Funding
Pensions Act
Number 25 of 1990 / Pensions Act, 1990
Part IV Funding Standard
40.
Interpretation
40. In this Part and the Third Schedule, except where the context otherwise requires-
[“additional resources” means, on any date, resources in addition to the resources used to determine whether the scheme satisfies the funding standard on the same date;]
. . .
. . .
“funding proposal” has the meaning assigned to it in section 49;
. . .
[“index-linked benefits” means benefits which, under the rules of a scheme, are increased while in payment at a rate wholly or partly linked to increases in an index of the cost of living or of wages or salaries or increases in salaries actually or notionally payable to serving employees in the relevant employment;]
. . .
“certified percentage” means a percentage specified for the purposes of section 45 (4);
“specified percentage” has the meaning assigned to it by section 44.
41.
Application
Regulations under this section
[41.-(1) Subject to section 52, this Part shall apply to any scheme other than-
(a) a defined contribution scheme, or
(b) [a small scheme] under which service in the relevant employment after the 1st day of January, 1993, does not entitle the members to long service benefit and, where any long service benefit is determined by reference to a member’s earnings, such earnings in the case of all members relate to a date or a period prior to the 1st day of January, [1993, or].
[(c) to such extent as may be prescribed, [a small scheme] the winding up of which has commenced.]
[(2) [Notwithstanding subsection (1) but subject to paragraph (aa)-]
[(a) this Part shall apply to-
(i) a defined contribution scheme which is a regulatory own funds scheme,
(ii) a defined contribution scheme which is paying benefits to or in respect of members where those benefits are not secured under a policy or policies of assurance with one or more undertakings, and
(iii) a small scheme of the type referred to in paragraph (b) of subsection (1) which is aregulatory own funds scheme,]
[(aa) the provisions of this Part which relate to the funding standard reserve shall not apply to-
(i) a defined contribution scheme which is a regulatory own funds scheme, or
(ii) a small scheme of the type referred to in paragraph (b) of subsection (1) which is aregulatory own funds scheme,]
[(b) subsections (1), (1A), [(1AA), (1AB),] (1B) and (2) of section 48 (amended by section 16 of the Social Welfare and Pensions Act 2009) shall apply to any scheme other than a defined contribution scheme, and]
(c) subsections (3), [(3A), (3B)] and (4) of section 48 shall apply to every scheme.]
42.
Actuarial funding certificate
42.-(1) The trustees of a relevant scheme shall, from time to time in accordance with section 43, submit to the Board a certificate, in this [Act] referred to as “an actuarial funding certificate”.
[(1A) On and after 1 June 2012, the trustees of a relevant scheme shall, from time to time in accordance with section 43, submit tothe Board a certificate, in this Act referred to as ‘a funding standard reserve certificate’.]
(2) The trustees of a relevant scheme shall cause actuarial funding certificates to be prepared by an actuary who shall certify therein that as at the date, [in this Act referred to as ‘the effective date of the actuarial funding certificate’], on which the liabilities and resources of the scheme are calculated for the purposes of section [44(1)] either-
(a) the scheme satisfies the funding standard provided for in section [44(1)], or
(b) the scheme does not satisfy the funding standard.
[(2A) The trustees of a relevant scheme shall cause funding standard reserve certificates to be prepared by an actuary who shall certify therein that as at the date, in this Act referred to as ‘the effective date of the funding standard reserve certificate’, on which the funding standard reserve is calculated for the purposes of section 44(2) either-
(a) the scheme satisfies the funding standard reserve, or
(b) the scheme does not satisfy the funding standard reserve.]
(3) In the case of a relevant scheme which commenced before [1 June 2002], the first actuarial funding certificate submitted in accordance with section 43 [having an effective date after 1 June 2002] shall also state the certified percentage in relation to the scheme.
[(4) Regulations under this section may-
(a) prescribe the form and content of an actuarial funding certificate [and a funding standard reserve certificate], and
(b) require the actuary, in completing an actuarial funding certificate [and a funding standard reserve certificate], to comply with the applicable professional guidance issued by the Society of Actuaries in Ireland and specified in the regulations or with any other applicable guidance issued by any other person [(including the Board or the Minister)] and specified in the regulations.]
[(5) The Board, where it considers that it is necessary or appropriate and would not be contrary to the interests of the members of a scheme, may modify the requirements of subsections [(1), (1A), (2) and (2A)] in respect of such scheme in such circumstances and on such terms as it considers appropriate.]
43.
Effective dates for actuarial funding certificates
43.-(1) The first actuarial funding certificate shall have an effective date-
[(a) in the case of a relevant scheme which commenced before 1 January 1991, not later than 1 January 1994, and]
(b) in the case of a relevant scheme which commenced on or after [1 January 1991], not later than 3 1/2 years after the commencement of the scheme, [and]
[(ba) in the case of a scheme to which this Part applies by virtue of the amendment effected bysection 31(a) of the Social Welfare and Pensions Act 2005, not later than 1 April 2007, and]
[(bb) in the case of a relevant scheme which commenced after 22 September 2005, not later than 3 years after the commencement of the scheme, and]
[(c) in the case of a scheme to which this Part applies by virtue of the amendment effected bysection 32(a) of the Social Welfare and Pensions Act 2005, not later than 1 January [2007,]]and
[(d) in the case of a scheme which has been excluded, in whole or in part, from the application of this Part by virtue of regulations made under section 52 and which is no longer so excluded, not later than 6 months after the date on which [the exclusion ceases to apply, and]
[(e) notwithstanding paragraphs (a) and (b), in the case of each of the following relevant schemes:
(i) the Bord Na Móna (Members) Superannuation Scheme 1959;
(ii) the Dublin Port and Docks Board Unestablished Employees’ Superannuation Scheme 1990;
(iii) the Dublin Port and Docks Board Officers’ Superannuation Scheme 1961;
(iv) the Dublin Port and Docks Board Established Grade A Employees’ Superannuation Scheme;
(v) the Foynes Port Company Pension Scheme;
(vi) the Shannon Estuary Port Company Superannuation Plan (Limerick Harbour Commissioners Officers’ Superannuation Scheme 1962);
(vii) the Superannuation Scheme for Employees of the Pilotage Authority of the Dublin Pilotage District 1994;
(viii) the Port of Waterford Company Pension and Death Benefits Plan;
not later than 1 January 2009,]
[[and, subject to subsections (1A) and (1B)], a subsequent] actuarial funding certificate shall have an effective date not later than 3 1/2 years after the effective date of the immediately preceding certificate.
[(1A) Where, in accordance with subsection (1), an actuarial funding certificate, having an effective date after 22 September 2005, has been prepared, any subsequent actuarial funding certificateshall have an effective date not later than 3 years after the effective date of the immediately preceding certificate.]
[(1B) Notwithstanding subsections (1) and (1A) and subject to section 53M, in the case of a relevant scheme which is a regulatory own funds scheme an actuarial funding certificate shall be submitted to the Board having an effective date of:
(a) in the case of a relevant scheme which on 23 September 2010 was a regulatory own funds scheme, not later than 6 months after the date on which Chapter 2 of Part 4 of the Social Welfare and Pensions Act 2011 comes into operation;
(b) in the case of a relevant scheme which commences after 23 September 2010 and which from the relevant scheme’s commencement is a regulatory own funds scheme-
(i) not later than 4 weeks after the date of commencement of the relevant scheme, or
(ii) not later than 4 weeks after the date on which Chapter 2 of Part 4 of the Social Welfare and Pensions Act 2011 comes into operation,
whichever is the later;
(c) in the case of a relevant scheme which at its commencement was not a regulatory own funds scheme but becomes a regulatory own funds scheme after 23 September 2010-
(i) not later than 4 weeks after the date on which the scheme becomes a regulatory own funds scheme, or
(ii) not later than 4 weeks after the date on which Chapter 2 of Part 4 of the Social Welfare and Pensions Act 2011 comes into operation,
whichever is the later.
(1C) While a relevant scheme to which this Part applies remains a regulatory own funds scheme eachactuarial funding certificate submitted after the appropriate effective date referred to in subsection (1B) shall have an effective date not later than one year after the effective date of the immediately preceding certificate.
(1D) Where, in accordance with subsection (1B) or (1C) an actuarial funding certificate has been prepared and the relevant scheme subsequently ceases to be a regulatory own funds scheme, any subsequent actuarial funding certificate shall have an effective date not later than 3 years after the effective date of the immediately preceding certificate.]
[(1E) In the case of a relevant scheme, a funding standard reserve certificate shall have the same effective date as the actuarial funding certificate for the scheme where the effective date of thatactuarial funding certificate falls on or after 1 June 2012.]
[(2) Subject to subsections (2A), (3), (3A), (3B) and (4), an actuarial funding certificate and, on or after 1 June 2012, a funding standard reserve certificate shall be submitted to the Board by the trustees of the scheme within 9 months (or such other period as may be prescribed) of the effective date of the relevant certificate.]
[(2A) Notwithstanding the foregoing provisions of this section, the Board may, by notice in writing to the trustees of a relevant scheme, require the trustees to submit to the Board, by such date as may be specified in the notice, an actuarial funding certificate or funding standard reserve certificate having as an effective date such date as is specified in that notice and the trustees shall comply with any such notice.]
