Divorce & Pension Rights
Earmarking pension provision
The Pensions Act 1995 gave courts power to make an "earmarking" order such that a portion of the pension may be paid to the spouse on the retirement of the named pension fund holder. If a pension scheme member or policy holder (typically the husband) has built up a pension provision with a transfer value of, say, £100,000 the court may earmark a percentage of future pension benefits for the wife. This also applies to any lump sump as well as pension in payment. There are two drawbacks. First, death of the husband would mean the wife losing the benefit of any earmarking order, and second, it means there is no clean break between husband and wife.
Offsetting pension value
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