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Pension Funds

U.K. corporate deficit down for September, year

The total deficit of all U.K. corporate pension funds fell 7.5% in September and dropped 68.4% for the year ended Sept. 30, to 37 billion ($48.2 billion), figures from JLT Employee Benefits show.

The funded level of these funds was 98% as at Sept. 30 — no change from the previous month and an improvement over 93% as of Sept. 30, 2017.

Pension fund assets fell 0.9% for the month but grew 2.4% for the year to 1.565 trillion. Liabilities fell 1.1% in September and fell 2.6% for the year, to 1.6 trillion.

FTSE 100 firms saw deficits fall 33.3% in September and drop 93.3% for the year, to 2 billion. The funded level was 100% as at Sept. 30, no change from a month earlier and up from 96% a year earlier.

For FTSE 350 companies, deficits were flat at 7 billion for the month, and fell 81.6% for the year. The funded level stayed at 99% over the month and improved from 95% as at Sept. 30, 2017.

"This has been a quiet month in markets with both the inflation outlook and long-term interest rates drifting slightly upwards," Charles Cowling, chief actuary at JLT Employee Benefits, said in a statement accompanying the figures. "At the same time equity markets have held up well, despite continuing political uncertainty in Europe and the U.S. All of this means that pension scheme deficit positions are broadly unchanged, showing a modest improvement over the last 12 months."