[(3) If an annual report prepared under subsection (1) of section 55-
(a) does not contain the statement by an actuary required under subsection (3) or (4) of that section, as appropriate,
(b) contains the statement by an actuary required under that subsection (3) but the actuarydoes not state therein that he or she is reasonably satisfied that, if he or she were to prepare under section 42 an actuarial funding certificate and, on or after 1 June 2012, a funding standard reserve certificate having an effective date of the last day of the period to which the annual report relates, he or she would certify, in the case of an actuarial funding certificate, that the scheme satisfies the funding standard, or, in the case of a funding standard reserve certificate, that the scheme satisfies the funding standard reserve, or
(c) contains the statement by an actuary required under that subsection (4) but the actuarydoes not state therein that he or she is reasonably satisfied, in the case of an actuarial funding certificate that the scheme will satisfy the funding standard at the effective date of the next actuarial funding certificate or, where applicable, any later date specified undersubsection (3) or (3B) of section 49, and, in the case of a funding standard reserve certificate, that the scheme will satisfy the funding standard reserve at the effective date of the next funding standard reserve certificate, or, where applicable, any later date specified under section 49(3B),
then, subject to subsection (3A), in each case, the trustees of the scheme shall submit an actuarial funding certificate and, on or after 1 June 2012, a funding standard reserve certificate to the Board within 12 months of the last day of the period to which the annual report relates and such certificate or certificates shall have an effective date not earlier than the last day of the period to which the annual report relates,]
[(3A) Subsection (3) shall not apply in relation to an annual report prepared under subsection (1) of section 55 where, on the last day of the period to which the report relates, the relevant schemewas a regulatory own funds scheme.
(3B) Subject to section 53M an actuarial funding certificate required under subsection (1B) or (1C) shall be submitted to the Board by the trustees of the regulatory own funds scheme within 3 months ofthe effective date of the certificate.]
[(4) The Board, on application to it in that behalf by the trustees of a scheme, [may extend the time limit within which an actuarial funding certificate or a funding standard reserve certificate shall be submitted to the Board under subsection (2), (2A), (3) or (3B)], as the case may be, for a period not exceeding 6 months where the Board considers the extension is appropriate having regard to the circumstances of the application concerned.]
44.
Provisions relating to funding standard
(1) Subject to the subsequent provisions of this Part, a relevant scheme shall be deemed to have satisfied the funding standard if, in the opinion of the actuary, the resources of the scheme at theeffective date of the actuarial funding certificate would have been sufficient, if the scheme had been wound up on that date, to provide for-
(a) the liabilities of the scheme consisting of-
(i) additional benefits secured or granted by way of additional voluntary contributions or a transfer of rights from another scheme to which paragraph 2 of the Third Schedule relates to the extent that the rights to which the transfer relates were originally secured or granted by way of additional voluntary contributions,
(ii) benefits in the course of payment to which paragraph 1 of the Third Schedule relates,
(iii) benefits, other than those referred to in subparagraphs (i) and (ii), which consist of a transfer of rights from another scheme to which paragraph 2 of the Third Schedule relates,
(iv) benefits, other than those referred to in subparagraphs (i), (ii) and (iii), to whichparagraphs 3 and 4 of the Third Schedule relate, and
(v) the percentage (in this Part referred to as the ‘specified percentage’) of any benefits, other than those referred to in subparagraphs (i), (ii) and (iii), to which paragraph 5 of the Third Schedule relates,
and
(b) the estimated expenses of administering the winding up of the scheme.
(2) Subject to the subsequent provisions of this Part, a relevant scheme shall be deemed to have satisfied the funding standard reserve if, in the opinion of the actuary, the additional resources of the scheme at the effective date of the funding standard reserve certificate are at least equal to the aggregate of-
(a) an amount equal to A x (B – C) where-
A is 15 per cent (or such higher percentage, being not more than 50 per cent, or lower percentage, being not less than zero per cent as may be prescribed by the Minister),
B is the amount of the funding standard liabilities of the scheme at the effective date of the funding standard reserve certificate, and
C is the amount, subject to a maximum of an amount equal to the funding standardliabilities, of the resources of the scheme invested in the following assets-
(i) securities issued under section 54(1) of the Finance Act 1970 and known as bonds,
(ii) securities issued under the laws of a Member State (other than the State) that correspond to securities referred to in subparagraph (i),
(iii) cash deposits with one or more credit institutions,
(iv) such other assets of a type that offers a similar degree of security to those assets referred to in subparagraphs (i), (ii) or (iii) as may be prescribed by the Minister,
and
(b) the amount by which the funding standard liabilities of the scheme would increase on the effective date of the funding standard reserve certificate if the interest rate or interest rates assumed for the purposes of determining the funding standard liabilities was one half of one per cent (or such higher percentage, being not more than 5 per cent, or lower percentage, being not less than zero per cent, as may be prescribed by the Minister) less than the interest rate or interest rates (as appropriate) assumed for the purposes of determining thefunding standard liabilities for the actuarial funding certificate which has the same effective date as the funding standard reserve certificate less the amount by which the resources of the scheme would increase at the same date as a result of the same change in interest rate or interest rates.
(c) For the purposes of paragraphs (a) and (b), resources shall not include resources which relate to contributions or a transfer of rights from another scheme to the extent that thebenefits provided are directly determined by the accumulated value of those contributions or the amount transferred and a given investment performance is not guaranteed or specified in relation to those contributions or the amount transferred.]
[45.
Provisions relating to schemes commencing before 1 June 2002
45.-(1) This section applies to relevant schemes that came into operation before 1 June 2002.
(2) The actuary shall determine the percentage, if any, of the benefits under a scheme to whichparagraph 5 of the Third Schedule relates that, in his opinion, could have been provided at the effective date of the first actuarial funding certificate having an effective date after 1 June 2002 in relation to the scheme from the resources of the scheme if-
(a) the scheme had been wound up on that date, and
(b)
(i) the liabilities of the scheme for benefits under the scheme specified in subparagraphs (i), (ii), (iii) and (iv) of paragraph (a) of section [44(1)], and
(ii) the estimated expenses of administering a winding up,
had already been discharged from resources of the scheme.
(3) The first actuarial funding certificate having an effective date after 1 June 2002 in relation to a scheme shall state a percentage (in this Part referred to as “the certified percentage”), being the lesser of-
(a) the percentage determined by the actuary pursuant to subsection (2), and
(b) 100 per cent.
(4) For the purposes of this Part-
(a) where an actuarial funding certificate relates to an effective date not later than 1 June 2002, the specified percentage shall be 0 per cent,
(b) where an actuarial funding certificate relates to an effective date after 1 June 2002 but not later than 1 June 2012, the specified percentage shall be the certified percentage,
(c) where an actuarial funding certificate relates to an effective date after 1 June 2012 and on 1 June 2002 the scheme concerned was a funded scheme, the specified percentage shall be 100 per cent.]
46.
Matters to which actuary is to have regard
46.-[(1) [In completing an actuarial funding certificate or funding standard reserve certificate], theactuary-
(a) in addition to complying with the other provisions of this Part, shall have regard to such financial or other assumptions as he considers to be appropriate on the effective date of the certificate,
(b) notwithstanding anything contained in the rules of a relevant scheme, may assume that the liabilities of the scheme on winding up could have been provided by applying all or part of the resources of the scheme in the making of-
(i) a payment to another scheme, or
(ii) one or more payments falling to be made under policies or contracts of assurance that are effected on behalf of the member with one or more undertakings (within the meaning of the Insurance Act, 1989) and that are approved of by the Revenue Commissioners under [Chapter 1 of Part 30 of the Taxes Consolidation Act, 1997],
such payment or payments to be equal to the actuarial value of the benefits specified insubparagraphs [(i), (ii), (iii) and (iv)] of section [44(1)(a)], and the percentage of thebenefits specified in [section [44(1)(a)(v)],]and
[(c) notwithstanding anything contained in the rules of a relevant scheme, may assume that the liabilities of the scheme in respect of index-linked benefits on winding up in respect of any persons who are receiving benefits or have reached normal pensionable age are equal to the actuarial value of benefits with fixed rate increases where those fixed rate increases are calculated in accordance with any applicable guidance issued by [the Society of Actuaries in Ireland or any other person (including the Board or the Minister) in relation to the preparation of actuarial funding certificates or funding standard reserve certificates] in accordance with section 42.]
(2) In determining the benefits to be paid on the winding up of a relevant scheme, the actuary shall, in addition to complying with section 48, have regard to such financial or other assumptions as he considers to be appropriate.
[48.
Priorities on winding up of relevant scheme.
48.-(1) In applying the resources of a relevant scheme which has been wound up after 1 January 1997, the trustees shall discharge the liabilities of the scheme for the following benefits in the following order-
(a) where the scheme is wound up on or before 1 June 2002-
(i) firstly, the benefits specified in paragraph 1 of the Third Schedule to or in respect of those persons, who, at the date of the winding up, were within the categories referred to in that paragraph, to the extent that they are not already discharged, and
(ii) secondly, the benefits specified in paragraphs 2 and 3 of the Third Schedule to or in respect of those members of the scheme who, at the date of the winding up, were within the categories referred to in those paragraphs, to the extent that they are not already discharged,
before discharging the liabilities of the scheme for other benefits, and
(b) where the scheme is wound up after 1 June 2002-
(i) firstly, all additional benefits secured or granted by way of additional voluntary contributions or a transfer of rights from another scheme to which paragraph 2 of the Third Schedule relates to the extent that the rights to which the transfer relates were originally secured or granted by way of additional voluntary contributions,
(ii) secondly, the benefits specified in paragraph 1 of the Third Schedule to or in respect of those persons, who, at the date of the winding up, were within the categories referred to in that paragraph, to the extent that they are not already discharged, and
(iii) thirdly, the benefits specified in paragraphs 2, 3 and 4 of the Third Schedule to or in respect of those members of the scheme who, at the date of the winding up, were within the categories referred to in those paragraphs, to the extent that they are not already discharged,
before discharging the liabilities of the scheme for other benefits.
