1,000th scheme enters Pension Protection Fund (PPF)
The Pension Protection Fund (PPF) announced last week that the Carillion Rail (GTRM) Pension Scheme has become the 1,000th scheme to transfer to it since the PPF was established in 2005. Almost 4,000 members can now look forward to a more secure retirement.
The PPF is an independently run public corporation that exists to protect members of UK defined benefit pensions when their employer fails and their scheme is unable to pay them what they were promised. PPF benefits paid to members and the cost of running the PPF are paid for through levies on eligible pension schemes, income from its own investments, taking on the assets of schemes that transfer to the PPF, and recovering money, and other assets, from insolvent employers of the schemes it takes on.
Members that were over the scheme’s normal pension age at the time of insolvency will receive 100% of what was in payment at that time, and those under that age will receive 90% subject to a cap. Without the PPF, these members would’ve received significantly reduced retirement benefits.
Oliver Morley, Chief Executive Officer of the PPF, said: “The transfer of the 1000th scheme marks a significant milestone in protecting close to 260,000 members who have come to the PPF following a company insolvency. While the arrival of the 1000th scheme represents a lot of insolvencies and change for our members, it shows the value of the PPF and that the legislation put in place to protect our members makes a real difference to people’s lives.”
More information on the security of benefits for members of defined benefit schemes can be found in our Spotlight on this subject by clicking here.