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The Pension Protection Fund (PPF) has published an update on its plans for the third levy triennium starting in 2018. As announced in December 2015 work has been ongoing to consider what changes to the Experian insolvency model might be appropriate.
It highlights a number of areas where work is being undertaken to consider whether changes might be appropriate for 2018/19 onwards.
Key areas are:
• Investigating the case for using credit ratings, where available, and industry specific scorecards for regulated financial services entities
• A review of employer segmentation underpinning the model
• Managing the impact that accounting standard changes (in particular the introduction of FRS102) may have on variables measured currently in the Model.
David Taylor, General Counsel at the PPF, commented "While the framework adopted for 2015/16 onwards, including the Experian model, is working well, we are grateful to those stakeholders who have already shared their thoughts on the levy rules with us. The PPF-specific model has been broadly popular, as has the web-based portal. The first year’s invoicing using the model has been positive, with a significant drop in appeals. There are clearly areas where we can continue to develop the model to better reflect the risk that some schemes and their employers pose to us. There are also areas like FRS102 where we need to ensure that the levy rules reflect wider changes."
A formal consultation on proposals for the triennium will follow at the end of the year.
The PPF intends that the draft levy rules and levy estimate for 2017/18 will be published as normal in the autumn. Reflecting the PPF’s commitment to providing stability and predictability in the levy rules, the update reiterates the intention only to make major changes to the rules as part of the three year cycle. Accordingly, changes for 2017/18 are likely to be limited.
Notes to editors
The Pension Protection Fund protects millions of people throughout the United Kingdom who belong to defined benefit pension schemes. If their employers go bust, and their pension schemes cannot afford to pay what they promised, the PPF will pay compensation for their lost pensions. Over a hundred thousand people now receive compensation from the PPF and hundreds of thousands more will do so in the future. The PPF is a public corporation, set up by the Pensions Act 2004, and is run by an independent Board.
For further press information contact:
The PPF Press Office
0207 566 9775
[email protected]