[(1A) Notwithstanding subsection (1), in applying the resources of a relevant scheme that is wound up after the passing of the Social Welfare and Pensions Act 2009, or had wound up and had not discharged any of the liabilities of the scheme at the date of the passing of the Social Welfare and Pensions Act 2009, the trustees shall discharge the liabilities of the scheme for the followingbenefits in the following order:
(a) firstly, all additional benefits secured or granted by way of additional voluntary contributionsor a transfer of rights from another scheme to which paragraph 2 of the Third Schedule relates to the extent that the rights to which the transfer relates were originally secured or granted by way of additional voluntary contributions;
(b) secondly, the benefits (not including post-retirement increases in such benefits) specified inparagraph 1 of the Third Schedule to or in respect of those persons, who, at the date of the winding up of the scheme, were within the categories referred to in that paragraph, to the extent that those benefits have not already been discharged;
(c) thirdly, the benefits (not including post-retirement increases in such benefits) specified inparagraphs 2, 3 and 4 of the Third Schedule to or in respect of those members of the scheme who, at the date of winding up of the scheme, were within the categories referred to in those paragraphs, to the extent that those benefits have not already been discharged; and
(d) fourthly, the benefits specified in paragraphs 1, 2, 3 and 4 of the Third Schedule to or in respect of those persons and members of the scheme, who at the date of the winding up of the scheme, were within any of the categories referred to in any of those paragraphs, to the extent that those benefits have not already been discharged,
before discharging the liabilities of the scheme for other benefits.
[(1AA) Notwithstanding subsections (1) and (1A), in applying the resources of a relevant scheme, other than a relevant scheme referred to in subsection (1AB), that is wound up after the passing of theSocial Welfare and Pensions (No. 2) Act 2013, the trustees shall discharge the liabilities of therelevant scheme for the following benefits in the following order:
(a) firstly-
(i) all additional benefits secured or granted by way of additional voluntary contributions or a transfer of rights from another scheme to which paragraph 2 of the Third Schedule relates to the extent that the rights to which the transfer relates were originally secured or granted by way of additional voluntary contributions, and
(ii) benefits, the rate or amount of which is directly determined by the accumulated value of the contributions paid by or in respect of a member, or a transfer of rights from another scheme to the extent that the rate or amount of the rights to which the transfer relates is directly determined by the accumulated value of the contributions paid by or in respect of the member;
(b) secondly, in respect of the benefits (not including post-retirement increases in such benefits) specified in paragraph 1 of the Third Schedule to or in respect of those persons who, at the date of the winding up of the scheme, were within the categories referred to in that paragraph, the portion specified in subsection (1AC), to the extent that those benefits have not already been discharged;
(c) thirdly, 50 per cent of the benefits (not including post-retirement increases in such benefits) specified in paragraphs 2, 3 and 4 of the Third Schedule to or in respect of those members of the scheme who, at the date of the winding up of the scheme, were within the categories referred to in those paragraphs, to the extent that those benefits have not already been discharged;
(d) fourthly, the benefits (not including post-retirement increases in such benefits) specified inparagraph 1 of the Third Schedule to or in respect of those persons who, at the date of the winding up of the scheme, were within the categories referred to in that paragraph, to the extent that those benefits have not already been discharged;
(e) fifthly, the benefits (not including post-retirement increases in such benefits) specified inparagraphs 2, 3 and 4 of the Third Schedule to or in respect of those members of the scheme who, at the date of the winding up of the scheme, were within the categories referred to in those paragraphs, to the extent that those benefits have not already been discharged; and
(f) sixthly, the benefits specified in paragraphs 1, 2, 3 and 4 of the Third Schedule to or in respect of those persons and members of the scheme who, at the date of the winding up of the scheme, were within any of the categories referred to in any of those paragraphs, to the extent that those benefits have not already been discharged, before discharging the liabilities of the scheme for other benefits.
(1AB) Notwithstanding subsections (1) and (1A), in applying the resources of a relevant scheme that is wound up after the passing of the Social Welfare and Pensions (No. 2) Act 2013 and at the date of the winding up the employer participating in the relevant scheme is, or where more than one employer participates in such scheme, all of the employers participating in the scheme are, insolvent for the purposes of the Act of 1984, the trustees shall discharge the liabilities of therelevant scheme for the following benefits in the following order:
(a) firstly-
(i) all additional benefits secured or granted by way of additional voluntary contributions or a transfer of rights from another scheme to which paragraph 2 of the Third Schedule relates to the extent that the rights to which the transfer relates were originally secured or granted by way of additional voluntary contributions, and
(ii) benefits, the rate or amount of which is directly determined by the accumulated value of the contributions paid by or in respect of a member, or a transfer of rights from another scheme to the extent that the rate or amount of the rights to which the transfer relates is directly determined by the accumulated value of the contributions paid by or in respect of the member;
(b) secondly, 50 per cent of the benefits specified in paragraph 1 of the Third Schedule to or in respect of those persons who, at the date of the winding up of the scheme, were within the categories referred to in that paragraph, to the extent that those benefits have not already been discharged;
(c) thirdly, 50 per cent of the benefits specified in paragraphs 2, 3 and 4 of the Third Schedule to or in respect of those members of the scheme who, at the date of the winding up of the scheme, were within the categories referred to in those paragraphs, to the extent that thosebenefits have not already been discharged;
(d) fourthly, in respect of the benefits (not including post-retirement increases in such benefits) specified in paragraph 1 of the Third Schedule to or in respect of those persons who, at the date of the winding up of the scheme, were within the categories referred to in that paragraph-
(i) the annual amount, or
(ii) €12,000,
whichever is the lesser, to the extent that those benefits have not already been discharged;
(e) fifthly, the benefits (not including post-retirement increases in such benefits) specified inparagraph 1 of the Third Schedule to or in respect of those persons who, at the date of the winding up of the scheme, were within the categories referred to in that paragraph, to the extent that those benefits have not already been discharged;
(f) sixthly, the benefits (not including post-retirement increases in such benefits) specified inparagraphs 2, 3 and 4 of the Third Schedule to or in respect of those members of the scheme who, at the date of the winding up of the scheme, were within the categories referred to in those paragraphs, to the extent that those benefits have not already been discharged; and
(g) seventhly, the benefits specified in paragraphs 1, 2, 3 and 4 of the Third Schedule to or in respect of those persons and members of the scheme who, at the date of the winding up of the scheme, were within any of the categories referred to in any of those paragraphs, to the extent that those benefits have not already been discharged, before discharging the liabilities of the scheme for other benefits.
(1AC) For the purposes of paragraph (b) of subsection (1AA), the portion of the benefits shall be-
(a) where the annual amount is €12,000 or less-
(i) the annual amount, or
(ii) €12,000,
whichever is the lesser, or
(b) where the annual amount is greater than €12,000 and is less than €60,000-
(i) €12,000, or
(ii) 90 per cent of the annual amount,
whichever is the greater, or
(c) where the annual amount is €60,000 or more-
(i) €54,000, or
(ii) 80 per cent of the annual amount,
whichever is the greater.]
(1B) The liabilities of the scheme in respect of the benefits to which paragraph (d) of subsection (1A) applies shall rank equally between each other and shall be paid in full unless the resources of the scheme are insufficient to meet those liabilities, in which case they shall abate in equal proportions as between each other.]
[(1C) The liabilities of the relevant scheme in respect of the benefits referred to in-
(a) each of the paragraphs (a) to (f) of subsection (1AA) shall rank equally between each other and shall be paid in full unless the resources of the relevant scheme are insufficient to meet those liabilities, in which case they shall abate in equal proportions as between each other, and
(b) each of the paragraphs (a) to (g) of subsection (1AB) shall rank equally between each other and shall be paid in full unless the resources of the relevant scheme are insufficient to meet those liabilities, in which case they shall abate in equal proportions as between each other.
(1D) Where in the discharge of the liabilities of a relevant scheme under subsection (1AB), the resources of the relevant scheme are not sufficient to discharge, in whole or in part, the liabilities of the scheme in respect of the benefits referred to in paragraphs (b), (c) and (d) of subsection (1AB), or any of those benefits referred to in any of those paragraphs, the Minister for Finance shall, in accordance with section 48A, pay the amount certified under section 48A that is required to provide for the discharge of those liabilities in respect of those benefits in accordance with those paragraphs.]
(2) If, after discharging the liabilities of a scheme to which [[subsection (1)(b), (1A), (1AA) or (1AB) applies] for the benefits specified in those subsections] and any other benefits arising under the rules of the scheme, any resources of the scheme remain, then, before returning any part of the resources of the scheme to the employer, the trustees shall, to the extent that they have not already done so, provide out of the resources of the scheme for revaluation of the benefitsspecified in paragraph 4 of the Third Schedule, calculated in accordance with section 33 as though these benefits were specified in paragraphs 2 and 3 of the Third Schedule.
