Pensions Act 2004

Cited as:2004 c. 35
Jurisdiction:UK Non-devolved


Pensions Act 2004

2004 CHAPTER 35

An Act to make provision relating to pensions and financial planning for retirement and provision relating to entitlement to bereavement payments, and for connected purposes.

[18th November 2004]

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:—

1 The Pensions Regulator

Part 1

The Pensions Regulator

Establishment

Establishment

S-1 The Pensions Regulator

1 The Pensions Regulator

There shall be a body corporate called the Pensions Regulator (in this Act referred to as ‘the Regulator’).

S-2 Membership of the Regulator

2 Membership of the Regulator

(1) The Regulator is to consist of the following members—

(a) a chairman appointed by the Secretary of State

(b) the Chief Executive of the Regulator, and

(c) at least five other persons appointed by the Secretary of State after consulting the chairman

(2) The chairman must not be appointed from the staff of the Regulator or be the chairman of the Board of the Pension Protection Fund (see section 108)

(3) At least two of the members appointed under subsection (1)(c) must be appointed from the staff of the Regulator

(4) In appointing persons under subsection (1)(c) the Secretary of State must secure that a majority of the members of the Regulator are non-executive members

(5) No member of the staff of the Board of the Pension Protection Fund is eligible for appointment as a member of the Regulator.

(6) In this Part—

(a) references to executive members of the Regulator are to—

(i) the Chief Executive, and

(ii) the members appointed under subsection (1)(c) from the staff of the Regulator, and

(b) references to non-executive members of the Regulator are to members who are not executive members.

S-3 Further provision about the Regulator

3 Further provision about the Regulator

Schedule 1 makes further provision about the Regulator, including provision as to—

the terms of appointment, tenure and remuneration of members,

the appointment of the Chief Executive and other staff,

the proceedings of the Regulator,

its funding and accounts, and

the status and liability of the Regulator, its members and staff.

General provisions about functions

General provisions about functions

S-4 Regulator's functions

4 Regulator's functions

(1) The Regulator has—

(a) the functions transferred to it from the Occupational Pensions Regulatory Authority by virtue of this Act or any provisions in force in Northern Ireland corresponding to this Act, and

(b) any other functions conferred by, or by virtue of, this or any other enactment.

(2) As regards the exercise of the Regulator's functions—

(a) the non-executive functions listed in subsection (4) of section 8 must, by virtue of subsection (2) of that section, be discharged by the committee established under that section,

(b) the functions mentioned in the following provisions are exercisable only by the Determinations Panel—

(i) section 10(1) (the power in certain circumstances to determine whether to exercise the functions listed in Schedule 2 and to exercise them), and

(ii) section 99(10) (the functions concerning the compulsory review of certain determinations), and

(c) the exercise of other functions of the Regulator may be delegated by the Regulator under paragraph 20 of Schedule 1.

(3) Subsection (2) is subject to any regulations made by the Secretary of State under paragraph 21 of Schedule 1 (power to limit or permit delegation of functions).

S-5 Regulator's objectives

5 Regulator's objectives

(1) The main objectives of the Regulator in exercising its functions are—

(a) to protect the benefits under occupational pension schemes of, or in respect of, members of such schemes,

(b) to protect the benefits under personal pension schemes of, or in respect of, members of such schemes within subsection (2),

(c) to reduce the risk of situations arising which may lead to compensation being payable from the Pension Protection Fund (see Part 2), and

(d) to promote, and to improve understanding of, the good administration of work-based pension schemes.

(2) For the purposes of subsection (1)(b) the members of personal pension schemes within this subsection are—

(a) the members who are employees in respect of whom direct payment arrangements exist, and

(b) where the scheme is a stakeholder pension scheme, any other members.

(3) In this section—

‘stakeholder pension scheme’ means a personal pension scheme which is or has been registered under section 2 of the Welfare Reform and Pensions Act 1999 (c. 30) (register of stakeholder schemes);

‘work-based pension scheme’ means—

(a) an occupational pension scheme,

(b) a personal pension scheme where direct payment arrangements exist in respect of one or more members of the scheme who are employees, or

(c) a stakeholder pension scheme.

S-6 Supplementary powers

6 Supplementary powers

The Regulator may do anything (except borrow money) which—

(a) is calculated to facilitate the exercise of its functions, or

(b) is incidental or conducive to their exercise.

