Part 1: Collective Money Purchase Benefits Definitions Section 2: Qualifying benefits
This section defines what is a qualifying benefit. Subsections (1)(a) and (1)(b) provide that to be a qualifying benefit the rules of the scheme must provide for the rate or amount of the benefit to be variable so as to achieve a balance between the available assets of the scheme and the ‘required amount’, which is the projected costs of paying benefits under the scheme. The benefit must also be paid out of the available assets of the scheme. This makes it clear that qualifying benefits are not subject to any guaranteed level and that the employer is consequently not liable for any deficit.
	Subsection (1)(c) allows for benefits specified in regulations to be excluded from being categorised as qualifying benefits. This power is intended to ensure that benefits not intended to be CMPB do not inadvertently fall within the definition. For example, regulations could be made under this section to exclude non-money purchase benefits in the event a risk arises that they might be reclassified in law as CMPB and, therefore, removed from scheme funding requirements and eligibility for entry to the PPF.
	Subsection (2) defines the terms ‘available assets of the scheme’ and ‘the required amount’. The available assets do not include deductions for administration charges. The definition of ‘the required amount’ makes it clear that the calculation involves the application of actuarial assumptions and relates to the cost of providing benefits under the scheme on a collective basis.
	Where an occupational pension scheme is divided into sections, subsection (4) enables the provisions in this section to be read as if they referred to a section of the scheme.