The Industry-Wide Coal Staff Superannuation Scheme Regulations 1994

• Citation: S.I. 1994/2973
• Sections: 176

Section 1 Citation and Commencement

These regulations may be cited as the Industry-Wide Coal Staff Superannuation Scheme Regulations 1994 and shall come into force on 15th December 1994.

Section 2 Interpretation

In these Regulations

“the 1994 Act ” means the Coal Industry Act 1994;

“ the Scheme ” means the British Coal Staff Superannuation Scheme which was established under the Coal Industry Nationalisation (Superannuation) Regulations 1946 made under section 37 of the Coal Industry Nationalisation Act 1946 on 1 January 1947 by a resolution of 31 December 1946 of the National Coal Board and which was amended and continued to have effect by a resolution of 18 July 1947 of that Board and was further amended by subsequent resolutions of that Board the name of which was changed to the British Coal Corporation by section 1(1) of the Coal Industry Act 1947 ;

“ the Co-ordinator ” means Industry-Wide Coal Staff Superannuation Scheme Co-ordinator Limited.

Section 3 Establishment of new pension scheme

The Co-ordinator shall establish by means of a trust deed entered into between the Co-ordinator and Industry-Wide Coal Staff Superannuation scheme Trustees Limited a pension scheme in which participants in the Scheme, being an existing scheme within the meaning of Schedule 5 to the 1994 Act, are able to participate in accordance with the provisions of paragraph 3 of Schedule 5 to the 1994 Act.

Section 4 Provisions of new pension scheme

The pension scheme required by regulation 3 above to be established shall be in the terms of a trust deed as set out in the Schedule to these Regulations which contains provision as specified in paragraph 3(6) of Schedule 5 to the 1994 Act satisfying the Statutory requirements by reference to the Scheme as an existing scheme within the meaning of Schedule 5 to the 1994 Act.

Section 1 Establishment of Scheme and Declaration of Trust

The Co-ordinator hereby establishes the Scheme under irrevocable trusts with effect on and from [ date to be inserted in manuscript ] (hereinafter called “the Commencement Date”) and appoints the First Trustee to be the first trustee of the Scheme and the Co-ordinator hereby covenants with the First Trustee and successive trustees from time to time of the Scheme to observe and perform the provisions of the Trust Deed and the Rules.

Section 1 Eligibility and Admission to Membership

(1) No person shall be eligible for membership of the Scheme unless he satisfies the conditions set out in either paragraph (2) or paragraph (3) of this Rule.

(2) Persons who become Protected Employees with effect on and from Transfer Day, who have not subsequently ceased to be Protected Employees and who have not attained Normal Retiring Age shall be eligible for membership of the Scheme if they are in Eligible Employment.

(3) On and after the Commencement Date:—

(a) persons who before Transfer Day were members of BCSSS but did not become Protected Employees with effect on and from Transfer Day; and

(b) persons who became Protected Employees with effect on and from Transfer Day and have subsequently ceased to be Protected Employees; and

(c) persons who have previously been contributing members of IWS-MPS or of the Scheme,

and who (in any of (a), (b) or (c) above) have not attained Normal Retiring Age and have been granted a General Certificate of Health shall if the Employer so determines, be eligible to become (or again to become) members of the Scheme if they are in Eligible Employment.

(4) Every person who, satisfying the eligibility conditions set out in either paragraph (2) or paragraph (3) of this Rule, delivers to the Committee an application for membership of the Scheme in such form and within such period after satisfying the eligibility conditions as the Committee shall prescribe, shall thereupon be admitted to membership of the Scheme and such admission shall have effect from such date as the Committee shall determine.

Section 1 Interpretation

(1.1) Definitions. In this Appendix the following words have the following meanings:—

“1973 Act” means the Social Security Act 1973.

“1975 Act” means the Social Security Pensions Act 1975.

“Actuary” means a Fellow of the Institute of Actuaries or a Fellow of the Faculty of Actuaries or a person with other actuarial qualifications who is approved by the Secretary of State for Social Security, at the request of the Trustees, as being a proper person to act in this capacity.

“Contracted-out Employment” of a Member means his contracted-out employment by reference to the Scheme (which expression shall have the same meaning as in the 1975 Act).

“Fixed Rate Revaluation” means the method of revaluing a GMP before State Pension Age described in (C) in Rule 6.2.

“GMP” means the guaranteed minimum pension of a Member, Widow or Widower as defined in the 1975 Act.

“Insurer” means:—

an insurance company authorised under section 3 or 4 of the Insurance Companies Act 1982 to carry on ordinary long-term insurance business and acting through a branch or office in the United Kingdom; or

a friendly society enabled under regulations made under section 71(1) of the 1973 Act as amended by section 4 of the Social Security Amendment Act 1974 or under article 67 of the Social Security Pensions (Northern Ireland) Order 1975 to conduct such business as is described in that section or article.

“Limited Revaluation” means the method of revaluing a GMP before State Pension Age described in (B) in Rule 6.2.

“Member” means a member of the Scheme (including a person who is no longer in the pensionable service of any employer participating in the Scheme but in respect of whom benefits are still immediately or prospectively payable under the Scheme).

“Normal Retiring Date” means the day on which a Member attains his normal pension age (within the meaning of the 1975 Act) under the Scheme.

“Protected Rights” has the same meaning as in Schedule 1 to the Social Security Act 1986.

“Qualifying Service” has the same meaning as in the 1973 Act.

“Rule” followed by a number means the Rule with that number in this Appendix.

“Scheme” means this occupational pension scheme.

“Section 21 Revaluation” means the method of revaluing a GMP before State Pension Age described in (A) in Rule 6.2.

“Section 49 money purchase scheme” means a scheme which was a contracted-out money purchase scheme and which the Occupational Pensions Board are under a duty to supervise under section 49 of the 1975 Act.

“Section 49 salary related scheme” means a scheme which was a contracted-out salary related scheme and which the Occupational Pensions Board are under a duty to supervise under section 49 of the 1975 Act.

“Short Service Benefit” means the benefit to which an early leaver who satisfies the qualifying conditions must be entitled under the preservation requirements.

“State Pension Age” means a man’s 65th birthday and woman’s 60th birthday.

“Trustees” means the trustees or administrators of the Scheme.

“Widow” and “Widower” mean respectively the widow and the widower of a Member. If a Member has married under a law which allows polygamy and, on the day of the Member’s death has more than one spouse, none of them will qualify as a Widow or Widower. However, if only one spouse survives, that survivor will be the Widow or Widower.

(1.2) Legislation. References to any piece of legislation include any legislative modification or re-enactment of it, any regulations made under it and any equivalent Northern Ireland legislation.

Section 1

“Administrator” shall mean the person or persons having the management of the Scheme.

Section 1

The Member’s Aggregate Retirement Benefit shall not exceed:—

(a) on retirement at any time between attaining age 50 and attaining age 75, except before Normal Retiring Age on grounds of Incapacity, a pension of 1/60th of Final Remuneration for each year of Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval;

(b) on retirement at any time before Normal Retiring Age on grounds of Incapacity a pension of the amount which could have been provided at Normal Retiring Age in accordance with paragraph 1(a) above, Final Remuneration being computed as at the actual date of retirement;

(c) on leaving Pensionable Service before attaining age 75, a pension of 1/60th of Final Remuneration for each year of Service prior to leaving Pensionable Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval. The amount computed may be increased by 5 per cent for each complete year or, if greater, in proportion to any increase in the Index which has occurred between the date of termination of Pensionable Service and the date on which the pension begins to be payable. Any further increase necessary to comply with Social Security legislation is also allowable.

(d) Benefits for a Class A Member are further restricted to ensure that his total retirement benefit from the Scheme and from any Associated Scheme or Connected Scheme does not exceed a pension of 1/30th of the Permitted Maximum for each year of Service, subject to a maximum of 20/30ths. For the purpose of this limit, service is the aggregate of Service and any period of service which gives rise to benefits under a Connected Scheme provided that no period is to be counted more than once.

(e) For the purpose of calculating the Aggregate Retirement Benefit or the total retirement benefit in (a) to (d) above, the pension equivalent of any Lump Sum Retirement Benefit is one-twelfth of its total cash value.

