UK - The proposed levies for the Pension Protection Fund (PPF) will cost between £10,000 for a small pension scheme to £300,000 for a large pension scheme, according to Mercer Human Resource Consulting.
The government recently released its figures for the new levy - £15 for every active final salary scheme member and pensioner and d£5 for members who have deferred their pension. Additionally, administrative fees “are likely to increase costs further - by 10 to 20 per cent - meaning that the levy per active member will be around £17,” Mercer said. The PPF will become active in April and is likely to double next year, with higher risk schemes expected to pay more than lower risk schemes.
The PPF levies are higher than first expected because the government has widened the eligibility criteria for schemes to claim on the fund,” said Deborah Cooper (pictured), senior research actuary at Mercer. “When the levy becomes risk related next year, vulnerable schemes will be charged much more while the cost to those at low risk from claiming on the fund will hopefully fall.
As an example, Mercer has calculated that:
* For a small to medium sized scheme with 800 members, and a typical split of 300 actives, 250 deferreds and 250 pensioners, the PPF levy would be £9,500, plus £1,440 for the administration levy.
* For a large scheme with 25,000 members, and a typical split of 9,000 actives, 8,000 deferreds and 8,000 pensioners, the PPF levy would be £295,000, plus £18,500 for the administration levy.
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