(3) In applying the resources of a relevant scheme which has been wound up, the trustees may discharge, notwithstanding anything contained in the rules of the scheme and without the consent of the member concerned, the liability of the scheme for benefits payable to or in respect of any member by-
(a) making a payment to another funded scheme which provides or is capable of providing long service benefit and of which he is a member or a prospective member, or
[(b) the making of one or more payments under policies or contracts of assurance that are effected on behalf of the member with one or more undertakings (within the meaning of theInsurance Act 1989) [which policies or contracts are-]
(i) [approved by the Revenue Commissioners] under Chapter 1 of Part 30 of the Taxes Consolidation Act 1997, or
(ii) [in a form which has been certified by the Board] under section 53B (inserted bysection 42 of the Social Welfare and Pensions Act 2010),
and which policies or contracts of assurance shall not be deemed to be an occupational pension scheme for the purposes of this Act, or]
(c) where so prescribed, and in accordance with such conditions as may be prescribed, the making of a payment to the trustees, custodians, managers or administrators of an arrangement for the provision of retirement benefits established within the State, not being an arrangement of the kind mentioned in paragraphs (a) or (b),
of an aggregate amount not less than the actuarial value of the benefits payable on the winding up under the rules of the scheme, subject always to [subsections (1), (1A), (1AA), (1AB) and (2)].
[(3A) In purchasing an annuity in substitution for an index-linked benefit in a relevant scheme which has been wound up or in making a payment or payments under subsection (3), the trustees of a scheme which does not have sufficient resources to discharge all of the liabilities of the scheme forbenefits specified [in subsections (1)(b), (1A), (1AA) and (1AB)] may, notwithstanding anything contained in the rules of the scheme and without the consent of the member concerned, discharge the liability of the scheme for an index-linked benefit by purchasing an annuity with fixed rate increases or deem the actuarial value of an index-linked benefit to be equal to the actuarial valueof a benefit with fixed rate increases, provided that such fixed rate increases are calculated in accordance with any applicable guidance issued by the Society of Actuaries in Ireland in relation to the preparation of [actuarial funding certificates or funding standard reserve certificates] in accordance with section 42.
(3B) If the liabilities of a scheme for index-linked benefits are reduced under subsection (3A) any resources which remain in the scheme after discharging the liabilities of the scheme for all benefitsspecified [in subsections (1)(b), (1A), (1AA) and (1AB)] shall be applied in increasing the benefitspayable to and in respect of those persons specified [in subsections (1)(b)(ii), (1A)(b), (1AA)(b), (1AA)(d), (1AB)(b), (1AB)(d) and (1AB)(e)] who were entitled to index-linked benefits under the rules of the scheme at the date of the winding up.]
(4) Nothing in this section requires liabilities for benefits to be discharged before liabilities for expenses, fees and costs associated with the winding up of the scheme.]
[(5) For the purposes of this section, a relevant scheme is wound up on the date of the doing of such act, the happening of such event, or the making of such decision as, under the rules of the scheme, requires that the scheme be wound up, and “date of the winding up” shall, in relation to arelevant scheme, be construed accordingly.
(6) References in the Third Schedule to effective date of the certificate shall, for the purposes of this section, be construed as references to the date of the winding up of the relevant schemeconcerned.]
[(7) In this section-
(a) references to a post-retirement increase shall not include a postretirement increase which became payable before the date of the winding up, and
(b) references to an employer being insolvent for the purposes of the Act of 1984 shall be construed in accordance with that Act.
(8) In this section-
‘Act of 1984’ means the Protection of Employees (Employers’ Insolvency) Act 1984;
‘annual amount’, in relation to benefits, means the benefits payable to or in respect of a person in the form of an annual pension expressed as an annual amount.]
[48A.
Payment of certain amounts by Minister for Finance
where resources of relevant scheme are not sufficient to discharge liabilities in respect of benefits referred to in section 48(1D).
48A.-(1) Where the resources of a relevant scheme referred to in section 48(1D) are not sufficient to discharge the liabilities, referred to in section 48(1D), of that scheme in respect of the benefitsreferred to in section 48(1D)-
(a) the trustees of that scheme shall direct the actuary appointed to that scheme to prepare a statement of the difference between those liabilities in respect of the benefits referred to insection 48(1D) and the resources of that scheme that are available to discharge those liabilities in respect of those benefits, and
(b) the statement referred to in paragraph (a) shall-
(i) include a statement of the amount required to discharge the liabilities in respect of thebenefits referred to in that paragraph (in this section referred to as the ‘relevant amount’), and
(ii) include a statement by the actuary appointed to the relevant scheme that the relevant amount is the amount required for the discharge of the liabilities of that relevant scheme in respect of the benefits referred to in section 48(1D).
(2) The trustees referred to in subsection (1) shall-
(a) apply to the Board to certify the relevant amount concerned, and
(b) submit a copy of the statement referred to in subsection (1) with that application.
(3) Where the Board is satisfied that-
(a) the statement referred to in subsection (1) has been prepared in accordance with guidelines and guidance notes prescribed in regulations made by the Minister under subsection (11), and
(b) the relevant amount has been calculated in accordance with those guidelines and guidance notes,
the Board shall certify the relevant amount as being the amount required for the discharge of the liabilities of the relevant scheme concerned in respect of the benefits referred to in section 48(1D)and shall, when certifying the relevant amount, have regard to the guidelines made by the Ministerunder subsection (10)(b).
(4) Where the Board has certified a relevant amount under subsection (3) (in this section referred to as the ‘certified amount’), the trustees shall-
(a) apply to the Minister to request the payment by the Minister for Finance of an amount equal to the certified amount for the purpose of the discharge by the trustees of the liabilities of the relevant scheme in respect of the benefits referred to in section 48(1D), and
(b) include in such application the statement referred to in subsection (1).
(5) Where, in respect of an application under subsection (4), the Minister is satisfied that the certified amount has been certified in accordance with subsection (3), the Minister shall request the Minister for Finance to pay out of the Central Fund to the trustees of the relevant scheme concerned, an amount equal to the certified amount for the purpose of the discharge, by the trustees of thatrelevant scheme, of the liabilities of that scheme in respect of the benefits referred to in section 48(1D).
(6) The Minister for Finance shall, in consultation with the Minister for Public Expenditure and Reform, approve the request made under subsection (5).
(7) Where a request has been approved under subsection (6), the Minister for Finance shall pay out of the Central Fund to the trustees of the relevant scheme concerned an amount equal to the certified amount for the purpose of the discharge, by the trustees of that scheme, of the liabilities of that scheme in respect of the benefits referred to in section 48(1D).
(8) Where the Minister for Finance pays an amount to the trustees of a relevant scheme under subsection (7), the trustees of that scheme shall use that amount for the purpose of discharging the liabilities of the relevant scheme for the benefits referred to in section 48(1D).
(9) The amount referred to in subsection (7) that is required by the Minister for Finance for the making of a payment under that subsection shall be paid out of the Central Fund or the growing product thereof.
(10) The Minister shall-
(a) make, in consultation with the Board, guidelines in respect of the preparation of the statement referred to in subsection (1) and an application under subsection (2), and
(b) make guidelines in respect of the certification by the Board of a relevant amount under subsection (3).
(11) The Minister may make regulations requiring the trustees of a relevant scheme to comply with-
(a) guidelines or guidance notes issued by the Board under section 10, and
(b) guidelines made by the Minister under subsection (10)(a),
in respect of the preparation of the statement referred to in subsection (1) and an application by the trustees under subsection (2).
(12) The Minister shall, 12 months after the passing of the Social Welfare and Pensions (No. 2) Act 2013and on each anniversary of such passing, prepare a report on the applications made under subsection (4), the requests made by the Minister to the Minister for Finance under subsection (5) and the amounts paid out of the Central Fund under subsection (7) during the preceding 12 months and shall, as soon as practicable, after the preparation of the report, cause a copy of the report to be laid before each House of the Oireachtas.]
48B.
Payment of moneys by Minister for Finance in respect of liabilities accruing under certain relevant
48B.
(1) The Minister for Finance may, at the request of the Minister, following consultation with the Minister for Public Expenditure and Reform, pay moneys to an approved person for the purpose of the discharge by the approved person of the liabilities of an eligible pension scheme, referred to in paragraph (b) of the definition of eligible pension scheme.
(2) The Minister for Finance may, after consultation with the Minister for Public Expenditure and Reform, authorise a person to be an approved person for the purposes of this section.
(3) The moneys referred to in subsection (1) that are required by the Minister for Finance for the making of a payment under that subsection shall be paid out of the Central Fund or the growing produce thereof.
(4) In this section –
‘approved person’ means a person authorised under subsection (2);
‘eligible pension scheme’ means a relevant scheme where the date of the winding up of the scheme is on or after 25 January 2007 and before 25 December 2013 and in respect of which –
(a) the employer participating in the relevant scheme is, or where more than one employer participates in such scheme, all of the employers participating in the scheme are, at the date of the winding up insolvent for the purposes of the Protection of Employees (Employers’ Insolvency) Act 1984, and
(b) the resources of the relevant scheme are not sufficient to discharge in whole or in part, the liabilities of the scheme in respect of –
(i) 50 per cent of the benefits specified in paragraph 1 of the Third Schedule to or in respect of those persons who, at the date of the winding up of the scheme, were within the categories referred to in that paragraph, to the extent that those benefits have not already been discharged, and
(ii) 50 per cent of the benefits specified in paragraphs 2, 3 and 4 of the Third Schedule to or in respect of those members of the scheme who, at the date of the winding up of the scheme, were within the categories referred to in those paragraphs, to the extent that those benefits have not already been discharged.
