The Pension Protection Fund (PPF) has published its guide to the pension protection levy for the levy year 2010/11. It sets out timescales for payment of the levy, details of its calculation and how schemes can raise queries.
2010/11 will be the first year that the PPF has discretion to charge interest on late levy payments (that is, those which have not been received within 28 days of the invoice date). Interest will be charged at an annual rate of 5% above the Bank of England's base rate. The guide sets out the factors which the PPF can take into account in deciding whether it is reasonable to charge interest (including the scheme's levy payment history). The guide can be accessed on the PPF's website here.
The issue of charging interest is also dealt with on new FAQs on the PPF website.
In addition, the FAQs cover the issue of the "complex area" of the equalisation of guaranteed minimum pensions (GMPs). The PPF restates that they are working on the calculation requirements for equalising GMPs for different categories of member and that they will be issuing guidance in due course. Until this guidance is available, schemes in an assessment period will not be expected to take any action to equalise for GMPs. The PPF states that it will ensure that schemes are given sufficient notice of the guidance being made available.