The National Health Service Pension Scheme Regulations 1995

Meaning of “pensionable pay” and “final year’s pensionable pay”

C1.—(1) In these Regulations, “pensionable pay” means, subject to the provisions of this regulation, all salary, wages, fees and other regular payments made to a member in respect of pensionable employment as an officer, but does not include bonuses, payments made to cover expenses or payments for overtime.

(2) Subject to paragraph (3), any amount by which a member’s pensionable pay exceeds the permitted maximum will be ignored when calculating the amount of any contributions or benefits payable under these Regulations.

(3) Pensionable pay in excess of the permitted maximum will not be ignored in the case of a member who joined the scheme before 1st June 1989 except in relation to a period following a break in pensionable employment on or after that date.

(4) For the purposes of paragraph (3), no account shall be taken of a break in pensionable employment if—

(a)the member returns to pensionable employment within 12 months after leaving;

(b)the break is due to the member’s secondment or posting to another employer and, at the time of the secondment or posting, the member has a definite expectation of returning to pensionable employment when the period of secondment or posting ends;

(c)the break is due to the member being engaged in other employment which is approved for this purpose by the Secretary of State;

(d)the break is due to the member’s unpaid absence from work and the member returns to pensionable employment within one month after returning to work; or

(e)the break corresponds to the member’s absence from work wholly or partly because of pregnancy or confinement and the member returns to work after the break in exercise of her right under Section 39(1) of the Employment Protection (Consolidation) Act 1978(1) and returns to pensionable employment no later than one month after returning to work.

(5) This regulation applies to a member in respect of whom a transfer payment has been accepted from a health service scheme in the same way as if the period of employment that qualified the member for benefits under the health service scheme had been pensionable employment.

(6) In these Regulations, “final year’s pensionable pay” means pensionable pay in respect of the member’s last year of pensionable employment, ending on the date the member ceases to be in such employment, or dies, whichever occurs first, except—

(a)if pensionable pay was greater in either or both of the 2 consecutive years immediately preceding the last year, “final year’s pensionable pay” means pensionable pay in respect of the year immediately preceding the last year or, if greater, pensionable pay in respect of the first of those 2 consecutive years; and

(b)if the member was in pensionable employment for less than 12 months, “final year’s pensionable pay” means—

(7) In this regulation, “the permitted maximum” means the same as in section 590C of the Income and Corporation Taxes Act 1988 (earnings cap)(2).