Section 1

The Member’s Aggregate Retirement Benefit shall not exceed:—

(a) on retirement at or before Normal Retiring Age except before Normal Retiring Age on grounds of Incapacity, a pension of 1/60th of Final Remuneration for each year of Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval;

(b) on retirement before Normal Retiring Age on grounds of Incapacity a pension of the amount calculated in accordance with paragraph 1(a) above as if the Member had remained in Service until the Normal Retiring Age, Final Remuneration being computed as at the actual date of retirement;

(c) on retirement after Normal Retiring Age, a pension of the greatest of:—

(i) the amount calculated in accordance with paragraph 1(a) above on the basis that the actual date of retirement was the Member’s Normal Retiring Age;

(ii) the amount which could have been provided at Normal Retiring Age in accordance with paragraph 1(a) above increased either actuarially in respect of the period of deferment or in proportion to any increase in the Index during that period; and

(iii) where the Member’s total Service has exceeded 40 years, the aggregate of 1/60th of Final Remuneration for each year of Service before Normal Retiring Age (not exceeding 40 such years) and of a further 1/60th of Final Remuneration for each year of Service after Normal Retiring Age, with an overall maximum of 45 reckonable years.

Final Remuneration being computed in respect of (i) and (iii) above as at the actual date of retirement;

(d) on leaving Pensionable Service before Normal Retiring Age, a pension of 1/60th of Final Remuneration for each year of Service prior to leaving Pensionable Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval. The amount computed may be increased by 5 per cent for each complete year or, if greater, in proportion to any increase in the Index which has occurred between the date of termination of Pensionable Service and the date on which the pension begins to be payable. Any further increase necessary to comply with Social Security legislation is also allowable.

Section 1 MEMBER'S CONTRIBUTIONS

(a) Each Member is required to contribute to the Scheme in accordance with the provisions of Rule 4. The rate of contribution determined in accordance with Rule 4 will not be altered before the expiry of a period of 12 months from the date on which the first payment at the current rate became due without the specific agreement of the Board of Inland Revenue.

(b) In addition the Member may make voluntary contributions to the Scheme to secure additional benefits for himself and/or his Dependants. Any retirement benefits so secured must be in the form of non-commutable pension except to the extent to which the provisions of the Scheme allow commutation of trivial pensions or on the grounds of serious ill health.

(c) The contributions paid to the Scheme by a Member in a year of assessment shall not exceed either:—

(i) when aggregated with the Member’s contributions to any other exempt approved schemes, 15 per cent of the Member’s Remuneration; or

(ii) when aggregated with the Member’s contributions to any schemes which are Associated or Connected Schemes, 15 per cent of the Permitted Maximum.

Section 1 MEMBER'S CONTRIBUTIONS

(a) Each Member is required to contribute to the Scheme in accordance with the provisions of Rule 4. The rate of contribution determined in accordance with Rule 4 will not be altered before the expiry of a period of 12 months from the date on which the first payment at the current rate became due without the specific agreement of the Board of Inland Revenue.

(b) In addition the Member may make voluntary contributions to the Scheme to secure additional benefits for himself and/or his Dependants. Where such contributions commence on or after 8th April 1987 any retirement benefits so secured must be in the form of non-commutable pension except to the extent to which the provisions of the Scheme allow commutation of trivial pensions or on the grounds of serious ill health.

(c) The total contributions paid by the Member in a year of assessment to this and any Associated Scheme shall not exceed 15 per cent of his Remuneration for that year.

Section 1 DEPENDANTS' PENSIONS

Any pension for a Dependant, when aggregated with the pensions, other than those provided by surrender or allocation of the Member’s own pension, payable to that Dependant under all Associated Schemes, shall not exceed an amount equal to 2/3rds of the maximum Aggregate Retirement Benefit payable to the Member immediately before death under Part 1 above. Where the death of the Member occurs whilst in Service before Normal Retiring Age the maximum is that appropriate had the Member retired on grounds of Incapacity on the date of death entitled to no retained benefits from previous employments.

If pensions are payable to more than one Dependant of a Member, the aggregate of all Dependants' pensions payable in respect of him under this and all Associated Schemes shall not exceed the full amount of the maximum Aggregate Retirement Benefit described in the previous paragraph of this rule.

Section 2 Trusteeship, Scheme Fund and Management and Administration

With effect on and from the Commencement Date:—

(1) The moneys, investments and other property of the Scheme shall constitute the Scheme Fund, and the First Trustee, shall be the first sole trustee of the Scheme and the Scheme Fund;

(2) Save insofar as the Scheme Fund or any part of it is for the time being vested in any nominee or custodian trustee appointed under Clause 14(3) or in any person appointed under Clause 17(1), the Scheme Fund shall be vested in the Trustee;

(3) The management and administration of the Scheme, in accordance with the provisions thereof, shall be vested in the Trustee;

(4)

(a) All powers expressed by the Scheme, in whatever terms, to be vested in, conferred on or exercisable or to be exercised by the Committee shall be vested in the Trustee;

(b) Such powers and all other powers vested in, conferred on or exercisable or to be exercised by the Trustee under or by virtue of the Scheme shall be exercised by it and on its behalf by and through the Committee in their capacity as Committee of Management of the Trustee within the meaning of the Articles of Association of the Trustee (hereinafter called “the Articles”) or any other person or body of persons required, authorised or empowered to exercise such powers or any of them by or under any provision of the Scheme and by or under the Articles; and

(c) Save in relation to Clause 47 and the meanings assigned to “the Committee” by Clause 50(i), any reference in the Scheme, in whatever terms, to the Committee shall be construed as a reference to the Trustee acting by and through the Committee in the capacity specified in sub-paragraph (b) of this paragraph or any other person or body of persons required, authorised or empowered to act for it or on its behalf for that purpose by or under any provision of the Scheme and by or under the Articles.

Section 2 Ceasing Normal and Family Contributions

(1) This Rule shall override any other provisions of the Scheme and Rules which are inconsistent with it.

(2) A Member who, whilst remaining in Eligible Employment, wishes to cease to pay Normal and Family Contributions in accordance with the provisions of Rule 4, shall give notice to the Secretary. The notice required to be given for the purposes of this paragraph shall be in such form as the Committee may from time to time prescribe and may, if the Contributor is a Protected Person, contain advice as to the consequences of ceasing to be in service in Eligible Employment and Contributing Service. On the expiry of such notice his service in Eligible Employment and Contributing Service shall be deemed for the purposes of the Rules as having terminated in accordance with the provisions of Rule 24.

Section 2 Application of Appendix

(2.1) Application of Appendix. This Appendix shall apply if any Member’s employment becomes Contracted-out Employment by reference to the Scheme and the Scheme is not contracted-out on a money purchase basis.

The Appendix will only apply so long as anyone has a GMP or a prospective right to receive a GMP under the Scheme.

(2.2) Overriding effect of Appendix. This Appendix overrides any inconsistent provisions elsewhere in the Scheme except provisions which are necessary in order that Inland Revenue approval for the purposes of Chapter I Part XIV of the Income and Corporation Taxes Act 1988 is not prejudiced.

Section 2

“Aggregate Retirement Benefit” shall mean the aggregate of:—

(a) the Member’s pension under the Scheme and any Associated Scheme; and

(b) the pension equivalent of the Member’s Lump Sum Retirement Benefit.

Section 2

The Member’s Lump Sum Retirement Benefit shall not exceed:—

(a) on retirement at any time between attaining age 50 and attaining age 75, except before Normal Retiring Age on grounds of Incapacity, 3/80ths of Final Remuneration for each year of Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval;

(b) on retirement at any time before Normal Retiring Age on grounds of Incapacity the amount which could have been provided at Normal Retiring Age in accordance with paragraph 2(a) above, Final Remuneration being computed as at the actual date of retirement;

(c) on leaving Pensionable Service before attaining age 75, a lump sum of 3/80ths of Final Remuneration for each year of Service prior to leaving Pensionable Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval. The amount computed may be increased in proportion to any increase in the Index which has occurred between the date of termination of Pensionable Service and the date on which the benefit is first paid.

Section 2

The Member’s Lump Sum Retirement Benefit shall not exceed:—

(a) on retirement at or before Normal Retiring Age, except before Normal Retiring Age on grounds of Incapacity, 3/80ths of Final Remuneration for each year of Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval;

(b) on retirement before Normal Retiring Age on grounds of Incapacity the amount calculated in accordance with paragraph 2(a) above as if the Member had remained in Service until the Normal Retiring Age, Final Remuneration being computed as at the actual date of retirement;

(c) on retirement after Normal Retiring Age, the greatest of:—

(i) the amount calculated in accordance with paragraph 2(a) above on the basis that the actual date of retirement was the Member’s Normal Retiring Age;

(ii) the amount which could have been provided at Normal Retiring Age in accordance with paragraph 2(a) above together with an amount representing interest thereon; and

(iii) where the Member’s total Service has exceeded 40 years, the aggregate of 3/80ths of Final Remuneration for each year of Service before Normal Retiring Age (not exceeding 40 such years) and of a further 3/80ths of Final Remuneration for each year of Service after Normal Retiring Age, with an overall maximum of 45 reckonable years.

