PENSIONS Citation, commencement and interpretation 1 1 These Regulations may be cited as the State Scheme Premiums (Actuarial Tables) Regulations 1992, and shall come into force on 6th April 1993. 2 In these Regulations, unless the context otherwise requires— “the 1975 Act ” means the Social Security Pensions Act 1975; “the 1977 Act ” means the Social Security (Miscellaneous Provisions) Act 1977 ; “the 1986 Act ” means the Social Security Act 1986; “the Contracting-out Regulations ” means the Occupational Pension Schemes (Contracting-out) Regulations 1984 ; “accrued rights factor” means— in the case of an accrued rights premium, the weekly amount (calculated in accordance with the provisions of section 44(6) of the 1975 Act as modified, in a case to which section 22(13) of the 1977 Act applies, by regulation 47 of the Contracting-out Regulations) of the guaranteed minimum pension to which the earner inquestion had accrued rights under the scheme in question when the event giving rise to the liability for the premium occurred, multiplied by 52; in the case of a pensioner’s rights premium, the weekly amount (calculated as mentioned in sub-paragraph (a) above) of the guaranteed minimum pension of the person in question under the scheme in question when the event giving rise to the liability for the premium occurred, multiplied by 52; in the case of a transfer premium, the weekly amount (calculated without regard to the provisions of section 44(6) of the 1975 Act) of the guaranteed minimum pension to which the earner in question had accrued rights under the scheme in question when the event giving rise to the liability for the premium occurred, multiplied by 52; in the case of a limited revaluation premium, the weekly amount (calculated, in a case where the scheme has ceased to be contracted-out, in accordance with the provisions of section 45(3) of the 1975 Act ) of the guaranteed minimum pension to which the earner in question had accrued rights under the scheme in question when the event giving rise to the liability for the premium occurred, multiplied by 52; in the case of a contracted-out protected rights premium or a personal pension protected rights premium, an amount arrived at by multiplying by 52 the weekly amount of the guaranteed minimum pension to which the person in respect of whom the premium falls to be paid is treated as entitled under any one or more of section 29(2) of the 1975 Act , section 29(2A) of the 1975 Act and section 4 of the 1986 Act and which derives from the minimum contributions, minimum payments or transfer payments from which the rights whose cash equivalent is included in the premium derive, or, in a case where none of those provisions of the 1975 Act and the 1986 Act yet falls to be applied to him, that part of that guaranteed minimum pension which has so far accrued; “average market level indicator” has the meaning given in regulation 10 of these Regulations; “ the Board ” means the Occupational Pensions Board; “event giving rise to the liability for the premium” means— in the case of a transfer premium, the election to pay it; in the case of a limited revaluation premium, the termination of the service in contracted-out employment of the person in respect of whom the premium falls to be paid; in the case of an accrued rights premium or a pensioner’s rights premium, one of the following events, namely— the ceasing of the scheme to be contracted-out, or the Board’s withdrawal of their approval, given under section 44(1) of the 1975 Act , of arrangements made or to be made in relation to the scheme for the preservation or transfer of the accrued rights to guaranteed minimum pensions of, or the liability for the payment of guaranteed minimum pensions to, the person in respect of whom the premium falls to be paid, if it occurs in such circumstances that immediately thereafter the scheme is not contracted-out, and that person’s entitlement or accrued rights to guaranteed minimum pensions under the scheme are not subject to approved arrangements under section 44(1) of the 1975 Act; and in the case of a contracted-out protected rights premium or a personal pension protected rights premium, one of the following events, namely— the ceasing of the scheme to be a contracted-out scheme or an appropriate scheme (as the case may be); or the Board’s withdrawal of their approval, given under section 44ZA(1) of the 1975 Act or section 5(1) of the 1986 Act (as the case may be), of arrangements made or to be made in relation to the scheme for the preservation or transfer of the protected rights of the person in respect of whom the premium falls to be paid, if it occurs in such circumstances that immediately thereafter the scheme is not a contracted-out scheme (if an occupational pension scheme) or an appropriate scheme (if it is a personal pension scheme), and that person’s protected rights under the scheme are not subject to approved arrangements under section 44ZA(1) of the 1975 Act or section 5(1) of the 1986 Act (as the case may be); “gross dividend yield” means the gross dividend