Pensions Act 2014
| Jurisdiction | England & Wales |
| Citation | 2014 c. 19 |
Pensions Act 2014
2014 CHAPTER 19
An Act to make provision about pensions and about benefits payable to people in connection with bereavement; and for connected purposes.
[14th May 2014]
Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:-
Part 1
State pension
Introduction
1 State pension
(1) This Part creates a benefit called state pension.
(2) A person who reaches pensionable age before 6 April 2016 is not entitled to benefits under this Part (but may be entitled to similar benefits under Part 2 of the Contributions and Benefits Act).
State pension at the full or reduced rate
2 Entitlement to state pension at full or reduced rate
(1) A person is entitled to a state pension payable at the full rate if-
(a) the person has reached pensionable age, and
(b) the person has 35 or more qualifying years.
(2) A person is entitled to a state pension payable at the reduced rate if-
(a) the person has reached pensionable age, and
(b) the person has at least the minimum number of qualifying years but fewer than 35 qualifying years.
(3) The minimum number of qualifying years for a state pension payable at the reduced rate is to be specified in regulations and may not be more than 10.
(4) In this Part "qualifying year" means a tax year, during a person's working life, in which the person's earnings factor (or the sum of the person's earnings factors) is equal to or greater than the qualifying earnings factor for the year.
(5) For earnings factors, see sections 22 and 23 of the Contributions and Benefits Act.
(6) For transitional cases in which a person may be entitled to a different state pension (instead of a state pension under this section), see sections 4 and 12.
(7) There are provisions elsewhere that affect a person's entitlement to a state pension under this section or the rate at which it is payable.
3 Full and reduced rates of state pension
(1) The full rate of the state pension is the weekly rate for the time being specified in regulations.
(2) The reduced rate of the state pension for a person is the following proportion of the full rate-
(3) Once the full rate has been specified, the power to make regulations under subsection (1) may not be re-exercised so as to reduce the rate.
State pension at the transitional rate
4 Entitlement to state pension at transitional rate
(1) A person is entitled to a state pension payable at the transitional rate if-
(a) the person has reached pensionable age,
(b) the person has at least the minimum number of qualifying years, and
(c) the person has at least one pre-commencement qualifying year.
(2) The minimum number of qualifying years for a state pension payable at the transitional rate is to be specified in regulations and may not be more than 10.
(3) A person entitled to a state pension payable at the transitional rate is not entitled to a state pension under section 2.
(4) In this Part-
"post-commencement qualifying year" means a qualifying year beginning on or after 6 April 2016;
"pre-commencement qualifying year" means- (a) a qualifying year beginning on or after 6 April 1978 and ending before 6 April 2016, or (b) a reckonable year that would have been treated under regulation 13(1) of the Social Security (Widow's Benefit, Retirement Pensions and Other Benefits) (Transitional) Regulations 1979 ( s.i. 1979/643 ) as a qualifying year for the purposes of determining the person's entitlement to an old state pension that is a Category A retirement pension.
(5) A reckonable year mentioned in paragraph (b) of the definition of "pre-commencement qualifying year" counts towards the minimum number of qualifying years required by subsection (1)(b) (even though it does not come within the definition of "qualifying year" for the purposes of this Part).
(6) For earnings factors, see sections 22 and 23 of the Contributions and Benefits Act.
(7) There are provisions elsewhere that affect a person's entitlement to a state pension under this section or the rate at which it is payable.
5 Transitional rate of state pension
(1) The transitional rate of the state pension for a person is a weekly rate equal to-
(a) the sum of the amounts calculated under Schedule 1 for the person's pre-commencement and post-commencement qualifying years capped at the full rate of the state pension on the day on which the person reaches pensionable age, or
(b) if higher, the amount for the person's pre-commencement qualifying years alone.
(2) The transitional rate of the state pension for a person is to be increased from time to time in accordance with the applicable paragraph of Schedule 2.
(3) Section 6 requires the transitional rate of the state pension for a person to be recalculated in certain circumstances.
(4) There are special rules about the transitional rate for certain women: see section 11 (reduced rate elections).
6 Recalculation and backdating of transitional rate in special cases
(1) This section modifies the transitional rate of the state pension for a person if, after the person has reached pensionable age, a determination is made under section 48A(2) of the Pension Schemes Act 1993 (contracting-out: reinstatement in state scheme following payment of contributions equivalent premium).
(2) The person's transitional rate is to be recalculated (taking the determination into account under paragraph 3(8) of Schedule 1).
(3) The recalculated rate has effect as from the day on which the person reached pensionable age (and the other provisions of this Part apply accordingly).
Transitional entitlement based on contributions of others
7 Survivor's pension based on inheritance of additional old state pension
(1) A person is entitled to a state pension under this section if-
(a) the person has reached pensionable age,
(b) the person's spouse died while they were married or the person's civil partner died while they were civil partners of each other, and
(c) the person is entitled to an inherited amount under Schedule 3.
(2) A state pension under this section is payable at a weekly rate equal to the inherited amount.
(3) The rate of the state pension for a person under this section is to be increased from time to time in accordance with the applicable paragraph of Schedule 4.
(4) Regulations may provide that if at any time the sum of the relevant state pensions for a person exceeds an amount provided for by regulations, the rate of any state pension payable to the person under this section is to be reduced by the amount of the excess.
(5) The "sum of the relevant state pensions" for a person is the sum of-
(a) the rate of any state pension payable to the person under this section (ignoring any reduction under subsection (4)), and
(b) the rate of any state pension payable to the person under section 2, 4 or 12.
(6) In subsections (4) and (5) a reference to the rate of a person's state pension is to the rate-
(a) taking into account any reduction under section 14 (in the case of a state pension under section 4), but
(b) ignoring any increase under section 17.
(7) There are provisions elsewhere that affect a person's entitlement to a state pension under this section or the rate at which it is payable.
8 Choice of lump sum or survivor's pension under section 9 in certain...
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