Social Security Act 1989;

JurisdictionUK Non-devolved
Citation1989 c. 24


Social Security Act 1989

1989 CHAPTER 24

An Act to amend the law relating to social security and occupational and personal pension schemes; to make provision with respect to certain employment-related benefit schemes; to provide for the recovery out of certain compensation payments, of amounts determined by reference to payments of benefit; to make fresh provision with respect to the constitution and functions of war pensions committees; and for connected purposes.

[21st July 1989]

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:—

Contributions

Contributions

S-1 Amendments relating to primary Class 1 contributions.

1 Amendments relating to primary Class 1 contributions.

(1) In section 4 of the principal Act, for subsections (6) to (6B) (computation of primary Class 1 contributions) there shall be substituted—

(6) Where a primary Class 1 contribution is payable, the amount of that contribution shall be the aggregate of—

(a) the initial primary percentage of so much of the earnings paid in the tax week, in respect of the employment in question, as does not exceed the current lower earnings limit; and

(b) the main primary percentage of so much of those earnings as exceeds that limit but does not exceed the upper earnings limit;

but this subsection is subject to regulations under subsection (7) below or sections 128 to 132 below and to section 27 of the Pensions Act (contracted-out rates).

(6A) For the purposes of this Act the primary percentages shall be as follows—

(a) the initial primary percentage shall be 2 per cent.; and

(b) the main primary percentage shall be 9 per cent.;

but the rates of those primary percentages are subject to alteration under sections 122 and 123A below.

(6B) In the case of earners paid otherwise than weekly, any reference in subsection (6) above to the current upper, or (as the case may be) lower, earnings limit shall be taken as a reference to the prescribed equivalent of that limit.’

(2) In subsection (6F) of that section (alteration of number of primary or secondary brackets) the words ‘primary or’ shall be omitted.

(3) In section 122 of that Act (additional power to alter contributions) for paragraph (a) of subsection (1) there shall be substituted—

‘(a) the percentage rate specified—

(i) as the initial primary percentage in section 4(6A)(a);

(ii) as the main primary percentage in section 4(6A)(b);’.

(4) In subsection (4) of that section (variation of rates for purpose of adjusting Redundancy Fund) for paragraph (a) there shall be substituted—

‘(a) the percentage rate specified—

(i) as the initial primary percentage in section 4(6A)(a);

(ii) as the main primary percentage in section 4(6A)(b);’

(5) In subsection (6) of that section, for paragraph (a) (maximum variation in Class 1 rates of 0.25 percentage points) there shall be substituted—

‘(a) to increase for any tax year—

(i) the percentage rate of the initial or main primary percentage, or

(ii) the percentage rate for secondary Class 1 contributions,

to a percentage rate more than 0.25 per cent. higher than the percentage rate applicable at the end of the preceding tax year for the primary percentage or secondary Class 1 contribution in question; or’.

(6) In section 123A of that Act (further power to alter certain contributions) for subsection (1) there shall be substituted—

(1) For the purpose of adjusting amounts payable by way of primary Class 1 contributions, the Secretary of State may at any time make an order altering—

(a) the percentage rate specified as the initial primary percentage in section 4(6A)(a);

(b) the percentage rate specified as the main primary percentage in section 4(6A)(b).’

(7) In subsection (3) of that section, for paragraph (a) (limit on increase of primary Class 1 rates) there shall be substituted—

‘(a) to alter the percentage rate of the initial or main primary percentage to a percentage rate more than 0.25 per cent. higher than the percentage rate applicable at the end of the preceding tax year for the primary percentage in question; or’.

(8) In section 134 of that Act (destination of contributions) in paragraphs (a) and (i) of subsection (4) (‘appropriate national health service allocation’ and ‘appropriate employment protection allocation’, when in force, to include specified percentage of earnings in respect of which primary Class 1 contributions were paid) after the word ‘paid’ there shall be inserted the words ‘at the main primary percentage rate’.

(9) In Schedule 20 to that Act (glossary of expressions) there shall be inserted at the appropriate places—

‘‘Initial primary percentage’; ‘main primary percentage’; ‘primary percentage’

See section 4(6) and (6A).

