The Local Government Pension Scheme (Amendment etc.) Regulations 1999

• Citation: S.I. 1999/3438
• Sections: 10

Section 1 Citation, commencement and interpretation

(1) These Regulations may be cited as the Local Government Pension Scheme (Amendment etc.) Regulations 1999 and shall come in to force on 13th January 2000, but regulation 10 shall have effect from 1st April 1999.

(2) In regulations 9 and 10, expressions which are also used in the Local Government Pension Scheme Regulations 1997 have the same meaning as they have in those Regulations.

Section 2 Amendment of Regulations

The Local Government Pension Scheme Regulations 1997 shall be amended in accordance with regulations 3 to 8 of these Regulations.

Section 3 Agreements to enable employees of non-Scheme employers to be members (“ admission agreements”)

For regulation 5 substitute the following–

(5)

(1) An administering authority may make an admission agreement with any admission body.

(2) An admission agreement is an agreement that all or any specified class of the admission body’s employees may be members.

(3) These are admission bodies–

(a) a body which provides a public service in the United Kingdom otherwise than for the purposes of gain and which either–

(i) has sufficient links with a Scheme employer for the body and the Scheme employer to be regarded as having a community of interest, whether because the operations of the admission body are dependent on the operations of the Scheme employer or otherwise, or

(ii) is approved by the Secretary of State for the purpose of admission to the Scheme;

(b) a body to the funds of which any Scheme employer contributes;

(c) a body representative–

(i) of local authorities, or

(ii) of local authorities and officers of local authorities, or

(iii) of officers of local authorities, or

(iv) of Scheme employers;

(d) the Housing Corporation;

(e) Housing for Wales;

(f) the Commission for the New Towns;

(g) a company for the time being subject to the influence of a local authority as described in section 69 of the Local Government and Housing Act 1989 ;

(h) a body which–

(i) provides services or assets referred to in a best value arrangement or part of such services or assets,

(ii) is nominated to exercise a function specified in a section 15 direction, or

(iii) is specified in section 497A directions to perform a function or part of it.

(4) But the governors or managers of a voluntary school do not count as a body within paragraph (3)(a) or (b) and a body is only within paragraph (3)(c)(iii) if it is formed for the purpose of consultation as to the common interests of local authorities and the discussion of matters relating to local government.

(5) Approval under paragraph (3)(a)(ii) may be subject to such conditions as the Secretary of State thinks fit and he may withdraw approval at any time if such conditions are not met.

(6) It must be a term of an admission agreement made with a non-associated admission body within paragraph (3)(b) that the Scheme employer who provides funding (and, if more than one, all of them) guarantees the liability of the admission body to pay all amounts due from it under the Regulations.

(7) In the case of an admission agreement with a transferee admission body–

(a) the transferor Scheme employer, if not also the administering authority, must be a party to the admission agreement;

(b) only those employees of the transferee admission body who are employed in connection with–

(i) the provision of the services or assets referred to in the best value arrangement,

(ii) the function specified in the section 15 direction, or

(iii) the function or part of it to which the section 497A directions apply are eligible to be members of the Scheme;

(c) it shall require an indemnity or bond in an approved form and with an authorised insurer or a relevant institution; and

(d) provision shall be made for the matters set out in Schedule 2A.

(8) Where a transferor Scheme employer and a transferee admission body undertake to meet the requirements of paragraph (7), an administering authority must admit to the Scheme the eligible employees of the transferee admission body and, where it does so, the terms on which it does so are the admission agreement for the purposes of these Regulations.

(9) An admission agreement must terminate if the admission body ceases to be such a body.

(10) An admission agreement may make such other provision about its termination as the parties consider appropriate.

(11) When an administering authority make an admission agreement, they must promptly inform the Secretary of State of the date the agreement takes effect, the admission body’s name and, in the case of an admission agreement with a transferee admission body, the name of the relevant transferor Scheme employer.

(12) An administering authority must notify the Commissioners of Inland Revenue of the admission of an admission body within the time prescribed in regulations made under section 605 of the Taxes Act and provide such information as may be so prescribed.

(13) An administering authority and an admission body may make an admission agreement despite the fact that they do not exercise their functions or provide services or assets in areas which overlap or adjoin each other.

(14) Any question which may arise between the administering authority and any other party to an admission agreement relating to the construction of the agreement or to the rights and obligations under that agreement shall be referred in writing for determination to the Secretary of State.

(15) An employee of an admission body may not be a member if he is a member of another occupational pension scheme (within the meaning of section 1 of the Pension Schemes Act 1993 ) other than where the accrual of benefits under that pension scheme would not affect approval of the Scheme as an approved scheme.

(16) These Regulations apply to employment with an admission body in which the employee is an active member in the same way as if the body were a Scheme employer.

