Pensions regulation Flashcards
Andrew, aged 42, joined his previous employer’s defined benefit scheme in 2000 and left in 2008. If the scheme has entered the Pension Protection Fund, his benefits will be revalued each year in deferment in line with the:
a.
CPI capped at 5%.
b.
CPI capped at 2.5%.
c.
RPI capped at 5%.
d.
RPI capped at 2.5%.
a.
CPI capped at 5%.
Melissa is a member of her company’s contributory occupational defined contribution pension scheme. She is currently on maternity leave and will be paid a reduced salary for this period. What will happen to contributions paid into the scheme during her maternity leave?
a.
Both Melissa and her employer’s contributions will be based on the level of actual earnings she receives.
b.
Both Melissa and her employer are required to continue to make contributions based on her pensionable earnings prior to her starting maternity leave.
c.
Her employer’s contributions will be based on the level of actual earnings she receives and Melissa is required to continue to make contributions based on her pensionable earnings prior to her starting maternity leave.
d.
Her employer is required to continue to make contributions based on her pensionable earnings prior to her starting maternity leave and Melissa’s contributions will be based on the level of actual earnings she receives.
d.
Her employer is required to continue to make contributions based on her pensionable earnings prior to her starting maternity leave and Melissa’s contributions will be based on the level of actual earnings she receives.
The National Employment Savings Trust [NEST] and The People’s Pension are multi-employer master trust schemes. Which of these schemes, if any, is UNABLE to decline business it feels will be unprofitable?
a.
NEST only.
b.
The People’s Pension only.
c.
Both are able to decline business that is felt to be unprofitable.
d.
Neither are able to decline business that is felt to be unprofitable.
a.
NEST only.
Adam, who is a widower, died recently whilst in receipt of Pension Protection Fund [PPF] compensation of £24,000 p.a. His 16 year old son will be entitled to PPF compensation of:
a.
£24,000 p.a.
b.
£12,000 p.a.
c.
£6,000 p.a.
d.
£16,000 p.a.
b.
£12,000 p.a.
Which of the State Pensions paid to individuals who reached their State Pension Age prior to 6 April 2016 can be included in a pension sharing order?
a.
State Second Pension and SERPS only.
b.
State Second Pension only.
c.
SERPS only.
d.
Basic State Pension, SERPS and State Second Pension.
a.
State Second Pension and SERPS only.
If the Pension Protection Fund is to take responsibility for a scheme a number of requirements must be met. One of these is that the scheme must NOT have commenced wind-up before:
a.
6 April 2006.
b.
1 January 2005.
c.
1 January 2006.
d.
6 April 2005.
d.
6 April 2005.
John is declared bankrupt on 1 June 2023 and the trustee in bankruptcy applies for an income payments order that takes effect from 1 August 2023. The period of bankruptcy ends on 31 May 2024. If the income payments order is for the maximum term allowed, when must it end by?
a.
31 July 2024.
b.
31 July 2026.
c.
31 May 2026.
d.
31 May 2024.
b.
31 July 2026.
Which employee would be classed as a non-eligible jobholder for automatic enrolment purposes?
a.
Hee-Jin, who is 48 and has part time earnings of £5,000.
b.
Harry, who is 67 and has earnings of £24,000.
c.
Julie, who is 29 and has earnings of £15,000.
d.
Angus, who is 64 and has earnings of £45,000
b.
Harry, who is 67 and has earnings of £24,000.
Who can recover unpaid contributions to a work-based pension scheme from the employer?
a.
The Pensions Regulator.
b.
The Pensions Ombudsman.
c.
The FCA.
d.
HMRC.
a.
The Pensions Regulator.
A retired member of a defined benefit scheme that has entered the Pension Protection Fund can expect their pension income to increase in line with CPI capped at:
a.
5% for benefits accrued after 5 April 1997 and CPI capped at 2.5% for benefits accrued prior to 6 April 1997.
b.
2.5% for benefits accrued after 5 April 1997 and CPI capped at 5% for benefits accrued prior to 6 April 1997.
c.
2.5% for benefits accrued after 5 April 1997 and no increases for benefits accrued prior to 6 April 1997.
d.
5% for benefits accrued after 5 April 1997 and no increases for benefits accrued prior to 6 April 1997.
c.
2.5% for benefits accrued after 5 April 1997 and no increases for benefits accrued prior to 6 April 1997.
Once the assessment period to establish whether a defined benefit scheme meets the criteria for entry into the Pension Protection Fund has commenced certain limitations apply to the scheme. Which of these limitations is stated INCORRECTLY?
a.
No further benefits can be paid under the scheme.
b.
No further benefits can be accrued.
c.
No transfer values can be paid.
d.
No new members can be admitted.
a.
No further benefits can be paid under the scheme.
