In July 2021 the Court of Appeal ruled the PPF compensation cap was unlawful on the grounds of age discrimination, so we’re no longer applying it and we’re removing it from affected PPF pensioners. The information below is provided for anyone who still needs to refer to the previous situation.
Each year our compensation cap for PPF members is subject to review by the Department for Work and Pensions, with changes taking effect from 1 April.
If you were under your normal pension age when your scheme entered our assessment period, there is a cap on the total amount of annual compensation we can pay to you. Only around 0.5% of our members are affected by the compensation cap, which means the vast majority of members aren’t affected.
From the 1 April 2020, the cap at age 65 has been set at £41,461. This is an increase of 3.6% from the 2019/20 cap which was £40,020. The increase reflects the level of wage inflation over the period. As the cap is applied before your compensation is reduced to 90 per cent of our levels, the actual amount you would receive as a capped member retiring at 65 is £37,315.
The new cap will be increased for the majority of members that retire from 1 April 2020 onwards. The later you retire, the higher the annual cap is set, as you’ll be receiving payments for a shorter period of time.
If you’re already receiving payments from us these changes do not affect you, they only impact your compensation if you haven’t retired yet.
There is a cap on the amount of expected pension we can take into account when we work out your assistance. Only a small proportion of our members are affected by the cap, which means the vast majority of members aren’t affected.
From 1 April 2020, the cap has been set at £36,717. This is an increase of 1.7% from the 2019/20 cap which was £36,103. The increase reflects the level of inflation over the period.
The new cap will apply to all members retiring on or after 1 April 2020 — if you’re already receiving payments from us these changes do not affect you.