Final Remuneration being computed in respect of (i) and (iii) above as at the actual date of retirement;

(d) on leaving Pensionable Service before Normal Retiring Age, a lump sum of 3/80ths of Final Remuneration for each year of Service prior to leaving Pensionable Service (not exceeding 40 years) or such greater amount as will not prejudice Inland Revenue Approval. The amount computed may be increased in proportion to any increase in the Index which has occurred between the date of termination of Pensionable Service and the date on which the benefit is first paid.

Section 2 CONTINUED LIFE COVER

Any provision in the Rules to provide a lump sum benefit on the death of a Member occurring after retirement on pension (other than a payment under a guarantee of pension provision) shall be restricted in respect of a Member who joined the Scheme on or after 1st October 1991 to exclude any provision other than on death occurring before the Normal Retiring Age and after retirement on grounds of Incapacity. The amount of the benefit shall not exceed the amount payable had the Member died immediately before retirement increased in proportion to any increase in the Index between the date of the Member’s retirement and the date of death.

Section 2 TRANSFERS

(a) Any retirement benefits arising by virtue of the receipt by the Scheme of a transfer value (other than from another scheme providing benefits in respect of Service) shall not be capable of commutation unless and then only to the extent that a certificate has been obtained from the administrator of the transferring scheme showing the maximum lump sum payable from the transfer value. The amount so certified may be increased in proportion to any increase in the Index since the date the transfer payment was received.

(b) When, on or after a transfer having been made to another occupational pension scheme, the administrator of that scheme requests such a certificate as is referred to in paragraph 2(a) above the Administrator shall calculate as at the date of the transfer the maximum lump sum payable on retirement from the transfer value and certify that amount to the receiving scheme.

Section 2 INCREASES OF PENSIONS IN PAYMENT

The maximum amount of a pension ascertained in accordance with Part 1 and Part 2 of this rule less any pension which has been commuted for a lump sum or the pension equivalent of any benefits in lump sum form and any pension surrendered to provide a Dependant’s pension may be increased by 3 per cent for each complete year or, if greater, in proportion to any increase in the Index since the pension commenced.

Section 3 Trusteeship, Scheme Fund and Management and Administration

(1) In the event of the First Trustee ceasing for any reason to be the Trustee of the Scheme, the Co-ordinator shall forthwith procure that a new trustee or trustees of the Scheme and the Scheme Fund are appointed comprising either:—

(i) a new corporate trustee whose Articles of Association would be in a form corresponding as closely as may be possible to those of the First Trustee and would provide for the appointment of a committee of management consisting of eight persons, of whom four would be appointed by and would be subject to removal by the Co-ordinator, and four would be appointed by and would be subject to removal in accordance with rules to be agreed between the Co-ordinator and such organisations as at that time represent substantial proportions of the classes of the employees who are Members of the Scheme Provided that:—

(A) the four persons appointed by such organisations shall be persons who are or immediately before retirement were Contributors; and

(B) in the event that it is not possible to agree such rules or there is a dispute as to which organisations represent substantial proportions of the classes of the employees who are Members of the Scheme the matter shall be referred to a single Arbitrator to be named by the President for the time being of the Law Society. The Arbitrator so named shall have all the powers conferred on Arbitrators by the Arbitration Acts 1950 and 1979; or

(ii) eight individual trustees subject to appointment and removal as aforesaid.

(2) The Co-ordinator shall appoint the Chairman and Deputy Chairman of any such committee of management or of the trustees and the Chairman so appointed shall have, in the case of an equality of votes, a second or casting vote.

(3) The Co-ordinator shall, in connection with the aforesaid appointments, make such amendments to the Scheme and Rules as may be necessary to give effect to the provisions of paragraphs (1) and (2) of this Clause.

Section 3 Actual Date of Entry

(1) Subject as hereinafter provided, the Actual Date of Entry of a Member shall be the date with effect from which he is admitted as a Member of the Scheme.

(2) The Actual Date of Entry of a Contributor whose earlier service falls to be reckoned as Contributing Service pursuant to Rule 48 shall, subject to Rule 48(8)(b)(ii), be the Actual Date of Entry in respect of his first admission to the Scheme.

(3) The Actual Date of Entry of a Contributor who is a Contributor by virtue of paragraph (2) of Rule 1 shall be the date which was his Actual Date of Entry for the purposes of BCSSS.

Section 3 Amendment of Appendix

(3.1) Power to alter Appendix. The persons or bodies having the power of alteration in relation to the rest of the Scheme may make in writing any alteration to this Appendix necessary to comply with the contracting-out requirements of the 1975 Act applicable to salary related contracted-out schemes and Section 49 salary related schemes. This power of alteration may be exercised by them without any condition except the one in Rule 3.2.

(3.2) OPB’s consent. No alteration to this Appendix may be made without the consent of the Occupational Pensions Board. This applies whether the alteration is made under Rule 3.1 or under any other power of alteration in the Scheme.

Section 3

“Associated Employer”. An employer is associated with another employer if one is controlled by the other, or both are controlled by a third party. Control has the meaning in section 840 of the Taxes Act, or in the case of a close company, section 416 of the Taxes Act.

Section 3

The lump sum benefit (exclusive of any refund of the Member’s own contributions and any interest thereon) payable on the death of a Member while in Service or (having left Service with a deferred pension) before the commencement of his pension shall not, when aggregated with all like benefits under Associated Schemes, exceed the greatest of:—

(a) £5,000;

(b) 4 times the annual rate (subject to the Permitted Maximum) of the Member’s basic salary or wages at the date of death or leaving Pensionable Service together with the yearly average of Fluctuating Emoluments received in the 3 years (or the whole period of Service if less) up to the date of death or leaving Pensionable Service; and

(c) 4 times the Member’s Final Remuneration disregarding provisos (i), (ii), (iii) and (vi) of that definition less Retained Death Benefits.

Section 3

The lump sum benefit (exclusive of any refund of the Member’s own contributions and any interest thereon) payable on the death of a Member while in Service or (having left Service with a deferred pension) before the commencement of his pension shall not, when aggregated with all like benefits under Associated Schemes, exceed the greatest of:—

(a) £5,000;

(b) 4 times the annual rate of the Member’s basic salary or wages at the date of death or leaving Pensionable Service together with the yearly average of Fluctuating Emoluments received in the 3 years (or the whole period of Service if less) up to the date of death or leaving Pensionable Service; and

(c) 4 times the Member’s Final Remuneration disregarding provisos (i), (ii), (iii) and (vi) of that definition less Retained Death Benefits.

Section 3 PAYMENT OF RETIREMENT BENEFITS

(a) The payment of a Member’s retirement benefits shall not commence earlier than the Member attaining age 50, except on retirement on grounds of Incapacity, nor later than attaining age 75.

(b) No part of the Member’s retirement benefits is to be paid in advance of actual retirement except as necessary to comply with paragraph 3(a) above or to the extent necessary to comply with the requirements of the Pension Schemes Act 1993.

Section 3 SURPLUS AVCs

Where the application of the limits in this Appendix V requires the quantum of the Aggregate Retirement Benefit to be restricted and the Member has paid additional voluntary contributions to supplement scheme benefits, that restriction shall first be effected on those supplementary benefits so as to permit the repayment of the surplus additional voluntary contributions subject to section 599A of the Taxes Act.

The Administrator of the Scheme shall comply with the requirements of regulation 5 of The Retirement Benefits Schemes (Restriction on Discretion to Approve) (Additional Voluntary Contributions) Regulations 1993 (SI 1993 No 3016) and where the Scheme is the “leading scheme” in relation to a Member, with the requirements of regulation 6 of those Regulations so far as they concern main schemes. If those Regulations are amended or replaced by any other Regulations then this rule will have effect as if it had been amended or replaced accordingly.

Section 4 Nature of Scheme

The Scheme shall be a contributory scheme providing for or in respect of each of the Contributors after qualifying periods of Contributing Service:—

(i) as Normal Benefits (on payment by the Contributor of Normal Contributions) a pension for life on retirement at or after the Normal Retiring Age or earlier through ill-health or a lump sum payment on death before retirement or benefits on withdrawal; and

(ii) as Family Benefits (on payment by the Contributor of Family Contributions) pensions for the Contributor’s widow or widower and Children; and

(iii) as Added Benefits (on payment by the Contributor of Added Contributions at his option) further benefits of the nature mentioned in sub-paragraphs (i) and (ii).

