Step 1 | Identify: (a) the annual rate of later standard pension that would have been payable to the member spouse at the date of commencement of the later standard pension had there not been a family law payment split (the unreduced standard pension); and |
| (b) the indexed and non‑indexed components of the unreduced standard pension. |
Step 2 | Identify: (a) the annual rate of standard pension that was payable to the member spouse immediately before the operative time (the pre‑split standard pension); and |
| (b) the indexed and non‑indexed components of the pre‑split standard pension. |
Step 3 | Work out a reduction factor using the formula: |
Step 4 | Work out the annual rate of the standard pension payable in respect of the original interest to the member spouse after the operative time (the post‑split standard pension) by multiplying the pre‑split standard pension by the reduction factor. |
| The indexed and non‑indexed components of the post‑split standard pension are in the same proportion for the post‑split standard pension as they were for the pre‑split standard pension. |
Step 5 | Work out the reduction in the standard pension at the operative time (the reduction in standard pension) by subtracting the post‑split standard pension from the pre‑split standard pension. |
| Work out the corresponding reduction in the indexed component of the standard pension at the operative time by subtracting the indexed component of the post‑split standard pension in step 4 from the indexed component of the pre‑split standard pension in step 2. |
| Work out the corresponding reduction in the non‑indexed component of the standard pension at the operative time by subtracting the non‑indexed component of the post‑split standard pension in step 4 from the non‑indexed component of the pre‑split standard pension in step 2. |
Step 6 | Work out the increase in the indexed component of the reduction in standard pension for indexation during the period between the operative time and the date of commencement of the later standard pension as follows: |
| (a) work out the indexation factor by dividing the indexed component of the pre‑split standard pension from step 2, increased in accordance with Part XA of the Act in the period from the operative time to the date of commencement of the later standard pension, by the indexed component of the pre‑split standard pension from step 2; |
| (b) multiply the indexation factor by the indexed component of the reduction of the standard pension from step 5. |
Step 7 | Work out the annual rate of the standard pension payable to the member spouse at the date of commencement of the later standard pension (the current standard pension) by subtracting the following amounts from the unreduced standard pension: |
| (a) the current value of the indexed component of the reduction in standard pension from step 6; |
| (b) the non‑indexed component of the reduction in standard pension from step 5. |
Step 8 | Work out the annual rate of the non‑indexed component of the standard pension payable to the member spouse at the date of commencement of the later standard pension (the current standard pension non‑indexed component) by subtracting the reduction in the non‑indexed component of the standard pension at the operative time from step 5 from the non‑indexed component of the unreduced standard pension identified in step 1. |
| If the amount calculated is less than zero, the current standard pension non‑indexed component is zero. |
Step 9 | Work out the annual rate of the indexed component of the standard pension payable to the member spouse at the date of commencement of the later standard pension by subtracting the current standard pension non‑indexed component from step 8 from the current standard pension in step 7. |