(5) A reference to ‘effective date of the certificate’ in the Third Schedule shall, insofar as it relates to an eligible pension scheme, be construed as a reference to the date of the winding up of theeligible pension scheme concerned, with any necessary modifications.
49.
Funding proposal
49.
[(1) Where, in accordance with the provisions of section 43, the trustees of a scheme (other than aregulatory own funds scheme)-
(a) submit an actuarial funding certificate which certifies that at the effective date of the certificate the scheme does not satisfy the funding standard, or
(b) on or after 1 January 2016, submit a funding standard reserve certificate which certifies that at the effective date of the certificate the scheme does not satisfy the funding standard reserve,
they shall, subject to regulations under subsection (2A), submit to the Board a proposal (in this Part referred to as a ‘funding proposal’) in accordance with the provisions of this section.]
[(2) A funding proposal shall-
(a) contain a proposal designed to ensure that, in the opinion of the actuary-
(i) the scheme could reasonably be expected to satisfy the funding standard at the effective date of the next actuarial funding certificate or any later date specified under subsection (3) or (3B) where the funding proposal is submitted before 1 January 2016 and the effective date of the next actuarial funding certificate or any later date specified under subsection (3) or (3B) is before that date, and
(ii) in any other case, the scheme could reasonably be expected to satisfy the funding standard at the effective date of the next actuarial funding certificate or any later date specified under subsection (3) or (3B) and the funding standard reserve at the effective date of the next funding standard reserve certificate or any later date specified under subsection (3B),
and
(b) comply with regulations made under subsection (2A),
(c) be certified by the actuary as meeting the requirements of paragraph (a),
(d) be signed by or on behalf of the employer and by or on behalf of the trustees of the scheme, in each case signifying agreement to the proposal, and
(e) be submitted by the trustees of the scheme with the actuarial funding certificate or funding standard reserve certificate to which it relates.]
[(2A) Regulations under this section may-
(a) require the actuary, in certifying a funding proposal under subsection (2) or the failure of thescheme to satisfy the funding standard in accordance with subsection (3), to comply with any applicable professional guidance issued by the Society of Actuaries in Ireland and specified in the regulations or with any other applicable guidance issued by any other person (including the Board or the Minister) and specified in the regulations,
(b) require the trustees to comply with any applicable guidance issued by any person (includingthe Board or the Minister), and specified in the regulations, setting out-
(i) the requirements with which a funding proposal shall comply, and
(ii) the terms on and the circumstances in which the trustees are required to notify the Board of a failure by any person to comply with a term of a funding proposal,
(c) prescribe the terms on and circumstances in which-
(i) a date later than the effective date of the next actuarial funding certificate or nextfunding standard reserve certificate may be specified by the Board in accordance with subsection (3B),
(ii) the trustees are not required to submit a funding proposal under subsection (1), and
(iii) the Board may, by notice in writing to the trustees, declare that a funding proposal is no longer a valid funding proposal for the purposes of this section where there has been a failure to comply with a term of the funding proposal or the trustees of thescheme so request,
and
(d) prescribe guidance issued by any person (including the Board or the Minister) in respect of the matters specified in subparagraphs (i) to (iii) of paragraph (c).]
[(3) [Before 1 June 2012, subject to regulations under this section], the Board, on application to it in that behalf by the trustees of a scheme [(other than a regulatory own funds scheme)], may, in relation to the scheme, in the circumstances and on the terms that it considers appropriate, for the purposes of subsection [(2)(a)(i)] specify a date later than the effective date of the next actuarial funding certificate-
(a) in a case where the actuary concerned certifies that the failure of the scheme to satisfy thefunding standard relates wholly or mainly to either or both of the following:
(i) the assets of the scheme being less than expected where-
(I) this is due to the performance of relevant markets in relation to investments made with the resources of the scheme and that the performance of those markets in relation to those investments is not inconsistent with the performance generally of relevant markets for investment in the same period,
and
(II) having regard to the performance generally of relevant markets for investment,the Board considers that specifying a later date is necessary or appropriate and not contrary to the interests of the members of the scheme;
or
(ii) the liabilities of the scheme being greater than expected where-
(I) this is due to such factors and circumstances as shall be prescribed, and
(II) the Board considers that specifying a later date is necessary or appropriate and not contrary to the interests of members of the scheme;
or
(b) in the case of a scheme referred to in [section 43(1)(d) or 43(1)(e), where], the Boardconsiders that specifying a later date is necessary or appropriate and not contrary to the interests of members of the scheme.]
(3A) The Board, on application to it in that behalf by the trustees of a scheme [(other than a regulatory own funds scheme)], may, in relation to the scheme, in the circumstances and on the terms that it considers appropriate, modify the requirements of paragraphs [(b), (c), (d) or (e)] of subsection (2) where-
(a) administrative difficulties have arisen from circumstances outside the control of the trustees of the scheme or schemes,
(b) the modification does not materially alter those paragraphs, and
(c) the Board considers the modification necessary or appropriate and that it is not contrary to the interests of the members of the scheme.]
[(3B) On or after 1 June 2012, the Board on application to it in that behalf by the trustees of a scheme(other than a regulatory own funds scheme) may, in relation to the scheme, on the terms and in the circumstances prescribed or set out in guidance prescribed by regulations made under subsection (2A)-
(a) for the purposes of subsection (2)(a)(i) specify a date later than the effective date of the next actuarial funding certificate, and
(b) for the purposes of subsection (2)(a)(ii) specify a date later than the effective date of the next actuarial funding certificate or funding standard reserve certificate.]
[(4) In this section “employer” means the employer who undertakes the role of principal employer for the purposes of such scheme’s approval by the Revenue Commissioners under [Chapter 1 of Part 30 of the Taxes Consolidation Act, 1997] [or, where the Board is of the opinion that there is no such principal employer or that it is not possible to identify such employer, such other employer or employers participating in the scheme as the Board, in its absolute discretion, may, on application to it by the trustees of the scheme, specify and notify in writing to the trustees].]
50.
Direction by Board to trustees.
(1) The Board may, by notice in writing, following an application by the trustees or otherwise, direct the trustees of a relevant scheme (other than a regulatory own funds scheme) to take such measures as may be specified by the Board in the notice or, if no measures are specified in the notice, such measures as may be necessary in respect of members of the scheme then in relevant employment, who have not reached normal pensionable age and members whose service in relevant employment has ceased, who have not reached normal pensionable age and who have an entitlement to a preserved benefit or any other benefit under the scheme, the payment of which has not commenced, to reduce the benefits that would be payable to or in respect of those members from the scheme where –
(a) the trustees of the scheme fail to submit an actuarial funding certificate within the period specified in section 43,
(b) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have not submitted a funding proposal in accordance with section 49,
(c) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have submitted a funding proposal in accordance with section 49,
(d) the Board consents to the amendment of a scheme in accordance with section 50A (inserted by section 18 of the Social Welfare and Pensions Act 2009),
(e) the trustees of the scheme fail to submit a funding standard reserve certificate within the period specified in section 43,
(f) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, or
(g) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have submitted a funding proposal in accordance with section 49.
(1A) The Board may, by notice in writing, following an application by the trustees or otherwise, direct the trustees of a scheme (other than a regulatory own funds scheme) to take such measures as may be specified by the Board in the notice or, if no measures are specified in the notice, such measures as may be necessary to reduce future increases in benefits payable from the scheme to or in respect of persons receiving benefits under the scheme or persons who have reached normal pensionable age, where –
(a) the trustees of the scheme fail to submit an actuarial funding certificate within the period specified in section 43,
(b) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have not submitted a funding proposal in accordance with section 49,
(c) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have submitted a funding proposal in accordance with section 49,
(d) the Board consents to the amendment of a scheme in accordance with section 50A (inserted by section 18 of the Social Welfare and Pensions Act 2009),
(e) the trustees of the scheme fail to submit a funding standard reserve certificate within the period specified in section 43,
(f) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, or
(g) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have submitted a funding proposal in accordance with section 49.
(1B) The Board may, by notice in writing, following an application by the trustees or otherwise, direct the trustees of a relevant scheme (other than a regulatory own funds scheme) to take such measures as may
be specified by the Board in the notice or, if no measures are specified in the notice, such measures as may be necessary to reduce, in accordance with subsection (1C) and subject to subsection (1D), the benefits payable from the scheme to or in respect of persons receiving benefits under the scheme or persons who have reached normal pensionable age, where –
(a) the trustees of the scheme fail to submit an actuarial funding certificate within the period specified in section 43,
(b) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have not submitted a funding proposal in accordance with section 49,
(c) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have submitted a funding proposal in accordance with section 49,
(d) the Board consents to the amendment of a scheme in accordance with section 50A,
(e) the trustees of the scheme fail to submit a funding standard reserve certificate within the period specified in section 43,
(f) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, or
(g) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have submitted a funding proposal in accordance with section 49.
