Public Service Pensions Citation and Interpretation 1 1 These Regulations may be cited as the Public Service (Civil Servants and Others) Pensions (Amendment) Regulations 2018. 2 These Regulations come into force on 21st May 2018 and have effect— a in respect of regulations 6,7,8,18 and 19 retrospectively from the 1st April 2018; b in all other respects, retrospectively from 1st April 2015. Amendments to the Public Service (Civil Servants and Others) Pensions Regulations 2014 2 The Public Service (Civil Servants and Others) Pensions Regulations 2014 are amended as follows. Amendment of regulation 2 3 In regulation 2 (interpretation)— a for the definition of “active member”, substitute ““active member” has the meaning given in regulation 2A;”; b at the appropriate place insert— “additional adoption leave” means additional ordinary adoption leave under section 75B of the Employment Rights Act 1996 ; ; c at the appropriate place insert— “additional maternity leave” has the meaning given in regulation 2(1) of the Maternity and Parental Leave etc. Regulations 1999 ; ; d omit the definition of “additional paternity leave”; e for the definition of “adoption leave”, substitute— “adoption leave” means ordinary adoption leave or additional adoption leave; ; f at the appropriate place insert— “child-related leave” means adoption leave, maternity leave, parental leave, paternity leave or shared parental leave; ; g for the definition of “connected scheme”, substitute— “connected scheme” has the meaning given in regulation 2B; ; h in the definition of “index adjustment”— i in paragraph (a), for “that scheme year” substitute “the previous scheme year”; ii in paragraph (b), for “that scheme year” substitute “the previous scheme year”; i in the definition of “maternity leave”, omit the words after “additional maternity leave”; j at the appropriate place insert— “ordinary adoption leave” means ordinary adoption leave under section 75A of the Employment Rights Act 1996 ; ; k for the definition of “partnership pension account”, substitute— “partnership pension account” has the meaning given in regulation 2C; ; l at the appropriate place insert— “ PCSPS partial retirement option” means the option exercisable under rule— D.1A of Section I of the PCSPS; 3.3b of Section II of the PCSPS; or E.4 of Section III of the PCSPS; ; m at the appropriate place insert— “shared parental leave” has the meaning given in regulation 3(1) of the Shared Parental Leave Regulations 2014 ; ; n in the definition of “statutory pay”— i in paragraph (c), omit “ordinary”; ii for paragraph (d) substitute— d statutory shared parental pay within the meaning of section 171ZU (entitlement: birth) or section 171ZV (entitlement: adoption) of the Social Security Contributions and Benefits Act 1992 ; ; o omit the definition of “surviving nominated partner”; p at the appropriate place insert— “surviving partner” has the meaning given in regulation 101; . New regulations 2A and 2B 4 After regulation 2 (interpretation), insert— Active Membership 2A 1 A person (P) is an active member of this scheme if— a P is in pensionable service under this scheme; or b P is not in pensionable service under this scheme and paragraph (2) or (3) applies. 2 This paragraph applies if P is on unpaid authorised absence. 3 This paragraph applies if— a P is in scheme employment; b P is on unpaid sick leave or on unpaid child-related leave; and c P was an active member of this scheme, the PCSPS or another permitted pension scheme immediately before that leave began. 4 In this regulation “another permitted pension scheme” means, in relation to P, a pension scheme approved by the scheme manager for the purposes of this regulation. Connected Schemes 2B 1 Subject to paragraph (2), “connected scheme” means another statutory pension scheme that is connected, within the meaning of section 4(6) of the Act, with this scheme. 2 The following schemes are not connected schemes— a an injury or compensation scheme established under section 1 of the Act; b an injury or compensation scheme established under section 1 of the SA 1972; c a statutory pension scheme that is a defined contributions scheme; and d a public body pension scheme which relates to members of staff of a body, or the holder of an office, listed in Schedule 10 to the Act. Partnership Pension Account 2C 1 In these Regulations, “partnership pension account”, in relation to a person in scheme employment, means a pension scheme that has been approved by the scheme manager for the purposes of this regulation. 2 The scheme manager must not approve a pension scheme for the purposes of this regulation unless it is an— a an occupational pension scheme, a stakeholder pension scheme or a personal pension scheme; b a defined contributions scheme; and c a pension scheme to which the person’s employer is— i paying contributions; or ii not paying contributions because the person is not receiving earnings which are pensionable earnings for the purposes of the person’s pension scheme (other than because the person is on an unauthorised absence); or iii not paying contributions because the person received benefits under section 2 (compulsory and redundancy category (1972 Section members)) of the Civil Service Compensation Scheme or section 3 (flexible category (1972 Section members)) of that Scheme on the basis that the person’s reckonable service within the meaning of those sections was enhanced and the period by which that service was enhanced exceeds the period beginning with the day on which the person’s retirement under those sections began and ending with the day before the person was re-employed in the scheme employment. . Amendment of regulation 4 5 In regulation 4 (scheme manager), omit paragraph (3). Amendment of regulation 21 6 In regulation 21(1) (when does an option in take effect), for paragraph (a) substitute— a P becomes an active member of this scheme in relation to that service on the first day of the first pay period— i after the