Total annual pension levy to top £300 million

The total value of the pension protection levy, to be paid by all eligible defined-benefit and hybrid schemes from April 2006, will exceed the government's original estimate of £300 million a year, according to a consultation document* on the structure of the levy issued by the Pension Protection Fund (PPF). Some experts fear that the cost of the scheme could escalate out of control, citing the US example, where the Pension Benefit Guaranty Corporation has run up a deficit of US$23 billion (£13.11 billion).