(1C) A reduction in the benefits referred to in subsection (1B) shall, subject to subsection (1D), be made as follows:
(a) where the annual amount is €12,000 or less, no reduction shall be made from such annual amount;
(b) where the annual amount is greater than €12,000 and is less than €60,000, the reduction in such annual amount shall not exceed 10 per cent;
(c) where the annual amount is €60,000 or more, the reduction in such annual amount shall not exceed 20 per cent.
(1D) Where –
(a) the reduction referred to in subsection (1C) would result in the annual amount being reduced to less than €12,000, that reduction shall operate to reduce such annual amount to €12,000, and
(b) the annual amount is €60,000 or more and the reduction referred to in subsection (1C) would result in such annual amount being reduced to less than €54,000, that reduction shall operate to reduce such annual amount to €54,000.
(2) In relation to a direction made under subsection (1), (1A) or (1B) –
(a) paragraph 2(2) of the Second Schedule and paragraph 4(b)(i)(I) of the Third Schedule shall not apply in so far only as they conflict with the reduction in benefits pursuant to such a direction, and
(b) the benefits which may be reduced following such a direction shall include –
(i) a preserved benefit where an entitlement to the preserved benefit has arisen, and
(ii) any revaluation of a preserved benefit under section 33 where such revaluation relates to a revaluation year which ends,
prior to the date with effect from which measures are put in place pursuant to the direction. (2A) A reduction in benefits effected pursuant to a direction under subsection (1), (1A) or (1B) shall –
(a) be such as, in the opinion of the actuary concerned, ensures that, immediately following the reduction, the scheme will satisfy the funding standard and, on or after 1 January 2016, the funding standard reserve, or
(b) in the case of a scheme referred to in paragraph (c) or (g) of subsection (1), paragraph (c) or
(g) of subsection (1A) or paragraph (c) or (g) of subsection (1B), be such as, in the opinion of the actuary concerned, ensures that the scheme could reasonably be expected to –
(i) satisfy the funding standard at the effective date of the next actuarial funding certificate or any later date specified under subsection (3) or (3B) of section 49 where the funding proposal is submitted before 1 January 2016 and the effective date of the next actuarial funding certificate or any later date specified under the said subsection (3) or (3B) is before that date, and
(ii) in any other case, satisfy the funding standard at the effective date of the next actuarial funding certificate or any later date specified under subsection (3) or (3B) of section 49 and the funding standard reserve at the effective date of the next funding standard reserve certificate or any later date specified under the said subsection (3B).
(2B) Where the Pensions Authority gives a direction under subsection (1), (1A) or (1B), other than on application by the trustees, the trustees of the scheme shall –
(a) within one month of the date of the notice, notify in writing such persons as may be prescribed of the following –
(i) the direction,
(ii) the measures specified by the Pensions Authority in the notice or, if no measures are specified, such measures as the trustees consider may be necessary to reduce the benefits under the scheme, and
(iii) the right of such persons as may be prescribed to bring an appeal to the High Court under subsection (6),
and
(b) submit a copy of the notification made under paragraph (a) to the Pensions Authority not later than 10 days after the date of the notification.
(2C) Subject to subsection (2D), where –
(a) the Pensions Authority gives a direction under subsection (1A) or (1B), whether on application by the trustees of a scheme or otherwise, and
(b) a final decision has been taken that results in a reduction of benefits payable to, or in respect of, persons referred to in subsection (3)(a)(i)(III),
the trustees of the scheme shall inform those persons –
(i) of the reduction in benefits referred to in subsection (1A) or (1B) without delay after the final decision has been taken and not later than one month from the date on which that final decision was taken, and
(ii) 3 months before that final decision is implemented.
(2D) For the purposes of subsection (2C), where the Pensions Authority gives a direction referred to in that subsection which –
(a) specifies the measures to be taken by the trustees of the scheme to reduce the benefits, the date of the final decision referred to in subsection (2C) shall be the date of the notification of the direction given under subsection (1A) or (1B), or
(b) does not specify the measures to be taken by the trustees of the scheme to reduce the benefits, the date of the final decision referred to in subsection (2C) shall be the date of the decision taken by the trustees of the scheme in respect of the measures that are necessary to reduce the benefits pursuant to a direction under subsection (1A) or (1B).
(3) Where the Board gives a direction under subsection (1), (1A) or (1B), the trustees of the scheme shall – (a)
(i) within one month of the date of the notice, put in place such measures as may be specified in the notice or, if no measures are specified, such measures as may be necessary to reduce the benefits under the scheme, in respect of all or any of the –
(I) members of the scheme then in relevant employment who had not reached normal pensionable age,
(II) members whose service in relevant employment has ceased and who have not reached normal pensionable age and who have an entitlement to a preserved benefit or any other benefit under the scheme, and
(III) subject to subsection (2C), persons receiving benefits under the scheme or who have reached normal pensionable age,
that would be payable to or in respect of them from the scheme, but, in respect of persons specified in clause (III), only those benefits referred to in subsection (1A) or (1B), and
(ii) within a period of 2 months of the date of the notice, or such longer period as the Board considers appropriate, notify the members of the scheme of the reduction in benefits,
(b) within a period of 4 months of the date of the notice, submit to the Board –
(i) confirmation that the trustees have complied with paragraph (a) and, where relevant, subsection (2C),
(ii) copies of the notifications issued to members of the scheme and other persons under subparagraph (ii) of paragraph (a) and subsection (2C), and
(iii)
(I) an actuarial funding certificate and, on or after 1 January 2016, a funding standard reserve certificate certifying that at the effective date, being the effective date of the reduction in benefits, the scheme satisfies the funding standard and, on or after 1 January 2016, the funding standard reserve, or
(II) in the case of a scheme where a funding proposal has been submitted to the Board pursuant to section 49 and paragraph (c) or (g) of subsection (1), paragraph (c) or (g) of subsection (1A) or paragraph (c) or (g) of subsection (1B) applies, a statement by an actuary in such form as may be prescribed that he or she is reasonably satisfied that at the effective date of the reduction in benefits –
(A) the scheme will satisfy the funding standard at the effective date of the next actuarial funding certificate or, where applicable, any later date specified under subsection (3) or (3B) of section 49 where the funding proposal has been submitted before 1 January 2016 and the effective date of the next actuarial funding certificate or any later date specified under the said subsection (3) or (3B) is before that date, or
(B) in any other case the scheme will satisfy the funding standard at the effective date of the next actuarial funding certificate or, where applicable, any later date specified under subsection (3) or (3B) of section 49, and the funding standard reserve at the effective date of the next funding standard reserve certificate, or where applicable, any later date specified under the said subsection (3B).
(4) The Minister may make regulations requiring the trustees of a relevant scheme to comply with any applicable guidance issued by any person (including the Board or the Minister) and specified in the regulations setting out –
(a) the form by which the trustees of a relevant scheme may apply to the Board for a direction under this section, and
(b) the requirements to be met by the trustees in relation to any such application, including a requirement that the trustees give notice to the members of the scheme or other persons receiving benefits under the scheme of any proposal to apply for a direction under this section and to give those members and other persons an opportunity to make representations to the
trustees in relation to the proposal before the application for a direction is made.
(5) The Minister may make regulations for the purposes of this section, and, without prejudice to the generality of the foregoing, the regulations may provide that where the Board proposes to make a direction under subsection (1), (1A) or (1B) other than on application by the trustees –
(a) the Board may by notice in writing require a specified person to furnish the Board with such information as may be prescribed within the period specified in the notice,
(b) the trustees of the scheme and the employer to whom the scheme relates shall make such notifications and provide such information to such persons as may be prescribed, when and in such manner as the Pensions Authority may specify,
(c) such persons as may be prescribed shall be afforded an opportunity to make submissions to the Board, in respect of the proposed direction within such period as may be prescribed, and
(d) the Board shall, prior to making a direction, consider any such submissions.
(6) An appeal to the High Court on a point of law from a direction of the Board under subsection (1), (1A) or (1B), made other than on application by the trustees, may be brought by such persons as may be prescribed not later than 21 days after the date of the notification under subsection (2B) and subsection (2C).
(7) A direction of the Board under subsection (1), (1A) or (1B), made other than on application by the trustees, shall not take effect –
(a) during the period of 21 days after the date of the notification made under subsection (2B) and subsection (2C),
(b) if an appeal against the direction is brought during the period referred to in paragraph (a), before the date of the final determination of the appeal or any appeal from such determination or the withdrawal of either such appeal.
(8) Where the Board makes a direction under subsection (1), (1A) or (1B), other than on application by the trustees, the periods specified in subsection (3) shall be deemed to run from the date on which the direction takes effect.
(9) In this section, ‘annual amount’ has the meaning assigned to it by section 48(8).
50A.
Power to amend relevant scheme.
(1) Subject to this section and section 50, the trustees of a scheme (other than a regulatory own funds scheme) may –
(a) for the purpose of ensuring that the winding up of the scheme will not be required by reason only of the scheme not having sufficient resources to enable the liabilities of the scheme to be discharged,
(b) after compliance with regulations (if any) under this section, and
(c) with the consent of the Board,
make such amendments to the scheme as they consider appropriate.
(2) The Minister may make regulations requiring the trustees of a relevant scheme to give notice to the members of the scheme of any proposal to amend the scheme pursuant to this section and to give those members an opportunity to make representations to the trustees of the scheme in relation to the proposal before any amendment to the scheme is made.
