Welfare Reform and Pensions Bill -
Amendments to be debated in the House of Lords
- continued
House of Lords

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 Restrictions affecting section 24BB.     24BC.--(1) A pension sharing order under section 24BB above may not be made in relation to a pension arrangement which--
    (a)  is the subject of a pension sharing order in relation to the marriage, or
      (b)  has been the subject of pension sharing between the parties to the marriage.
        (2)  A pension sharing order under section 24BB above may not be made in relation to shareable state scheme rights if--
      (a)  such rights are the subject of a pension sharing order in relation to the marriage, or
      (b)  such rights have been the subject of pension sharing between the parties to the marriage.
        (3)  A pension sharing order under section 24BB above may not be made in relation to the rights of a person under a pension arrangement if there is in force a requirement imposed by virtue of section 25B or 25C below which relates to benefits or future benefits to which he is entitled under the pension arrangement."
 
 
        62C.--(1) Schedule 8 is amended as follows.
        (2)  In paragraph 9--
      (a)  in sub-paragraph (2)--
            (i)  for "or 24A" there is substituted ", 24A or 24B", and
            (ii)  for "to 24A" there is substituted "to 24BB", and
      (b)  in sub-paragraph (3), after paragraph (a) there is inserted--
      (aa)  for "or 24B" substitute ", 24B or 24BB";".
    (3)  In paragraph 10, in sub-paragraph (2), for "24A" there is substituted "24BB".
 
    (4)  For paragraph 11 there is substituted--
        11. In each of sections 25B(3) and 25C(1) and (3), for "section 23" substitute "section 22A or 23".
        11A. In section 25D--
      (a)  in each of subsections (1)(a), (2)(a) and (ab) and (2C)(c)(i), for "section 23" substitute "section 22A or 23", and
      (b)  in subsection (3), in the definition of "shareable state scheme rights", for "section 21A(1)" substitute "section 21(3)"."
    (5)  In paragraph 16, in sub-paragraph (2), at the end there is inserted--
      (f)  after paragraph (f) there is inserted--
      (fa)  a pension sharing order under section 24B which is made at a time when no divorce order has been made, and no separation order is in force, in relation to the marriage;"
      (g)  in paragraph (g), for "24B" substitute "24BB"."
    (6)  In that paragraph, after sub-paragraph (3) there is inserted--
        (3A)  In subsection (4A), after "paragraph" insert "(de), (ea), (fa) or"."
    (7)  In that paragraph, in sub-paragraph (4), for the words from "subsection (4)" to the end of the first of the inserted subsections there is substituted "subsection (4A) insert-", the second of the inserted subsections is renumbered "(4AA)" and after that subsection there is inserted--
        (4AB)  No variation of a pension sharing order under section 24B above shall be made so as to take effect before the making of a divorce order in relation to the marriage."
    (8)  In that paragraph, after sub-paragraph (4) there is inserted--
        (4A)  In subsection (4B), after "order" insert "under section 24BB above"."
    (9)  In that paragraph, after sub-paragraph (7) there is inserted--
        (8)  After subsection (7F) insert--
        (7FA)  Section 24B(3) above applies where the court makes a pension sharing order under subsection (7B) above as it applies where the court makes such an order under section 24B above."
        (9)  In subsection (7G)--
      (a)  for "Subsections (3) to (5) of section 24B" substitute "Section 24BA(5) to (7)", and
      (b)  for "that section" substitute "section 24B above"."
    (10)  After that paragraph there is inserted--
        16A. After section 31A insert--
 
 Discharge of pension sharing orders on making of separation order.     31B. Where, after the making of a pension sharing order under section 24B above in relation to a marriage, a separation order is made in relation to the marriage, the pension sharing order is discharged.""
        (11)  In paragraph 19, in sub-paragraph (3)--
      (a)  after "24A" there is inserted ", 24B", and
      (b)  after "property adjustment order," there is inserted "any pension sharing order,".
        (12)  In paragraph 21--
      (a)  after "24,", in the first place, there is inserted "24B,", and
      (b)  for "24,", in the second place, there is substituted "24BB,".
        (13)  After paragraph 25 there is inserted--
        25A. In section 52(2)(aa), for "section 21A" substitute "section 21"."
 
