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Detail of outcome
Withdrawal of increases to the General Levy with effect from 1 April 2020
Following consultation with industry in autumn 2019, the government made regulations that were due to increase the General Levy on Occupational and Personal Pension schemes with effect from 1 April 2020.
Given the unprecedented circumstances following the coronavirus (COVID-19) outbreak, on 27 March 2020 the government laid an order to revoke these Regulations. The levy rates will, therefore, not be increasing on 1 April 2020.
The government will now focus on reviewing the structure of the levy and will be engaging with industry over the course of the next few months.
The government response provides a summary of the responses received to the consultation.
Following consideration of these comments, the government will increase levy rates by 10% from 1 April 2020, as proposed in Option 1 of the consultation, for schemes with more than 11 members. The annual levy for Band 1 (2 to 11 members) will also increase to the amounts proposed in the consultation.
Further increases from April 2021 will be informed by a wider review of the levy.
The Occupational and Personal Pension Schemes (General Levy) (Amendment) Regulations 2020 (S.I. 2020 No. 195) have been made and laid in both Houses of Parliament.
The general levy on occupational and personal pension schemes recovers the funding provided by the Department for Work and Pensions (DWP) in respect of the core activities of The Pensions Regulator, the activities of The Pensions Ombudsman and part of the activities of the Money and Pensions Service.
This consultation seeks views on DWP’s proposed options to raise the levy rates from April 2020.
This consultation is primarily aimed at occupational pension scheme trustees, personal pension providers and sponsoring employers of pension schemes. We also welcome comments from the wider public.