Social Welfare Law Reform and Pensions Bill 2006
Part 3 and Sections 38 to 44 of the Social Welfare Law Reform and Pensions Bill 2006 amends the Pensions Act 1990, as amended (“the Act”). This document summarises the main changes to the Act proposed in the Bill.
Prosecutions
Section 39 inserting a new section 3A
Section 3 of the Act provides that where a person contravenes any provision of the Act or Regulations made under the Act, he or she shall be guilty of an offence and proceedings for a summary offence may be brought and prosecuted by the Pensions Board.
This new section 3A provides for a “pay up and remedy regime” as an alternative to prosecution where the Pensions Board believes that a person has committed an offence under the Act which is subject to a summary prosecution.
Rules of Evidence
Section 39 inserting a new section 3B
This section relates to the rules of evidence in Pensions Board prosecutions. It provides for copy documents certified by an officer of the Board to be admissible as prima facie evidence without a requirement for the original document to be produced and for certificates by officers of the Board of certain matters to be admissible as prima facie evidence of those matters without need for proof of the officer’s signature or his official position.
Indemnity of Board
Section 40 inserting a new section 26A
This section permits the Minister for Social and Family Affairs in consultation with the Minister for Finance to indemnify members of the Board, members of Committees of the Board and officers of the Board past and present, to such extent and on such terms as the Minister thinks fit in respect of any act or omission by such person in the performance of his or her functions provided that such act or omission was not in bad faith.
Benefits on wind-up
Section 41 inserting new sections 48(3A) and 48(3B)
Section 48(3A) provides that where a scheme is wound up with insufficient funds to discharge all liabilities, the trustees may discharge the liabilities for index-linked benefits by purchasing an annuity with equivalent fixed rate increases, calculated in accordance with Society of Actuaries in Ireland guidance. Section 48(3B) provides that where section 48(3A) is applied and there are resources remaining after paying benefits specified in paragraphs (i), (ii) and (iii) of subsection 48(1)(b), these resources should be first applied to those entitled to index-linked pensions at the date of wind-up.
Funding Standard
Section 41 inserting a new subsection 46(1)(c)
Section 41 inserts a new subsection 46(1)(c) which allows the scheme actuary, when completing an actuarial funding certificate, to assume that index linked benefits may be replaced by equivalent fixed rate increases. This reflects the changes introduced by the new section 48(3A).
Funding Standard
Schedule 8 - Miscellaneous Amendments to the Act
Section 43(1) is amended to provide that when a scheme ceases to be excluded from the funding standard under section 52, the trustees of the scheme will be required to submit an actuarial funding certificate to the Board with an effective date no more than 6 months after the date on which the exclusion ceased.
An amendment to sections 55(4) and (5) of the Pensions Act provides that, where under section 49(3) the Pensions Board has specified a later date for a scheme to meet the funding standard, the actuary’s statement in the annual report should state whether he or she is satisfied that the scheme will meet the funding standard by the specified date. This is a technical amendment to the certification required and has no effect on the funding of the scheme.
Independent assessment of actuarial work
Section 42 inserting a new section 51A
This section enables the Minister to make Regulations requiring a scheme actuary to have his or her work reviewed to ensure it complies with the provisions of the Act and professional guidance issued by the Society of Actuaries in Ireland.
Pensions Ombudsman
Section 43 amending Section 131
Section 131 of the Act is amended to allow the Pensions Ombudsman to bypass the Internal Dispute Resolution procedure in cases where there is clearly nothing to be gained from the process.
Disclosure of Information
Schedule 8 - Miscellaneous Amendments to the Act
Annual Reports
Section 55(2): Section 55(2)(c) currently provides for the Minister to make Regulations exempting small schemes in wind up from the requirement to prepare annual reports. It was decided to amend this sub-section to allow the Board require a scheme to produce such annual reports notwithstanding Regulations exempting them, in certain cases where the Board considers it necessary or appropriate and in the interests of members.
Statement of Reasonable Projection
Section 54(4): This amendment gives the Minister power to make regulations requiring trustees of defined contribution schemes to comply with actuarial advice and guidance in preparing the statement of reasonable projection which is required to be provided to scheme members at specified intervals under the 2005 Disclosure Regulations.
PRSAs
Schedule 8 -Miscellaneous Amendments to the Act
Section 35: This amendment provides that the trustees effecting a transfer payment under section 35 of the Act may now make the transfer payment to a Personal Retirement Savings Account.
Section 91: This is an amendment to the definition of “contributor”
Section 121: This amendment provides that where an employer provides access to an overseas pension scheme he or she is not obliged to give access to a Personal Retirement Savings Account (PRSA).
Cross-Border Schemes
Schedule 8 -Miscellaneous Amendments to the Act
Section 149: This is a technical amendment to allow more flexibility in the funding arrangements for cross border schemes in the light of clarification received from the European Commission.
Miscellaneous Amendments
Schedule 8 - Miscellaneous Amendments to the Act
Section 2(1): This amendment means that administrators will not be considered as trustees for the purposes of section 59A.
Section 5: This section gives the Minister the power to make regulations to give effect to any provisions of the EC Treaties or to any act adopted by an institution of the EC which regulates any of the provisions to which the Act applies.
No liability whatsoever is accepted by the Pensions Board, it’s servants or agents for any errors or omissions in the information contained in this document or for any loss occasioned to any person acting or refraining from acting as a result of any statement in this document.
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20 February, 2006