Section 4 Normal and Family Contributions

(1) Subject to the provisions of Rule 19 every Member by virtue of the foregoing provisions of the Rules who has not ceased to be employed in Eligible Employment shall from the date with effect from which he is admitted as a Member of the Scheme pay Normal Contributions for securing Normal Benefits at the rate of 5 per cent of Contribution Salary (or, if his Actual Date of Entry was before 1st January 1964, 4 per cent of Contribution Salary).

(2) Subject to the provisions of Rule 19 every Contributor shall also pay Family Contributions for securing Family Benefits at the rate of 1 per cent of Contribution Salary Provided that during the period terminating on 5th April 2009 every Contributor shall be relieved of the obligation to pay Family Contributions but for the purpose of calculating Family Benefits he shall be deemed to have paid Family Contributions during such period for so long as he continues to be a Contributor.

(3) Subject to the proviso to paragraph (2) of this Rule, contributions payable by a Contributor under paragraphs (1) and (2) of this Rule shall continue to be payable by him:—

(a) for a period of 40 years from the date of commencement of contributions under paragraph (1) of this Rule, reduced by the aggregate of any Back Service Credit for Normal Benefits; or

(b) subject to Rule 25(2), until he ceases to be employed in Eligible Employment in a grade eligible for membership of the Scheme; or

(c) until he ceases to be a Contributor under any other provision of the Rules

whichever is the shortest period.

Section 4 Entitlement to GMP

(4.1) Guaranteed Minimum. Rule 4 applies to a Member, Widow or Widower where the Member has a guaranteed minimum in relation to the pension provided for the Member under the Scheme in accordance with section 35 of the 1975 Act.

(4.2) Member’s GMP. The Member shall be entitled to a pension for life paid at a rate equivalent to a weekly rate of not less than that guaranteed minimum. The pension will be paid from State Pension Age but commencement of the pension may be postponed for any period during which the Member remains in employment after State Pension Age:—

(1) if the employment is employment to which the Scheme relates and the postponement is not for more than 5 years after State Pension Age, or

(2) if the Member consents to the postponement.

(4.3) Widow’s GMP. Where the Member is a man and dies at any time leaving a Widow, she shall be entitled, subject to Rule 4.4, to receive a pension from the Scheme paid at a rate equivalent to a weekly rate of not less than half that guaranteed minimum.

(4.4) The pension shall be paid for life to any Widow.

(4.5) Widower’s GMP. Where the Member is a woman and dies at any time on or after 6 April 1989 leaving a Widower, he shall be entitled, subject to Rule 4.6, to receive a pension from the Scheme paid at a rate equivalent to a weekly rate of not less than half of that part of that guaranteed minimum which is attributable to earnings for the tax year 1988/89 and subsequent tax years.

(4.6) The pension shall be paid for life to any Widower.

(4.7) Offsetting pension against GMP. Any pension payable to the Member, Widow or Widower under any other provision of the Scheme may be offset against his or her pension entitlement under Rule 4 except to the extent that:—

(1) any part of the other pension is an equivalent pension benefit within the meaning of the National Insurance Act 1965, or

(2) any part of the other pension is the “appropriate amount” under Part I of Schedule 1A of the 1975 Act, or

(3) offsetting would contravene Rule 7.

Section 4

“Associated Scheme” shall mean any Relevant Scheme providing benefits in respect of Service.

Section 4

The preceding provisions of this rule shall be modified in their application to a Member who is a Controlling Director as follows:—

(a) the amount of the maximum Aggregate Retirement Benefit in paragraph 1 and of the maximum Lump Sum Retirement Benefit in paragraph 2 shall be reduced, where necessary for Inland Revenue Approval, to take account of any corresponding benefits under retirement annuity contracts or trust schemes approved under Chapter III Part XIV of the Taxes Act or under personal pension schemes approved under Chapter IV Part XIV of the Taxes Act; and

(b) where retirement takes place after Normal Retiring Age but not later than the Member’s 70th birthday, paragraph 1(c)(ii) and (iii) and paragraph 2(c)(ii) and (iii) shall not apply, and if retirement is later than the attainment of that age the paragraphs shall apply as if the Member’s 70th birthday had been specified in the Rules as his Normal Retiring Age so as not to treat as Service after Normal Retiring Age any Service before the Member reaches the age of 70.

Section 4 TRANSFERS

(a) The benefits arising on retirement from a transfer value shall not be capable of commutation nor shall they be paid in lump sum form if the transfer is accompanied by a certificate from the administrator of the transferring scheme to the effect that the transfer value is not to be used to provide benefits in lump sum form.

(b) When making a transfer to an approved personal pension scheme the Administrator shall provide a certificate of the maximum lump sum payable on retirement from the transfer value if the transferring member:—

(i) was aged 45 or more at the time that the transfer payment was made; or

(ii) has, at any time within the 10 years preceding the date on which the right to the cash equivalent being transferred arose, been, in respect of any employment to which the transfer payment or any part of it relates, either:—

(I) a Controlling Director; or

(II) in receipt of annual remuneration in excess of £60,000 or, if greater, the allowable maximum (ie. the equivalent for personal pension schemes of the Permitted Maximum) for the year of assessment in which the date of transfer falls; or

(iii) is entitled to benefits included in the transfer payment which arise from an occupational pension scheme under which the normal retiring age is 45 or less.

The COMMON SEAL of INDUSTRY-WIDE COAL STAFF SUPERANNUATION SCHEME CO-ORDINATOR LIMITED was hereunto affixed in the presence of:—

Director

Secretary/Director

The COMMON SEAL of INDUSTRY-WIDE COAL STAFF SUPERANNUATION SCHEME TRUSTEES LIMITED was hereunto affixed in the presence of:—

Director

Secretary/Director

Section 5 Contributions by Employers

(1) Each Employer shall pay as standard contributions to the Scheme Fund a sum equal to the recommended percentage of the Salaries paid by the Employer to Members employed by the Employer in respect of any period during which a Member is in Contributing Service. For the purpose of this Clause the “recommended percentage” in relation to any Employer means the percentage recommended in respect of the liabilities relating to employees and former employees of that Employer from time to time by the Actuary for this purpose under Clause 6 or 7(3)(i).

(2) An Employer shall make additional contributions to the Scheme as shall from time to time be determined under Rule 49(1).

(3) Every Employer shall pay as deficiency contributions after the coming into operation of any determination of deficiency contributions made by the Actuary under Clause 7, such payments as may become payable by it thereunder or as may be necessary on the advice of the Actuary.

(4) The total amount of the contributions which would otherwise be payable by an Employer shall be reduced by an amount equal to the difference between the total amount of any Contributions Equivalent Premiums paid during any period insofar as they relate to periods of service of an employee or former employee of that Employer in respect of which a pension would or might otherwise have become payable under the combined provisions of Rule 21 and the Contracting-out Rules and the total of the amounts recovered by that Employer during that period under section 61 of the 1993 Act.

(5) The provisions of regulations made under section 56A of the 1975 Act or section 113 of the 1993 Act requiring the furnishing of information regarding the failure of an employer to forward sums deducted, or due to be deducted, from a member’s remuneration shall apply to the Scheme as if references in the regulations to sums deducted, or due to be deducted, from a Member’s remuneration to meet the Member’s liability to contribute to the Scheme included sums payable by an Employer to meet the Employer’s liability to contribute to the Scheme and as if (in relation to an Employer’s contribution) the reference to the date on which the sums were, or were due to be, deducted were a reference to the date on which the Employer’s contribution was due to be paid to the Committee.

(6)

(i) All instalments of standard contributions, additional contributions or deficiency contributions payable by each Employer to the Scheme shall be paid within one month of the date on which each contribution becomes payable. In the case of standard contributions, such contributions shall become payable at such intervals not greater than three months as the Committee shall from time to time determine. Additional contributions to the Scheme become payable at the times which shall be determined by the Committee when making any determination under Rule 49(1) and the timing of payment of deficiency contributions shall be provided for in any determination of deficiency contributions made by the Actuary under Clause 7.

(ii) In the event of any standard, additional or deficiency contributions payable hereunder not being paid in full by the date determined in accordance with (i) above the relevant Employer shall pay to the Scheme together with the outstanding contributions such additional supplement as shall be determined by the Committee on the advice of the Actuary having regard to the length of delay and relevant financial factors.