(17) In this regulation, regulation 6 and Schedule 2A (where applicable)–

(a) “authorised insurer” means–

(i) an insurance company authorised under section 3 or 4 of the Insurance Companies Act 1982 to carry on long term business, or

(ii) an EC company which is lawfully carrying on long term business, or providing long term insurance, in the United Kingdom, and expressions used in this definition and the Insurance Companies Act 1982 have the same meaning as in that Act;

(b) “best value arrangement” means a contract or other arrangement made with a transferor Scheme employer for the provision of, or making available of, services or assets, for the purposes of or in connection with the exercise of a function of that transferor Scheme employer;

(c) “indemnity or bond in an approved form” means an indemnity or bond to meet a level of risk exposure arising on premature termination of the best value arrangement actuarially assessed to the satisfaction of the administering authority and the transferor Scheme employer;

(d) “local authority” for the purposes of paragraph (3)(c) and (g) includes the Greater London Authority;

(e) “non-associated admission body” means a body described in–

(i) paragraph (3)(a)(ii), or

(ii) paragraph (3)(b) where, at the date that the admission agreement is made, the total contribution from any one or more Scheme employers to its funds equals less than 50% of funding contributed by third parties;

(f) “relevant institution” means–

(i) an institution authorised under Part I of the Banking Act 1987 (regulation of deposit-taking business),

(ii) a person to whom the restriction on acceptance of deposits in section 3 of that Act does not apply because he is specified in Schedule 2 to that Act (Central banks etc.), or

(iii) a European authorised institution which has lawfully established a branch in the United Kingdom for the purpose of accepting deposits,

and “European authorised institution” has the same meaning as in the Banking Co-ordination (Second Council Directive) Regulations 1992 ;

(g) “section 15 direction” means a direction given under section 15 of the Local Government Act 1999 ;

(h) “section 497A directions” means directions made under section 497A of the Education Act 1996 ;

(i) “transferee admission body” means an admission body described in paragraph (3)(h); and

(j) “transferor Scheme employer” means an authority or body which is a Scheme employer and is–

(i) named in section 1(1) of the Local Government Act 1999 as a best value authority for the purposes of Part I of the Local Government Act 1999, or

(ii) mentioned in section 2(1) of that Act as an authority or body which the Secretary of State may by order provide is a best value authority for those purposes.

Section 4 Further restrictions on eligibility

In regulation 6, add at the end–

(10) A person who is a member and is an employee of a transferee admission body is treated as leaving a local government employment when he ceases to be employed in connection with–

(a) the services or assets referred to in the best value arrangement,

(b) the function specified in the section 15 direction, or

(c) the function to which the section 497A directions apply.

Section 5 Re-employed and rejoining deferred members

In regulation 32, add at the end–

(11) In the case of a member who first becomes a member on or after 13th January 2000 any period of membership in the employment of a non-associated admission body (as defined in regulation 5(17)(e)) shall not be aggregated with any other periods of membership for the purpose of calculating his retirement grant.

Section 6 Special circumstances where revised actuarial valuations and certificates must be obtained

In regulation 78 –

(a) in paragraph (2)(a), for “of the admission body” substitute “of the fund in respect of current and former employees of the admission body ”;

(b) in paragraph (2A) after the words “the outgoing admission body” insert “ or from an insurer or any person providing a guarantee or indemnity on behalf of that admission body,”; and

(c) after paragraph (2A) insert the following–

(2B) An administering authority may obtain from an actuary a certificate specifying, in the case of an admission body, the percentage or amount by which, in the actuary’s opinion,–

(a) the contribution at the common rate should be adjusted, or

(b) any prior individual adjustment should be increased or reduced,

with a view to providing that the value of the assets of the fund in respect of current and former employees of that admission body is neither materially more nor materially less than the anticipated liabilities of the fund in respect of those employees at the date that the admission agreement is to end.

Section 7 Admission agreements

After Schedule 2, add as Schedule 2A the Schedule set out in the Schedule to these Regulations.

Section 8 Revenue Restrictions

In Schedule 4, amend paragraph 1(1) by–

(a) in the definition of “Class B member” in sub-paragraph (b), after “ since before 1st June 1989” inserting “and has not had a continuity break ”;

(b) in the definition of “Class C member” in sub-paragraph (a) after “ 17th March 1987” inserting “and has not had a continuity break”; and

(c) after the definition of “Class C member” inserting the following definition–

“continuity break” is a change of employment from a Scheme employer (including an admission body) to a non-associated or transferee admission body (as defined in regulation 5(17)(e) and (i)) but does not include a change in the case of a person who was a member of the Scheme on 13th January 2000.

Section 9 Savings

The amendments made by regulations 2 to 8 shall not affect any admission agreements made in accordance with the Local Government Pension Scheme Regulations 1997 before the date on which these Regulations come into force.

Section 10 Employees of local education authorities

(1) This regulation applies where:–

(a) directions are given, prior to the date on which these Regulations come into force, under section 497A of the Education Act 1996 pursuant to which a person (“the transferee”) performs a function on behalf of a local education authority; and

(b) a person (“the employee”) who, immediately before the date from which the transferee performs the function, is a member in the employment of the local education authority, continues from that date in employment with the transferee in connection with the performance of that function.

(2) When this regulation applies the employee shall be treated for the purposes of the Local Government Pension Scheme Regulations 1997 as an employee of the local education authority as long as he remains in employment with the transferee in connection with the performance of the function referred to in paragraph (1).

(3) Paragraph (2) ceases to have effect when the employee becomes a member under an admission agreement.