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56A.—(1) In this section ‘indexation’, in relation to a pension, means the provision of an increase, in each successive year of the period during which the pension is paid, of the amount of the pension, each such increase that is so provided being equal to a percentage of the amount of the pension in payment at the time the increase falls to be made, being a percentage at least equal to the lower of—
(a) the percentage increase in the general level of consumer prices during a period of twelve months ending at any time within twelve months before the increase of the amount of pension falls to be made, determined by the trustees in such manner as they think appropriate, and
(b) four per cent.
(2) This section applies to a scheme to which section 56(1)(b) applies, the rules of which do not require either—
(a) indexation of pensions, or
(b) the provision of an increase, in each successive year of the period during which each pension thereunder is paid, of the amount of the pension, each such increase that is specified in the scheme being not less than 3 per cent of the amount of the pension in payment at the time the increase falls to be made.
(3) The trustees of a scheme to which this section applies shall, at intervals not exceeding 3½ years, cause the actuary to value the additional liability which would be imposed on the scheme by the indexation of pensions payable thereunder.
(4) The actuary of a scheme to which this section applies shall report on the additional liability and the resulting requirement for contributions which would be imposed on the scheme by the indexation of pensions as regards—
(a) pensions then in payment under the scheme, and
(b) pensions not then in payment thereunder whose payment is anticipated.
(5) The trustees of a scheme to which this section applies shall, following receipt of the actuary's report referred to in subsection (4), consider the possibility of effecting indexation of—
(a) pensions then in payment under the scheme, and
(b) pensions not then in payment thereunder whose payment is anticipated,
and, where effecting such indexation of pensions would require the exercise of a discretion by any other person, they shall report on the results of their consideration to that person.
(6) Where a person receives a report from the trustees of a scheme under subsection (5), he shall furnish to the trustees a response by him to that report.
(7) Regulations may provide for—
(a) the matters to be addressed by the actuary of a scheme in his report with respect to the matters referred to in subsection (4),
(b) the matters to be addressed by a person in making a response under subsection (6), and
(c) the period within which a person required to respond under subsection (6) shall so respond.”.
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