(iii) In the event that an Employer shall fail to pay any outstanding standard, additional or deficiency contribution together with any supplement determined in accordance with this paragraph on demand the Trustee shall (without prejudice to its power to deem that an Employer ceases to contribute for purposes of Clause 49(2)) deliver a demand for payment to the Employer and if such demand is not satisfied within 21 days the Committee shall in the name of the Trustee institute legal proceedings for the recovery of the same as a debt of the Employer due to the Scheme.

Section 5 Additional Voluntary Contributions by Members

(1) This Rule sets out the terms upon which a Contributor may elect to make additional voluntary contributions to the AVC Scheme in order to secure additional benefits on retirement or payable upon death.

(2) In this Rule the words and expressions defined in Clause 50 shall have the same meanings and in addition:

(a) “AVC Scheme” means the Scheme embodied in this Rule for the provision of certain additional benefits;

(b) “the Contributor’s Fund” shall mean in relation to a Member the value determined by the Committee of his interest in the AVC Scheme on his retirement, death or whichever is applicable of his ceasing to be in Eligible Employment and the date on which benefits under Rule 24 commence to be payable and for the purpose of this sub-paragraph the value of a Member’s interest in the AVC Scheme shall be determined by the Committee having regard to his contributions to the AVC Scheme and (if he is a Transferred BCSSS Member) his contributions to the AVC Scheme of BCSSS.

(3) No Contributor may elect in accordance with paragraph (4) of this Rule if he is then subject to notice to terminate his employment.

(4)

(a) Subject to paragraph (3) of this Rule a Contributor may elect to pay additional voluntary contributions at any time prior to Normal Retiring Age.

(b) In no circumstances shall any additional voluntary contributions be of such an amount that they would (when aggregated with any Normal or Family Contributions) exceed the limit in Rule 19.

(c) Additional voluntary contributions will be deducted from the earnings becoming payable to a Contributor save that subject to the provisions of paragraph (4)(b) of this Rule a Contributor may at any time make a lump sum payment as an additional voluntary contribution to the AVC Scheme by way of a special payment.

(d) A Contributor may on giving reasonable notice to the Secretary reduce, increase or terminate his additional voluntary contributions Provided that subject as hereinafter mentioned a reduction in his additional voluntary contributions must not result in the payment of contributions of less than such amount as the Trustee may from time to time determine and provided further that the Trustee shall have power in its absolute discretion to allow a Contributor to terminate or reduce his additional voluntary contributions in case of financial hardship.

(5) Additional voluntary contributions shall be payable in such manner (consistent with Inland Revenue Approval) as the Contributor and the Employer shall agree and shall be applied by the Trustee to provide additional benefits in respect of the Contributor in such form as the Contributor shall with the consent of the Trustee determine Provided that no part of the additional benefit shall take the form of a cash payment payable to the Member during his lifetime except to the extent as may be permitted by the Board of Inland Revenue. Such additional benefits must be reasonable having regard to (1) the amount of the additional voluntary contributions and (2) the value of the other benefits under the Scheme.

(6) On the death of a Contributor while in Eligible Employment, the Contributor’s Fund (if any) shall be applied by the Trustee pursuant to Rule 27 or Rule 28, whichever shall be applicable.

(7) On the retirement of a Contributor the Contributor’s Fund shall unless otherwise agreed between the Contributor and the Trustee be applied by the Trustee in accordance with the wishes of the Contributor expressed to the Trustee in writing subject to the proviso to paragraph (5) of this Rule Provided that:—

(a) if the Contributor has not expressed any wishes in writing to the Trustee it shall be entitled to apply the Contributor’s Fund in providing such benefits for the Contributor his Dependants or personal representatives as the Trustee in its absolute discretion shall think appropriate subject to the proviso to paragraph (5) of this Rule;

(b) if the wishes of the Contributor expressed pursuant to this paragraph would result in the benefit for which the Contributor has elected exceeding the Inland Revenue Limits then the surplus of the money in the Contributor’s Fund shall be applied by the Trustee at its discretion in providing such other benefits for the Contributor his Dependants or personal representatives as the Trustee in its absolute discretion shall deem appropriate; and

(c) if the Trustee has provided the maximum benefits to or in respect of a Contributor which it may provide under the Inland Revenue Limits then the Trustee shall realise the balance of the Contributor’s Fund and shall pay the proceeds of such realisation to the Contributor (or if the Contributor has died to the personal representatives of the Contributor) after deducting the amount of any tax to which the Scheme’s administrator is charged by section 599A of the Taxes Act by virtue of making the payment.

(8) Any benefit provided pursuant to paragraph (7) of this Rule shall be secured by contracts or policies taken out with an Approved Insurer.

(9) On a Member ceasing to be a Contributor before attaining Normal Retiring Age without becoming entitled to an immediate pension under Rule 23 then:—

(a) the additional voluntary contributions payable by such Member shall cease forthwith;

(b) if the Contributor to whom this paragraph applies elects to take a refund of his contributions the Contributor’s Fund shall be returned to him subject to deduction of tax pursuant to Ru1e 57;

(c) if a transfer is made to another retirement benefits fund, scheme or arrangement in respect of part or all of the Contributor’s benefits under the Scheme a like transfer shall be made in respect of the Contributor’s Fund; and

(d) subject to the preceding provisions the Contributor’s Fund shall be applied in providing benefits in accordance with paragraph (7) of this Rule at Normal Retiring Age or such other date on which any benefits under Rule 24 commence to be payable to him or if he dies before any benefits under Rule 24 commence to be payable to him a payment shall be made to his estate equal to his Contributor’s Fund.

Section 5 Increasing a Member’s GMP after State Pension Age or a Widow’s or Widower’s GMP

Any GMP to which a Member, Widow or Widower is entitled under Rule 4 shall, insofar as it is attributable to earnings in the tax years from and including 1988/89, be increased in accordance with the requirements of section 37A of the 1975 Act.

Section 5

“Class A Member” shall be any Member who is not a Class B or Class C Member.

Section 6 Employer’s Initial Rate of Standard Contributions

In respect of the period from the date of an Employer’s first participation in the Scheme to the periodic review (referred to in Clause 7) which next follows such date the Actuary shall recommend the rate of that Employer’s standard contributions to the Scheme.

Section 6 Purchase of Further Years of Family Contributing Service

(1)

(a) A Contributor shall have the option to purchase Further Years of Family Contributing Service in accordance with the succeeding provisions of this Rule.

(b) Subject as hereinafter provided, the option conferred by this paragraph to purchase Further Years of Family Contributing Service other than Added Years for Normal Family Benefits shall be exercisable only by a Transferred BCSSS Member within six months of marriage or of first becoming a Contributor, whichever is the later Provided that if the Contributor has married whilst downgraded and not been allowed to continue as a Contributor he may (without prejudice to the time limits available to him under this sub-paragraph) exercise that option within three months of re-entering a grade eligible for membership of the Scheme.

(c) The option conferred by this paragraph to purchase Added Years for Normal Family Benefits shall be exercisable in accordance with Rule 8(3) and (4) and, in so far as it is applicable, paragraph (2)(a) of this Rule.

(2) Subject as hereinafter provided:—

(a) A Contributor who exercises an option under paragraph (1) of this Rule shall subject to the provisions of Rule 19 pay for the period (if any) from his Actual Date of Entry to 6th April 1993 (but excluding any period between those dates which, by virtue of Rule 46(4), does not count as Contributing Service or during which the Contributor was downgraded and not allowed to continue as a Contributor (or, before the Commencement Date, as a Contributor to BCSSS) or was not in Eligible Employment (or, before the Commencement Date, in Eligible Employment for the purposes of BCSSS)) the same proportion of Contribution Salary as under Rule 4(2) and such further payments under the succeeding provisions of this Rule as may be appropriate.

(b) A Transferred BCSSS Member who has been granted a Back Service Credit for Normal Benefits under Rule 44AA of BCSSS (in the form in which that Rule in BCSSS had effect on 2nd April 1961), or a Back Service Credit for Normal Benefits under Rule 39, but no Back Service Credit for Normal Family Benefits under that Rule, shall have the option of paying three per cent of the annual rate of Salary paid to him at his Actual Date of Entry disregarding in any pay period (if the Member is a Capped Member) the excess (if any) over the amount of which the annual equivalent is the Permitted Maximum for the Tax Year in which such pay period ends for the whole or any part of the period of such Back Service Credit, and he shall receive a Back Service Credit for Normal Family Benefits corresponding to the length of time by reference to which payment is so made. This option shall be exercisable within six months of transfer or first appointment to Eligible Employment or of exercising the option under paragraph (1) of this Rule for Normal Family Benefits, whichever is the later.