 
        (14)  In paragraph 32, in sub-paragraph (2), for the words from "the words" to the end there is substituted "paragraph (a) substitute--
      (a)  make one or more orders each of which would, within the meaning of Part II of the 1973 Act, be a financial provision order in favour of a party to the marriage or a child of the family or a property adjustment order in relation to the marriage,".
    (15)  In that paragraph, in sub-paragraph (3), for "21(a)" there is substituted "21(1)(a)".
 
    (16)  In that paragraph, after sub-paragraph (3) there is inserted--
        (3A)  For section 21(1)(ba) substitute--
      (ba)  sections 24BA(5) to (7) (provisions about pension sharing orders in relation to divorce);
      (baa)  section 24BC(1) to (3) (provisions about pension sharing orders in relation to nullity);".
        (3B)  In section 21(3), for "section 23" substitute "section 22A or 23."")
 
152A*     Page 151, line 21, at end insert-- 
 ("Bankruptcy (Scotland) Act 1985 (c. 66) 
     62D. The Bankruptcy (Scotland) Act 1985 has effect subject to the following amendments.
 
    62E. In section 35(1), in paragraph (a) for "under the said section 8(2) for the transfer of property by him" substitute "a court has, under the said section 8(2), made an order for the transfer of property by him or made a pension sharing order".
 
    62F. After section 36C there is inserted--
 
 Recovery of excessive contributions in pension-sharing cases.     36D.--(1) For the purposes of section 34 of this Act, a pension-sharing transaction shall be taken--
    (a)  to be a transaction, entered into by the transferor with the transferee, by which the appropriate amount is transferred by the transferor to the transferee; and
    (b)  to be capable of being an alienation challengeable under that section only so far as it is a transfer of so much of the appropriate amount as represents excessive contributions.
    (2)  For the purposes of section 35 of this Act, a pension-sharing transaction shall be taken--
    (a)  to be a pension sharing order made by the court under section 8(2) of the Family Law (Scotland) Act 1985; and
    (b)  to be an order capable of being recalled under that section only so far as it is a payment or transfer of so much of the appropriate amount as represents excessive contributions.
    (3)  For the purposes of section 36 of this Act, a pension-sharing transaction shall be taken--
    (a)  to be something (namely a transfer of the appropriate amount to the transferee) done by the transferor; and
    (b)  to be capable of being an unfair preference given to the transferee only so far as it is a transfer of so much of the appropriate amount as represents excessive contributions.
    (4)  Where--
    (a)  an alienation is challenged under section 34;
    (b)  an application is made under section 35 for the recall of an order made in divorce proceedings; or
    (c)  a transaction is challenged under section 36,
if any question arises as to whether, or the extent to which, the appropriate amount in the case of a pension-sharing transaction represents excessive contributions, the question shall be determined in accordance with subsections (5) to (9).
 
    (5)  The court shall first determine the extent (if any) to which the transferor's rights under the shared arrangement at the time of the transaction appear to have been (whether directly or indirectly) the fruits of contributions ("personal contributions")--
    (a)  which the transferor has at any time made on his own behalf, or
    (b)  which have at any time been made on the transferor's behalf,
to the shared arrangement or any other pension arrangement.
 
    (6)  Where it appears that those rights were to any extent the fruits of personal contributions, the court shall then determine the extent (if any) to which those rights appear to have been the fruits of personal contributions whose making has unfairly prejudiced the transferor's creditors ("unfair contributions").
 
    (7)  If it appears to the court that the extent to which those rights were the fruits of unfair contributions is such that the transfer of the appropriate amount could have been made out of rights under the shared arrangement which were not the fruits of unfair contributions, then the appropriate amount does not represent excessive contributions.
 
    (8)  If it appears to the court that the transfer could not have been wholly so made, then the appropriate amount represents excessive contributions to the extent to which it appears to the court that the transfer could not have been so made.
 
