The Pension Protection Fund (PPF) recently published its Pension Protection Levy Policy Statement for 2010 to 2011.
Included in the statement were the board’s aims and objectives for protecting UK pension schemes in the coming years.
The report revealed that the PPF plans to collect an overall levy of £720 million during the period that the statement covers.
A levy scaling factor of 1.64 was also announced in the report, along with a risk-based cap of 0.5 per cent of liabilities.
PPF said this would protect the most vulnerable ten per cent of schemes.
The report also outlined changes to the way probabilities of insolvency for foreign businesses are calculated and alterations to the requirements of block transfers.
An April 9th 2010 deadline for certification of deficit reduction contributions was also announced.
The move to protect vulnerable schemes could be welcomed by employees of firms with large pension deficits.
However, the high profile cases reported in the media recently, such as the £3.7 billion deficit at British Airways could see may people turn to alternative retirement funding to supplement their pension incomes.
This could lead to a rise in the popularity of equity release schemes, which allow property owners to supplement their pension payments with money drawn against the value of their assets