(c) A Contributor who has opted under paragraph (1) hereof for Added Years for Normal Family Benefits shall pay therefor, and in addition to any other contributions payable by him, the lump sum payment per £100 of Contribution Salary at the date of exercise of the option or the annual contribution (payable by instalments) per £100 of Contribution Salary at such date necessary to purchase one Added Year for Normal Family Benefits as are set out in Appendices I and II Provided that in the case of a Former BCSSS Member who exercises the option upon joining the Scheme, the date of exercise of the option for these purposes shall be deemed to be that which applied under BCSSS.

(d)

(i) Contributions under paragraphs (2)(a) and (b) of this Rule shall (subject as therein provided) be paid as a single lump sum within 28 days of notification of the amount payable or, at the option of the Contributor, be spread forward with compound interest over the period from the date of exercise of the option under paragraph (1) of this Rule by virtue of which they become payable to a date five years before Normal Retiring Age Provided that if a Contributor lodges a request with the Secretary within 30 days of the date of his being notified of the cost of the contributions for Normal Family Benefits, the Employer may in its discretion allow all or part of the spread-forward contributions payable pursuant to this paragraph to accumulate as a loan in accordance with Rule 53.

(ii) Contributions under paragraph (2)(c) of this Rule shall be payable as a single lump sum within 28 days of notification of the amount payable or, at the option of the Contributor, be spread with compound interest over the period from the date of the exercise of the option under paragraph (1) of this Rule by virtue of which they become payable to Normal Retiring Age.

(iii) A Transferred BCSSS Member who exercised prior to 17 May 1990 under BCSSS an option to purchase Further Years of Family Contributing Service may on or before Normal Retiring Age elect either to have the number of Added Years credited reduced to such period as may, in the opinion of the Actuary, be actuarially equivalent to the contributions for Added Years already paid, or to have the outstanding contributions, which would otherwise have been payable until his attainment of the Normal Retiring Age, deducted from any lump sum or pension payable to him.

(e) Notwithstanding the provisions of Rule l8 in calculating spread-forward contributions in respect of payments under paragraph (2)(b) of this Rule, no interest shall be added in respect of the period before Actual Date of Entry.

(f) If a Contributor’s spouse dies, or the marriage is dissolved or annulled, and all Children attain the age of 18 years or die, no further contributions shall be payable under any of the foregoing provisions of this Rule.

(g) If a Contributor satisfies the Committee that he is living separate and apart from his spouse pursuant to a decree for judicial separation or a deed of separation, and that he has no Children below the age of 18 years living and he requests that the provisions of this paragraph shall apply to him, then, with effect from such date as the Committee shall determine, no further contributions shall be payable under any of the foregoing provisions of this Rule Provided that if a Contributor who has ceased to pay contributions by virtue of the preceding provisions of this paragraph resumes cohabitation with his spouse he shall thereupon recommence payment of such contributions as he would pay but for the operation of this paragraph and shall also pay in such manner as the Committee may decide a sum representing the amount of the contributions which the Contributor would have paid but for the operation of this paragraph whilst living separate and apart from his spouse, together with interest thereon to the date of resumption of cohabitation.

(3)

(a) Where contributions have ceased to be payable pursuant to paragraph (2)(f) of this Rule (or, in the case of a Transferred BCSSS Member, Rule 12(2)(m) of BCSSS), or where they have ceased to be payable under paragraph (2)(g) of this Rule (or, in the case of a Transferred BCSSS Member, Rule 12(2)(n) of BCSSS) and the spouse referred to in that provision has died or the Contributor’s marriage to her has been dissolved or annulled, and all Children have attained the age of 18 years or died, and the Contributor subsequently remarries whilst still paying Normal Contributions under Rule 4(1), he may, at his option:—

(i) if he is a Transferred BCSSS Member and if contributions to BCSSS so ceased before 6th April 1993, pay contributions in a manner consistent with the provisions of Rule 12(3) of BCSSS for the period between the date of such cessation and 6th April 1993 (but excluding any period between those dates which, by virtue of Rule 46(4), does not count as Contributing Service or during which he was downgraded and not allowed to continue as a Contributor or was not in Eligible Employment); and

(ii) pay a sum representing the value at the date of cessation under paragraph (2)(f) of this Rule (or, in the case of a Transferred BCSSS Member, Rule 12(2)(m) of BCSSS) or as the case may be paragraph (2)(g) of this Rule (or, in the case of a Transferred BCSSS Member, Rule 12(2)(n) of BCSSS) of the future spread-forward contributions which would have become payable under paragraphs (2)(a), (b) and (c) of this Rule with interest to date of the exercise of such option; to be spread-forward with compound interest over the period from the date of recommencing payments to a date five years before Normal Retiring Age, or, if this date has passed, to be spread-forward with compound interest to Normal Retiring Age.

(b) Where a Contributor remarries in the circumstances specified in paragraph (3)(a) hereof, and that spouse dies or the marriage is dissolved or annulled, and all Children attain the age of 18 years or die, no further contributions shall be payable under any of the foregoing provisions but if he subsequently remarries whilst still paying Normal Contributions under Rule 4(1) he may, at his option, pay in the manner determined by the Committee such sum in respect of Family Benefits as the Actuary considers reasonable having regard to the contributions already paid by the Contributor under this Rule.

(4)

(a) Subject as hereinafter provided a Contributor who exercises or has exercised an option under paragraph (1) of this Rule shall be credited:—

(i) with Family Contributing Service for the period if any from his Actual Date of Entry to the date of commencement of payments under Rule 4(2) (but excluding any period between those dates which, by virtue of Rule 46(4), does not count as Contributing Service or during which the Contributor was downgraded and not allowed to continue as a Contributor (or, before the Commencement Date, as a Contributor to BCSSS) or was not in Eligible Employment (or, before the Commencement Date, in Eligible Employment for the purposes of BCSSS));

(ii) if he pays or has paid contributions in accordance with paragraph (2)(b) of this Rule, with Family Contributing Service equal in length to the Back Service Credit referred to in whichever of those provisions is applicable; and

(iii) if he exercises or has exercised the option under paragraph (1) of this Rule for Added Years for Normal Family Benefits, with a period of Family Contributing Service consisting of the Added Years for which he has so opted.

(b) Subject as hereinafter provided a Transferred BCSSS Member who opts to make contributions under the provisions of this Rule shall be credited with Family Contributing Service equal to the difference between:—

(i) as the case may be, either the period of the Back Service Credit or the Added Years which would have applied under BCSSS if the contributions to purchase Further Years of Family Contributing Service under BCSSS had not ceased as a result of the arrival of Transfer Day; and

(ii) as the case may be either the period of the Back Service Credit or the Added Years notified to the Committee by the committee of BCSSS as having been purchased by contributions made before Transfer Day.

(c) If a Contributor:—

(i) ceases to pay contributions under this Rule by virtue of paragraph (2)(f) thereof and does not for whatever reason make any subsequent payment under paragraph (3) of this Rule; or

(ii) ceases to pay contributions under this Rule by virtue of paragraph (2)(g) thereof and does not for whatever reason make any subsequent payment under that provision or under paragraph (3)(a) of this Rule; or

(iii) ceases to pay contributions under this Rule by virtue of paragraph (3)(b) thereof and does not for whatever reason make any subsequent payment under that provision; or

(iv) leaves Eligible Employment and subsequently satisfies the requirements of Rule 26(1)(a) or 26(1)(b) but does not for whatever reason make any payment under Rule 26(3)(c) or 26(4); or

(v) leaves Eligible Employment in circumstances giving rise to entitlement to a payment of benefits under Rule 24(2), 24(3), or Rule 24(6) and if applicable Rule 32 and subsequently re-enters Eligible Employment, again becomes a Contributor and has part or all of his earlier service again reckoned as Contributing Service, but does not for whatever reason make any payment under Rule 48(6)(iii) or under that provision as applied by Rule 48(8)(a)(ii) or Rule 48(8)(b)(iii) or under Rule 48(7),

then without prejudice to the provisions of Rule 8(8), Rule 32 and Rule 48 the period of Family Contributing Service credited to him under sub-paragraph (a) or (b) of this paragraph shall be reduced by such period as the Actuary considers reasonable having regard to the effect (if any) of those provisions and to the amount of the contributions under this Rule remaining unpaid at the date when he so ceases to pay contributions or leaves Eligible Employment as the case may be.

