PENSIONS Citation and commencement 1 1 These Regulations may be cited as the Local Government Superannuation (Scotland) Amendment Regulations 1996. 2 These Regulations shall come into force on 1st April 1996, but— a regulations 2 to 4 and 17 shall have effect from 17th May 1990; b regulations 12 to 15 and 18 shall have effect from 28th December 1994; and c regulations 5 to 11 shall have effect from 2nd May 1995. Amendment of the Local Government Superannuation (Scotland) Regulations 1987 2 The Local Government Superannuation (Scotland) Regulations 1987 (referred to in these Regulations as “the principal Regulations”) shall be amended in accordance with regulations 3 to 15 below. Entitlement to retirement pension and retiring allowance 3 Regulation E2 shall be amended— a in paragraph (6)— i by substituting for the words “to (11)” the words “and (10)”; and ii by substituting for sub-paragraph (c) to the end the following sub-paragraph:— c in the case of a person who has attained the age of 60 years, has ceased to be employed in local government employment and has duly elected to receive payment from the relevant date, from that date. ; b by inserting after paragraph (6) the following paragraphs:— 6A An election under paragraph (6)(c) shall be made by notice in writing to the employing authority given within the period of three months beginning with the relevant date. 6B In paragraphs (6)(c) and (6A) “relevant date” in relation to any person means— a the date on which he attains the age of 60 years, or b if later, the date of his ceasing to be employed in local government employment. ; c in paragraph (7) by omitting the words “Subject to paragraph (11),”; and d by deleting paragraph (11). Amount of retirement pension and retiring allowance 4 Regulation E3(15) shall be amended— a in sub-paragraph (b) by inserting at the end the words “before 1st April 1996”; and b by inserting after sub-paragraph (b) the following sub-paragraph:— or c in the case of a man, to less than the annual rate obtained by multiplying one eightieth of his pensionable remuneration by the length in years of the whole period of his service in contracted-out employment on or after 17th May 1990 and before 1st April 1996 . Entitlement to widow’s short-term and long-term pensions 5 Regulation E5 shall be amended— a in paragraph (1) by inserting after sub-paragraph (a) the following sub-paragraph:— aa would have been so entitled but for the commutation of such payments for a lump sum in accordance with regulation E11A, or ; and b in paragraph (4) by inserting after the words “paragraph (1)(a)” the word “, (aa)”. Amount of widow’s short-term and long-term pensions 6 Regulation E6 shall be amended— a in paragraph (1) by inserting— i in sub-paragraph (a) after the word “applies” the words “, and the provisions of sub-paragraph (d) of this paragraph do not apply,”; and ii after sub-paragraph (c) the following sub-paragraph:— or d where all or part of her husband’s retirement pension was commuted for a lump sum in accordance with regulation E11A, a rate equal to the annual rate of the retirement pension to which her husband would have been entitled immediately before the date of his death but for such commutation. ; and b in paragraph (2) by inserting— i in sub-paragraph (a) after the word “applies” the words “, and the provisions of sub-paragraph (g) of this paragraph do not apply”; and ii after sub-paragraph (f) the following sub-paragraph:— and g where all or part of her husband’s retirement pension was commuted for a lump sum in accordance with regulation E11A, half the annual rate of the retirement pension to which her husband would have been entitled immediately before the date of his death but for such commutation. . Entitlement to children’s short-term and long-term pensions 7 Regulation E8 shall be amended— a in paragraph (1) by inserting after sub-paragraph (a) the following sub-paragraph:— aa would have been so entitled but for the commutation of such payments for a lump sum in accordance with regulation E11A, or ; and b in paragraph (4) by inserting after the words “paragraph (1)(a)” the words “or (aa)”. Amounts of children’s short-term and long-term pensions 8 Regulation E9(4)(c) shall be amended— a by inserting after the words “in respect of a retirement pension” the words “, or would have been so entitled but for the commutation of such retirement pension for a lump sum in accordance with regulation E11A,”; b by inserting after head (ii) the following head— iii the commutation of all or part of such retirement pension for a lump sum under regulation E11A, and ; and c by renumbering existing head (iii) as “(iv)”. Death gratuity 9 Regulation E11 shall be amended— a in paragraph (1) by inserting after the words “to (11)” the words “and regulation E11A(5)”; b in paragraph (3) by substituting for the words “paragraphs (4) to (11)” the words “paragraphs (4A) to (11)”; and c by substituting for paragraph (4) the following paragraph:— 4 Where paragraph (1)(a) applies the death gratuity shall be an amount equal to twice the deceased’s pensionable remuneration, less, in a case where a surviving