Total pension deficits among the U.K.s top 100 companies fell to £21 billion ($41.34 billion) the lowest level in five years with 25% of the companies surveyed reporting a surplus in their corporate final-salary pension plans, according to a survey released by Deloitte & Touche.
Buoyant stock market returns and a fall in the price of bonds have helped boost corporate final-salary pension funds in the U.K., according to the survey.
A surplus can be a headache for the company, as it is near impossible for the employer to take a refund from a pension scheme, David Robbins, pensions partner, said in a news release about the survey. The surplus could effectively be stranded.
Deloitte advised corporate sponsors to start looking now at strategies which reduce the risk of a stranded surplus arising, including using assets such as real estate to provide security to the pension fund rather than making cash contributions, according to the news release.
Spokeswoman Ali Agmen-Smith couldnt be reached for comment.