(d) If the period of Family Contributing Service credited to a Contributor is reduced under sub-paragraph (c) of this paragraph, the Committee may in their discretion in the case of any reduction under sub-paragraph (c)(ii) and shall in any other case cancel such reduction on payment by the Contributor or his widow (or her widower) of such sum as the Committee acting on the advice of the Actuary may require.

Section 6 Revaluation of GMP

(6.1) After State Pension Age. If the commencement of any Member’s GMP is postponed for any period after State Pension Age, that GMP shall be increased to the extent, if any, specified in sections 35(6), (6A) and (6B) of the 1975 Act.

(6.2) Before State Pension Age. Where a Member ceases to be in Contracted-out Employment before State Pension Age, the Member’s GMP at State Pension Age or at the Member’s earlier death will be calculated by increasing the accrued rights to GMP at cessation of Contracted-out Employment under (A) or (B) or (C) below.

Section 21 Revaluation

(A) The increase will be by the percentage by which earnings factors for the tax year in which Contracted-out Employment ceases are increased by the last order under section 21 of the 1975 Act to come into force before the tax year in which the Member reaches State Pension Age or dies (if earlier).

Limited Revaluation

(B) The increase will be by the lesser of:—

(1) 5 per cent compound for each tax year after that in which Contracted-out Employment ceases up to and including the last complete tax year before the Member reaches State Pension Age or dies (if earlier), and

(2) the percentage by which earnings factors for the tax year in which Contracted-out Employment ceases are increased by the last order under section 21 of the 1975 Act to come into force before the tax year in which the Member reaches State Pension Age or dies (if earlier).

The Trustees must pay a limited revaluation premium in respect of the Member to the Secretary of State.

Fixed Rate Revaluation

(C) The increase will be by such rate as regulations made under section 45(1)(b) of the 1975 Act specify as being relevant at the date Contracted-out Employment ceases, for each tax year after the tax year containing that date up to and including the last complete tax year before the Member reaches State Pension Age or dies (if earlier).

The Trustees and the principal employer participating in the Scheme shall decide whether (A) or (B) or (C) applies to the Scheme. They may at any time decide that one of the other two methods shall be used, instead of the method currently being used, for all Members ceasing to be in Contracted-out Employment after a specified date. They must notify the Occupational Pensions Board whenever the method of revaluation for the Scheme is changed.

(6.3) Transfers in. Where a transfer payment is received in respect of a Member from another scheme (“the transferring scheme”) which includes accrued rights of the Member to a GMP, the earnings factors used in calculating that GMP will normally be revalued using Section 21 Revaluation during the Member’s Contracted-out Employment and Rule 6.2 will apply if that Contracted-out Employment ceases before State Pension Age. The Trustees may, however, decide, if the provisions of the transferring scheme so allow, to use either Fixed Rate Revaluation or Limited Revaluation from the date on which the Member ceased to be in contracted-out employment by reference to the transferring scheme until the Member attains State Pension Age (or dies, if earlier) but:—

(1) Fixed Rate Revaluation may not be used as regards any part of the GMP being transferred which arose from contracted-out employment in relation to a previous scheme and which the transferring scheme is already revaluing by Limited Revaluation (or vice versa), and

(2) the Trustees may not make that decision in respect of any Member if, when he becomes a Member, his contracted-out employment before he became a Member is treated as continuing for the purposes of the 1975 Act.

Where under Rule 6.3 Limited Revaluation is to be used, the Trustees shall have power to pay out of the transfer payment in respect of that Member any limited revaluation premium payable as a result of the Member ceasing to be in contracted-out employment by reference to the transferring scheme.

Where the Scheme accepts the proceeds of or the assignment of an insurance policy which consists of or includes accrued rights to GMP condition (1) above applies unless the Trustees use Section 21 Revaluation.

(6.4) Transfers out. Where a Member’s accrued rights to GMPs are transferred to another contracted-out salary related scheme or to a section 49 salary related scheme, the Trustees may agree with the administrator of that scheme that the Member’s GMP shall, instead of being revalued using the method currently being adopted under Rule 6.2, be revalued using another method which would be permitted if that scheme contained a rule in the same terms as Rule 6.3 but, where Limited Revaluation is to be used, that administrator must make arrangements for the payment of any limited revaluation premium (unless it has already been paid by the Trustees).

Section 6

“Class B Member” shall mean any Member:—

(a) who, on or after 17th March 1987 and before 1st June 1989, joined the Scheme being a scheme which commenced before 14th March 1989; or

(b) who the Board of Inland Revenue have agreed in writing to be a Class B Member by virtue of previous membership of a Relevant Scheme;

and, in either case, has not opted to become a Class A Member.

Section 7 Periodic Valuations

(1) The Actuary shall make periodic reviews of the financial condition of the Scheme. The Committee shall determine the date as at which the first such periodic review shall be made. Each period in respect of which such a subsequent periodic review is made:—

(a) shall commence on the day immediately following the end of the period in respect of which the last preceding review was made under this Clause;

(b) shall not in any event exceed three and a half years; and

(c) shall be determined by the Committee.

(2) The Actuary shall make a separate review under this Clause in respect of each Employer’s Fund.

(3) On each such periodic review:—

(i) The Actuary shall make recommendations as to the rate of each Employer’s standard contributions to the corresponding Employer’s Fund in the Scheme. Such rates shall be expressed as a percentage of the Contribution Salaries of the members employed by such Employer or in such other form as may be agreed between the Committee and the Actuary.

(ii) The Actuary shall determine whether or not, at the review date, there is a surplus or deficiency in each Employer’s Fund if contributions after the review date are paid at the rate or rates recommended in sub-paragraph (i) of this paragraph.

(iii) The Actuary shall make a report to the Committee on the financial condition of the Scheme and of each Employer’s Fund specifying the determination made by him under this paragraph. A copy of each review and report so made on an Employer’s Fund shall be delivered by the Committee to the Co-ordinator and to the relevant Employer, together with any recommendation they may wish to make thereon.

(4)

(a) If there is a deficiency in an Employer’s Fund, the Actuary shall determine the total periodic sum, either fixed in money terms or linked to average earnings or prices, (in this paragraph called “the deficiency sum”) which, in his opinion, is required to be paid by way of deficiency contributions to the Employer’s Fund over a period not exceeding twenty years commencing on such date not earlier than the review date and not later than the date the report of the Actuary is delivered to the Committee and at such periodic intervals not being less frequent than every 6 months as shall be determined by the Co-ordinator.

(b) Having regard to any determination pursuant to paragraph (3) or (4) of this Clause, the Actuary shall review any previous determination of deficiency contributions then operative made by him and shall substitute for such previous determination a fresh determination of deficiency contributions.

(c) If there is a surplus in an Employer’s Fund and such surplus will not be eliminated by the Employer continuing to be relieved wholly or partially from the obligation to pay any contributions in accordance with proposals approved on a previous actuarial review, the Committee shall make recommendations to the Employer for dealing with any remaining surplus. The Employer shall consider such recommendations and the Co-ordinator shall make such amendments to the Scheme and take such other actions as it considers appropriate to deal with any such remaining surplus in accordance with the principles set out in this sub-paragraph. Any such remaining surplus shall be applied in accordance with the following order of priorities:—

(i) first to provide annual cost of living increases to pensions and frozen pensions which are liabilities of the relevant Employer’s Fund in respect of the period of the five preceding calendar years and the period of the calendar year in which such recommendations are put forward insofar as during that period any increase in excess of 5 per cent may not have been made pursuant to Rule 33 having regard to the proviso to sub-paragraph (2)(a) of Rule 33;

(ii) second to suspend the Employer’s obligation to pay standard contributions for such period as may be related to the aggregate of (i) the total amount of any deficiency contributions paid by the Employer during the period of six years ended on the preceding 5 April and (ii) the value of any loss suffered by the Employer during such period as a result of the withdrawal or reduction on any actuarial review of any benefit by way of relief from or reduction in the obligation to pay standard contributions granted to the Employer on an earlier actuarial review;

(iii) third to provide cost of living increases in respect of every pension (including a frozen pension) which is a liability of the relevant Employer’s Fund payable in relation to the calendar year next following the calendar year in which such recommendations are put forward;

(iv) fourth to calculate the amount of the remaining balance after (a) deducting the cost of the changes made pursuant to sub-paragraphs (i), (ii) and (iii) of this paragraph and after (b) retaining in the Scheme such sum (if any) as may be agreed as prudent by the Trustee and the Employer after consultation with the Actuary and, insofar as is practicable, to apply an amount equal to one half of the amount of such remaining balance for the benefit of Members (either by making improvements to benefits or by reducing the rate of contributions, if any, under Rule 4 or eliminating them altogether, for a period) and to apply the other half of such amount for the benefit of the Employer.

