PPF faces back-payments as court rules cap is discriminatory

A PPF spokesperson said: “We’re studying the detail of the judgment carefully to decide our next steps, and we will work closely with DWP to understand how the UK government will respond. While we do so, we’ll continue to pay our members their current level of benefits.”

Steve Webb, former pensions minister and partner at consultancy LCP, said: “This ruling is great news for thousands of workers whose pensions were capped simply because their company went bust before they reached pension age. But it could have a much wider knock-on effect."

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He said although Justice Lewis had backed the application of the 90 per cent cut, this was not a question asked by the claim, and could be interpreted differently by another judge.

"If it is discrimination to cap compensation on larger pensions only for those under pension age, there could be further legal challenge to the whole principle of only paying 90 per cent compensation across the board for those under pension age.  

"This could have much more far-reaching implications for the overall size of the PPF levy and for the levy payable by individual schemes and employers,” he said.

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