The Health and Social Care (Pension Scheme) Regulations (Northern Ireland) 2008

CHAPTER 8ABATEMENT

Application of Chapter 8

115.—(1) This Chapter applies if—

(a)a person who is a pensioner member of the Scheme is employed in HSC employment,

(b)the person’s employment is not employment to which the person was transferred as a result of a transfer of an undertaking to the person’s employer,

(c)the person’s pension is a pension under—

(i)regulation 52 (early retirement on ill-health: active members),

(ii)regulation 54 (early retirement on ill-health: deferred members), or

(iii)regulation 55(1)(d)(ii) (early retirement on termination of employment by employing authority) in a case where the Department certified that the member’s employment was terminated in the interests of the efficiency of the service in which the member was employed, and

(d)the person has not reached the age of 65.

(2) In this Chapter “HSC employment” includes—

(a)employment to which regulations made under sections 10 (1) and (2) and 12 (1) and (2) of, and Schedule 3 to, the Superannuation Act 1972 apply,

(b)employment with an employer in respect of whom a direction has been made under section 7 of the Superannuation (Miscellaneous Provisions) Act 1967(1),

(c)employment to which regulations made under section 10 of the Superannuation Act 1972(2) and having effect in Scotland apply,

(d)employment to which a scheme made under section 2 of the Superannuation Act 1984 (an Act of Tynwald) applies,

(e)employment with an employer with whom an agreement has been made under section 235 of the National Health Service Act 2006.

(3) In this Chapter, subject to paragraph (4)—

(a)a person to whom this Chapter applies is referred to as an “employed pensioner”,

(b)the pension to which the employed pensioner is entitled is referred to as the “old service pension”,

(c)the employment in respect of which the pension is payable is referred to as “the old employment”, and

(d)the employment in which the employed pensioner is employed is referred to as the “new employment”.

(4) This Chapter applies whether or not the person is an active member of the Scheme in the new employment.

(5) For the purposes of this Chapter, so much of any pension as is additional pension is ignored.

Information

116.—(1) A person who becomes an employed pensioner must inform—

(a)the person’s employer in the new employment, and

(b)any other person that the Department may specify,

that the old service pension is payable.

(2) A person who ceases to be an employed pensioner in one new employment and becomes an employed pensioner in another new employment must inform—

(a)the person’s employer in the other new employment, and

(b)any other person that the Department may specify,

that the old service pension is payable.

Reduction of pension

117.—(1) If the condition in paragraph (2) is met, the amount of the old service pension for any scheme year is reduced.

(2) The condition is that the employed pensioner’s relevant income for the scheme year exceeds the employed pensioner’s previous pay.

(3) The amount of the reduction under paragraph (1) is equal to that excess but cannot exceed the enhancement amount.

(4) For the meaning of “relevant income” and “enhancement amount” see regulation 118.

(5) For the meaning of “previous pay” see regulation 119.

(6) If the employed pensioner holds the new employment for only part of any scheme year, this regulation applies as if—

(a)the reference in paragraph (2) to the employed pensioner’s relevant income were a reference to the appropriate proportion of that income, and

(b)the reference in that paragraph to the employed pensioner’s previous pay were a reference to the appropriate proportion of that pay.

(7) In paragraph (6) “the appropriate proportion” means the same proportion as the period during which the new employment is held bears to the whole scheme year.

(8) If the member has a guaranteed minimum under section 10 of the 1993 Act in relation to the old service pension, nothing in this regulation requires the reduction of the old service pension below the amount of the member’s guaranteed minimum in relation to it.

Meaning of “relevant income”

118.—(1) The employed pensioner’s relevant income for a scheme year is the aggregate of—

(a)the amount of pay received by the employed pensioner during that year from the new employment (assuming, in any case where the employed pensioner is not an active member of the Scheme in the new employment, that the employed pensioner is such a member), and

(b)the enhancement amount in relation to the old service pension.

(2) The enhancement amount, in relation to an old service pension, is the difference between—

(a)the amount of that pension for that year, and

(b)the amount that that pension would have been had it been payable under regulation 48.

(3) If the old service pension is payable under regulation 52 or 54 (ill-health pensions) to an employed pensioner who had not reached the age of 55 at the time when entitlement to the pension arose, for the purposes of paragraph (2)(b)—

(a)the fact that entitlement to a pension under regulation 48 depends on reaching that age is ignored, but

(b)the employed person’s actual age at the relevant time is taken into account in determining the reduction to be made under regulation 48(2).

(4) If the old service pension is a tier 2 ill-health pension, for the purposes of paragraph (2)(b), only the employed pensioner’s actual pensionable service at the time when entitlement to the pension arose is taken into account in determining the amount that would have been payable under regulation 48.

(5) If the employed pensioner exercised the option under regulation 58 (general option to exchange part of pension for lump sum) in relation to the old service pension, the resulting reduction in the pension is ignored for the purposes of this regulation.

(6) If the employed pensioner exercised the option under regulation 62 (election to allocate pension) in relation to the old service pension, the resulting reduction in the pension is taken into account for the purposes of this regulation.

(7) References in this regulation to the amount of a pension for any scheme year are to its amount for that year after any increases payable under the Pensions (Increase) Act (Northern Ireland) 1971 in respect of that pension, including the increases that would have been payable in respect of any amount not paid because of a reduction ignored under paragraph (5).