(3) Regulations under this section may contain such incidental, supplementary and consequential provisions as appear to the Minister to be necessary for the purposes of the regulations.
(4) Notwithstanding the rules of a relevant scheme, the consent of the members of the scheme to the amendment of the scheme pursuant to this section shall not be required.
(5) This section shall not operate to limit any power to amend the rules of a relevant scheme, that apart from this section, vests in the trustees of the scheme.
50B.
Direction by Board to trustees to wind up scheme.
(1) The Board may, subject to this section, by notice in writing direct the trustees of a relevant scheme (other than a regulatory own funds scheme) to wind up the scheme with effect from such date as is specified in the notice if –
(a) the trustees of the scheme fail to submit an actuarial funding certificate within the period specified in section 43,
(b) the actuarial funding certificate certifies that the scheme does not satisfy the funding standard and the trustees of the scheme have not submitted a funding proposal in accordance with section 49,
(c) the trustees of the scheme fail to submit a funding standard reserve certificate within the period specified in section 43,
(d) the funding standard reserve certificate certifies that the scheme does not satisfy the funding standard reserve and the trustees of the scheme have not submitted a funding proposal in accordance with section 49, or
(e) the trustees of the scheme have failed to comply with a direction under subsection (1), (1A) or (1B) of section 50 within the period specified in subsection (3)(a)(i) of that section.
(2) A direction under this section shall be in writing and may include directions to –
(a) the trustees of the scheme,
(b) any employer to whom the scheme relates, or
(c) the registered administrator of the scheme,
in respect of the manner, including the relevant time limits, within which the winding up is to proceed.
(3) A person shall comply with a direction given to him or her under this section.
(4) The winding up of a scheme pursuant to a direction under this section shall have the same effect as if it had been made under powers conferred by or under the rules of the scheme.
(5) A direction under this section may be made, and shall be complied with, notwithstanding any enactment or rule of law or any rule of the scheme or any agreement which would otherwise prevent the winding up or require the implementation of any procedure or the obtaining of any consent to effect the winding up of the scheme.
(6) The Minister may make regulations for the purposes of this section and, without prejudice to the foregoing, the regulations may provide that before the Board makes a direction under this section –
(a) the Board may by notice in writing require a specified person to furnish the Board with such information as may be prescribed within the period specified in the notice,
(b) the trustees of the scheme and the employer to whom the scheme relates shall make such notifications and provide such information to such persons as may be prescribed, when and in such manner as the Pensions Authority may specify,
(c) such persons as may be prescribed shall be afforded an opportunity to make submissions to the Board in respect of the proposed direction, within such period as may be prescribed, and
(d) prior to making a direction, the Board shall consider any such submissions.
(7) Where the Board makes a direction under this section in respect of a scheme, any direction made under subsection (1), (1A) or (1B) of section 50 and referred to in subsection (1)(e), in relation to the scheme shall cease to have effect from the date on which the direction under this section comes into effect.
(8) The cessation of a direction made under subsection (1), (1A) or (1B) of section 50, pursuant to subsection (7), shall not prejudice the initiation of a prosecution of any person for having failed to comply with that direction or any other requirement of that section, prior to the date of the direction under this section.
(9) The Board shall, not later than 21 days after the date on which it makes a direction under this section, publish a notice in a daily newspaper circulating in the State, setting out particulars of the direction.
(10) An appeal to the High Court on a point of law from a direction under this section may be brought not later than 21 days after the date of publication of the notice under subsection (9) by such person as may be prescribed.
(11) A direction under this section shall not come into effect –
(a) during the period of 21 days after the date of publication of the notice under subsection (9), or
(b) if an appeal against the direction is brought during the period referred to in paragraph (a), before the date of the final determination of the appeal or any appeal from such determination or the withdrawal of either such appeal.
(12) In this section, ‘employer’ in relation to a scheme means the current or former employer of any person in respect of whom benefits are or have been payable under the scheme.
50C.
Application to High Court
(1) If the Board is of the opinion that a person has not complied with or is not complying with –
(a) a direction under subsection (1), (1A) or (1B) of section 50,
(b) a direction under section 50B, or
(c) a requirement under subsection (2B) or (3) of section 50,
the Board may apply to the High Court for an order compelling the person to comply with the direction or requirement concerned.
(2) Where, following an application by the Board under subsection (1), the High Court is satisfied that it is appropriate to do so, the Court may make an order compelling the person to comply with the direction or requirement concerned.
(3) Where the High Court makes an order under subsection (2), it may, for the purpose of giving full effect to the order, include such conditions in the order and make such ancillary or other orders as it deems fit.
51.
Qualification for appointment as actuary of scheme.
(1) A person shall not be qualified for appointment as actuary for the purposes of this Act to a scheme or regulatory own funds trust RAC –
(a) unless he possesses the prescribed qualifications, or
(b) if he is a member of a class of persons standing prescribed for the time being for the purposes of this section.
(2) A person shall not act as actuary to a particular scheme or regulatory own funds trust RAC at a time when he is disqualified under this Act for appointment to that office and, if an actuary of a scheme or regulatory own funds trust RAC becomes so disqualified during his term of office as such actuary, he shall thereupon vacate his office and give notice in writing to the trustees of the scheme or regulatory own funds trust RAC that he has vacated his office by reason of such disqualification.
51A.
Review of actuarial work.
(1) The Minister may make regulations requiring any actuary appointed to a scheme or trust RAC to have his or her actuarial work in relation to the scheme reviewed for compliance with this Act and any regulations made under this Act.
(2) The review under subsection (1) shall be carried out in accordance with professional guidance issued by the Society of Actuaries in Ireland for that purpose or with any applicable guidance issued by any other person (including the Minister) and specified in the regulations.
(3) The professional guidance issued by the Society of Actuaries in Ireland or any other guidance referred to in subsection (2) shall include provisions relating to prescribed matters which matters may include but not necessarily be limited to the following:
(a) the appointment of a reviewing actuary;
(b) the frequency of reviews;
(c) the timescale for reviews.
(4) Any information relating to the scheme or trust RAC that is required for the purposes of the review in accordance with subsection (1) shall be made available by the actuary to the scheme or trust RAC to the person conducting the review.
(5) In this section ‘actuarial work’ means:
(a) actuarial valuation reports prepared by an actuary in accordance with section 56;
(b) actuarial funding certificates or funding standard reserve certificates prepared by an actuary in accordance with section 42;
(c) funding proposals certified by an actuary in accordance with section 49;
(d) annual statements made by an actuary in accordance with section 55;
(e) regulatory own funds trust RAC technical provisions certificates prepared by an actuary for the purposes of section 53G;
(f) regulatory own funds certificates prepared by an actuary in accordance with section 53J.
52. Exclusion from and modification of Part IV and Third Schedule.
[51A.
Review of actuarial work.
51A.-(1) The Minister may make regulations requiring any actuary appointed to a scheme [or trust RAC] to have his or her actuarial work in relation to the scheme reviewed for compliance with this Act and any regulations made under this Act.
(2) The review under subsection (1) shall be carried out in accordance with professional guidance issued by the Society of Actuaries in Ireland for that purpose or with any applicable guidance issued by any other person (including the Minister) and specified in the regulations.
(3) The professional guidance issued by the Society of Actuaries in Ireland or any other guidance referred to in subsection (2) shall include provisions relating to prescribed matters which matters may include but not necessarily be limited to the following:
(a) the appointment of a reviewing actuary;
(b) the frequency of reviews;
(c) the timescale for reviews.
(4) Any information relating to the scheme [or trust RAC] that is required for the purposes of the review in accordance with subsection (1) shall be made available by the actuary to the scheme [ortrust RAC] to the person conducting the review.
(5) In this section ‘actuarial work’ means:
(a) actuarial valuation reports prepared by an actuary in accordance with section 56;
(b) actuarial funding certificates [or funding standard reserve certificates] prepared by an actuary in accordance with section 42;
[(c) funding proposals certified by an actuary in accordance with section 49;
(d) annual statements made by an actuary in accordance with section 55;
(e) regulatory own funds trust RAC technical provisions certificates prepared by an actuary for the purposes of section 53G;
(f) regulatory own funds certificates prepared by an actuary in accordance with section 53J.]]
52.
Exclusion from and modification of Part IV and Third Schedule
52.-(1) Where the Minister considers that some or all of the benefits under specified schemes or categories of schemes are, or may be, paid in whole or in part out of moneys provided from the Central Fund or moneys provided by the Oireachtas, he may byregulations made with the consent of the Minister for Finance exclude those schemes or categories of schemes from the application of this Part and the Third Schedule.
(2) Where the Minister considers that-
(a) it would be unreasonable, having regard to their nature, character and resources and the methods by which benefitspayable under them are funded, and
(b) it would be contrary to the interests of their members,
to require specified schemes or categories of schemes to comply fully with specified provisions of this Part and the Third Schedule, he may by regulations made with the consent of the Minister for Finance provide that those provisions shall apply in relation to those schemes or categories of schemes with specified modifications, being modifications that, in the opinion of the Minister, are reasonable and do not materially alter those provisions.
53.
Conflict between Part IV and schemes
53.-(1) The provisions of this Part and of any regulations made. thereunder shall override any rule of a scheme to the extent that that rule conflicts with those provisions.