    (9)  In making the determination mentioned in subsection (6) the court shall consider in particular--
    (a)  whether any of the personal contributions were made for the purpose of putting assets beyond the reach of the transferor's creditors or any of them; and
    (b)  whether the total amount of any personal contributions represented, at the time the pension sharing arrangement was made, by rights under pension arrangements is an amount which is excessive in view of the transferor's circumstances when those contributions were made.
    (10)  In this section and sections 36E and 36F--
    appropriate amount", in relation to a pension-sharing transaction, means the appropriate amount in relation to that transaction for the purposes of section 25(1) of the Welfare Reform and Pensions Act 1999 (creation of pension credits and debits);
    excessive contributions" shall be construed in accordance with subsection (2)(b) of section 36A of this Act;
    pension-sharing transaction" means an order or provision falling within section 24(1) of the Welfare Reform and Pensions Act 1999 (orders and agreements which activate pension-sharing);
    shared arrangement", in relation to a pension-sharing transaction, means the pension arrangement to which the transaction relates;
    transferee", in relation to a pension-sharing transaction, means the person for whose benefit the transaction is made;
    transferor", in relation to a pension-sharing transaction, means the person to whose rights the transaction relates.
 
 Recovery orders.     36E.--(1) In this section and section 36F of this Act, "recovery order" means--
    (a)  a decree granted under section 34(4) of this Act;
    (b)  an order made under section 35(2) of this Act;
    (c)  a decree granted under section 36(5) of this Act,
in any proceedings to which section 36D of this Act applies.
 
    (2)  Without prejudice to the generality of section 34(4), 35(2) or 36(5) a recovery order may include provision--
    (a)  requiring the person responsible for a pension arrangement in which the transferee has acquired rights derived directly or indirectly from the pension-sharing transaction to pay an amount to the permanent trustee on the debtor's estate,
    (b)  adjusting the liabilities of the pension arrangement in respect of the debtor,
    (c)  adjusting any liabilities of the pension arrangement in respect of any other person that derive, directly or indirectly, from rights of the debtor under the arrangement,
    (d)  for the recovery by the person responsible for the pension arrangement (whether by deduction from any amount which that person is ordered to pay or otherwise) of costs incurred by that person in complying in the debtor's case with any requirement under section 36C(1) or in giving effect to the order.
    (3)  In subsection (2), references to adjusting the liabilities of a pension arrangement in respect of a person include (in particular) reducing the amount of any benefit or future benefit to which that person is entitled under the arrangement.
 
    (4)  The maximum amount which the person responsible for an arrangement may be required to pay by a recovery order is the lesser of--
    (a)  so much of the appropriate amount as, in accordance with section 36D of this Act, represents the excessive contributions, and
    (b)  the value of the debtor's rights under the arrangement acquired by the transferee as a consequence of the transfer of the appropriate amount.
    (5)  A recovery order which requires the person responsible for an arrangement to pay an amount ("the restoration amount") to the permanent trustee on the debtor's estate must provide for the liabilities of the arrangement to be correspondingly reduced.
 
    (6)  For the purposes of subsection (5), liabilities are correspondingly reduced if the difference between--
    (a)  the amount of the liabilities immediately before the reduction, and
    (b)  the amount of the liabilities immediately after the reduction,
is equal to the restoration amount.
 
    (7)  A recovery order in respect of an arrangement--
    (a)  shall be binding on the person responsible for the arrangement, and
    (b)  overrides provisions of the arrangement to the extent that they conflict with the provisions of the order.
 
 Recovery orders: supplementary.     36F.--(1) The person responsible for a pension arrangement under which the transferee has, at any time, acquired rights by virtue of the transfer of the appropriate amount shall, on the permanent trustee of the debtor's estate making a written request, provide the trustee with such information about the arrangement and the rights under it of the transferor and transferee as the permanent trustee may reasonably require for, or in connection with, the making of an application for a recovery order.
 
    (2)  Nothing in--
 
  
    (a)  any provision of section 159 of the PensionSchemes Act 1993 or section 91 of the PensionsAct 1995 (which prevent assignation and the making of orders which restrain a person from receiving anything which he is prevented from assigning),
    (b)  any provision of any enactment (whether passed or made before or after the passing of the Welfare Reform and Pensions Act 1999) corresponding to any of the provisions mentioned in paragraph (a), or
    (c)  any provision of the arrangement in question corresponding to any of those provisions,
applies to a court exercising its power to make a recovery order.
 