S-7 Transfer of OPRA's functions to the Regulator

7 Transfer of OPRA's functions to the Regulator

(1) Subject to the provisions of this Act, the functions of the Occupational Pensions Regulatory Authority (‘OPRA’) conferred by or by virtue of—

(a) the Pension Schemes Act 1993 (c. 48),

(b) the Pensions Act 1995 (c. 26), and

(c) the Welfare Reform and Pensions Act 1999,

are hereby transferred to the Regulator.

(2) Accordingly—

(a) in section 181(1) of the Pension Schemes Act 1993 (which defines ‘the Regulatory Authority’ to mean OPRA), for the definition of ‘the Regulatory Authority’ substitute—

‘‘the Regulatory Authority’ means the Pensions Regulator;’,

(b) in section 124(1) of the Pensions Act 1995 (which defines ‘the Authority’, in Part 1 of that Act, to mean OPRA), for the definition of ‘the Authority’ substitute—

‘‘the Authority’ means the Pensions Regulator,’,

(c) in section 8(1) of the Welfare Reform and Pensions Act 1999 (c. 30) (which defines ‘the Authority’, in Part 1 of that Act to mean OPRA), for the definition of ‘the Authority’ substitute—

‘‘the Authority’ means the Pensions Regulator;’, and

(d) in section 33 of that Act (time for discharge of pension credit liability), in subsection (5) for ‘the Occupational Pensions Regulatory Authority’ substitute ‘the Pensions Regulator’.

Non-executive functions

Non-executive functions

S-8 Non-executive functions

8 Non-executive functions

(1) The functions listed in subsection (4) (in this Part referred to as ‘the non-executive functions’) are functions of the Regulator.

(2) The Regulator must establish a committee to discharge the non-executive functions on its behalf.

(3) Only non-executive members of the Regulator may be members of the committee.

(4) The non-executive functions are—

(a) the duty to keep under review the question whether the Regulator's internal financial controls secure the proper conduct of its financial affairs;

(b) the duty to determine under paragraph 8(4)(b) of Schedule 1, subject to the approval of the Secretary of State, the terms and conditions as to remuneration of any Chief Executive appointed under paragraph 8(4)(a) of that Schedule.

(5) The committee established under this section must prepare a report on the discharge of the non-executive functions for inclusion in the Regulator's annual report to the Secretary of State under section 11.

(6) The committee's report must relate to the same period as that covered by the Regulator's report.

(7) The committee may establish sub-committees, and the members of any such sub-committee—

(a) may include persons who are not members of the committee or of the Regulator, but

(b) must not include persons who are executive members or other staff of the Regulator.

(8) The committee may authorise any of its members or any of its sub-committees to discharge on its behalf—

(a) any of the non-executive functions;

(b) the duty to prepare a report under subsection (5).

(9) The committee (or any of its sub-committees) may be authorised under paragraph 20(1) of Schedule 1 to exercise further functions of the Regulator.

(10) This section is subject to any regulations made by the Secretary of State under paragraph 21 of Schedule 1 (power to limit or permit delegation of functions).

The Determinations Panel

The Determinations Panel

S-9 The Determinations Panel

9 The Determinations Panel

(1) The Regulator must establish and maintain a committee consisting of—

(a) a chairman, and

(b) at least six other persons

(in this Part referred to as ‘the Determinations Panel’).

(2) The Regulator must appoint as the chairman of the Panel the person nominated in accordance with paragraph 11 of Schedule 1 (nomination by a committee established by the chairman of the Regulator).

(3) The chairman of the Panel must—

(a) decide the number of persons to be appointed as the other members of the Panel, and

(b) nominate a person suitable for each of those appointments.

(4) The Regulator must then appoint as the other members of the Panel the persons nominated by the chairman of the Panel.

(5) The following are ineligible for appointment as members of the Panel—

(a) any member of the Regulator;

(b) any member of the staff of the Regulator;

(c) any member of the Board of the Pension Protection Fund;

(d) any member of the staff of that Board.

(6) The Panel may establish sub-committees consisting of members of the Panel.

(7) Further provision about the Panel is made in Schedule 1, including provision as to the terms of appointment, tenure and remuneration of members and as to its procedure.

S-10 Functions exercisable by the Determinations Panel

10 Functions...

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