Citation and commencement

1. These Regulations may be cited as the Police Pensions (Additional Voluntary Contributions) Regulations 1991, and shall come into force on 1st July 1991 but have effect as from 6th April 1990.

Interpretation

2.—(1) In these Regulations, unless the context otherwise requires, any reference to a numbered regulation or Schedule is to be construed as a reference to the regulation or Schedule which bears that number in these Regulations, and any reference to a numbered paragraph in a regulation of or a Schedule to these Regulations is to be construed as a reference to the paragraph bearing that number in that regulation or, as the case may be, that Schedule.

(2) In these Regulations references to the Taxes Act are references to the Income and Corporation Taxes Act 1988(3) , references to the 1999 Act are references to the Welfare Reform and Pensions Act 1999 and references to the 1987 Regulations are references to the Police Pensions Regulations 1987(4).

(3) In these Regulations, unless the context otherwise requires—

“the 1993 Act” means the Pension Schemes Act 1993;

“the 1999 Act” means the Welfare Reform and Pensions Act 1999;

“approved additional voluntary contributions provider” means The Equitable Life Assurance Society or The Standard Life Assurance Company ;

“approved scheme” means a retirement benefits scheme approved under Chapter 1 of Part XIV of the Taxes Act;

“the AVC scheme” means the occupational pension scheme (within the meaning of section 1 of the Pension Schemes Act 1993) established under section 1 of the Police Pensions Act 1976 and these Regulations;

“basic contributions” means contributions paid pursuant to an election under regulation 4(1);

“basic contributor” is to be construed in accordance with regulation 7;

“cash equivalent” means a cash equivalent mentioned in paragraph 12(1) of Schedule 1A to the Social Security Pensions Act 1975(5);

“central police officer” has the same meaning as in the 1987 Regulations;

“death benefit contributions” means contributions paid pursuant to an election under regulation 5(1);

“death benefit contributor” is to be construed in accordance with regulation 7;

“death benefit cover” is to be construed in accordance with regulation 5(1);

“earnings” and “emoluments” mean earnings and emoluments in respect of service as a pensionable policeman, disregarding, except where regulation 3 or 5 of the Retirement Benefit Schemes (Tax Relief on Contributions) (Disapplication of Earnings Cap) Regulations 1990(6) applies, any excess in any tax year over the figure which is the permitted maximum for that year for the purposes of section 592(8B) of the Taxes Act(7) (that is to say, the figure specified for the year by an order made by the Treasury under section 590C(6) of that Act);

“free-standing additional voluntary contributions scheme” means an approved scheme which falls within section 591(2)(h) of the Taxes Act;

“the Index” means the index of retail prices published by the Department of Employment;

“insurance company” means—

“normal benefit age” means 60;

“overseas policeman” has the same meaning as in the 1987 Regulations;

“participator” means a basic contributor or a person who has ceased to be a basic contributor but has not exercised any right to take a cash equivalent or to be paid a lump sum under regulation 14(1);

“pension credit” means a credit under section 29(1)(b) of the 1999 Act or under corresponding Northern Ireland legislation;

“pension credit” means a credit under section 29(1)(b) of the 1999 Act, including a credit under corresponding Northern Ireland legislation;

“pension credit benefits” means in relation to the AVC Scheme the benefits payable under that Scheme which are attributable (directly or indirectly) to a pension credit;

“pension credit member” means a person who has rights under the AVC Scheme which are attributable (directly or indirectly) to a pension credit either solely or wholly separately from any other rights under the AVC Scheme;

“pension credit member” has the meaning given by section 124(1) of the Pensions Act 1995;

“pension credit rights” has the meaning given by section 101B of the 1993 Act;

“pension debit” means a debit under section 29(1)(a) of the 1999 Act or under corresponding Northern Ireland legislation;

“pension debit member” means a person who has rights under the AVC Scheme and whose shareable rights under that Scheme are subject to a pension debit;

“pension investments” means investments made under regulations 9(1) and 10(2);

“pension sharing order” means a pension sharing order or other provision referred to in section 28(1) of the 1999 Act or Article 25(1) of the Welfare Reform and Pensions (Northern Ireland) Order 1999;

“pension sharing order” means an order or provision mentioned in section 28(1) of the 1999 Act;

“pensionable policemean”means a person by whom contributions are for the time being payable under regulation G2 of the 1987 Regulations;

“Police Pensions Scheme” means the Police Pensions Scheme, the rules of which are set out in the Police Pensions Regulations 1987;

“relevant police authority” has the meaning given by regulation L1(4) of the Police Pensions Regulations 1987;

“retire” means become entitled to payment of a pension or gratuity under regulations B1 to B5 of the 1987 Regulations, and cognate expressions are to be construed accordingly;

“shareable rights” means any rights a person has under the AVC Scheme except those rights referred to in regulation 2 of the Pension Sharing (Valuation) Regulations 2000;

“the Society” means The Equitable Life Assurance Society; and

“tax year” means the 12 months beginning with 6th April in any year.

