The Pension Protection Fund (PPF) recently announced proposals for a new formula for calculating the pension protection levy from 2012/2013 onwards.
The PPF is intending to:
- fix the levy rules for three years at a time, subject to the right to review under exceptional circumstances;
- use average measures for both underfunding and insolvency risk; and
- focus more on factors in the levy payers’ control in determining the new levy formula.
It is hoped that these mechanisms will provide greater predictability for employers in their financial planning, as well as helping the PPF to meet it target of becoming financially self-sufficient by 2030 (please see our previous bulletin).
These proposals are subject to a further consultation which runs until 20 December.