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Slightly happier New Year for UK pension deficit

Pension_old_woman_410The deficit of the UK's 200 largest privately sponsored final salary pension schemes stood at £52bn on New Year's Eve - a 40% improvement on the £87bn figure recorded a year before.

However, this is still a long way from the £3bn surplus of 31st December 2008, according to Aon Hewitt.

In Aon Hewitt's view, although many of the conditions affecting the funding position of pension schemes remain broadly similar to this time last year, the equity market rally has eased the pain for businesses, offering a renewed sense of optimism for the New Year.

Marcus Hurd, principal and actuary at Aon Hewitt, said: “With pension scheme deficits looking more manageable, now is the time for sensible planning. Companies should ensure that they have the right risk-reward balance and consider whether they should lock in to current deficit levels or continue to play market volatility to seek extra return.”

©2011 funds europe