The Gazette 1996

GAZETTE

JULY 1996

the Court may, in relation to a retirement benefit under a Pension Scheme of which one of the spouses concerned is a member, on application being made at the time of the making of the Decree or at any time thereafter during the lifetime of the member spouse, by either of the spouses or by a person on behalf of a dependant member of the family, make an order providing for the payment of a benefit consisting of the whole, or a part, of that part of the retirement benefit that is payable under the scheme and has accrued at the time of the making of the Decree. The Court may order the payment to be made to the other spouse or to his or her personal representative, or to a person for the benefit of a dependant member of the family. Section 12 - Sub-section 3 Additionally, where a Decree of Judicial Separation has been granted the Court may, in relation to a contingent benefit under a pension scheme of which one of the spouses concerned is a member, on application being made not more than one year after the making of the Decree by either of the spouses or by a person on behalf of a dependant member of the family concerned, make an order providing for the payment, upon the death of the member spouse, of either the whole or a part of that part of any contingent benefit that is payable under the pension scheme. The Court may make the order in favour of the other spouse or in favour of a person for the benefit of a dependant member of the family. These Orders are called Pension Adjustment Orders. It might be of assistance if I endeavour to explain what, in practise, the two types of Pension Adjustment Order are. Under sub-section 2 the Pension Adjustment Order relates to a retirement benefit. Under sub-sectión 3 it relates to a contingent benefit.

Sub-section 2 In so far as it relates to a retirement benefit, the Pension Adjustment Order relates only to the part of the retirement benefit which has accrued at the time of the making of the Decree of Judicial Separation. Thus any part of the retirement benefit which accrues to a spouse after the making of the Decree cannot be the subject matter of a Pension Adjustment Order. In making the Pension Adjustment Order under sub-section 2 the Court must specify the period of reckonable service of the member spouse prior to the granting of the Decree to be taken into account, and the percentage of the retirement benefit accrued during that period to be paid to the Applicant. Thus the Court could, for example, in relation to a member spouse who has ! completed 40 years of scheme service, order that, say, 50% of the benefit accrued during 20 of the 40 years be designated as payable to the spouse. This could apply in relation to a couple who were married for only 20 of the 40 years of reckonable service. Reckonable service means service in I Relevant employment means any employment or any period of self employment to which a scheme applies. Retirement benefit means all | benefits other than contingent benefits payable under the scheme. Where the Court makes an Order in relation to a retirement benefit, j payment of the part of the retirement benefit designated for the applicant j commenced being paid to the member ! spouse, in other words in a situation | where the member spouse had already retired. Where payment of the designated j i would of course commence immediately if the designated retirement benefit had already j i relevant employment during membership of any scheme.

benefit to the member spouse has not commenced, the applicant spouse has two options. He or she may either simply leave the part of the retirement benefit designated for him or her within the pension scheme, and the payment of the part of the member's pension which is designated to the dependant spouse will then be paid to him or her when the member's pension falls due. One could say, in this instance, that a portion of the pension has been ear-marked for the dependant spouse. Alternatively the dependant spouse is entitled to have an amount of money from the scheme concerned (called a "Transfer Amount") equal to the value of the designated benefit applied in accordance with sub-section 5. Sub-section 5 provides that where the Court has made an order under sub- section 2 and payment of the designated benefit concerned has not commenced the trustees shall, when application is made to them by the dependant spouse, apply, in accordance with relevant guidelines, the Transfer Amount either. (i) if the trustees and the spouse so agree, in providing a benefit for the dependant spouse under the same scheme that is of the same actuarial value as the transfer amount concerned, or,

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(ii) at the determination of the

dependant spouse, to a different occupational pension scheme, for example a scheme of which the dependant spouse is already a member, or, in making a payment into what is called "an approved arrangement" which means an arrangement whereby the trustees effect policies or contracts of insurance that are approved of by the Revenue Commissioners. Where a Transfer Amount is applied under sub-section 5 one could say that this is a form of "pension splitting" where the benefit designated in favour of the dependant spouse has been split away from the retirement benefit of the member of the pension scheme.

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