Construe ‘initial primary percentage rate’ and ‘main primary percentage rate’ as references to the percentage rates from time to time specified in

section 4(6A)(a) or (b) as the initial or, as the case may be, main primary percentage.’

‘‘Main primary percentage’

See ‘initial primary percentage’; ‘main primary percentage’; ‘primary percentage’ above.’

‘‘Primary percentage’

See ‘initial primary percentage’; ‘main primary percentage’; ‘primary percentage’ above.’

S-2 Repayment of contributions where earnings become repayable.

2. In Schedule 1 to the principal Act (contributions: supplementary provisions) in paragraph 6(1) (matters for which regulations may provide) after paragraph (g) there shall be inserted—

‘(gg) for the repayment, in prescribed cases, of the whole or a prescribed part of any contributions paid by reference to earnings which have become repayable;’.

S-3 Abolition of Treasury supplement to contributions.

3 Abolition of Treasury supplement to contributions.

3. No payments by way of supplement, or adjustment of supplement, under section 1(5) of the principal Act shall be made after 31st March 1989 in respect of any contributions whether paid before, on or after that date.

S-4 Earnings factors.

4 Earnings factors.

(1) Section 13 of the principal Act (contribution conditions and earnings factors) shall be amended in accordance with subsections (2) to (4) below.

(2) In subsection (5) (manner in which tables and rules are to be drawn up) after the words ‘so that in general’ there shall be inserted—

‘(a) for any tax year beginning on or after 6th April 1987, the amount of earnings on which primary Class 1 contributions have been paid or treated as paid gives rise, subject to subsection (5A) below, to an earnings factor for that year equal or approximating to the amount of those earnings; and’.

(3) After subsection (5A) there shall be inserted—

(5AA) Regulations may impose limits with respect to the earnings factors which a person may have or be treated as having in respect of any one tax year.’

(4) After subsection (5B) (duty to maintain and retain records) there shall be inserted—

(5C) Where the Secretary of State is satisfied that records of earnings relevant for the purpose of calculating a person's earnings factors for a tax year beginning on or after 6th April 1987 have not been maintained or retained or are otherwise unobtainable then, for the purpose of determining those earnings factors, he may—

(a) compute, in such manner as he thinks fit, an amount which shall be regarded as the amount of that person's earnings on which primary Class 1 contributions have been paid or treated as paid, or

(b) take the amount of those earnings to be such sum as he may specify in the particular case.’

(5) The Earnings Factor Regulations, as in force for the purpose of determining earnings factors for the tax years beginning with 6th April 1985 and 6th April 1986, shall have effect, and be taken always to have had effect, with the substitution in paragraph 3 of Schedule 1 (which, as amended by regulation 2(3) of the Amending Regulations, provided in certain cases for the aggregation of separate contributions) for the words from ‘where the values’ to ‘those sums’ of the words—

‘where, in the case of any two or more separate sums—

(a) the values to be accorded to F (apart from this paragraph) would fall to be ascertained under the same paragraph of paragraph 2(e) above, and

(b) the values to be so accorded to G would fall to be ascertained under the same paragraph of paragraph 2(f) above,

those sums’.

(6) In subsection (5) above—

‘the Earnings Factor Regulations’ means the Social Security (Earnings Factor) Regulations 1979 ; and

‘the Amending Regulations’ means the Social Security (Earnings Factor) Amendment Regulations 1985 .

(7) The amendment by subsection (5) above of a provision contained in regulations shall not be taken to have prejudiced any power to make further regulations revoking or amending that provision, whether in relation to the tax years there mentioned or otherwise.

(8) The Social Security (Earnings Factor) Amendment Regulations 1988 shall have effect, and be deemed always to have had effect, as if the amendment made by subsection (3) above had come into force before the making of those regulations.

Liability to maintain children

S-5 Liability of parents to maintain children under the age of nineteen in respect of whom income support is paid.

5 Liability of parents to maintain children under the age of nineteen in respect of whom income support is paid.

(1) In section 20(11) of the...

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