yield applicable to the All-Share Index compiled by the Financial Times, the Institute of Actuaries and the Faculty of Actuaries; “15-year gross redemption yield” means the gross redemption yield compiled by the Financial Times, the Institute of Actuaries and the Faculty of Actuaries, applicable to 15-year British Government Stocks with high coupons; “20-year gross redemption yield” means the gross redemption yield compiled by the Financial Times, the Institute of Actuaries and the Faculty of Actuaries, applicable to 20-year British Government Stocks with high coupons; “15-year index number” means, in relation to any yield falling within one of the range of yields specified in the “Yield per cent” column in Schedule 6, the number shown opposite that range in the “Index number” column in that Schedule; “20-year index number” means, in relation to any yield falling within one of the range of yields specified in the “Yield per cent” column in Schedule 7, the number shown opposite that range in the “Index number” column in that Schedule; “market level indicator” has the meaning given in regulation 10 of these regulations; “monthly market level indicator” has the meaning given in regulation 10 of these Regulations; “scheme” means occupational pension scheme or personal pension scheme, as the case may be; and other expressions have the same meaning as in the 1975 Act, or, if they have no meaning in that Act, the same meaning as in the 1986 Act. Prescribed classes of investments 2 For the purposes of section 16(3) of the 1986 Act, the prescribed classes of investments are those fixed-interest stocks by reference to which the 15-year gross redemption yield and the 20-year gross redemption yield are calculated, and those equities by reference to which the gross dividend yield is calculated. Accrued rights premiums 3 1 For the purposes of calculating the amount of an accrued rights premium, the Secretary of State shall apply the actuarial tables in Schedule 1 or the actuarial tables in Schedule 2 in accordance with the provisions of this regulation. 2 In a case where the weekly rate of the guaranteed minimum pension to which the earner in question has accrued rights under the scheme in question does not fall to be determined in accordance with provisions included in the scheme by virtue of section 35(7) of the 1975 Act (revaluation without reference to orders under section 21 of the 1975 Act), the Secretary of State shall apply the actuarial tables in Schedule 1. 3 In a case where the weekly rate of the guaranteed minimum pension to which the earner in question has accrued rights under the scheme in question falls to be determined wholly or partly in accordance with provisions included in the scheme by virtue of section 35(7) of the 1975 Act and the scheme’s provisions conform with the additional requirement of regulation 22 of the Contracting-out Regulations the Secretary of State shall apply the actuarial tables in Schedule 1. 4 In any other case the Secretary of State shall apply the actuarial tables in Schedule 2. Transfer premiums 4 For the purpose of calculating the amount of a transfer premium, the Secretary of State shall apply, in a case such as is described in regulation 3(2) or (3) of these Regulations, the actuarial tables in Schedule 1, and in any other case, the actuarial tables in Schedule 2. Limited revaluation premiums 5 For the purpose of calculating the amount of a limited revaluation premium, the Secretary of State shall apply the actuarial tables in Schedule 3. Pensioner’s rights premiums 6 1 For the purpose of calculating the amount of a pensioner’s rights premium, the Secretary of State shall apply the actuarial tables in Schedule 4 or the actuarial tables in Schedule 5, in accordance with the provisions of this regulation. 2 In a case where the person in question is entitled to receive a guaranteed minimum pension in respect of his own service in contracted-out employment, the Secretary of State shall apply the actuarial tables in Schedule 4. 3 In a case where the person in question is a woman who is entitled to receive a guaranteed minimum pension in respect of her late husband’s service in contracted-out employment, the Secretary of State shall apply the actuarial tables in Schedule 5. 4 In a case where the person in question is a man who is entitled to receive a guaranteed minimum pension in respect of his late wife’s service in contracted-out employment and the circumstances are such that regulation 33D of the Contracting-out Regulations applies, the Secretary of State shall apply the actuarial tables in Schedule 5. Personal pension protected rights premiums and contracted-out protected rights premiums 7 For the purposes of calculating the cost of providing a guaranteed minimum pension such as is mentioned in section 5(9) of the 1986 Act in relation to a personal pension protected rights premium or in section 44ZA(8) of the 1975 Act in relation to a contracted-out protected rights premium, the Secretary of State shall apply— a in a case where the person in respect of whom the premium