The Pension Protection Fund (PPF) has today confirmed its final levy rules for the 2025-26 levy in its Levy policy statement. The final rules are different from those proposed in the September consultation which suggested a collection target of £100 million.
The PPF now expects to collect £45 million, with almost all (99.7%) levy payers expected to see a levy reduction. This was a result of stakeholder feedback on the consultation proposals challenging the £100m collection target given the PPF’s strong funding position and urging a change in legislation to support a lower collection target (possibly nil).
The PPF has included a provision in the rules to enable the calculation of a zero levy if the required legislative provisions are brought forward and become law over 2025-26 or if the Government makes a clear commitment to make the required changes. The PPF will keep the situation under review but will be able to exercise discretion and calculate a scheme-based and risk-based levy of nil for schemes, except alternative-covenant schemes for which a risk-based levy will continue to be charged.
Given uncertainty in respect of the levy to be collected, which will depend on the timing of legislative changes, there might be a delay in invoicing which usually commences in the autumn. The PPF expects to provide an update on invoicing expectations by the end of September 2025.
