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DB pension deficits rise £40bn

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.

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Comments

There is one comment at the moment, we would love to hear your opinion too.

  1. Charles Seymour-Cole 1st December 2017 at 12:13 pm

    Its OK, Sara Protheroe, chief customer officer at the Pension Protection Fund (PPF) has said the PPF believes deficits are ‘affordable’ and ‘expects that most schemes will pay their benefits in full’. Reassuring news indeed.

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