The combined deficit of defined benefit pension schemes reached £450bn at the end of November, according to research from PwC.
The accountancy giant’s Skyval Index reveals the deficit of these funds climbed £40bn from the previous month.
The Skyval Index provides an outlook of around 5,800 DB pension funds across the UK.
It estimates that the funds have a total liability target of more than £2trn, but currently only have assets of £1.56 trillion.
PwC chief actuary Steven Dicker says: “Despite the increase in short-term interest rates by the Bank of England, long-term real interest rates, which are the main driver of the pension deficit number moved slightly in the opposite direction.”
As a result, while pension fund assets grew £20bn in the month, liabilities increased £60bn, resulting in a net increase in the deficit of £40bn.