Pension Sharing on Divorce

Pension Regulations have, since 1995, contained provisions whereby maintenance (known as earmarking) can be paid from a member’s pension to their ex-spouse under a Court direction.

From 1 December 2000 new “Pensions Sharing” Regulations came into force with respect to divorce or annulment (but not judicial separation) proceedings which commenced on or after that date.

The provisions are not compulsory.  They can provide an alternative to the current earmarking arrangements.  The Regulations provide that both parties are given the value of the member’s pension and the Courts can take into account in any financial settlement.  If the Courts so direct, the settlement may include a Pension Sharing Order.  Such Orders entitle the ex-spouse or civil partner to a Pension Credit and the Scheme member’s pension will be reduced by an equivalent debit.

The Pension Credit will, in effect, give the ex-spouse or ex-civil partner a percentage of the members pension based on the member’s Scheme membership at the date of the Court Order.  In the LGPS the Pension Credit can be taken as a pension benefit at age 65, or can be transferred to another pension scheme.

Pension credits can be transferred out of but not into the LGPS.

The Pension Section is obliged to provide information when requested by solicitors acting for either party in divorce or annulment proceedings.  Charges are levied for the provision of this information.