Commentary on Sections Contracting out Section 282: Meaning of “working life” in Pension Schemes Act 1993
1138.This section amends the meaning of “working life” in section 181 of the Pension Schemes Act 1993. This definition is used for calculating an earner’s Guaranteed Minimum Pension (GMP). The existing definition of “working life” has the same meaning as in paragraph 5(8) of Schedule 3 to the Social Security Contributions and Benefits Act 1992 (i.e. “working life” is the period between (inclusive) the tax year in which the person attained the age of 16; and (exclusive) the tax year in which he attained pensionable age or died under that age). Under section 126 of and Schedule 4 to the Pensions Act 1995, pensionable age for women to which paragraph 5(8) refers will be raised from 60 to 65 in stages commencing in 2010, to bring women’s pensionable age into line with that for men. By virtue of the amendments made by this section “working life” for the purposes of calculating an earner’s GMP will now end with the tax year before the person reaches the age of 65 (in the case of a man) or 60 (in the case of a woman), or if earlier, the tax year before the person dies. The amendment made by this section brings the definition of “working life” into line with the definition of “pensionable age” for GMPs, which will remain unchanged from 2010.