    (3)  Regulations may, for the purposes of the recovery provisions, make provision about the calculation and verification of--
    (a)  any such value as is mentioned in section 36E(4)(b);
    (b)  any such amounts as are mentioned in section 36E(6)(a) and (b).
    (4)  The power conferred by subsection (3) includes power to provide for calculation or verification--
    (a)  in such manner as may, in the particular case, be approved by a prescribed person; or
    (b)  in accordance with guidance--
          (i)  from time to time prepared by a prescribed person, and
          (ii)  approved by the Secretary of State.
    (5)  References in the recovery provisions to the person responsible for a pension arrangement are to--
    (a)  the trustees, managers or provider of the arrangement, or
    (b)  the person having functions in relation to the arrangement corresponding to those of a trustee, manager or provider.
    (6)  In this section--
    prescribed" means prescribed by regulations;
    the recovery provisions" means this section and sections 34, 35, 36 and 36E of this Act;
    regulations" means regulations made by the Secretary of State.
    (7)  Regulations under the recovery provisions may--
    (a)  make different provision for different cases;
    (b)  contain such incidental, supplemental and transitional provisions as appear to the Secretary of State necessary or expedient.
    (8)  Regulations under the recovery provisions shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament."  ")
1993 c. 48.
1995 c. 26.
152B*     Page 152, line 24, leave out ("the matters specified in paragraphs (a) and (b) of section 342A(6)") and insert--
    ("(a)  whether any of the personal contributions were made for the purpose of putting assets beyond the reach of the transferor's creditors or any of them, and
    (b)  whether the total amount of any personal contributions represented, at the time the pension-sharing transaction was made, by rights under pension arrangements is an amount which is excessive in view of the transferor's circumstances when those contributions were made.")
 
152C*     Page 152, line 26, at end insert ("and sections 342E and 342F") 
152D*     Page 152, line 44, at end insert-- 
 <~et>("Orders under section 339 or 340 in respect of pension-sharing transactions.     342E.--(1) This section and section 342F apply if the court is making an order under section 339 or 340 in a case where-- 
  
    (a)  the transaction or preference is, or is any part of, a pension-sharing transaction, and
 
  
    (b)  the transferee has rights under a pension arrangement ("the destination arrangement", which may be the shared arrangement or any other pension arrangement) that are derived, directly or indirectly, from the pension-sharing transaction.
 
      (2)  Without prejudice to the generality of section 339(2) or 340(2), or of section 342, the order may include provision--
    (a)  requiring the person responsible for the destination arrangement to pay an amount to the transferor's trustee in bankruptcy,
    (b)  adjusting the liabilities of the destination arrangement in respect of the transferee,
    (c)  adjusting any liabilities of the destination arrangement in respect of any other person that derive, directly or indirectly, from rights of the transferee under the destination arrangement,
    (d)  for the recovery by the person responsible for the destination arrangement (whether by deduction from any amount which that person is ordered to pay or otherwise) of costs incurred by that person in complying in the transferor's case with any requirement under section 342F(1) or in giving effect to the order,
    (e)  for the recovery, from the transferor's trustee in bankruptcy, by the person responsible for a pension arrangement, of costs incurred by that person in complying in the transferor's case with any requirement under section 342F(2) or (3).
    (3)  In subsection (2), references to adjusting the liabilities of the destination arrangement in respect of a person include (in particular) reducing the amount of any benefit or future benefit to which that person is entitled under the arrangement.
 
    (4)  The maximum amount which the person responsible for the destination arrangement may be required to pay by the order is the lesser of--
    (a)  so much of the appropriate amount as, in accordance with section 342D, represents excessive contributions, and
    (b)  the value of the transferee's rights under the destination arrangement so far as they are derived, directly or indirectly, from the pension-sharing transaction.
    (5)  If the order requires the person responsible for the destination arrangement to pay an amount ("the restoration amount") to the transferor's trustee in bankruptcy it must provide for the liabilities of the arrangement to be correspondingly reduced.
 
    (6)  For the purposes of subsection (5), liabilities are correspondingly reduced if the difference between--
    (a)  the amount of the liabilities immediately before the reduction, and
    (b)  the amount of the liabilities immediately after the reduction,
is equal to the restoration amount.
 
    (7)  The order--
    (a)  shall be binding on the person responsible for the destination arrangement, and
    (b)  overrides provisions of the destination arrangement to the extent that they conflict with the provisions of the order.
 
