Section 116 — Pensions Act 2008: Discharge of liability

Discharge of liability 116 1 This section applies where the Board is subject to a liability in respect of a pension compensation credit.

2 The Board must discharge the liability by sending a notice to the transferee.

3 On the sending of the notice the transferee becomes entitled, with effect from (and including) the transfer day, to compensation calculated in accordance with Schedule 5.

4 For the purposes of that calculation, the initial annual rate of compensation is an amount determined by the Board.

5 The Board must determine that amount in such a way as to secure that the cash equivalent value of the compensation to which the transferee becomes entitled under subsection (3) equals the amount of the credit.

6 The Secretary of State may by regulations make provision about the calculation of cash equivalents for the purposes of subsection (5).

7 The notice sent under this section must—

a state that the transferee is entitled to periodic pension compensation calculated under Schedule 5, and b specify the amount determined under subsection (4).

8 Where the transferee dies before liability in respect of the credit has been discharged—

a subsections (2) to (7) do not have effect in relation to the discharge of liability in respect of the credit, and b liability in respect of the credit must be discharged in accordance with regulations made by the Secretary of State.