The Pension Protection Fund

The Pension Protection Fund (PPF) was established on 6 April 2005 as a statutory fund to pay compensation to members of underfunded defined benefit occupational pension schemes whose sponsoring employer has become insolvent.

The statutory provisions governing the operation of the PPF are contained in the Pensions Act 2004 (PeA 2004), ss 107–220 and Sch 7, and underlying regulations.

For an outline of the operation of the PPF as a statutory compensation fund and how it interacts with defined benefit and hybrid occupational pension schemes, see Practice Note: The Pension Protection Fund—an introduction.

Entry and eligibility

Schemes must satisfy certain statutory requirements to be eligible for entry into the PPF. In particular, a scheme must be an eligible scheme, and a qualifying insolvency event must have occurred in relation to a sponsoring employer.

Not all schemes are eligible for entry into the PPF, eg money purchase schemes or schemes in winding-up immediately before 6 April 2005. Certain other types of scheme are specifically excluded from entry into the PPF.

The PPF will also only assume responsibility for a scheme if the scheme's assets

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