 Orders under section 339 or 340 in pension-sharing cases: supplementary.     342F.--(1) On the transferor's trustee in bankruptcy making a written request to the person responsible for the destination arrangement, that person shall provide the trustee with such information about--
    (a)  the arrangement,
    (b)  the transferee's rights under it, and
    (c)  where the destination arrangement is the shared arrangement, the transferor's rights under it,
as the trustee may reasonably require for, or in connection with, the making of applications under sections 339 and 340.
 
    (2)  Where the shared arrangement is not the destination arrangement, the person responsible for the shared arrangement shall, on the transferor's trustee in bankruptcy making a written request to that person, provide the trustee with such information about--
    (a)  the arrangement, and
    (b)  the transferor's rights under it,
as the trustee may reasonably require for, or in connection with, the making of applications under sections 339 and 340.
 
    (3)  On the transferor's trustee in bankruptcy making a written request to the person responsible for any intermediate arrangement, that person shall provide the trustee with such information about--
    (a)  the arrangement, and
    (b)  the transferee's rights under it,
as the trustee may reasonably require for, or in connection with, the making of applications under sections 339 and 340.
 
    (4)  In subsection (3) "intermediate arrangement" means a pension arrangement, other than the shared arrangement or the destination arrangement, in relation to which the following conditions are fulfilled--
    (a)  there was a time when the transferee had rights under the arrangement that were derived (directly or indirectly) from the pension-sharing transaction, and
    (b)  the transferee's rights under the destination arrangement (so far as derived from the pension-sharing transaction) are to any extent derived (directly or indirectly) from the rights mentioned in paragraph (a).
    (5)  Nothing in--
 
  
    (a)  any provision of section 159 of the Pension Schemes Act 1993 or section 91 of the PensionsAct 1995 (which prevent assignment and the making of orders which restrain a person from receiving anything which he is prevented from assigning),
    (b)  any provision of any enactment (whether passed or made before or after the passing of the Welfare Reform and Pensions Act 1999) corresponding to any of the provisions mentioned in paragraph (a), or
    (c)  any provision of the destination arrangement corresponding to any of those provisions,
applies to a court exercising its powers under section 339 or 340.
 
    (6)  Regulations may, for the purposes of sections 339 to 342, sections 342D and 342E and this section, make provision about the calculation and verification of--
    (a)  any such value as is mentioned in section 342E(4)(b);
    (b)  any such amounts as are mentioned in section 342E(6)(a) and (b).
    (7)  The power conferred by subsection (6) includes power to provide for calculation or verification--
    (a)  in such manner as may, in the particular case, be approved by a prescribed person; or
    (b)  in accordance with guidance--
          (i)  from time to time prepared by a prescribed person, and
          (ii)  approved by the Secretary of State.
    (8)  In section 342E and this section, references to the person responsible for a pension arrangement are to--
    (a)  the trustees, managers or provider of the arrangement, or
    (b)  the person having functions in relation to the arrangement corresponding to those of a trustee, manager or provider.
    (9)  In this section--
    prescribed" means prescribed by regulations;
    regulations" means regulations made by the Secretary of State.
    (10)  Regulations under this section may--
    (a)  make different provision for different cases;
    (b)  contain such incidental, supplemental and transitional provisions as appear to the Secretary of State necessary or expedient.
    (11)  Regulations under this section shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament."  ")
1993 c. 48.
1995 c. 26.
  
Clause 80
 
  
BY THE BARONESS HOLLIS OF HEIGHAM
 
153     Page 85, line 4, leave out subsections (3) to (5) 
154     Page 85, line 17, leave out ("24D") and insert ("24B") 
155     Page 85, line 18, leave out ("of nullity") 
  
BY THE LORD GOODHART
THE EARL RUSSELL
THE LORD ADDINGTON
 
156     Page 85, line 19, leave out from ("before") to end of line 20 and insert ("1st January 2000.") 
  
BY THE BARONESS HOLLIS OF HEIGHAM
 
157     Page 85, line 21, leave out subsection (7) 
158     Page 85, line 24, leave out subsection (8) and insert--
 
    ("(8)  Paragraph 3 of Schedule 3 does not have effect if the proceedings in which the decree is granted were begun before the day on which section 19 comes into force.")
 
