British pension lifeboat freezes levy, warns hikes to follow
* 2013/14 levy set at 630 mln stg
* Warns of heightened risk, future increases
By Anjuli Davies
LONDON, Sept 25 (Reuters) - The British agency that pays the pensions of companies that go bankrupt will freeze the amount it charges firms annually for protection next year, it said on Tuesday, in a bid to alleviate the pain facing corporate Britain.
In the face of mounting pressure from businesses struggling in an environment of persistent economic weakness, the Pension Protection Fund (PPF) maintained its annual estimate for its safety net at 630 million pounds ($1 billion) for 2013/14, the same as the previous year.
But PPF Chief Executive Alan Rubenstein warned that the funding situation of pension schemes had deteriorated significantly in the past 18 months, reflected in the number of claims made to the agency, that could make future increases inevitable.
"We remain concerned about economic conditions," Rubenstein told Reuters in a telephone interview. "We sit here having taken action to help pension funds, but if we do see current heightened risk conditions persist, it will inevitably lead to increases in the future."
"If you want a lifeboat that is to set sail, it has to be properly funded," said Rubenstein.
The PPF was launched in 2005 to take over the assets and liabilities of any UK-based defined benefit pension scheme if an employer goes bust. It currently has around 12 billion pounds of assets under management which it expects to rise to 17 billion by 2015. (Editing by David Holmes)
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