period of two months beginning with the date on which the option is exercised; or ii after any shorter period the scheme manager considers appropriate; . Amendment of regulation 23 7 In regulation 23(opting out of this scheme)— a in paragraph (1)(b), for “opens” substitute “opts to join”; b in paragraph (2), after “(1)(a)” insert “or (b)”. Amendment of regulation 25 8 In regulation 25 (opting out after one month), for paragraph (3) substitute— 3 If P opts to join a partnership pension account, P ceases to be in pensionable service under this scheme in relation to that employment on the last day of the first pay period— a after the period of two months beginning on the date on which the option is exercised; or b after any shorter period the scheme manager considers appropriate. . Amendment of regulation 26 9 In regulation 26(4) (pensionable earnings), in the definition of “permanent pensionable earnings” at the end add of paragraph (a) insert “(not including pay received in respect of a period of sick leave on reduced pay at a rate determined by the member’s employer to be appropriate because it is equivalent to the annual rate of an ill-health pension.)”. Amendment of regulation 27 10 In regulation 27(3) (meaning of “assumed pay”)— a for paragraph (b), substitute— b P is on ordinary adoption leave, ordinary maternity leave or paternity leave; ; b in paragraph (c), after “statutory pay” insert “whilst on additional adoption leave, additional maternity leave, shared parental pay or parental leave”. Amendment of regulation 32 and new regulation 32A 11 1 In regulation 32(1) (calculation of “retirement index adjustment”), at the beginning insert “Subject to regulation 32A,”; 2 After regulation 32, insert— Modification of the retirement index adjustment 32A 1 Where this regulation applies, the retirement index adjustment must equal 0. 2 This regulation applies where— a the leaving year is the scheme year ending on 31st March 2016; and b the retirement index adjustment would otherwise be less than 0. . Amendment of regulation 41 12 In regulation 41(2) (receipt of a transfer value payment), for “153” substitute “152”. Amendment of regulation 42 13 In regulation 42(2) (receipt of a club transfer value payment), for “152” substitute “153”. Amendment of regulation 43 14 In regulation 43 (amount of pension for a scheme year), after paragraph (8), insert— 9 For the purpose of paragraph (4), in respect of a period of assumed pay under this scheme, “pensionable earnings” means the member’s assumed pay. . Amendment of regulation 59 15 In regulation 59(1) (qualifying service)— a in paragraph (a), for “pensionable service under” substitute “active membership of”; b after (a), insert— aa the member’s service in another occupational pension scheme that the Minister has determined should be counted for the purposes of this regulation; . New regulation 73A 16 After regulation 73 (meaning of “upper tier payment threshold”), insert— Payment thresholds: further interpretation 73A In regulations 72 and 73, a reference to a member who is partially retired includes a reference to a transition member with continuity of service who has exercised the PCSPS partial retirement option. . Amendment of regulation 80 17 In regulation 80 (options under this Chapter), after paragraph (a) insert— aa the option under regulation 82A to partially buy out the early payment reduction; . New regulation 82A 18 After regulation 82 (option to buy out early payment reduction), insert— Option to partially buy out early payment reduction 82A 1 This regulation applies if— a a member of this scheme becomes entitled under Chapter 2 to the immediate payment of a full retirement pension; and b the member has not reached— i normal pension age under this scheme; or ii if applicable, the member’s effective pension age or enhanced effective pension age. 2 The member may, with the consent of the Minister, opt under this regulation to buy out a proportion of the early payment reduction that would otherwise apply to the calculation of the annual rate of retirement pension. 3 The cost must be met by way of a special payment to this scheme made by— a the member; b the member’s employer (“the employer”); or c both the member and the employer. 4 The employer may make a special payment using a lump sum payable to the member under a compensation scheme. 5 Any special payment by the employer must be made— a in accordance with the compensation scheme; or b with the consent of the Minister. 6 If the employer makes a special payment under paragraph (5)(a), the lump sum payable to the member under the compensation scheme is reduced by the amount of the special payment. 7 The scheme manager, after consulting the scheme actuary, must determine the actuarial reduction that would apply if a member exercises the option under this regulation. 8 Where a member exercises the option under this regulation, references in these Regulations to the early payment reduction apply as if the reference were to the actuarial reduction determined under this regulation. . Amendment of regulation 100 19 In regulation 100 (surviving adults), in the definition of “surviving adult”, omit “nominated”. Amendment of regulation 101 20 For regulation 101 (meaning of “surviving nominated partner”), substitute— Meaning of “surviving partner” 101 1 A person (P) is a surviving partner of a deceased member of this scheme if P satisfies the scheme manager that immediately before the member’s death— a P and the member were cohabiting as partners in an exclusive, committed long-term relationship; b P and the member were not prevented from entering into a marriage or a civil partnership; and c either P was financially dependent on the member, or P and the member were financially interdependent. . Amendment of regulation 128 21 In regulation 128 (meaning of “final pay”), for paragraph (4), substitute— 4 In this regulation— a if the member is a transition member with continuity of service, “pensionable earnings” in