(4)The definition of “insurance company” in paragraph (3) must be read with—

(a)section 22 of the Financial Services and Markets Act 2000,

(b)any relevant order under that section, and

(c)Schedule 2 to that Act .

Making and acceptance of elections

3.—(1) Any election under these Regulations—

(a)is to be made by giving written notice to the police authority, and

(b)is, subject to paragraphs (2) to (4), to be accepted by the authority.

(2) No election under these Regulations is to be accepted if any limit imposed by regulation 8(4) or 13 (limits on contributions and benefits) would be exceeded.

(3) An election falling within regulation 16(2) (death benefit cover, continued death benefit cover and increased death benefit cover) is not to be accepted if—

(a)any information required under regulation 16(2) is not given, or

(b)the information given is such that the cover could not be secured by investment under regulation 9(3).

(4) A pension election under regulation 11(2) made after retirement may be accepted only if the police authority are satisfied as mentioned in regulation 11(2).

(5) The police authority are to give effect as soon as is reasonably practicable to any election accepted by them.

Election to pay basic contributions

4.—(1) A pensionable policeman may at any time elect to pay basic contributions under these Regulations.

(2) The notice of such an election is to specify—

(a)the amount of each contribution, and

(b)the way in which the contributions are to be invested under regulation 9.

Elections in respect of death benefit cover

5.—(1) A pensionable policeman may at any time elect to pay death benefit contributions to secure death benefit cover, that is to say the payment of a lump sum in the event of his dying in the circumstances specified in paragraph (2).

(2) The circumstances are that—

(a)at the time of his death he is still a death benefit contributor, and

(b)his death occurs before his retirement date and is not the result of an injury received in the execution of his duty (within the meaning of regulation A11 of the 1987 Regulations).

(3) A pensionable policeman’s retirement date is the date on which he would be required by regulation A18(1) of the 1987 Regulations to retire assuming that there were no postponement under regulation A18(2) and no change of rank.

(4) The notice of an election under paragraph (1) is to specify the approved additional voluntary contributions provider with which the contributions are to be invested and the amount to be secured, which must not be more than that which would be the permitted amount for the purposes of Part III of Schedule 2 if he were to die on the date on which the election takes effect.

(5) An election under paragraph (1) ceases to have effect on the person’s retirement date, but if the time at which he is required by regulation A18(1) of the 1987 Regulations to retire becomes later by reason of—

(a)his being promoted, or

(b)a postponement under regulation A18(2),

• he may elect to pay further contributions to secure the continuance to the later date of he death benefit cover in force immediately before the change.

(6) Any continued death benefit cover secured by an election under paragraph (5) lapses if the person retires before the date to which the cover was continued.

Variation and cancellation of elections

6.—(1) A basic contributor may at any time elect—

(a)to alter the amount of his basic contributions, or

(b)to require them to be invested in future, under regulation 9, in a different way, or

(c)to require the police authority to realise any investment and to reinvest the proceeds, under regulation 9, in a different way, or

(d)to cancel his election under regulation 4(1).

(2) A death benefit contributor may at any time elect—

(a)to alter the approved additional voluntary contributions provider with which the contributions are to be invested and the amount to be secured, but not so as to exceed the amount which would be the permitted amount for the purposes of Part III of Schedule 2 if he were to die on the date on which the election takes effect, or

(b)to cancel his election under regulation 5(1).

(3) A person paying further contributions under regulation 5(5) (continuance of death benefit cover during service after retirement age) may at any time make any election that he could have made under paragraph (2)(a) above if he had been paying death benefit contributions.

Basic and death benefit contributors

7.—(1) Subject to paragraph (3), a person is a basic contributor while an election under regulation 4(1) (regular contributions) has effect.

(2) Subject to paragraph (3), a person is a death benefit contributor while an election under regulation 5(1) has effect.

(3) A person who has ceased to be a pensionable policeman ceases to be either a basic contributor or a death benefit contributor.

Payment and amount of contributions

8.—(1)Basic contributions are payable to the police authority at intervals of not less than 4 weeks.

(2)Death benefit contributions and further contributions under regulation 5(5) (continuance of death benefit cover) are payable to the police authority at the same times as basic contributions.

(3) All contributions are to be deducted by the police authority from the person’s pay.

