The Pension Protection Fund (Entry Rules) Regulations (Northern Ireland) 2005

Schemes which are not eligible schemes

2.—(1) For the purposes of Article 110(1)(b) (eligible schemes), an occupational pension scheme is not an eligible scheme if it is –

(a)a public service pension scheme under the provisions of which there is no requirement for assets related to the intended rate or amount of benefit under the scheme to be set aside in advance (disregarding requirements relating to voluntary contributions);

(b)a scheme which is made under Article 9 of the Superannuation (Northern Ireland) Order 1972(1) (superannuation of persons employed in local government service, etc.) which provides pensions to persons mentioned in paragraph (1)(a) of that Article;

(c)a scheme which is established under section 48 of the Northern Ireland Act 1998(2) (pensions of members), or which was established under Part II of the Ministerial Salaries and Members' Pensions Act (Northern Ireland) 1965(3) or Article 3 of the Assembly Pensions (Northern Ireland) Order 1976(4);

(d)a scheme in respect of which a relevant public authority has given a guarantee or made any other arrangements for the purposes of securing that the assets of the scheme are sufficient to meet its liabilities;

(e)a scheme which is not a tax approved scheme;

(f)a scheme which provides relevant benefits within the meaning of section 612(1) of the 1988 Act but which is not a relevant statutory scheme within the meaning of section 611A(5) of that Act;

(g)a scheme –

(i)which has been categorised by the Commissioners of Inland Revenue for the purposes of its approval as a centralised scheme for non-associated employers;

(ii)which is not contracted-out, and

(iii)under the provisions of which the only benefits that may be provided on or after retirement (other than money purchase benefits derived from the payment of voluntary contributions by any person) are lump sum benefits which are not calculated by reference to a member’s salary;

(h)a scheme –

(i)the only benefits provided by which (other than money purchase benefits) are death benefits, and

(ii)under the provisions of which no member has accrued rights (other than rights to money purchase benefits);

(i)a scheme with such a superannuation fund as is mentioned in section 615(6)(6) of the 1988 Act (exemption from tax in respect of certain pensions);

(j)a scheme which does not have its main place of administration registered in the United Kingdom;

(k)a scheme with fewer than 2 members;

(l)a scheme with fewer than 12 members where all the members are trustees of the scheme and either –

(i)the scheme rules provide that all decisions are made only by the trustees who are members of the scheme by unanimous agreement, or

(ii)the scheme has a trustee who is independent in relation to the scheme for the purposes of Article 23(7) of the 1995 Order (power to appoint independent trustees) and is registered in the register maintained by the Regulator in accordance with regulations made under paragraph (4) of that Article;

(m)a scheme with fewer than 12 members where all the members are directors of a company which is the sole trustee of the scheme and either –

(i)the scheme rules provide that all decisions are made only by the members of the scheme by unanimous agreement, or

(ii)one of the directors of the company is independent in relation to the scheme for the purposes of Article 23 of the 1995 Order and is registered in the register maintained by the Regulator in accordance with regulations made under paragraph (4) of that Article;

(n)the scheme established by the Salvation Army Act 1963(8), or

(o)a scheme which, on or after the day appointed(9) by the Department for the purposes of Article 110(2), does not have an employer in relation to the scheme and which has not been authorised under Article 137 (closed schemes) to continue as a closed scheme.

(2) Except as otherwise provided by paragraphs (3) and (4), an occupational pension scheme which would be an eligible scheme but for this paragraph is not an eligible scheme where, at any time, the trustees or managers of the scheme enter into a legally enforceable agreement with an employer in relation to the scheme the effect of which is to reduce the amount of any debt due to the scheme from that employer under Article 75 of the 1995 Order (deficiencies in the assets) which may be recovered by, or on behalf of, those trustees or managers.

(3) Paragraph (2) shall not apply where –

(a)before the beginning of an assessment period –

(i)the trustees or managers of the scheme enter into a legally enforceable agreement with an employer in relation to the scheme the effect of which is to reduce the amount of the debt due to the scheme from that employer under Article 75(2) of the 1995 Order which may be recovered by, or on behalf of, those trustees or managers;

(ii)the value of the scheme’s assets would be sufficient to secure benefits for, or in respect of, members of the scheme which correspond to the amount of compensation which would be payable in relation to the scheme in accordance with the pension compensation provisions if the Board were to assume responsibility for the scheme in accordance with Chapter 3 (pension protection) of Part III of the Order;

(iii)an individual appointed to act as the actuary in relation to the scheme (“the actuary”) has provided the Board with a written estimate of the current value of the assets and the protected liabilities of the scheme together with a statement about the effect which the agreement would have on the value of the scheme’s assets as recorded in that estimate, and

(iv)the Board has determined to validate the estimate and statement provided;

(b)before the beginning of an assessment period, the trustees or managers of the scheme enter into a legally enforceable agreement with an employer in relation to the scheme, as part of an arrangement under Article 418 of the Companies Order (power of company to compromise with creditors and members), the effect of which is to reduce the amount of the debt due to the scheme from that employer under Article 75(2) of the 1995 Order which may be recovered by, or on behalf of, those trustees or managers, or

(c)after the beginning of an assessment period, or a further assessment period(10), the Board is acting as creditor of an employer in relation to the scheme under Article 121 (Board to act as creditor of the employer) and has entered into a legally enforceable agreement with that employer on behalf of the trustees or managers of the scheme the effect of which is to reduce the amount of the debt due to the scheme from that employer under Article 75(4) of the 1995 Order which may be recovered by, or on behalf of, those trustees or managers.

(4) Paragraph (2) shall not apply in relation to an eligible scheme where, before the beginning of an assessment period in relation to the scheme, a prescribed arrangement is in place pursuant to regulations made under Article 75A(11) of the 1995 Order (deficiencies in the assets: multi-employer schemes).

(5) Where the Board has determined to validate, or not to validate, an estimate and statement provided to it by the actuary under paragraph (3)(a)(iii), it must issue a notice to this effect and must give a copy of that notice to –

(a)the trustees or managers of the scheme;

(b)the actuary;

(c)the insolvency practitioner in relation to the employer in relation to the scheme, and

(d)the Regulator.

(6) A notice issued by the Board under paragraph (5) shall be in writing and shall contain the following information –

(a)the name or type of the notice issued;

(b)the date on which the notice is issued;

(c)the date on which the Board received the estimate and statement from the actuary;

(d)the Board’s determination to validate, or not to validate, the estimate and statement received from the actuary;

(e)a statement of reasons for the Board’s determination;

(f)the address for communications at which the Board may be contacted in connection with the issue of the notice;

(g)whether the issue of the notice by the Board is a reviewable matter and, if so, the time limit for applying for a review of, or appeal against, the issue of the notice;

(h)the date on which the notice issued will become binding, and

(i)whether or not the notice issued contains any restricted information and, if so, the nature of the restrictions.

(7) The Board’s determination to validate, or not to validate, the estimate and statement provided to it by the actuary under paragraph (3)(a)(iii) does not take effect –

(a)until –

(i)the Board has issued a notice under paragraph (5) relating to the determination, and

(ii)the period within which the issue of that notice may be reviewed by virtue of Chapter 6 (reviews, appeals and maladministration) of Part III of the Order has expired, and

(b)if the issue of the notice was so reviewed, until –

(i)the review and any reconsideration;

(ii)any reference to the PPF Ombudsman in respect of the issue of the notice, and

(iii)any appeal against his determination or directions,

has been finally disposed of.