(d) For the purposes of sub-paragraph (c) of this paragraph, “pension” and “frozen pension” shall have the same meanings as in Rule 33(5).

(5) In respect of each Employer’s Fund the Committee shall submit to the Board of Inland Revenue in any of the circumstances referred to in Schedule 22 to the Taxes Act proposals which shall have been approved by the Committee and by the relevant Employer and which comply with paragraph 3(2) to (4) of Schedule 22 to the Taxes Act and shall carry out any such proposals if they are approved by the Board of Inland Revenue PROVIDED THAT except on the discontinuance of the Scheme under Clause 48 the Committee shall neither submit to the Board of Inland Revenue nor carry out any proposal which would lead to the transfer or payment of any part of the Scheme Fund to any of the Employers.

Section 7 Purchase of Further Years of Family Contributing Service

The Committee may, at their discretion, require Satisfactory Evidence of Health of Contributor before permitting the exercise of an option under Rule 6(1).

Section 7 Anti-Franking

Except as provided in sections 37A and 41A–41E of the 1975 Act, no part of a Member's, Widow’s or Widower’s pension under the Scheme may be used to frank an increase in the Member's, Widow’s or Widower’s GMP under Rule 5 or Rule 6.

Section 7

“Class C Member” shall mean any Member who joined the Scheme before 17th March 1987 or who joined subsequently and who the Board of Inland Revenue have agreed in writing to be a Class C Member by virtue of previous membership of a Relevant Scheme and, in either case, has not opted to become a Class A Member.

Section 8 Admission of Other Employers and New Members

(1)

(a) With effect on and from each Transfer Day the Committee shall admit to participation in the Scheme any person body of persons or corporate body which on such Transfer Day becomes the employer of any one or more individuals employed in the undertaking to which the restructuring scheme (within the meaning of section 12 of the 1994 Act) relates and the transfer of which takes effect on such Transfer Day (being individuals who immediately before such Transfer Day were Contributors under BCSSS who had not attained the Normal Retiring Age under BCSSS), subject to the provisos to paragraph (3) of this Clause.

(b) With effect on and from each Transfer Day the Committee shall admit to participation in the Scheme any corporate body (being a corporate body which immediately before such Transfer Day employed any one or more individuals who were then Contributors under BCSSS and who had not then attained the Normal Retiring Age under BCSSS) which on such Transfer Day ceases to be a subsidiary of the British Coal Corporation, subject to the provisos to paragraph (3) of this Clause.

(2)

(a) With effect on and from the First Transfer Day the Committee shall admit to participation in the Scheme any person body of persons or corporate body (other than a Trade Union or Thames) in relation to which such date is the Transfer Day, subject to the provisos to paragraph (3) of this Clause.

(b) With effect on and from the Transfer Day applicable or any Trade Union or Thames, the Committee shall admit such Trade Union or Thames (as may be appropriate) to participation in the Scheme, subject to the provisos to paragraph (3) of this Clause.

(3) The Committee shall admit to participation in the Scheme any person body of persons or corporate body which at any time after the Commencement Date and other than on and as a result of a Transfer Day occurring becomes the employer of an individual who is a Protected Employee in circumstances in which such individual does not thereupon cease to be a Protected Employee (“the new employer”) Provided that:—

(i) the new employer shall enter into a deed by which it covenants with the Co-ordinator and the Trustee to comply with and observe the provisions of the Scheme so far as they are applicable to it as an Employer; and

(ii) the participation of the new employer will not prejudice Inland Revenue Approval of the Scheme.

(4)

(a) Employees of Employers (subject to the exceptions mentioned in sub-paragraph (b) of this paragraph) who become employed by the Employer after the Employer began to participate in the Scheme shall not be eligible for membership of the Scheme.

(b) The following categories of new employees shall be excluded from the provisions of sub-paragraph (a) of this paragraph:—

(i) new employees who immediately before entering the employment of the Employer were employed by another Employer, who were Protected Employees by reference to the Scheme while in the employment of that other Employer and who have not ceased to be Protected Employees; and

(ii) new employees (not within (i) above) who at any time before entering the employment of the Employer were members of BCSSS or the Mineworkers' Scheme or IWS—MPS or members of the Scheme but only if the Employer has requested that they be eligible for membership of the Scheme and if the Committee have approved that request.

Section 8 Purchase of Added Years by Contributors

(1) Subject to the provisions of Rule 19 Contributors to have option (exercisable as hereinafter provided) of purchasing Added Years for Normal Benefits on paying a single contribution or Added Contributions spread forward with compound interest over period from date of exercise of option to Normal Retiring Age of an amount sufficient to cover actuarially computed whole cost of providing added benefits.

(2) The Committee may, at their discretion, require Satisfactory Evidence of Health of a Contributor before permitting option to be exercised.

(3) The exercise of the option conferred by paragraph (1) hereof, and of the option for Added Years for Normal Family Benefits conferred by Rule 6(1), shall be subject to the approval of the Committee.

(4) Number of Added Years for Normal Benefits or Normal Family Benefits purchased not to bring total Contributing Service (when aggregated (in the case of a Former BCSSS Member who is not a Transferred BCSSS Member) with Contributing Service under BCSSS) by Normal Retiring Age up to more than 40 years.

(5) Contributions to cease at Normal Retiring Age or on ceasing to be a Contributor or on cessation of contributions on downgrading under Rule 25 whichever is the earliest.

(6) Tables currently in use showing respectively the lump sum payment per £100 of Contribution Salary at date of exercising option and the annual contribution per £100 of such Contribution Salary necessary to purchase one Added Year for Normal Benefits are set out in Appendices I and II Provided that in the case of a Former BCSSS Member who exercises the option upon joining the Scheme, the date of exercise of the option for these purposes shall be deemed to be that which applied under BCSSS. The rates are, however, subject to such amendment from time to time as the Committee, on the advice of the Actuary, deem requisite as regards options exercised after the adoption of the amended Tables. In the case of a Former BCSSS Member who is not a Transferred BCSSS Member and who exercised the option to pay annual contributions for Added Years for Normal Benefits whilst a member of BCSSS the number of Added Years to be purchased by contributions therefor while a member of the Scheme (on the assumption that they continue to be paid until the date on which they would have ceased under BCSSS) shall be the difference between:—

(i) the Added Years that would have been purchased under BCSSS if contributions thereto had continued; and

(ii) the Added Years which the committee of BCSSS notifies to the Committee as having been purchased under BCSSS by contributions made to BCSSS before Transfer Day.

(7) Added Years whether for Normal Benefits or Normal Family Benefits not to count for qualifying periods for Normal Benefits or Normal Family Benefits (subject to Rule 23(4)).

(8) In the event that a Contributor ceases to pay contributions for Added Years under this Rule or Rule 6(1) the number of Added Years credited shall be reduced by the proportion that the value of the outstanding contributions which would otherwise have been payable until his attainment of Normal Retiring Age, as defined in the Scheme at the time he elected to purchase Added Years or (in the case of a Former BCSSS Member whose election was made while a Member of BCSSS) as defined in BCSSS at the time of such election, bears to the sum of the value of the contributions for Added Years already paid and the value of the outstanding contributions.

(9) A Transferred BCSSS Member who elected to purchase Added Years under BCSSS prior to 17th May 1990, may on or before Normal Retiring Age exercise one of the following options:—

(i) to have the number of Added Years credited reduced by the proportion that the value of the outstanding contributions which would otherwise have been payable until his attainment of Normal Retiring Age, as defined in the Scheme at the time he elected to purchase Added Years, bears to the sum of the value of the contributions for Added Years already paid and the value of the outstanding contributions; or

(ii) if either he was a Member of BCSSS on 27th July 1989 or the exercise of the option conferred by this sub-paragraph would not result in the limit on contributions imposed by Rule 19 being breached, to have the value of the outstanding contributions which would otherwise have been payable until his attainment of Normal Retiring Age as defined in the Scheme at the time he elected to purchase Added Years under this Rule deducted from any lump sum payable to him; or

(iii) to pay increased contributions as advised by the Actuary until attaining Normal Retiring Age.