The Pension Protection Fund (PPF) has reported an increase in consolidated reserves, amounting to £12.1bn as of 31 March 2023, an increase of £400m and a funding ratio rise of 156 per cent, reflecting an 18.1 percentage point increase year-on-year.
According to its recently published 2021/22 annual report and accounts, this surge in the funding ratio can be attributed to a 25 per cent decrease in reported liabilities, influenced by the rise in interest rates experienced during the first half of the financial year.
PPF chief executive officer Oliver Morley says: “This year, we’ve paid out £1.1bn in member payments, more than last year. This underpins once again the importance of our role in providing assurance, not only to our existing members, but also the promise of protection we offer to the 9.7 million members in the DB schemes we protect.
“Going forward, our priority remains to provide protection and reassurance, while also continuing to innovate and respond to the changing economic and social climate that impacts our levy payers and members.”
Oliver Morley continued: “Over the years, the levy has been a vital source of income, without which we wouldn’t have been able to provide compensation to our members. Our expectation has long been that the importance of our levy would decline over time as our funding position improved. As we enter a new phase in our funding journey, we can now consider bringing down the levy without risking our ability to pay members’ their benefits.
“We will also re-think our levy system and ensure its fit for the future. We’re grateful for the feedback we’ve had on this to date, and we’ll be looking to engage further with those stakeholders over the coming months.”
