Social Welfare and Pensions Act 2012
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Amendment of section 50 of Principal Act. |
35.— Section 50 of the Principal Act is amended by— | |
(a) substituting the following subsection for subsection (1): | ||
“(1) The Board may, by notice in writing, following an application by the trustees or otherwise, direct the trustees of a relevant scheme (other than a regulatory own funds scheme) to take such measures as may be specified by the Board in the notice or, if no measures are specified in the notice, such measures as may be necessary in respect of members of the scheme then in relevant employment, who have not reached normal pensionable age and members whose service in relevant employment has ceased, who have not reached normal pensionable age and who have an entitlement to a preserved benefit or any other benefit under the scheme, the payment of which has not commenced, to reduce the benefits that would be payable to or in respect of those members from the scheme where— | ||
(a) the trustees of the scheme fail to submit an actuarial funding certificate within the period specified in section 43, | ||
(b) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, | ||
(c) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have submitted a funding proposal in accordance with section 49, | ||
(d) the Board consents to the amendment of a scheme in accordance with section 50A (inserted by section 18 of the Social Welfare and Pensions Act 2009 ), | ||
(e) the trustees of the scheme fail to submit a funding standard reserve certificate within the period specified in section 43, | ||
(f) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, or | ||
(g) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have submitted a funding proposal in accordance with section 49.”, | ||
(b) substituting the following subsection for subsection (1A): | ||
“(1A) The Board may, by notice in writing, following an application by the trustees or otherwise, direct the trustees of a scheme (other than a regulatory own funds scheme) to take such measures as may be specified by the Board in the notice or, if no measures are specified in the notice, such measures as may be necessary to reduce future increases in benefits payable from the scheme to or in respect of persons receiving benefits under the scheme or persons who have reached normal pensionable age, where— | ||
(a) the trustees of the scheme fail to submit an actuarial funding certificate within the period specified in section 43, | ||
(b) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, | ||
(c) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have submitted a funding proposal in accordance with section 49, | ||
(d) the Board consents to the amendment of a scheme in accordance with section 50A (inserted by section 18 of the Social Welfare and Pensions Act 2009 ), | ||
(e) the trustees of the scheme fail to submit a funding standard reserve certificate within the period specified in section 43, | ||
(f) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, or | ||
(g) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have submitted a funding proposal in accordance with section 49.”, | ||
(c) substituting the following subsection for subsection (2): | ||
“(2) In relation to a direction made under subsection (1) or (1A)— | ||
(a) paragraph 2(2) of the Second Schedule and paragraph 4(b)(i)(I) of the Third Schedule shall not apply in so far only as they conflict with the reduction in benefits pursuant to such a direction, and | ||
(b) the benefits which may be reduced following such a direction shall include— | ||
(i) a preserved benefit where an entitlement to the preserved benefit has arisen, and | ||
(ii) any revaluation of a preserved benefit under section 33 where such revaluation relates to a revaluation year which ends, | ||
prior to the date with effect from which measures are put in place pursuant to the direction.”, | ||
(d) substituting the following subsection for subsection (2A): | ||
“(2A) A reduction in benefits effected pursuant to a direction under subsection (1) or (1A) shall— | ||
(a) be such as, in the opinion of the actuary concerned, ensures that, immediately following the reduction, the scheme will satisfy the funding standard and, on or after 1 January 2016, the funding standard reserve, or | ||
(b) in the case of a scheme referred to in paragraph (c) or (g) of subsection (1) or paragraph (c) or (g) of subsection (1A), be such as, in the opinion of the actuary concerned, ensures that the scheme could reasonably be expected to— | ||
(i) satisfy the funding standard at the effective date of the next actuarial funding certificate or any later date specified under subsection (3) or (3B) of section 49 where the funding proposal is submitted before 1 January 2016 and the effective date of the next actuarial funding certificate or any later date specified under the said subsection (3) or (3B) is before that date, and | ||
(ii) in any other case, satisfy the funding standard at the effective date of the next actuarial funding certificate or any later date specified under subsection (3) or (3B) of section 49 and the funding standard reserve at the effective date of the next funding standard reserve certificate or any later date specified under the said subsection (3B).”, | ||
(e) substituting the following subsection for subsection (3): | ||
“(3) Where the Board gives a direction under subsection (1) or (1A), the trustees of the scheme shall— | ||
(a) (i) within one month of the date of the notice, put in place such measures as may be specified in the notice or, if no measures are specified, such measures as may be necessary to reduce the benefits under the scheme, in respect of all or any of the— | ||
(I) members of the scheme then in relevant employment who had not reached normal pensionable age, | ||
(II) members whose service in relevant employment has ceased and who have not reached normal pensionable age and who have an entitlement to a preserved benefit or any other benefit under the scheme, and | ||
(III) persons receiving benefits under the scheme or who have reached normal pensionable age, | ||
that would be payable to or in respect of them from the scheme, but, in respect of persons specified in clause (III), only those benefits referred to in subsection (1A), and | ||
(ii) within a period of 2 months of the date of the notice, or such longer period as the Board considers appropriate, notify the members of the scheme and other persons who are receiving benefits under the scheme or who have reached normal pensionable age, of the reduction in benefits, | ||
(b) within a period of 3 months of the date of the notice, submit to the Board— | ||
(i) confirmation that the trustees have complied with paragraph (a), | ||
(ii) copies of the notifications issued to members of the scheme and other persons under subparagraph (ii) of paragraph (a), and | ||
(iii) (I) an actuarial funding certificate and, on or after 1 January 2016, a funding standard reserve certificate certifying that at the effective date, being the effective date of the reduction in benefits, the scheme satisfies the funding standard and, on or after 1 January 2016, the funding standard reserve, or | ||
(II) in the case of a scheme where a funding proposal has been submitted to the Board pursuant to section 49 and paragraph (c) or (g) of subsection (1) or paragraph (c) or (g) of subsection (1A) applies, a statement by an actuary in such form as may be prescribed that he or she is reasonably satisfied that at the effective date of the reduction in benefits— | ||
(A) the scheme will satisfy the funding standard at the effective date of the next actuarial funding certificate or, where applicable, any later date specified under subsection (3) or (3B) of section 49 where the funding proposal has been submitted before 1 January 2016 and the effective date of the next actuarial funding certificate or any later date specified under the said subsection (3) or (3B) is before that date, or | ||
(B) in any other case the scheme will satisfy the funding standard at the effective date of the next actuarial funding certificate or, where applicable, any later date specified under subsection (3) or (3B) of section 49, and the funding standard reserve at the effective date of the next funding standard reserve certificate, or where applicable, any later date specified under the said subsection (3B).”, | ||
and | ||
(f) inserting the following new subsection after subsection (3): | ||
“(4) The Minister may make regulations requiring the trustees of a relevant scheme to comply with any applicable guidance issued by any person (including the Board or the Minister) and specified in the regulations setting out— | ||
(a) the form by which the trustees of a relevant scheme may apply to the Board for a direction under this section, and | ||
(b) the requirements to be met by the trustees in relation to any such application, including a requirement that the trustees give notice to the members of the scheme or other persons receiving benefits under the scheme of any proposal to apply for a direction under this section and to give those members and other persons an opportunity to make representations to the trustees in relation to the proposal before the application for a direction is made.”. |