(4) The total of the contributions of all kinds paid in any tax year must not exceed the lesser of (A-B-C) and D, where—

• A is 15 per cent of the person’s emoluments for that year,

• B is the total of any contributions paid by him in the year to another approved scheme,

• C is the total of the contributions paid by him in the year under the 1987 Regulations, and

• D is the amount which would provide the maximum allowable benefits.

(5) The maximum allowable benefits are—

(a)where the person is a basic contributor only, a retirement pension the annual rate of which is likely to be the maximum allowed by regulation 13,

(b)where he is not a basic contributor but is paying contributions to secure death benefit cover, the maximum amount that can be secured having regard to regulations 5(4) and 6(2)(a), and

(c)where he both is a basic contributor and is paying contributions to secure death benefit cover, both the retirement pension mentioned in sub-paragraph (a) and the maximum amount mentioned in sub-paragraph (b).

Investment of contributions

9.—(1)Basic contributions are to be invested by the police authority in accordance with any election for the time being having effect under regulation 4(1) or 6(1)(b) or (c).

(2) In paragraph (1) “invested” means investedwith the Society in one or more of the following ways:

(a)in The Equitable Life With-Profits Fund;

(b)in The Equitable Life Unit-Linked Managed Pensions Fund;

(c)for deposit by the Society with the Woolwich Building Society

with such approved additional voluntary contributions providers and in such investments managed by those providers as may be selected by the basic contributor .

(3)Death benefit contributions and further contributions under regulation 5(5) are to be invested by the police authority with the Societywith the approved additional voluntary contributions provider selected by the death benefit contributor so as to secure death benefit cover of the amount required by any election for the time being having effect under regulation 5(1) or (5) or 6(2) or (3).

Inward transfers

10.—(1) A police authority may accept a transfer value from the administrator of—

(a)a free-standing additional voluntary contributions scheme, or

(b)an approved scheme which provides additional benefits but does not fall within section 591(2)(h) of the Taxes Act,

in respect of a basic contributorexcept if or to the extent that the transfer value relates to pension credit rights .

(2)A transfer value accepted by a police authority is to be invested by them with the Society—

(a)in such one or more of the ways mentioned in regulation 9(2) as may be specified in writing by the contributor, or

(b)if he does not specify how the transfer value is to be invested, in the fund mentioned in regulation 9(2)(a).

(2)A transfer value accepted by a police authority is to be invested by them with such approved additional voluntary contribution providers and in such investments managed by those providers as may be specified in writing by the basic contributor.

Outward transfers

10A.—(1)This regulation applies where a police authority receive a request in writing from a participator that they are to apply to the approved additional voluntary contributions provider to realise the pension investment held by the provider in respect of the participator and pay an amount representing the value of the investments made in relation to the participator under these Regulations to the police authority for transmission to the administrator of a scheme or arrangement within paragraph (4) who is willing to receive such a payment in respect of him.

(2)On receiving such a request the police authority shall transmit it to the approved additional voluntary contributions provider in question and on receiving that amount they shall pay it to the administrator of that scheme or arrangement.

(3)the payment under paragraph (2) of an amount representing all pension investments in respect of the participator discharges the police authority from all liability in respect of the participator under these Regulations.

(4)A scheme or arrangement is within this paragraph if—

(a)the participator is a participator in the scheme or arrangement, and

(b)it is a scheme or arrangement for the time being approved by the Board of Inland Revenue as a scheme or arrangement to which transfers of rights in respect of additional voluntary contributions may be made in the circumstances which apply in the case of the request by the participator in question.

Outward transfers

10A.A police authority may pay a transfer value representing the value of a person’s pension credit or of investments made under regulation 12A(2) in the circumstances of Chapter II of Part IVA of the Pension Schemes Act 1993 and regulations made under that Chapter.

Pension sharing on divorce or nullity of marriage

10A.Schedule 1A has effect for making provision in relation to pension credit rights and pension credit payable under the scheme constituted by these Regulations.

Retirement pensions

11.—(1) A retirement pension is a pension payable to the participator for life, commencing on the date of his retirementcommencing—

(a)in the case of a participator within paragraph (2), on the date of his retirement, and

(b)in the case of a participator within paragraph (2A), from the date on which the police authority apply the amount obtained under paragraph (6) as mentioned in that paragraph .

(2) During the month ending on the date of his retirement, a participatorwho retires before 1st November 1999 is to make a pension election; but if the police authority are satisfied that it was not reasonably practicable for an election to be made during that period they may accept one made after retirement.

(2A)A participator who retires on or after 1st November 1999 is to make a pension election before his 75th birthday .

(3) The notice of a pension election is to specify whether the annual rate of the retirement pension—

(a)is to be fixed, or

(b)is to vary in accordance with the Index, or

(c)is to increase yearly by a specified percentage,

and from which of the pension providers it is to be purchasedand, in the case of a participator within paragraph (2), from which of the pension providers, or in the case of a participator within paragraph (2A), from which insurance company, the pension is to be purchased .