spouse’s long-term pension is payable under regulation E5, the appropriate amount to be deducted under paragraph (9). . Commutation of pension for reason of ill-health 10 After regulation E11 there shall be inserted the following regulation:— Commutation of pension for reason of ill-health E11A 1 This paragraph applies where the appropriate administering authority, acting on medical advice, is satisfied that, at the time when a retirement pension first becomes payable to a former pensionable employee (“the recipient”), he is in serious ill-health, with a life expectancy of less than one year. 2 In a case to which paragraph (1) applies, the appropriate administering authority may commute so much of the retirement pension as exceeds or would exceed the guaranteed minimum pension for a lump sum payable to the recipient of such amount as shall be calculated in accordance with paragraph (3). 3 The lump sum payable under paragraph (2) is the amount obtained by multiplying the commuted amount of the recipient’s annual retirement pension, rounded up to the nearest one pound, by a factor of 5. 4 Payment of a lump sum under paragraph (2) shall discharge the appropriate administering authority’s liability to pay a death gratuity under regulation E11. 5 The appropriate administering authority shall deduct from any payment under this regulation any tax to which they may become chargeable under section 599 of the Income and Corporation Taxes Act 1988 (charge to tax: commutation of entire pension in special circumstances). . Interest on late payment 11 Regulation E35 shall be amended— a in paragraph (1)— i by deleting the word “or” where it appears at the end of sub-paragraph (b); ii by inserting the following sub-paragraph after sub-paragraph (c):— or d an ill-health lump sum payment payable under regulation E11A, ; iii by deleting the word “or” where it appears immediately after the words “the allowance” and by inserting a comma there; and iv by inserting after the word “gratuity” where it appears for a second time the words “or payment”; and b in paragraph (2) by inserting at the end the following sub-paragraph:— h in the case of an ill-health lump sum payable under regulation E11A, the date on which a retirement pension first becomes payable. Certain persons who become subject to certain other superannuation schemes 12 In regulation J13— a in paragraph (3)(b) for the words “to whom regulation J14 applies” there shall be substituted the words “who has given notice under regulation J14(4)(b)”; and b paragraph (4) shall be deleted. Transfer of rights of persons to whom regulation J13 applies 13 For regulation J14 and the heading thereto there shall be substituted the following:— Transfer of pension rights J14 1 In this regulation, unless the context otherwise requires— “the 1993 Act ” means the Pension Schemes Act 1993 ; “appropriate part of the fund” means the part determined in accordance with paragraph (8); “contracted-out” has the meaning given by section 7 of the 1993 Act ; “eligible employer” means a scheduled body or a body which has entered into an admission agreement; “pensionable service” has the meaning given by section 70(2) and (3) of the 1993 Act; “relevant beneficiaries” means the pensionable employees to whom this regulation applies and other persons who under these Regulations are or may become entitled to benefit through such pensionable employees; “the scheme managers” means the scheme managers of the transferee scheme; “the transfer date” means in the case of— a person within paragraph (2)(a)(i), the date of transfer of the undertaking; a person within paragraph (2)(a)(ii), the date his employer ceases to be an eligible employer; and a person within paragraph (2)(b), the date on which he becomes subject to an approved non-local government scheme; “transferee scheme” means the approved non-local government scheme to which a person transfers his pension rights under this regulation; “undertaking” has the same meaning as in the Transfer of Undertakings (Protection of Employment) Regulations 1981 . 2 This paragraph applies— a to a person who ceases to be a pensionable employee because— i the undertaking in which he is employed is transferred to a body which is not an eligible employer; or ii the body by which he is employed ceases to be an eligible employer for whatever reason, and in respect of whom the body employing him after the transfer date can make other provision under an approved non-local government scheme; and b to a person to whom regulation J13 applies. 3 A person within paragraph (2)(a) shall be treated for the purposes of these Regulations as having ceased to hold his employment on the transfer date. 4 Where— a a person to whom paragraph (2) applies has not reached state pensionable age on the transfer date, and b before the transfer date or, with the consent of his employing authority, the appropriate administering authority and the scheme managers, within 3 months after the transfer date, he has given written notice to the appropriate administering authority and, if different, to his employing authority that he wishes to transfer his pension rights under these Regulations to the transferee scheme, and c the scheme managers, the appropriate administering authority and, if different, his employing authority have each given their consent before the transfer date or, where appropriate, within 3 months of the transfer date, the appropriate administering authority shall set aside and pay to the scheme managers the appropriate part of the superannuation fund whether in cash or in assets or both (“the transfer payment”) for the benefit of the relevant beneficiaries, subject to the provisions of paragraph (9). 