(2) Any question as to-
(a) whether any provision of this Part (including any such provision as modified by regulations), any regulation madethereunder or the Third Schedule conflicts with any rule of a scheme, or
(b) whether a scheme is a defined benefit scheme or a defined contribution scheme for the purposes of this Part,
shall be determined by the Board on application to it in writing in that behalf by a person who, in relation to the scheme, corresponds to a person mentioned in section 38 (3) in relation to a scheme mentioned therein.
(3) An appeal to the High Court on a point of law from a determination of the Board, under subsection (2) in relation to a scheme, may be brought by the person who made, or a person who was entitled to make, the application concerned under subsection (2) [not later than six months after the date of the determination by the Board].
53A.
Definition.
53A. In this Part ‘undertaking’ means an undertaking within the meaning of the Insurance Act 1989.
Part IVA Certification of Certain Policies or Contracts of Assurance
53B.
Certification of certain policies or contracts of assurance.
(1) The Board may certify a form of policy or contract of assurance, submitted to the Board by anundertaking in that behalf, in respect of schemes that are approved by the Revenue Commissioners under Chapter 1 of Part 30 of the Taxes Consolidation Act 1997, where the Board is satisfied that the form of policy or contract of assurance is designed-
(a) to provide the sums payable to the scheme in respect of some or all of the benefits in relation to a person who, under the scheme-
(i) is receiving benefits, or
(ii) has reached normal pensionable age,
or
(b) to discharge the liability of the scheme for some or all of the benefits payable to or in respect of a person who under a scheme-
(i) is receiving benefits, or
(ii) has reached normal pensionable age.
(2) For the purpose of obtaining certification under subsection (1) an undertaking shall furnish to the Board such information in such form as may be prescribed for the purposes of this section.
(3) A policy or contract of assurance referred to in subsection (1) may include a policy or contract of assurance which is referenced by-
(a) securities issued under section 54(1) of the Finance Act 1970 and known as bonds, or
(b) securities issued under the laws of a Member State (other than the State) that correspond to securities referred to in paragraph (a).
(4) Certification by the Board under subsection (1) shall be subject to such terms and conditions asthe Board may consider appropriate.
Part IVA
Certification of Certain Policies or Contracts of Assurance
53C. Register of policies or contracts of assurance certified under Section 53B.
53C. The Board shall-
(a) keep a register in which there shall be entered such particulars as may be prescribed, for the purposes of this Part, in relation to policies or contracts of assurance that have been certified under section 53B and such register shall be open for inspection by any member of the public at all reasonable times on payment of such fee as the Board may determine, and
(b) maintain, in accordance with regulations, an up to date database of information relating to particulars referred to in paragraph (a).
Third Schedule Funding Standard – Benefits
Section 44.
1.The benefits for the purposes of this paragraph shall be all future benefits payable under the rules of the scheme to or in respect of a person who at the effective date of the certificate is receiving benefits or has reached normal pensionable age, excluding future increases in such benefits which are, at the effective date of the certificate, contingent upon the exercise of some person’s discretion.
2. The benefits for the purposes of this paragraph shall be any additional benefits secured for or granted to or in respect of a member of a scheme under the scheme by way of additional voluntary contributions or a transfer of rights from another scheme. Such benefits shall be calculated as at the effective date of the certificate and shall be –
(a) where, at the effective date of the certificate, the member’s service in relevant employment has terminated and a transfer payment has not been applied in accordance with section 34 or 35, preserved benefit payable in respect of such additional benefits calculated in accordance with Part III or, if no such preserved benefit is payable, the benefits payable under the rules of the scheme in respect of the additional voluntary contributions or the transfer of rights, and
(b) where, at the effective date of the certificate, the member is in relevant employment, preserved benefit in respect of such additional benefits calculated in accordance with Part III, as if the member’s service in relevant employment had terminated on such date but, other than for the purposes of section 48, disregarding any provision requiring the completion of a minimum period of qualifying service.
3. The benefits for the purposes of this paragraph shall be calculated as at the effective date of the certificate and shall be –
(a) in the case of a member of that scheme whose service in relevant employment terminated after 1 January 1991 but prior to the effective date of the certificate and in respect of whom a transfer payment has not been applied in accordance with section 34 or 35 the greater of –
(i) the preserved benefits to which the member is entitled under section 28 and which are referred to in paragraph 1(1)(a), (b) and (c) of the Second Schedule (including future revaluations thereof and those benefits payable on the death of the member entitled to preserved benefit) calculated in accordance with Part III, and
(ii) the benefits payable under the rules of the scheme in respect of reckonable service completed after 1 January 1991, and
(b) in the case of a member of that scheme then in relevant employment, the greater of –
(i) the preserved benefits to which the member would be entitled under section 28 and which are referred to in paragraph 1(1)(a), (b) and (c) of the Second Schedule (including future revaluations thereof and those benefits payable on the death of the member entitled to preserved benefit) calculated in accordance with Part III, and
(ii) the long service benefits payable under the rules of the scheme in respect of reckonable service completed after 1 January 1991 but prior to the effective date of the certificatetogether with any other benefits payable on the death of the member entitled to long service benefit in respect of such period of reckonable service,
calculated as if the member’s service in relevant employment has terminated on the effective date of the certificate but, other than for the purposes of section 48, disregarding any provision requiring the completion of a minimum period of qualifying service which may prevent the member concerned from acquiring an entitlement to benefit on termination of such employment
4. The benefits for the purposes of this paragraph shall be calculated as at the effective date of the certificate and shall be –
(a) any benefit payable under the rules of the scheme in respect of reckonable service completed prior to 1 January 1991 to or in respect of a member of that scheme –
(i) whose service in relevant employment terminated prior to the effective date of the certificate, and
(ii) who has not exercised any right to a transfer payment to another scheme,
and
(b) a benefit payable to or in respect of a member then in relevant employment whose reckonable service commenced before 1 January 1991 being –
(i) subject to clause (ii), in the case of a defined benefit scheme, the greater of –
(I) the amount determined by the formula –
where –
L is the amount of long service benefit calculated as at the effective date of the certificate on the basis of the rules of the scheme in force on 1 January 1991,
M is the period of reckonable service completed prior to 1 January 1991, and
N is the period of reckonable service that would have been completed if the member had remained in relevant employment until normal pensionable age and such service had continued to qualify for long service benefit:
Provided that, where the rules of the scheme in force at 1 January 1991 provided for benefits to be calculated in relation to a member’s pensionable earnings at, or in a specified period prior to, his attaining normal pensionable age or in some other way relative to such earnings, the benefit under this clause may be calculated in a corresponding manner by reference to his earnings at, or in the same period before the effective date of the certificate, and
(II) the long service benefits payable under the rules of the scheme in respect of reckonable service completed before 1 January, 1991, together with any other benefits payable on the death of the member entitled to long service benefit in respect of such period of reckonable service calculated as if the member’s service in relevant employment had terminated on the effective date of the certificate but disregarding any provision which may prevent the member concerned from acquiring an entitlement to benefit on termination of relevant employment, less, where under paragraph 3 the amount of benefits calculated in accordance with subparagraph (b) (i) of that paragraph exceeds the amount calculated in accordance with subparagraph (b) (ii) of that paragraph, the difference between these two amounts.
(ii) in the case of a defined benefit scheme where the rate or amount of part of the long service benefit payable thereunder is directly determined by an amount of contribution paid by or in respect of the member of the scheme –
(I) in so far as it relates to such part of the long service benefit, a benefit whose actuarial value is equal to the then accumulated value of the contributions paid by or in respect of the member of the scheme for the purpose of long service benefit prior to 1 January 1991, and
(II) in so far as it relates to the remaining part of long service benefit, a benefit calculated in accordance with clause (i).
5. The benefits for the purposes of this paragraph shall be calculated as at the effective date of the certificate and shall be, to the extent that they have not already been specified in any of the preceding paragraphs –
(a) in the case of a member of that scheme whose service in relevant employment terminated after 1 June 2002 but prior to the effective date of the certificate and in respect of whom a transfer payment has not been applied in accordance with section 34 or 35, the greater of –
(i) the preserved benefits to which the member is entitled under section 28 and which are referred to in paragraph 1(1)(d) of the Second Schedule (including future revaluations thereof and those benefits payable on the death of the member entitled to preserved benefit) calculated in accordance with Part III,
(ii) any minimum contributory retirement benefit to which the member is entitled under section 35A, and
(iii) the benefits payable under the rules of the scheme,
and
(b) in the case of a member of that scheme then in relevant employment, the greater of –
(i) the preserved benefits to which the member would be entitled under section 28 and which are referred to in paragraph 1(1)(d) of the Second Schedule (including future revaluations thereof and those benefits payable on the death of the member entitled to preserved benefit) calculated in accordance with the provisions of Part III,
(ii) any minimum contributory retirement benefit to which the member would be entitled under section 35A, and
(iii) the long service benefits payable under the rules of the scheme in respect of reckonable service completed prior to the effective date of the certificate and, where the member would be entitled to an immediate retirement benefit if he unilaterally terminated his service in relevant employment on the effective date of the certificate, any increase in long service benefit arising under section 35A together with any other benefits payable on the death of the member entitled to long service benefit in respect of such period of reckonable service,
calculated as if the member’s service in relevant employment had terminated on the effective date of the certificate but, other than for the purposes of section 48, disregarding any provision requiring the completion of a minimum period of qualifying service which may prevent the member concerned from acquiring an entitlement to benefit on termination of such employment.