(4) The pension providers are the bodies listed in Schedule 1.

(5) The notice may also specify that if the participator dies within the period of 5 years beginning when the pension commenced the balance that would have been payable during the remainder of that period if the pension had continued at the rate in force at the time of his death is to be paid as a lump sum.

(6) Subject to paragraphs (7) and (8)paragraphs (7) to (8) , the police authority are to realise the pension investments and apply the amount obtained to the purchase from the specified pension provider or, as the case may be, insurance company of a retirement pension in accordance with the notice of election.

(7) Subject to paragraph (8), in case of a participator who retires before 1st November 1999 the police authority—

(a)if they do not accept a pension election made after retirement, shall, and

(b)if—

(i)6 months after retirement no election has been made, and

(ii)they are satisfied that there is no reasonable excuse for the delay,

may in their discretion at any time,

apply the amount obtained to the purchase from any of the pension providers of such a retirement pension as appears to them to be suitable having regard to the participator’s family circumstances and his age and health.

(7A)subject to paragraph (8), in the case of a participator who retires on or after 1st November 1999 and does not make a pension election before his 75th birthday, the police authority shall apply the amount obtained to the purchase from an insurance company of such a retirement pension as appears to them to be suitable having regard to the participator’s family circumstances and his age and health .

(8) If—

(a)there are exceptional circumstances of serious ill-health, or

(b)his aggregate pension benefits would be trivial,

the police authority may in their discretion realise the pension investments without purchasing any pension, and in that event the amount obtained becomes payable as a lump sum.

(9) Aggregate pension benefits are trivial if the annual rate of the retirement pension that could be purchased, together with the annual equivalent of all pension benefits payable to the participator from other sources, would not exceed—

(a)£104, or

(b)if greater, any amount prescribed by regulations for the time being in force under paragraph 15(4) of Schedule 16 to the Social Security Act 1973(8).

(10) Except as provided in paragraph (8), a retirement pension may not in whole or in part be surrendered, commuted or assigned.

Lump sum death benefit

12 Where a person who is paying death benefit contributions or further contributions under regulation 5(5) dies and any lump sum secured by those contributions is obtained by the police authority from the Societythe approved additional voluntary contributions provider the lump sum becomes payable.

Pension sharing on divorce

12A.—(1)Pension sharing within the meaning of Part IV of the 1999 Act is available under the AVC scheme in respect of all or part of a person’s shareable rights as set out in this Regulation except as otherwise provided, and a police authority shall discharge its liability in respect of a pension credit which derives from the AVC Scheme in accordance with paragraph 1 of Schedule 5 to the 1999 Act (pension credits: mode of discharge: funded pension schemes).

(2)Upon the taking effect of a pension sharing order, an amount representing the pension credit member’s share of the pension debit member’s accumulated additional voluntary contributions calculated in accordance with regulation 10(4) of the Pension Sharing (Implementation and Discharge of Liability) Regulations 2000 shall be invested by the police authority in accordance with the wishes of the pension credit member in one or more of the ways prescribed in regulation 9(2).

(3)The benefits that may be provided in accordance with this regulation under a pension policy purchased as described in regulation 11(6) as it applies in the circumstances of this regulation are a pension and one or more dependant’s pensions.

(4)The pension will commence not earlier than the date on which the pension credit member attains the age of 60 and is payable for life.

(5)A dependant’s pension is a pension which would become payable to a dependant on the death of the pension credit member after his pension has commenced as provided in paragraph (4) and is payable for life, except that, in the case of a dependant to whom Part D of the 1987 regulations would apply if the pension credit member were a member of the Police Pensions Scheme, it shall cease to be payable when a child’s allowance would cease to be payable under that Part.

(6)Upon the death of a person after a pension sharing order has been made but before a police authority has discharged its liability in respect of the pension credit to which that person would otherwise be entitled, a lump sum equal to the value of the pension credit at the date of that person’s death shall be paid to his personal representatives.

(7)Paragraphs (2) to (10) of regulation 11 apply in the circumstances of this regulation, with the following modifications wherever the words to be modified appear:–

(a)the reference to participator shall be a reference to pension credit member;

(b)the reference to retirement shall be a reference to the date on which the pension commences under regulation 12A(4);

(c)the reference to retirement pension shall be a reference to a pension credit member’s pension;

(d)the reference in paragraph (8) to serious ill-health shall be a reference to ill-health which is such as to give rise to a life expectancy of less than one year from the date on which the commutation is applied for; and

(e)the reference in paragraph (9) to any amount prescribed by regulations for the time being in force under paragraph 15(4) of Schedule 16 to the Social Security Act 1973 shall be a reference to the amount prescribed by regulation 3(2)(b) of the Pension Sharing (Pension Credit Benefit) Regulations 2000.