5 The appropriate administering authority shall not give their consent under paragraph (4)(c) unless the person transferring his pension rights will acquire pension rights under the transferee scheme at least equivalent to those which he would have obtained if a transfer value had been paid to the scheme managers under regulation J2. 6 The appropriate administering authority shall provide the person transferring his pension rights with sufficient information in writing to check that the condition in paragraph (5) is satisfied. 7 Notwithstanding anything in the Acts of 1937 to 1953 and the regulations made thereunder, the former regulations, any local Act scheme or any provision of the 1974 Regulations or these Regulations, where a payment or transfer of assets is to be or has been made under this regulation, no other payment or transfer of assets shall be made out of the superannuation fund on account of service or employment to which the payment or transfer of assets under this regulation relates. 8 a The appropriate part of the fund shall be the amount of the value at the transfer date of the actual and potential liabilities of the appropriate superannuation fund accrued at the transfer date in respect of the relevant beneficiaries as determined by the actuary to the appropriate superannuation fund on the basis of actuarial assumptions specified by the actuary, adjusted as the actuary shall think fit to take into account— i any period between the transfer date and the date of actual payment of the transfer payment; and ii any other matters as the actuary at his sole discretion shall think fit. b The employing authority shall bear the costs of determining the appropriate part of the fund and apportioning the fund or, if there is more than one employing authority involved, each shall bear such part of the costs as the actuary of the appropriate superannuation fund determines. 9 Where a transfer payment in respect of a person is made under paragraph (4), then— a if the payment is to a transferee scheme which is contracted-out and the transferee scheme undertakes to accept liability for the guaranteed minimum pension, no deduction shall be made from the transfer payment; b in any other case, there shall be deducted from the transfer payment the amount of any transfer premium which may be paid under section 55(3) of the 1993 Act or contributions equivalent premium which may be paid pursuant to section 55(2) of the 1993 Act and such amount shall be used either in paying such a transfer premium or contributions equivalent premium or, at the discretion of the appropriate administering authority, in preserving the liability for the guaranteed minimum in the appropriate superannuation fund; and c in every case, the appropriate administering authority shall certify to the scheme managers the amount included in the transfer payment which represents the person’s contributions and interest on them and may require the scheme managers to undertake to treat only such amounts as employee’s contributions in the transferee scheme. J14A Where under regulation B6— a a body has made an admission agreement (“the first admission agreement”) with an administering authority (“the first administering authority”) and that first admission agreement ceases to have effect; and b thereupon an admission agreement (“the second admission agreement”) between that body and a different administering authority (“the second administering authority”) takes effect, regulation J14 shall apply to the exclusion of Part Q as if— i a person employed by that body when the first admission agreement ceased to have effect and the second admission agreement took effect were a person within paragraph (2)(a) of regulation J14; ii the superannuation fund maintained by the second administering authority were the transferee scheme; iii the second administering authority were the scheme managers; and iv the date the second admission agreement takes effect were the transfer date. J14B Where— a an undertaking (within the meaning of regulation J14(1)) is transferred from an employing authority (“the first employer”) to a body (“the second employer”) which thereupon enters into an admission agreement with an administering authority (“the new administering authority”) in respect of one or more persons (“the transferring employees”) who were pensionable employees in relation to their employment with the first employer and who remain pensionable employees in relation to their employment with the second employer; b the new administering authority is different from the