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The Pension Protection Fund

The Pension Protection Fund pays compensation to members of eligible defined benefit pension schemes, where the sponsoring employer becomes insolvent and the pension scheme does not have enough assets to cover PPF compensation. It is part of the new regime set up by the Pensions Act 2004.

It is financed by:

a scheme based levy which is related to its PPF liabilities and;
a risk based levy which is based upon the degree of underfunding of those liabilities and sponsor default.

Defined benefit schemes (excluding public service schemes) must pay levies.

The PPF also operates the Fraud Compensation Scheme which compensates members of schemes whose fund has been reduced by theft or dishonesty.

NAPF has regular meetings not only with the Chairman and Chief Executive but also with management at the PPF and is closely invovled in its development.