Pension Protection Fund valuation meaning

In this issue: Autumn Budget 2024 The Pension Protection Fund The Pensions Ombudsman Scheme amendments Pensions dashboards Daily and weekly news alerts Dates for your diary Trackers Autumn Budget 2024 Key pensions announcements and views from the market In the Autumn Budget 2024, delivered on 30 October 2024, the Chancellor of the Exchequer, the Rt Hon Rachel Reeves MP, stated the government’s overriding aim is to repair the economy’s foundations and drive change by safeguarding working people, mending the NHS and rebuilding Britain. The principal pensions measures are: from 6 April 2027, unused pension pots and death benefits payable from a pension will be counted within an individual’s estate for inheritance tax purposes. As part of these reforms, pension scheme administrators will be responsible for reporting and settling any inheritance tax due on unused pension funds and death benefits...

What is an assessment period? When a qualifying insolvency event affects the sponsoring employer of an eligible scheme, the scheme moves into a Pension Protection Fund (PPF) assessment period as a result of that event. This arises on the occurrence of that event. The day on which that period starts is known as the ‘assessment date’ for the scheme. Since 3 January 2012, the assessment period is no longer required to last for at least 12 months. Throughout the assessment period, the PPF considers whether the scheme satisfies the requirements for entry into the PPF. In particular, the PPF will appoint an actuary to carry out a valuation of the scheme as at the assessment date, in order to determine whether the scheme’s assets are less than the protected liabilities—broadly, the benefits the PPF would pay to members if the scheme were to enter the PPF...

ARCHIVED This archived Practice Note explains how coronavirus affected trustees administering pension schemes, summarising the approaches taken by the Pensions Regulator, the Pension Protection Fund, the Pensions Ombudsman and other regulators. It also outlines the consequences for public service pension schemes, including measures under the Coronavirus Act 2020. The COVID-19 pandemic posed significant challenges for those running schemes, and this Note records the stances adopted by the various pensions regulatory bodies (including the Pensions Regulator (TPR) and the Pension Protection Fund (PPF)) alongside the practical issues trustees encountered. It also addresses the effect of coronavirus on public service arrangements, including impacts arising via the Coronavirus Act 2020. TPR’s position TPR consistently indicated it would regulate in a pragmatic and sympathetic manner where breaches arose from COVID-19. It introduced a number of easements, with some ending on 30 June 2020, for example: the option to pause DB transfer processing permitting delays to filing revised recovery plans and others extended to 30...

Requirements for PPF entry The conditions for a scheme to transfer into the PPF are: the scheme must be an eligible scheme—see: What schemes are eligible? below and either: a qualifying insolvency event must occur in relation to a scheme employer—see: What is a qualifying insolvency event? below, or the employer is unlikely to continue as a going concern and meets SI 2005/590, reg 7—see: Alternative route to PPF entry, below the insolvency practitioner for the employer must confirm that a scheme rescue cannot proceed—see: Duty of insolvency practitioner to issue notices confirming status of scheme (section 122 notices) and the scheme’s assets must be below the ‘protected liabilities’ (broadly, the benefits the PPF would pay to members)—see: Protected liabilities, below The statutory framework setting out which schemes may enter the PPF is contained in: sections 120–168 of the Pensions Act 2004 (PeA 2004) the...