body which maintains the superannuation fund to which the first employer contributed in respect of the transferring employees immediately before the transfer; and c in his employment with the second employer each transferring employee is entitled to reckon any reckonable service which he was entitled to reckon in his employment with the first employer, regulation J14 shall apply to the exclusion of Part Q as if— i a transferring employee were a person within paragraph (2)(a) of regulation J14; ii the superannuation fund maintained by the new administering authority were the transferee scheme; iii the new administering authority were the scheme managers; and iv the date the admission agreement with the new administering authority takes effect were the transfer date. . 14 In paragraph 1 of Schedule 16 for the words “, J3(1) or J14” there shall be substituted the words “or J J3(1)”. 15 Schedule 18 shall be deleted. Right to opt out of effect of amendments made by regulations 3 to 11 16 1 This regulation shall apply in the case of any person (“a relevant beneficiary”) to whom any benefit (including a return of contributions and any pension payable to a widow, widower or any dependant by virtue of a surrender) is or may become payable, being a benefit (“a relevant benefit”) payable to, or in respect of, a person who before the date on which the relevant regulation of these Regulations has effect— a ceased to hold an employment in respect of which he was a pensionable employee (whether or not he has subsequently recommenced any such employment); or b died while in such employment. 2 If, in relation to a relevant benefit, a relevant beneficiary— a would be placed by any amendment made by regulations 3 to 11 of these Regulations in a worse position than he would have been in if that amendment had not been made, and b so elects, by notice in writing given to the appropriate administering authority within the six month period beginning with the date on which these Regulations come into force, then, in the case of that beneficiary and in relation to that benefit, the principal Regulations shall have effect, subject to paragraph (3), as if these Regulations had not been made. 3 If such an election as is mentioned in paragraph (2) is made in relation to a benefit which is or may become payable in respect of a person who is employed in local government employment, or if that person subsequently recommences service in such an employment, then— a the election shall have effect in relation to the benefit only to the extent that it accrues or has accrued— i by virtue of periods of service rendered before the cessation referred to in paragraph (1) (or, if there has been more than one such cessation, the last of them before the date on which the relevant regulation of these Regulations has effect); or ii by virtue of contributions paid in respect of any such periods of service; and b in determining entitlement to, or the amount of, the benefit to that extent, he shall (without prejudice to the application of this paragraph) be treated as if he had never recommenced service in such employment at any time after the cessation referred to in sub-paragraph (a); and the principal Regulations shall apply accordingly. Transitional provisions for elections under regulation E2(6) or (7)(a) of principal Regulations 17 Where by virtue of the amendments made by regulation 3 above a man has, on or after 17th May 1990 and before these Regulations come into force, become entitled to make an election under regulation E2(6) or (7)(a) of the principal Regulations— a he may give notice of such election within six months of the date when these Regulations come into force, notwithstanding the time limits for election expressed in regulation E2(6) or (7)(a) of the principal Regulations; and b the election may be expressed to have effect as if the notice had been given on the first day on which he became entitled to give notice of the election, and any election so expressed shall have effect accordingly. Transitional provisions for transfer of pension rights 18 1 Subject to paragraph (2), the amendments made by regulations 12 to 15 of these Regulations shall not affect any transfers made under the principal Regulations before the date on which these Regulations come into force. 2 Where— a by virtue of the amendments made by regulations 12 to 15 of these Regulations a person has, on or after 28th December 1994 and before these Regulations come into force, become entitled to give notice under regulation J13 or J14 of the principal Regulations as amended by these Regulations; b he gives such notice within 3 months of the date on which these Regulations come into force; and c those bodies referred to as his employing authority, the appropriate administering authority and the scheme managers in regulation J14 of the principal Regulations as amended by these Regulations consent to such notice having effect, the notice shall have effect as if given on the first day on which he became entitled to give notice. James Douglas-Hamilton Minister of State, Scottish Office St Andrew’s House, Edinburgh 18th February 1996