(8)In regulation 15, wherever regulation 11 is referred to, it shall include a reference to that regulation as modified by this regulation in relation to pension credits.

Benefit limits

13.—(1) Schedule 2 has effect for limiting the benefits that may be paid under these Regulations.

(2) The maximum annual rate of a retirement pension ascertained from Schedule 2 is increased—

(a)by 3 per cent for each complete year that has elapsed, or

(b)if a greater increase results, in proportion to the increase in the Index that has occurred,

since the date on which the pension became payable.

Repayment in certain cases

14.—(1) If a person—

(a)ceases to be a basic contributor before retiring, and

(b)does not acquire a right to a cash equivalent, and

(c)becomes entitled under regulation B6 of the 1987 Regulations to an award by way of repayment of his aggregate pension contributions,

the appropriate lump sum becomes payable.

(2) If a participator dies before retirement the appropriate lump sum becomes payable.

(3) The appropriate lump sum is the realisable value of the pension investments.

Payment by police authorityresponsible person

15.—(1) Retirement pensions shall be paid by the police authorityresponsible person to the persons entitled to them.

(2) Lump sums payable—

(a)as mentioned in regulation 11(5) or paragraph 2 of Schedule 1A or by virtue of an election for a payment under paragraph 3(4)(f) of that Schedule , or

(b)under regulation 12 or 14(2),

shall be paid by the police authorityresponsible person to the deceased’s widow or widower or, if there is no widow or widower, to the personal representatives.

(3) Lump sums payable under regulation 11(8) or 14(1) shall be paid by the police authorityresponsible person to the former basic contributor.

(4) If by reason of regulation 13 a benefit is not payable in full, the police authorityresponsible person shall pay to the person entitled to the benefit so much of the relevant amount as would—

(a)in the case of a retirement pension, if applied to its purchase, or

(b)in the case of a lump sum, if paid as part of it,

have caused the benefit to exceed the limit.

(5) The relevant amount is—

(a)in the case of a retirement pension the amount obtained under regulation 11(6), and

(b)in the case of a lump sum payable under regulation 12 or 14, that sum.

(6) The amount of any tax chargeable under the Taxes Act on a payment under this regulation or Schedule 1A (pension sharing) shall be deducted by the police authorityresponsible person before payment.

(7)For the purposes of this regulation “the responsible person” means—

(a)so far as the regulation relates to the payment of a pension or to the payment of a lump sum payable under regulation 11(5), the insurance company from which the pension has been purchased under regulation 11, and

(b)so far as it relates to the payment of a lump sum, the police authority .

Information

16.—(1) A person making an election under these Regulations is to give the police authority such information as they may reasonably require for the purposes of their functions under these Regulations.

(2) A person making—

(a)an election under regulation 5(1) or (5) (death benefit and continued death benefit cover), or

(b)an election under regulation 6(2)(a) (increased death benefit cover), or

(c)an election under regulation 6(3) corresponding to one that could have been made under regulation 6(2)(a),

(d)an election under paragraph 3 of Schedule 1A (pension credit benefits) ,

is, in particular, to give the police authority such information about his health as they may reasonably require having regard to regulation 9(3) (investment so as to secure death benefit cover).

Appeals

17.—(1) A person who is aggrieved by the refusal of the police authority to admit a claim to receive as of right a pension, or a larger pension than that granted, under these Regulations may, subject to paragraph (2), appeal—

(a)if he was, or the claim is to a pension in respect of a person who was, a member of a police force within the meaning of the Police Act 1964(9), to the Crown Court, or

(b)if he was, or the claim is to a pension in respect of a person who was, a member of a police force within the meaning of the Police (Scotland) Act 1967(10), to the sheriff having jurisdiction in the place where he last served as such a member, or

(c)if he was, or the claim is to a pension in respect of a person who was, an overseas policeman, an inspector or assistant inspector of constabulary or a central police officer, to the Secretary of State.

(2) Paragraph (1) does not confer a right of appeal against anything done by the police authority in the exercise of a power conferred by these Regulations which is rexpressly declared by these Regulations to be a power which they are to exercise in their discretion.

(3) In this regulation “pension” includes any lump sum payable under these Regulations.

Retrospective effect: incidental provision

18.—(1) Any notice given after 5th April 1990 and before 1st July 1991 which, if these Regulations had been in force, would have constituted notice of an election under these Regulations is to be treated as having constituted notice of such an election.

(2) These regulations shall be treated as having come into force on 1st March 1990 in relation to any sum paid by a pensionable policeman in anticipation of these Regulations, and any such sum shall be treated as forming part of his pension investments.

