In September the PPF issued its 2016/17 pension protection fund levy consultation document. Consultation closed on 22 October 2015. Interestingly, while the issue of whether a scheme is last man standing is not, strictly speaking, a matter for consultation, the PPF has taken the opportunity to set out its views and provide feedback on the recent last man standing exercise. Trustees of defined benefit pension schemes, which have previously claimed ‘last man standing’ status for PPF levy purposes, will recall that the Pensions Regulator wrote to them at the beginning of the year asking them to complete and submit confirmation of the fact that they had taken legal advice as to the status of their scheme. Over half of the schemes contacted by the Pensions Regulator failed to respond to the request to provide confirmation that the scheme was last man standing. The Regulator and the PPF have taken the unusual step of allowing those schemes a grace period and to allow them to report as to their legal status on their forthcoming scheme returns. Of those schemes that did reply, it became clear that many had been categorised as last man standing schemes in the past when in fact they were not. There may be historic reasons for this; for example, when schemes were first required to categorise themselves, the wording of the question posed in the scheme return was ambiguous, meaning that an incorrect response was often elicited, with that incorrect response being repeated in subsequent returns to the Regulator. The PPF has stated in its consultation document that where a scheme has incorrectly benefitted from the discount given to last man standing schemes, it would re-invoice the scheme for the correct amount. For larger schemes this may be a substantial amount. Additionally, if it had been thought that a scheme was last man standing, when it was not, this could have fed into any covenant review taken into account as part of a scheme’s valuation process. For this reason alone, it is recommended that trustees and employers consider what options may be open to them to rebalance the position. For example, for some trustees and employers now might be a good time to consider, or reconsider, the availability of a contingent asset. This would usually reduce risk exposure for the scheme with the welcome possibility of a consequential reduction in the PPF levy. It is worth noting that for Type A contingent assets (guarantees), the PPF emphasises in its consultation document the importance of assessing the strength of a guarantor and proposes incorporating key elements from its 2015 ‘guarantor strength factsheet’ into the 2016/17 Contingent Asset Guidance. The PPF has also suggested that it would look more favourably on schemes that go through the process of altering their schemes to make them last man standing and the implications of this if they can do so retrospectively. If you would like to discuss the categorisation of your scheme, or if you are one of the 50% of schemes that did not respond to the Pensions Regulator and would now like some legal advice, or if you would like to understand better how to make your scheme into a last man standing scheme, please contact any member of the Irwin Mitchell Pensions team. For general enquiries 0370 1500 100 Or we can call you back at a time of your choice Request a call back Phone lines open 24/7, 365 days a year Contact us today For a free initial consultation Freephone 0370 1500 100 Prefer not to call? Use our form Your name* Your email* Your phone number* How can we help?* Enquiry type Court Of Protection Crime & Investigations Divorce & Family Law Solicitors Employment Law Conveyancing & Property Solicitors Medical Negligence Claims Personal Injury Claims Protecting Your Rights Wills, Trusts & Estates Solicitors This data will only be used by Irwin Mitchell for processing your query and for no other purpose.