Yesterday The Occupational Pension Schemes (Levy Ceiling - Earnings Percentage Increase) Order 2010 was laid before Parliament and is to come into force on 3 February.

This Order specifies that, for the purposes of s.178(3)(a) PA 2004, the earnings percentage for the period from 1 August 2008 to 31 July 2009 ("the review period") is 0.9%.

S.178(6) of the Act specifies that the earnings percentage is the percentage by which it appears to the Secretary of State that the general level of earnings in Great Britain has increased during the review period.

The earnings percentage is used to increase the maximum amount of levy that the Board of the Pension Protection Fund can impose on eligible pension schemes.

At the same time, a draft of The Occupational Pension Schemes (Levy Ceiling) Order 2010 has been laid before Parliament for approval by resolution of each House as required under s. 316(2)(f) PA 2004.

The 2009/10 Order (SI 2009/794) specifies that the levy ceiling for the financial year beginning on 1 April 2009 is £863,412,967. S.178(3)(a) of the Act provides that the levy ceiling must increase in line with any increase in the general level of earnings obtaining in Great Britain, ie 0.9% as above. Accordingly, article 2 of this Order specifies that the levy ceiling for the financial year beginning on 1 April 2010 is £871,183,684.

A second Draft Order concerning the PPF was laid before Parliament yesterday, also for approval by resolution of each House. The Pension Protection Fund (Pension Compensation Cap) Order 2010, coming into force on 1 April 2010, specifies the amount of the compensation cap for the purposes of para 26(7) of Sch 7 PA 2004, in accordance with paras 27(2) and (3) of that Schedule, as £33,054.09. However, no-one whose benefits are subject to the cap, including those scheme members who have taken early retirement, will actually get as much as this. Because their compensation is limited to 90% of what they were entitled to, the maximum is 90% of the cap, ie from 1.4.10 £29,748.68.

Revised guidance on contingent assets

The Board of the PPF has just published a revised version of the comprehensive guidance first published in September 2006, updated to reflect the Board's approach to contingent asset arrangements for the levy year 2010/11.

Contingent assets comprise

• Guarantees given by parent/group companies and undertakings (Type A)
• Security over cash, real estate and securities (Type B)
• Letters of credit and bank guarantees (Type C)