respect of any period includes the member’s pensionable earnings under the PCSPS before the transition date for that member; and b in respect of a period of assumed pay, “pensionable earnings” means the member’s assumed pay. . Amendment of regulation 129 22 In regulation 129 (meaning of “annualised final pay”), for paragraph (3), substitute— 3 In this regulation— a if the member is a transition member with continuity of service, “pensionable earnings” in respect of any period includes the member’s pensionable earnings under the PCSPS before the transition date for that member; and b in respect of a period of assumed pay, “pensionable earnings” means the member’s assumed pay. . Amendment of regulation 131 23 In regulation 131 (amount payable on death of deferred member or pensioner member (death out of service)), omit paragraph (2). Amendment of regulation 135 24 In regulation 135(4) (amount of pensionable earnings), for “additional paternity” substitute “shared parental”. Amendment of regulation 136 25 In regulation 136(3) (payment of member contributions), in paragraph (a), for “additional paternity” substitute “shared parental”. Amendment of regulation 140 26 In regulation 140 (application of part)— a in paragraph (a), for “Chapter 4 of Part 4” substitute “Chapter 1 of Part 4ZA”; b in paragraph (b), for “Chapter 5” substitute “Chapter 2”. Amendment of Schedule 1 27 1 Schedule 1 (payments for extra pension) is amended as follows. 2 In sub-paragraph (4) of paragraph 12, after “adoption leave” insert “, paid shared parental leave”. 3 In sub-paragraph (2) of paragraph 33, after “adoption leave” insert “, paid shared parental leave”. 4 In sub-paragraph (2) of paragraph 44, after “adoption leave” insert “, paid shared parental leave”. Amendment of Schedule 2 28 1 Schedule 2 (transitional provisions) is amended as follows. 2 Omit paragraph 7. 3 For paragraph 15, substitute 15 This paragraph applies if— a P was an active member of an existing scheme or an existing public body pension scheme (“P’s transitional scheme”) on 31st March 2012; b P begins service which is pensionable under the PCSPS not more than 5 years after leaving pensionable service under an existing public body pension scheme; and c P would, unless P dies, reach normal pension age under the PCSPS and P’s transitional scheme on or before 1st April 2022. . 4 For paragraph 24, substitute— 24 This paragraph applies if— a P was an active member of an existing scheme or an existing public body pension scheme (“P’s transitional scheme”) on 31st March 2012; b P begins service which is pensionable under the PCSPS not more than 5 years after leaving pensionable service under an existing public body pension scheme; and c P would, unless P dies, reach normal pension age under— i the PCSPS during the period beginning with 2nd April 2022 and ending with 1st September 2025; and ii P’s transitional scheme on or before 1st September 2025. . 5 In paragraph 29— a in sub-paragraph (4), at the beginning insert “Subject to sub-paragraphs (4A) and (4B) and paragraph 29A,”; b after sub-paragraph (4), insert— 4A Where the conditions in sub-paragraph (4B) are met, the annual rate of an upper tier top up earned pension payable under this scheme is determined in accordance with paragraph 29A. 4B The conditions are— a In the period of 12 months beginning with the day on which M became an active member of this scheme— i M was on a period of unpaid sick leave; or ii M was on a period of sick leave on reduced pay in respect of which M was paid at a rate determined by M’s employer to be appropriate because it is equivalent to the annual rate of an ill-health pension; b The latest period of leave mentioned in sub-paragraph (a) ended less than 12 months before M became entitled to an ill-health pension under this scheme. . 6 After paragraph 29, insert— 29A 1 Where this paragraph applies, the annual rate of upper tier top up earned pension payable under this scheme is the greater of the annual rates of upper tier top up earned pension calculated in accordance with— a regulation 76; and b sub-paragraph (2). 2 The annual rate of upper tier top up earned pension calculated in accordance with this sub-paragraph is calculated in the same way as the annual rate of full retirement earned pension is calculated under regulation 61, but— a the references to the member’s full retirement earned pension are taken to be references to the enhancement fraction of the deemed pension; and b the early payment reduction is not subtracted. 3 In this paragraph— “deemed pension” means the amount of earned pension the member would have accrued in the member’s deemed period of pensionable service if the circumstances in paragraph 29(4B)(a) had not applied; “the enhancement fraction” is— A / B where— A is the member’s assumed period of pensionable service; and B is the shorter of— the member’s deemed period of pensionable service; the number of scheme years in relation to which an amount of earned pension was specified in the active member’s account, or would have been if the circumstances in paragraph 29(4B)(a) had not applied; “the member’s assumed period of pensionable service” means the period (expressed in years)— beginning with the day after the member’s period of service ceased; and ending with— for a member employed for a fixed term, the day with which that term ends; or for a member otherwise employed, the day before the day on which the member will reach prospective normal pension age (assuming that the member lives until that age); “the member’s deemed period of pensionable service” means the period (expressed in years)— beginning with the day the member became an active member of this scheme; and ending with the day on which the member became entitled to an ill-health pension under this scheme. . Signed Oliver Dowden Minister for Implementation Cabinet Office 26th April 2018 We consent Andrew Stephenson David Rutley Two of the Lords Commissioners of Her Majesty’s Treasury 26th April 2018