Meaning of “previous pay”: general

119.—(1) For the purposes of this Chapter an employed pensioner’s previous pay, subject to paragraph (3) and regulation 120 (members with concurrent employments) is the greater of—

(a)the employed pensioner’s reckonable pay for the purposes of the old service pension, and

(b)the annual rate of pay for the old employment at the time it ceased.

(2) In this regulation “annual rate of pay” means the sum of—

(a)the annual rate of so much of the employed pensioner’s pensionable pay immediately before the old service pension became payable as consisted of—

(i)salary,

(ii)wages, or

(iii)other regular payments,

of a fixed nature, and

(b)so much of any fees and other regular payments not of a fixed nature as—

(i)was payable to the employed pensioner during the period of 12 months ending with the day the old employment ceased, and

(ii)formed part of the employed pensioner’s pensionable pay.

(3) Subject to regulation 120, the amount to be taken as the employed pensioner’s previous pay must be adjusted in each scheme year for inflation.

(4) The reference in paragraph (3) to adjusting that amount in each scheme year for inflation is to increasing it by the same amount as that by which an annual pension equal to that amount would have been increased under the Pensions (Increase) Act (Northern Ireland) 1971 at 6th April in that scheme year if—

(a)that pension was eligible to be so increased, and

(b)the beginning date for that pension were the same as the beginning date for the old service pension.

(5) In this regulation “the beginning date”, in relation to a pension, means the date on which it is treated as beginning for the purposes of section 8(2) of the Pensions (Increase) Act (Northern Ireland) 1971.

Meaning of “previous pay”: members with concurrent employments

120.—(1) In the case of an employed pensioner who held one or more other HSC employments at the same time as the old employments, the amount to be taken as the employed pensioner’s previous pay is the sum of—

(a)the amount of the employed pensioner’s previous pay, in accordance with regulation 119, and

(b)in respect of any of the other HSC employments which are held in the scheme year mentioned in regulation 117(2), the annual rate of pay for that employment in that scheme year, and

(c)in respect of any of the other HSC employments which are not held in the scheme year mentioned in 117(2), the pensionable pay for that employment for the period of 12 months ending with the day before the old employment ceased or, if the employed pensioner was not a member of the Scheme in that employment in that period, the amount that would have been the pensionable pay for it assuming that the employed pensioner had been such a member.

(2) The amount to be taken as the employed pensioner’s previous pay in accordance with paragraph (1) must be adjusted in each scheme year for inflation in the manner set out in regulation 118.

Application of this Chapter to part-time employment

121.—(1) This regulation provides for the application of this Chapter where the old employment or the new employment is a part-time employment.

(2) The reference in regulation 119(1)(a) to the employed pensioner’s reckonable pay for the purposes of the old service pension must be taken as a reference to such amount as in the opinion of the Department would have been the reckonable pay for those purposes if—

(a)the old employment had been a comparable whole-time employment, and

(b)accordingly the member’s reckonable pay had been determined without reference to regulation 18 or 19.

Employed pensioners with more than one pension

122.—(1) This regulation provides for the application of this Chapter where a person is entitled to more than one old service pension falling within regulation 115(1)(c) in any scheme year.

(2) In regulation 117—

(a)for paragraphs (1) and (2) substitute—

“(1) If the condition in paragraph (2) is met, the amount of the old service pensions for any scheme year is reduced.

(2) The condition is that the employed pensioner’s relevant income for the scheme year exceeds the employed pensioner’s previous pay for all the old employments.

(2A) The amount of the reduction under paragraph (1) in the case of each of the pensions is equal to the same proportion of that excess as the amount of the pension for the scheme year before the reduction, bears to the sum of the pensions for that year before the reduction”.

(3) In regulation 118(1)(b) for “the old service pension” there shall be substituted “all the old service pensions”.

(4) Regulation 123 applies as if references to the old service pensions were references to all those pensions.

Provisional reductions and later adjustments

123.—(1) If it appears to the Department that the condition in regulation 117(2) will be met in any scheme year in respect of the old service pension for that year, the Department may reduce the amount of that pension paid at any time in the scheme year.

(2) Where the old service pension for a scheme year is being reduced under this Chapter, the Department must review the amount of the reduction—

(a)at the end of the scheme year, and

(b)at any time during the scheme year if it appears to the Department that—

(i)the amount of the reduction made for the year is or may become incorrect, or

(ii)no reduction should be made.

(3) If at any time during the scheme year it so appears the Department must make such adjustments, whether by altering the amount of the reduction or by repaying to the employed pensioner any amount that should not have been deducted from the pension, as appear to the Department to be required.

(4) If at the end of the scheme year it is apparent that—

(a)the reduction in the old service pension for the year was excessive, or

(b)no such reduction should have been made,

the Department must repay the amount due to the employed pensioner.

(5) If at the end of the scheme year it is apparent that the old service pension paid for the year exceeded the amount due because the reduction in the old service pension required under regulation 117 was not made, the employed pensioner must repay the excess to the Department.

(6) Paragraph (5) does not affect the Department’s right to recover a payment or overpayment in any case where the Department considers it appropriate to do so.