John, aged 62, and Jane, aged 65, divorced ten years ago and Jane received an earmarking periodic payment order as part of the divorce settlement. With Jane’s earmarked pension, it is INCORRECT to say that if:
a.
John remarries, Jane will lose her earmarked pension.
b.
Jane remarries, she will lose her earmarked pension.
c.
Jane moves in with her new partner, she is likely to lose her earmarked pension.
d.
John dies, the earmarking order dies with him.
a.
John remarries, Jane will lose her earmarked pension.
What is the minimum postponement period a workplace pension can use to defer the date on which it assesses a worker?
a.
One week.
b.
One month.
c.
Three months.
d.
One day.
d.
One day.
Following an action by Fiona’s insurer in May 2023, she complained to the Financial Ombudsman Service [FOS]. The maximum monetary award the FOS can enforce is:
a.
£375,000 plus interest and costs.
b.
£375,000 in total, including interest and costs.
c.
£415,000 in total, including interest and costs.
d.
£415,000 plus interest and costs.
d.
£415,000 plus interest and costs.
Jane has been awarded an earmarked periodic payment from her ex-husband’s pension scheme. She should be aware that:
a.
if her ex-husband remarries the payments will stop.
b.
the income payments will be paid to her after tax at her ex-husband’s marginal rate has been deducted.
c.
she retains the right to these payments if she remarries.
d.
she is entitled to receive a transfer value for these benefits.
b.
the income payments will be paid to her after tax at her ex-husband’s marginal rate has been deducted.
Kelly has received a pension credit that relates to her ex-husband’s membership of the Civil Service Pension Scheme. As a result the scheme must offer her:
a.
the choice between membership of the scheme and receiving a transfer value.
b.
either membership of the scheme or a transfer value but it is up to the scheme to decide which.
c.
membership of the scheme but can choose not to offer her a transfer value.
d.
a transfer value but they can choose not to offer her membership of the scheme.
c.
membership of the scheme but can choose not to offer her a transfer value.
Megan and her employer both contribute 5% of her salary into a defined contribution scheme. Megan has just started her maternity leave and she plans to return to work after six months. Her employer will pay her full salary of £2,000 per month for three months and this will reduce to £1,000 for the remaining three months. Regarding the contributions made into the scheme during her period of maternity leave, Megan:
a.
will pay £100 per month for the first three months and £50 per month for the next three months. Her employer will contribute £100 per month for the entire six month period.
b.
will not have to make any pension contributions during her period of maternity leave, but her employer will be required to pay £100 per month for the entire six month period.
c.
and her employer will pay £100 per month for the entire six month period.
d.
and her employer will pay £100 per month for the first three months and £50 per month for the next three months.
a.
will pay £100 per month for the first three months and £50 per month for the next three months. Her employer will contribute £100 per month for the entire six month period.
Which individual would have their complaint investigated by The Pensions Ombudsman?
a.
Bryan, who is unhappy with the way a trustee of his employer’s occupational pension scheme is carrying out his duties.
b.
Barbara, who feels she was mis-sold her personal pension plan.
c.
Reg, who feels the charges on his employer’s in-house AVC scheme are too high.
d.
John, who is about to retire and feels that his State pension forecast does not take full account of his class 1 National Insurance Contribution record.
a.
Bryan, who is unhappy with the way a trustee of his employer’s occupational pension scheme is carrying out his duties.
Q: What is the role of The Pensions Regulator (TPR)?
A: The Pensions Regulator (TPR) is the UK regulator of work-based pension schemes.
Q: What is the responsibility of The Pensions Regulator?
A: The Pensions Regulator has the responsibility to protect the benefits and rights of members of work-based pension schemes and reduce the risk of situations that may lead to compensation being payable from the Pension Protection Fund (PPF).
Q: What are the three categories of powers that The Pensions Regulator has?
A: The Pensions Regulator has three broad categories of powers: gathering information, regulation and enforcement action, and acting against avoidance.
Q: Which organization handles complaints about the sale and marketing of products sold by FCA registered firms?
A: The Financial Ombudsman Service (FOS) is responsible for dealing with complaints about the sale and marketing of products sold by FCA registered firms.
Q: What type of complaints does the Pensions Ombudsman investigate?
A: The Pensions Ombudsman investigates complaints about the running of occupational pension schemes and individual pension arrangements that do not fall under the remit of the Financial Ombudsman Service (FOS).
Q: Who sponsors the Money and Pensions Service (MaPS), and what is their commitment?
A: The Money and Pensions Service (MaPS) is sponsored by the Department for Work and Pensions (DWP) with a commitment to ensure that people throughout the UK have the guidance and information they need to make effective financial decisions.
Q: What is MoneyHelper and what does it include?
A: MoneyHelper is a free, consumer-facing service provided by the Money and Pensions Service (MaPS) that includes Pension Wise, which offers guidance on pensions.
