PLSA’s response to 2024/25 Pension Protection Fund (PPF) Levy Consultation

The PPF recently published a consultation on its proposed changes to the 2024/25 levy rules to achieve a halving of the levy it collects from DB schemes from £200 million in 2023/24 to £100 million in 2024/25.

We support the PPF’s approach to continue reducing the levy it charges in line with its funding strategy, particularly with scheme funding continuing to improve over the past year. As a result of this latest reduction, almost all eligible DB schemes (with the exception of some idiosyncratic cases) will see a reduction in their total levy for 2024/25.

The PPF is proposing to maintain the total levy at £100 million in future years (i.e. 2025/26 onwards). However, the PLSA believes that the levy should be reduced further given the amount of surplus held by DB schemes and the strong funding position of the PPF, which has built up its reserves to over £12 billion.

We will engage further with the PPF on the levy calculation methodology for future years when it publishes its levy rules for 2025/26 next autumn.