03 January 2007
The CBI has expressed concern at the level and volatility of the
Pensions Protection Fund levy, following the announcement by the
Board of the Pensions Protection Fund of its levy estimate of
£675m for 2007/08.
The CBI says that a charge of £675m means the levy will be
significantly higher than the Government's initial estimate of
£300m per annum.
For 2006/07 the levy estimate was £575m, but the PPF only
collected £324m. This was because companies took steps to
improve their insolvency risk scores, and improvements in equity
markets partly led to lower than expected deficits.
Susan Anderson, CBI Director of Human Resources Policy, said:
"Against a background of historically high contributions to company
pension schemes, the cost of the PPF is a real concern to business,
and the volatility of the levy makes it difficult for companies to
plan ahead.
"Many companies are struggling to meet the cost of their
liabilities. They need to be reassured that in future the cost of
the levy to business will be kept under control."