159     Page 85, line 43, leave out subsection (12) 
  
Schedule 13
 
  
BY THE BARONESS HOLLIS OF HEIGHAM
 
159A*     Page 159, line 28, column 3, at beginning insert-- 
   ("In section 8(3), the words ", subject to section 21(4) below,".") 
159B*     Page 159, line 41, column 3, at end insert ("4(6),") 
159C*     Page 160, line 10, column 3, at end insert-- 
   ("Section 145(1)(a)(i) and (ii).") 
159D*     Page 160, line 22, column 3, at beginning insert-- 
   ("In Article 9(3), the words ", subject to Article 21(4),".") 
159E*     Page 160, line 29, column 3, leave out ("and 24(3)") and insert (", 24(3), 33(5) and 75(3)") 
159F*     Page 160, line 31, column 3, leave out ("and 38(4) and (5)") and insert (", 38(4) and (5) and 49(3)") 
159G*     Page 160, line 31, column 3, at end insert-- 
   ("In Schedule 5, paragraph 2(2).") 
159H*     Page 160, line 33, at end insert-- 
 ("1999 c. 10.Tax Credits Act 1999.In Schedule 2, paragraph 34.
In Schedule 6, the entry relating to the Social Security Administration (Northern Ireland) Act 1992.")
 
  
Clause 83
 
  
BY THE LORD HIGGINS
THE BARONESS BUSCOMBE
THE LORD ASTOR OF HEVER
 
160     Page 86, line 14, at end insert ("; and section 75 shall not come into force until the Secretary of State is satisfied that there are sufficient safeguards within the Child Support Agency to protect the confidential nature of the information declared") 
  
BY THE BARONESS HOLLIS OF HEIGHAM
 
161     Page 86, line 18, after ("5") insert ("and 62A to 62C") 
162     Page 86, leave out line 19 and insert--
    ("(c)  section 80(6) and (8); and")
 
  
BY THE EARL RUSSELL
THE LORD GOODHART
THE LORD ADDINGTON
 
162A     Page 86, line 26, leave out ("52,") 
  
BY THE LORD HIGGINS
THE BARONESS BUSCOMBE
THE LORD ASTOR OF HEVER
 
163     Page 86, leave out line 29 and insert--
    ("(  )  section 74 and sections 76 to 78;")
 
  
BY THE EARL RUSSELL
THE LORD GOODHART
THE LORD ADDINGTON
 
163A     Page 86, line 33, at end insert--
 
    ("(3A)  Section 52 shall not come into force until such day following publication of research into the actions and income of those disentitled to benefit.")
 
  
BY THE LORD HIGGINS
THE BARONESS BUSCOMBE
THE LORD ASTOR OF HEVER
 
163B     Page 86, line 33, at end insert--
 
    ("(  )  Part IV shall not come into force until a period of no less than one year after regulations to be made under that Part have been published in draft by the Secretary of State for consultation.")
 
163C     Page 86, line 37, leave out ("IV") and insert ("III") 
  
BY THE EARL RUSSELL
THE LORD GOODHART
THE LORD ADDINGTON
 
164     Page 86, line 39, at end insert--
 
    ("(4A)  Section 52 shall not come into force until after the Secretary of State has properly evaluated pilot schemes on work-focused interviews.
 
    (4B)  The evaluation under subsection (4A) shall include an assessment of the experience of those disentitled whether they be--
    (a)  employed,
    (b)  in hospital,
    (c)  in prison,
    (d)  unemployed,
information on whether they are disentitled to all or part of their benefits, and an assessment of the means of subsistence available to them and their subsequent condition.")
 
  
Clause 84
 
  
BY THE BARONESS HOLLIS OF HEIGHAM
 
165     Page 87, line 3, after ("5") insert (", 62A to 62C") 
166     Page 87, leave out line 5 and insert--
    ("(e)  section 80(6) and (8).")
 
167*     Page 87, line 10, after ("13") insert ("and 62D to 62F") 
168*     Page 87, line 25, leave out ("26,") and insert ("26(b),") 
169*     Page 87, line 38, after ("25") insert ("and 26(a)") 
170*     Page 88, line 5, leave out ("15,") and insert ("15C,") 
 
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