Figures published by the Pension Protection Fund (PPF) have revealed a sharp fall in the deficit of the UK’s defined benefit pension schemes.
According to the PPF, the deficit was trimmed to £15.1 billion at the end of February from £51.9 billion at the end of January.
It is also a significant improvement on February 2009 when the deficit stood at £204.7 billion.
The improvement was the result of stronger share prices and improved returns on Government bonds, said the PPF.
The PPF comments: “Over the past year, rising equity markets have led to an increase in scheme assets of 20.4 per cent. Over the same period, changes in bond yields would have resulted in a 2.2 per cent rise in liabilities.
“However, the change in actuarial assumptions in October reduced estimated liabilities by approximately eight per cent or £70 billion,” it added.
Concerns about the deficit may result in a number of people looking at additional options when it comes to planning for their retirement, said the PPF.
Huge deficits have led blue-chip companies to close their final-salary pension schemes - to existing members as well as new employees.
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