(3) A sum is one paid in anticipation of these Regulations if—

(a)it was paid to the Society after 28th February 1990 and before 6th April 1990 on the understanding that if regulations providing for additional voluntary contributions were made it would be treated as consisting of contributions invested with the Society under the regulations, and

(b)it would not, if these Regulations had been in force during the tax year ending with 5th April 1990, have exceeded the limit imposed by regulation 8(4).

SCHEDULE 1APENSION SHARING

Discharge of liability in respect of a pension credit

1.—(1)Where a relevant police authority discharge their liability in respect of a pension credit which derives from the scheme constituted by these Regulations (“a scheme pension credit”) in accordance with paragraph 1(2) of Schedule 5 to the 1999 Act (pension credits: mode of discharge: funded pension schemes— conferring rights under the scheme from which the rights derive), they must do so by investing the amount of the credit to provide for the purchase from an insurance company of an annuity which meets the conditions in sub-paragraph (4).

(2)The investment shall be made by the authority, in accordance with an election made by the person entitled to the pension credit, in one or more funds managed by a pension provider meeting the requirements referred to in regulations 12 to 14 of the Pension Sharing (Pension Credit Benefit) Regulations 2000.

(3)The pension credit member may vary an election under sub-paragraph (2) by a further election at any time before the authority have completed the arrangements for the investment of the amount of the credit.

(4)The conditions referred to in sub-paragraph (1) are that—

(a)the annuity provides a pension which begins not earlier than normal benefit age and is payable to the pension credit member for life,

(b)any other pensions which are payable under the annuity—

(i)are payable only to dependants,

(ii)are payable only on the death of the pension credit member after he has reached normal benefit age,

(iii)if they are payable to the pension credit member’s child, are payable only if at the date of the pension credit member’s death the child is one who is eligible for an allowance under Part D of the 1987 Regulations in respect of the death (or would be if at the date of death the pension credit member had been a pensionable policeman), and

(iv)subject to paragraph (5), are payable to the dependant for life, and

(c)the annuity is not capable in whole or in part of surrender, assignment or commutation.

(5)If the dependant to whom the annuity is payable is within sub-paragraph (4)(b)(iii), the pension must cease to be payable when he ceases to be a dependent child.

(6)For the purposes of sub-paragraph (5), a person ceases to be a dependent child at the time when, if he were the child of a pensionable policeman, he would cease to be eligible for any allowance under Part D of the 1987 Regulations.

(7)In this paragraph “dependant”, in relation to a pension credit member, means a person who at the date of the member’s death—

(a)is the pension credit member’s spouse and, if separated from the member by an order or decree of a competent court, is receiving from the member regular contributions for the person’s support or the support of the person’s child in consequence of such an order or decree, or

(b)is a person who would be the pension credit member’s child within the meaning of Schedule A of the 1987 Regulations if at the date of the pension credit member’s death the member had been a pensionable policeman.

Discharge of liability in respect of a pension credit following the death of the person entitled to the pension credit

2.—(1)If the person entitled to a scheme pension credit dies before liability in respect of it has been discharged, the relevant police authority shall discharge their liability in respect of it by making a payment of a lump sum in accordance with regulation 6(2)(a)(i) of the Pension Sharing (Implementation and Discharge of Liability) Regulations 2000.

(2)The lump sum payable under this paragraph is to be of an amount equal to the realisable value of the investments made under paragraph 1 and shall be paid in accordance with regulation 15.

Pension credit benefit

3.—(1)The benefit to which a pension credit member is entitled under the scheme constituted by these Regulations shall be a pension.

(2)The pension shall be payable not earlier than when the pension credit member reaches normal benefit age and shall be payable to him for life.

(3)The value of the pension referred to in this paragraph shall equal the value of the pension credit rights which have accrued to or in respect of the pension credit member.

(4)Not earlier than one month before the pension credit member reaches normal benefit age, a pension credit member shall, by giving notice to the relevant police authority, make a benefits election specifying—

(a)whether only a pension payable for life is to be provided;

(b)for whom, if anyone, a dependant’s pension is to be provided;

(c)if more than one pension is to be provided, either—

(i)the proportion of the amount secured by the total investments made under paragraph 1 that is to be applied to the purchase of each of them; or

(ii)the dependants' pensions to be provided expressed as a percentage of the pension for life;

(d)in respect of every pension to be provided, whether the annual rate of the pension—

(i)is to be fixed; or

(ii)is to vary in accordance with the Index; or

(iii)is to increase yearly by a specified percentage or, if lower than that percentage, by the increase in the Index for the year in question;

(e)the pension provider listed in Schedule 1 from whom each pension is to be purchased (being a provider meeting the requirements referred to in regulations 12 to 14 of the Pension Sharing (Pension Credit Benefit) Regulations 2000), and

(f)whether, if the pension credit member dies before the expiry of the period of five years beginning with the date on which the pension begins to be payable, the balance that would have been payable during the remainder of that period, if the payments of pension had continued at the rate in force at the date of death, is to be payable as a lump sum.

