It's our duty to protect people with a defined benefit pension when an employer becomes insolvent. We manage £32 billion of assets for our 292,000 members.
Today, the Department for Work and Pensions have published their response to the 'Options for Defined Benefit schemes' consultation which ran last year.
The circumstances in which commutation is possible are set out in Regulation 19 of the Pension Protection Fund (Compensation) Regulations 2005 and Regulation 21 sets out how this option may be exercised.
Paragraphs 26 and 27 of Schedule 7 of the Pensions Act 2004 set out the circumstances in which the compensation cap applies and how and when it should be increased. 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 advisers who still need to refer to previous calculation tables and factors.
In all cases, the early retirement factor is applied to the compensation before the compensation cap is applied. Simply follow the links to the tables of early retirement factors detailed below:
If you need to access step down factors that were used in the past, simply follow the links to the appropriate tables, detailed below. Effective dates on or after 1 October 2020 and prior to 1 October 2021 For all determinations in respect of a step down pension with an effective date between 1 October 2020 and 30 September 2021, please use the following:
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