falls to be paid is the earner to whose protected rights the premium relates and he has not attained pensionable age, the actuarial tables in Schedule 1; b in a case where the person in respect of whom the premium falls to be paid is entitled to receive a pension giving effect to his own protected rights, the actuarial tables in Schedule 4; c in a case where the person in respect of whom the premium falls to be paid is a woman who is entitled to receive a pension giving effect to her late husband’s protected rights, the actuarial tables in Schedule 5; and d in a case where the person in respect of whom the premium falls to be paid is a man who is entitled to receive a pension giving effect to his late wife’s protected rights (not being a case to which either regulation 18(2A) of the Contracting-out Regulations or regulation 3 of the Personal Pension Schemes (Personal Pension Protected Rights Premiums) Regulations 1987 applies), the actuarial tables in Schedule 5. Calculation of guaranteed minimum pension or premium by reference to the Schedules 8 In Schedules 1 to 5— a the cost of providing the guaranteed minimum pension referred to in regulation 7 above in a case to which that regulation applies; and b the premium payable, in any other case, the person in respect of whom it is payable, adjusted in accordance with regulation 11 of these Regulations and multiplied by the accrued rights factor, and “age” means the age attained by that person in the tax year in which the event giving rise to the liability for the premium occurred. Use of first or second table in the Schedules 9 1 The Secretary of State shall apply the first table in each of Schedules 1 to 5 in relation to guaranteed minimum pensions or parts of guaranteed minimum pensions which accrued before 6th April 1988, and the second table in relation to guaranteed minimum pensions or parts of guaranteed minimum pensions accruing after 5th April 1988. 2 In paragraph (1) of this regulation, references to guaranteed minimum pensions include references to guaranteed minimum pensions to which a person is, or is prospectively, entitled or treated as entitled. Market level indicators 10 1 In these Regulations “market level indicator”, “monthly market level indicator” and “average market level indicator” shall be construed in accordance with the provisions of this regulation. 2 “Market level indicator” means— a for the purpose of determining the amount of a premium in a case to which regulation 3, 4, 5 or 7(a) of these Regulations applies, the sum of— i 312 divided by x, where x per cent. is the gross dividend yield, and ii the 20-year index number; and b for the purpose of determining the amount of a premium in a case to which regulation 6 or 7(b), (c) or (d) of these Regulations applies, the 15-year index number. 3 “Monthly market level indicator”, in relation to any month, means the average of the market level indicators derived from the 15-year index numbers or (as the case maybe) the 20-year index numbers and the gross dividend yields, appropriate to the first 5 days on which the London Stock Exchange was open in that month, rounded, if that average is not a whole number, to the nearest whole number, or to the nearest lower whole number where the decimal part of that average is 0.5. 4 “Average market level indicator” means the average, rounded, if it is not a whole number, in the manner described in paragraph (3) of this regulation, of the monthly market level indicators relating to all of the months in the 5-year period preceding the month in which the event giving rise to the liability for the premium occurred. Adjustment of tables 11 1 The tables in Schedules 1 to 5 shall be adjusted in accordance with the provisions of this regulation. 2 In relation to guaranteed minimum pensions or parts of guaranteed minimum pensions which accrued before 6th April 1988, the appropriate figure from the tables shall be multiplied by the monthly market level indicator relating to the month in which the event giving rise to the liability for the premium occurred and divided by 100. 3 In relation to guaranteed minimum pensions or parts of guaranteed minimum pensions accruing after 5th April 1988, the appropriate figurec from the tables shall be multiplied by the monthly market level indicator relating to the month in which the event giving rise to the liability from the premium occurred and divided by the average market level indicator. 4 In paragraphs (2) and (3) of this regulation, references to guaranteed minimum pensions include references to guaranteed minimum pensions to which a person is, or is prospectively entitled or treated as entitled. Revocation of regulations 12 The State Scheme Premiums (Actuarial Tables) Regulations 1987 , the State Scheme Premiums (Actuarial Tables) Amendment Regulations 1988 , and the State Scheme Premiums (Actuarial Tables) Amendment Regulations 1991 are hereby revoked. Signed by authority of the Secretary of State for Social Security. Henley Parliamentary Under-Secretary of State, Department of Social Security 16th March 1992