(5)On receipt of a notice of election under sub-paragraph (4) the police authority must, as soon as is reasonably practicable, realise the investments made under paragraph 1 and apply the proceeds to the purchase from the specified pension provider of the benefits specified in the notice of election.

(6)If a pension credit member who reached normal benefit age after 1st December 2000 has—

(a)reached the age of 75; and

(b)failed to give a notice of election under sub-paragraph (4) on or before the date of his 75th birthday,

the relevant police authority may realise the investments made under paragraph 1 and apply the proceeds to the purchase of a pension policy which meets the requirements of regulations 12 to 14 of the Pension Sharing (Pension Credit Benefit) Regulations 2000 from an insurance company in order to provide such benefits as appear to them to be suitable having regard to the pension credit member’s family circumstances, age and health.

Outward transfers

4.—(1)The relevant police authority shall, upon receipt of a notice in writing under section 101F(1) of the 1993 Act (power to give transfer notice), pay a transfer value in respect of the member’s pension credit rights in accordance with the provisions of Chapter II of Part IVA of the 1993 Act (requirements relating to pension credit benefit: transfer values) and Part III of the Pension Sharing (Pension Credit Benefit) Regulations 2000 (transfer values).

(2)That transfer value must be calculated in accordance with regulation 24 of the Pension Sharing (Pension Credit Benefit) Regulations 2000 (manner of calculation and verification of cash equivalents).

Commutation of the whole of pension credit benefit before normal benefit age

5.—(1)A pension credit member shall be entitled to the commutation of the whole of the benefits payable to or in respect of him under the scheme constituted by these Regulations by virtue of rights attributable (directly or indirectly) to a pension credit before reaching normal benefit age if the pension credit member is suffering from serious ill-health before normal benefit age.

(2)In sub-paragraph (1) “serious ill-health” means ill-health giving rise to a life expectancy of less than one year from the date on which commutation is applied for.

(3)In the case of such a member the relevant police authority may realise the investments made under paragraph 1 without purchasing an annuity and pay the proceeds to the pension credit member as a lump sum.

Commutation of the whole of pension credit benefit at normal benefit age

6.—(1)A pension credit member shall be entitled to the commutation of the whole of the benefits payable to or in respect of him under the scheme constituted by these Regulations by virtue of rights attributable (directly or indirectly) to a pension credit at normal benefit age in the following circumstances.

(2)They are if—

(a)the pension credit member is suffering from serious ill health at normal benefit age, or

(b)the aggregate of total benefits payable to the pension credit member, including those attributable (directly or indirectly) to pension credit rights, does not exceed £260 per annum at normal benefit age.

(3)In the case of such a pension credit member the relevant police authority may realise the investments made under paragraph 1 without purchasing an annuity and pay the proceeds to the member as a lump sum.

(4)In sub-paragraph (2)(a) “serious ill-health” means ill-health giving rise to a life expectancy of less than one year from the date on which notice is given under paragraph 3(4).

Pension credit member dies before pension becomes payable

7.If a pension credit member dies before any benefit becomes payable under paragraph 3, the relevant police authority may realise the investments made under paragraph 1 without purchasing an annuity and pay the proceeds to the member’s personal representatives as a lump sum.

Separate treatment of pension credit rights

8.Where a pension credit member has rights under the scheme constituted by these Regulations apart from his pension credit rights, the pension credit rights are to be treated as provided separately for the purposes of all requirements of the Inland Revenue in relation to limits on benefits.

Regulation 11(4)

SCHEDULE 1PENSION PROVIDERS

• The Society

• Eagle Star Insurance Company Limited

• Legal and General Assurance Society Limited

• Prudential Corporate Pensions

• Scottish Widows' Fund and Life Assurance Society

• The Standard Life Assurance Company

• Sun Life Assurance Society PLC

Regulation 13

SCHEDULE 2BENEFIT LIMITS

PART Iinterpretation

1. Paragraphs 2 to 5 have effect for defining expressions used in this Schedule.

2. “Total retirement benefits” means the total of so much of—

(a)the annual rate of the participator’s retirement pension under these Regulations,

(b)the annual rate of any pension under regulations B1 to B5 of the 1987 Regulations, and

(c)the actuarial equivalent as an annual pension of any gratuity under regulations B2 to B4 of the 1987 Regulations,

as is not attributable to the receipt of any transfer value, together with the annual rate of any pension payable to him under a free-standing additional voluntary contributions scheme.

