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By Carolyn Cohn
LONDON, Sept 23 (Reuters) - Britain's Pension Protection
Fund (PPF) said on Monday it would assess the funding levels of
Thomas Cook's retirement schemes, following the collapse of the
world's oldest travel firm.
PPF is an industry-funded scheme set up to protect the
pensions of employees in failing companies.
"We await notification that the associated schemes have
entered PPF assessment," a spokeswoman said in an emailed
statement, adding PPF would protect the pensions of people on
Thomas Cook’s defined benefit, or final salary, schemes.
After the assessment, which typically lasts about 18-24
months, the pensions could enter the PPF or the risk could be
taken over by an insurer.
Thomas Cook pension schemes have in aggregate a surplus of
100 million pounds ($124 million) above levels needed to secure
PPF benefits, a spokesman for the Thomas Cook pension trustees
said.
"The trustees therefore are hopeful that the PPF lifeboat
will, once the assessment period has ended, not be called on and
benefits in excess of PPF levels will be provided from outside
the PPF," he said in an emailed statement.
Under PPF rules, existing pensioners receive their benefits
in full. People under retirement age suffer a 10% cut to their
pensions, subject to a cap which ensures they receive at least
50% of their entitlements.
($1 = 0.8042 pounds)
(Reporting by Carolyn Cohn
Editing by Rachel Armstrong and Edmund Blair)