S.L. 514.4 Art. 6Under-provision in a retirement scheme.

(1) Where an actuarial valuation shows that, on the effective date of the valuation, the value of the retirement scheme assets is less than the amount prescribed for the purposes of paragraph (a) of the definition ''technical funding requirement'' in regulation 2(2) (the difference shown in the valuation hereinafter referred to as ''the shortfall'') the employer or contributor shall -

(a) by making an appropriate payment to the retirement scheme; or

(b) by such other method as may be stipulated in Pension Rules, secure an increase in the value of the retirement scheme assets which, taken with any contributions paid, is not less than the shortfall.

(2) The required increase in that value must be secured -

(a) before the end of such period as may be stipulated in Pension Rules reckoned from the date of the valuation; or

(b) if the actuarial valuation was obtained by reason of a statement in the certificate referred to in regulation 5(3), before the end of a period stipulated in Pension Rules reckoned from the date of the certificate.

(3) Except in such circumstances as may be stipulated in Pension Rules, if the employer or contributor referred to in sub-regulation (1) fail to secure the required increase in value before the end of the period applicable under sub-regulation (2), the retirement scheme administrator, or the retirement scheme actuary shall within the period of thirty days reckoned from the end of that period, give written notice of that fact to the competent authority, members and beneficiaries of the retirement scheme.

(4) Except in such circumstances as may be stipulated in Pension Rules, if the employer referred to in sub-regulation (1) fails to secure the required increase in value before the end of the period applicable under sub-regulation (2), then so much of the shortfall as, at any subsequent time, has not been met by an increase in value made under sub-regulation (1) or otherwise by contributions made before the end of that period, such shortfall shall be recoverable by the retirement scheme from the employer and the provisions of article 19(5) of the Act shall mutatis mutandis apply with regard to any such debt; and, in the case of a personal retirement scheme, such amounts shall be recoverable from the contributor.

(5) The competent authority may extend, or further extend the period referred to in sub-regulation (2), and where it refuses to extend or further extend the period, it shall give written notice to the retirement scheme of the refusal together with a statement of reasons for its decision.