3.—(1) “Final remuneration” means the greater of A and B, where—

• A is the participator’s highest year’s adjusted earnings during the period of 5 years ending on the material date, and

• B is the average of his total taxable earnings for any period of 3 or more consecutive years ending no earlier than 10 years before the material date,

but, in respect of any year other than the one ending on the material date, earnings are to be taken to have been increased in proportion to any increase in the Index from the end of the year up to the material date.

(2) In this paragraph “adjusted earnings” means C + D, where—

• C is the participator’s total taxable earnings for the year in question less any bonus payments and payments for overtime (“fluctuating emoluments”),

• and D is the average, for a period ending with the year in question, of any fluctuating emoluments; the period is one of at least 3 years or, if shorter, the period during which the fluctuating emoluments have been payable,

and “the material date” means the earliest of—

(a)the retirement date, and

(b)the date on which the participator ceased to be a pensionable policeman.

4.—(1) “Retained benefits” means the total of any pensions payable to the participator—

(a)in respect of employment before he became a pensionable policeman, under a retirement benefits scheme (within the meaning of section 611 of the Taxes Act) or under an annuity contract falling within section 431(4)(d) of the Taxes Act, or

(b)under a retirement annuity contract or trust scheme approved under Chapter III of Part XIV of the Taxes Act,

and so much of any pension payable to him under these Regulations or the 1987 Regulations as is attributable to a transfer value received from any such scheme or on the termination of any such contract.

(2) In this paragraph “pension” includes the actuarial equivalent as an annual pension of any lump sum.

5.—(1) “Actuarial” means determined by, or in accordance with tables prepared by, the Government Actuary.

(2) “Relevant service” means service as a regular policeman within the meaning of the1987 Regulations, and “relevant birthday” means the birthday on which he would be required by regulation A18(1) of those Regulations to retire assuming that there were no postponement under regulation A18(2) and no change of rank.

PART IIretirement pensions

6. The annual rate of a participator’s retirement pension under these Regulations must not be such as to cause his total retirement benefits to exceed the permitted amount.

7.—(1) If the participatorretires on his relevant birthday, the permitted amount is the greater of E and F, where—

• E is 1/60th of his final remuneration for each of up to 40 years of relevant service, and

• F is the lesser of G and H.

(2) In sub-paragraph (1)—

• G is 1/30th of his final remuneration for each of up to 20 years of relevant service, and

• H is 2/3rds of his final remuneration less any retained benefits.

8. If the participatorretires on a date later than his relevant birthday, the permitted amount is the greatest of J, K and, where applicable, L, where—

• J is an amount calculated in accordance with paragraph 7 as at the later date,

• K is an amount calculated in accordance with paragraph 7 as at his relevant birthday increased, up to the later date, either actuarially or in proportion to any increase in the Index, and

• L is, in the case of a participator with more than 40 years of relevant service, 1/60th of his final remuneration for each of up to 45 years of relevant service, excluding any years before his relevant birthday in excess of 40.

9.—(1) If the participatorretires after having, before his relevant birthday, ceased to be in relevant service, the permitted amount is the greater of (M + R) and—

(2) For the purposes of sub-paragraph (1) the appropriate increase is an increase in the amount in question, either—

(a)in proportion to any increase in the Index, or

(b)if greater, at 5 per cent compound,

from the cessation of relevant service to the date of retirement.

PART IIIlump sums on death

10.—(1) The aggregate of—

(a)the lump sum secured by any death benefit contributions, and

(b)any lump sum payable under regulation 14(2),

must not be such as to cause the total lump sum death benefits to exceed the permitted amount.

(2) The total lump sum death benefits are the total of—

(a)the lump sums mentioned in sub-paragraph (1)(a) and (b), and

(b)any similar benefits totalling £1,000 or more that are payable under relevant schemes.

(3) The relevant schemes are—

(a)other approved schemes,

(b)schemes approved under Chapter IV of Part XIV of the Taxes Act,

(c)free-standing additional voluntary contributions schemes,

(d)retirement annuity contracts approved under Chapter III of Part XIV of the Taxes Act, and

(e)the scheme constituted by the 1987 Regulations.

(4) The permitted amount is £5,000 or, if greater, 4 times the death benefit contributor’s remuneration.

(5) The death benefit contributor’s remuneration is the greatest of S, T and U, where—

• S is what his final remuneration would have been if the date of his death had been the material date,

• T is his highest year’s adjusted earnings for the purpose of calculating S, and

• U is his total taxable earnings during any period of 12 months ending not more than 3 years before the date of his death, increased as mentioned in paragraph 3(1).