The Pensions Increase (Review) Order 2006
© Crown Copyright 2006
In accordance with section 151(1) of the Social Security Administration Act 1992[1] the Secretary of State for Work and Pensions has given a direction[2] under section 150(2) and section 190(1)(a) of that Act that the sums mentioned in section 150(1)(c) of that Act are to be increased; The Treasury now make the following Order in exercise of the powers conferred by section 59(1), (2), (5) and (5ZA) of the Social Security Pensions Act 1975[3] and now vested in them[4]: Citation and commencement 1. —(1) This Order may be cited as the Pensions Increase (Review) Order 2006 and comes into force on 10th April 2006. (2) This Order and the existing Orders may be cited together as the Pensions Increase (Review) Orders 1972 to 2006. Interpretation 2. —(1) In this Order—
(2) For the purposes of this Order the time
when a pension "begins" is that stated in section 8(2) of the 1971
Act[
44], and the "beginning date"
shall be construed accordingly.
(b) a pension beginning on or after 11th April 2005 and before 10th April 2006 may be increased by 2.7 per cent multiplied by
(ii) B is 12.
(2) Those conditions are—
(b) the official pension is—
(ii) a substituted pension; or (iii) a relevant injury pension.
Increases in certain lump sums
(b) B is 12. Reductions in respect of guaranteed minimum pensions
(b) whose entitlement to that guaranteed minimum pension arises from an employment from which (either directly or by virtue of the payment of a transfer credit) entitlement to the official pension also arises, be reduced by an amount equal to the rate of the guaranteed minimum
pension unless the Treasury[
45] otherwise direct, in accordance
with the provisions of section 59A of the 1975 Act. (This note is not part of the Order) Under section 59 of the Social Security Pensions Act 1975 as amended, and as modified by section 59A of that Act, the Treasury (in whom the functions conferred by those provisions are now vested) are required to provide by order for the increase in the rates of public service pensions. Under section 59(7) of the 1975 Act, section 59 of that Act has effect as if it were contained in the Pensions (Increase) Act 1971. Section 9(2)(c) of the 1971 Act provides that references to the "rate" of pension shall have effect as references also to the amount of a lump sum benefit. The increase is the percentage (or in some circumstances a fraction of the percentage) by which the Secretary of State for Work and Pensions has, by direction given under the provisions of section 151(1) of the Social Security Administration Act 1992, increased the sums referred to in section 150(1)(c) of that Act. These are the sums which are the additional pensions in long term benefits, namely the additional pension entitlements accruing to employees in respect of earnings after 5th April 1978. For pensions which began before 11th April 2005 the increase is 2.7 per cent. For pensions which began on or after 11th April 2005 the increases are as follows—
Article 4 of the Order provides for increases on certain deferred lump sums which became payable on or after 11th April 2005 and before 10th April 2006. The Order also makes provision for the amount by reference to which any increase in the rate of an official pension is to be calculated to be reduced by the amount equal to the rate of the guaranteed minimum pension entitlement deriving from the employment which gives rise to the official pension. This is required by section 59(5) of the Social Security Pensions Act 1975. However by virtue of section 59A of that Act and the Transfer of Functions (Minister for the Civil Service and Treasury) Order 1981 the Treasury are empowered to direct that in respect of specified cases or classes of case either no such reduction be made or the reduction shall be less than the rate of the guaranteed minimum pension. Section 59(5ZA) was inserted into section 59 by section 5 of the Pensions (Miscellaneous Provisions) Act 1990. This applies section 59(5) to a widow's or widower's pension. Notes: [1] 1992 c. 5.back [2] The direction is contained in S.I. 2006/ 645.back [3] 1975 c. 60; section 59(1) was amended by section 1(7) of the Pensions (Miscellaneous Provisions) Act 1990 (c. 7) and by the Social Security (Consequential Provisions) Act 1992 (c. 6) Schedule 2, paragraph 34. Section 59(5) was amended by section 11 of the Social Security Act 1979 (c. 18) and the Social Security Act 1985 (c. 53), Schedule 5, paragraph 33. Section 59 was also amended by the Social Security Act 1979, sections 11 and 21(4) and Schedule 3, paragraph 20, section 9(8) of the Social Security Act 1986 and section 5 of the Pensions (Miscellaneous Provisions) Act 1990, which inserted sub-section (5ZA). Section 59 is modified by section 59A, which was inserted by section 11(4) of the Social Security Act 1979 and amended by section 9(9) of the Social Security Act 1986, and further amended by section 190, Schedule 8, paragraph 9(2) of the Pension Schemes Act 1993.back [4] S.I. 1981/1670.back [5] 1971 c. 56.back [6] 1974 c. 9.back [7] Relevant amendments were made to section 17(1) by sections 1(3) and 3(3) of the 1974 Act; by section 1(6) of the Pensions (Miscellaneous Provisions) Act 1990 (c. 7) and by the Welfare Reform and Pensions Act 1999 (c.30), section 39(1) and (5).back [8] S.I. 1972/1298.back [9] S.I. 1973/1370.back [10] S.I. 1974/1373.back [11] S.I. 1975/1384.back [12] S.I. 1976/1356.back [13] S.I. 1977/1387.back [14] S.I. 1978/1211.back [15] S.I. 1979/1047.back [16] S.I. 1980/1302.back [17] S.I. 1981/1217.back [18] S.I. 1982/1178.back [19] S.I. 1983/1264.back [20] S.I. 1984/1307.back [21] S.I. 1985/1575.back [22] S.I. 1986/1116.back [23] S.I.1987/130.back [24] S.I.1988/217.back [25] S.I.1989/477.back [26] S.I.1990/483.back [27] S.I.1991/684.back [28] S.I.1992/198.back [29] S.I.1993/779.back [30] S.I.1994/776.back [31] S.I.1995/708.back [32] S.I.1996/800.back [33] S.I.1997/634.back [34] S.I.1998/503.back [35] S.I.1999/522.back [36] S.I.2000/672.back [37] S.I. 2001/664.back [38] S.I. 2002/699.back [39] S.I. 2003/681.back [40] S.I. 2004/858.back [41] S.I. 2005/858.back [42] Section 5(1) was amended by the Superannuation Act 1972 (c.11), section 29(1), Schedule 6, paragraph 85.back [43] Section 3 was amended by section 3(3) of the 1974 Act, section 1 of the Pensions (Miscellaneous Provisions) Act 1990, by the Pensions Increase (Reduction of Qualifying Age) Order 1972 (S.I. 1972/1299), by section 171 of the Pensions Act 1995 (c. 26) and by the Welfare Reform and Pensions Act 1999 (c.30), section 39(1) and (2).back [44] Section 8(2) was amended by section 1(5) of the Pensions (Miscellaneous Provisions) Act 1990 and by the Welfare Reform and Pensions Act 1999(c.30), section 39(1) and (4).back [45] See S.I. 1981/1670, articles 2(1)(c) and 3(5).back
ISBN 0 11 074308 3 |
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© Crown copyright 2006 | Prepared 20 March 2006 |