Prospective
This Statutory Instrument has been made in consequence of defects in S.I. 2023/116 and is being issued free of charge to all known recipients of that Statutory Instrument.
Statutory Instruments
Pensions
Made
at 3.08 p.m. on 6th February 2023
Laid before Parliament
at 5.15 p.m. on 6th February 2023
Coming into force in accordance with article 1(2) to (5)
The Secretary of State for Work and Pensions, in exercise of the powers conferred by sections 178(1) and (6) and 315(2) and (5) of the Pensions Act 2004(1), makes the following Order.
In accordance with section 178(5) of that Act, the Secretary of State has reviewed the general level of earnings obtaining in Great Britain during the period of 12 months ending with 31st July 2022. It appears to the Secretary of State that the general level of earnings has increased by 5.8% during that period.
Prospective
1.—(1) This Order may be cited as the Pension Protection Fund and Occupational Pension Schemes (Levy Ceiling) (No. 2) Order 2023.
(2) Articles 2 and 3 come into force on 14th March 2023.
(3) Article 4 comes into force on 31st March 2023.
(4) Article 5 comes into force on 1st April 2023.
(5) This article and article 6 come into force on 13th March 2023.
(6) This Order extends to England and Wales and Scotland.
Commencement Information
I1Art. 1 in force at 13.3.2023, see art. 1(5)
2. In this Order, “the Act” means the Pensions Act 2004.
Commencement Information
I2Art. 2 in force at 14.3.2023, see art. 1(2)
3. For the purposes of section 178(3)(a) of the Act (the levy ceiling), the percentage by which it appears to the Secretary of State that the general level of earnings has increased during the review
period(2) is 5.8%.
Commencement Information
I3Art. 3 in force at 14.3.2023, see art. 1(2)
4. For the purposes of section 177 of the Act (amounts to be raised by the pension protection levies), the levy ceiling for the financial year beginning on 1st April 2023 is £1,246,964,705.
Commencement Information
I4Art. 4 in force at 31.3.2023, see art. 1(3)
5. The Pension Protection Fund and Occupational Pension Schemes (Levy Ceiling) Order 2022 is revoked(3).
Commencement Information
I5Art. 5 in force at 1.4.2023, see art. 1(4)
6. The Pension Protection Fund and Occupational Pension Schemes (Levy Ceiling) Order 2023 is revoked(4).
Commencement Information
I6Art. 6 in force at 13.3.2023, see art. 1(5)
Signed by authority of the Secretary of State for Work and Pensions
Laura Trott
Parliamentary Under Secretary of State
Department for Work and Pensions
At 3.08 p.m. on 6th February 2023
Prospective
(This note is not part of the Order)
This Order specifies the earnings percentage used to calculate the levy ceiling (article 3) and the amount of the levy ceiling (article 4) for use in relation to the Pension Protection Fund in the financial year beginning on 1st April 2023.
The Board of the Pension Protection Fund (“the Board”) is established by section 107 of the Pensions Act 2004 (c. 35) (“the Act”) to provide compensation for members of certain occupational pension schemes which are under-funded at a certain level and whose sponsoring employer has become insolvent.
Section 175 of the Act requires that the Board must impose pension protection levies for each financial year. Section 177(2) of the Act provides that the amount of the levies for a financial year must not exceed the levy ceiling for that financial year. The Pension Protection Fund and Occupational Pension Schemes (Levy Ceiling) Order 2022 (S.I. 2022/88) (“the 2022 Order”) specified that the levy ceiling for the financial year beginning on 1st April 2022 was £1,178,605,581. Section 178(3)(a) of the Act provides that the levy ceiling must increase in line with any increase in the general level of earnings obtaining in Great Britain.
Article 3 of this Order specifies that the increase in the general level of earnings for the period from 1st August 2021 to 31st July 2022 is 5.8%. Accordingly, article 4 of this Order specifies that the levy ceiling for the financial year beginning on 1st April 2023 is £1,246,964,705.
Article 5 of this Order revokes the 2022 Order.
Article 6 of this Order revokes the Pension Protection Fund and Occupational Pension Schemes (Levy Ceiling) Order 2023 (S.I. 2023/116) which contained errors.
This Order amends an existing regulatory regime and the associated administrative costs or savings for the private sector and civil society organisations are negligible. A full impact assessment is not necessary for such an Order.
See section 178(4) of the Pensions Act 2004 and regulation 3 of S.I. 2006/2692. The review period is the period from 1st August 2021 to 31st July 2022.
S.I. 2023/116, which is defective.