Part 1: Public Service Pension Schemes Chapter 1: Schemes other than Judicial Schemes and Local Government Schemes Section 23: Power to pay compensation
This section provides for scheme managers to pay compensation in respect of any losses incurred by a member or, in the case of deceased members, their representatives, as a result of the discrimination that arose or the remedy under this Act. Section 23(2) allows schemes to make regulations for an employer to reimburse amounts paid out by a scheme manager under section 23(1).
	Section 23(3) defines the instances where a loss in this section is compensatable. A compensatable loss is one that meets any of the three conditions set out at section 23(4) to 23(6) and is of a description specified in Treasury directions.
	The first condition is that the loss is attributable to, or is reasonably regarded as attributable to, a relevant breach of a non-discrimination rule. The second condition is that the loss is attributable to the application of any provision of, or made under, Chapter 1. Both these losses can include ‘Part 4 tax losses’ – see section 23(8) and 23(9). The third condition refers to a specific situation where new scheme benefits are chosen in the context of pensioner and deceased members. The third condition applies where the member is a relevant member and the loss is a "Part 4 tax loss" (see section 23(9)) that is attributable to the value of rights in respect of the remediable service under a Chapter 1 new scheme.
	Section 23(7) defines a relevant member and section 23(8) specifies that, in this section, a "loss" includes a loss of any kind, in particular, a Part 4 tax loss.
	Section 23(9) defines a "Part 4 tax loss" as a loss arising as a result of the member either incurring a charge, or incurring an increased charge, under Part 4 of Finance Act 2004 or not being entitled to a relief, or being entitled to less relief, under that Part of that Act. This ensures that compensation can be paid in respect of members where HMRC’s statutory time limits do not allow for correction of the amount of tax paid.
	Section 23(10) sets out that a loss does not include an amount that is already payable under Chapter 1 or under any other regulations made by virtue of the Chapter. Section 23(13) ensures that compensation in respect of losses is not paid in relation to members where they or their personal representatives have already received compensation through an order of a court or tribunal or otherwise.