing authority status was granted;
(c)not later than one month before the date on which the guarantee is expressed to cease to have effect (if that is not the start of a scheme year);
(d)if it becomes a party to another qualifying contract;
(e)immediately it reasonably believes that its estimated contribution liability under regulation 30, 33, 34, 35, 48 or 57 has increased or may increase by more than 10%;
(f)on being notified in writing by the scheme manager that the scheme manager considers that the sum guaranteed by the guarantee does not equal or exceed the required level of cover.
(6) Paragraph (7) applies if—
(a)paragraph (5)(e) applies; and
(b)the independent provider determines that the amount of cover provided by the IP guarantee or IP guarantees currently having effect is less than the total required level of cover in respect of all of its qualifying contracts.
(7) The independent provider must before the end of the period of 14 days starting with the determination—
(a)increase the amount of cover its IP guarantee or guarantees so as to at least equal the total required level of cover; or
(b)take out an additional IP guarantee or guarantees for such amount or amounts as will secure that the total required level of cover is effected.
(8) The independent provider must before the end of the period mentioned in paragraph (7) notify the scheme manager of the action taken under that paragraph.
(9) Paragraph (10) applies if—
(a)paragraph (5)(f) applies; and
(b)the independent provider determines that the amount of cover provided by the IP guarantee or IP guarantees currently having effect is not less than the total required level of cover in respect of all of its qualifying contracts.
(10) The independent provider must—
(a)before the end of the period of 14 days after the determination notify the scheme manager of the determination; and
(b)provide the scheme manager with such information as the scheme manager may from time to time require in relation to the extent to which its IP guarantee or guarantees are sufficient to meet the required level of cover.