The total deficit of U.K. corporate pension funds increased 2.4% to £259 billion ($401.5 billion) in July, said JLT Employee Benefits in its latest monthly index.
Assets increased 2.5% to £1.254 trillion, while liabilities also increased 2.4%, to £1.513 trillion. The funded level of all corporate pension funds was 83%, and remained unchanged from June 30.
FTSE 100 pension funds had a total deficit of £82 billion, a 5.1% increase during the month. A 1.9% increase in assets, to £546 billion, was not enough to offset a 2.3% increase in total liabilities, to £628 billion. The funded level remained steady at 87%.
FTSE 350 company deficits also increased, 3.3% to £93 billion. Assets increased 2% to £618 billion, and liabilities increased 2.2% to £711 billion. The funded level remained at 87%.
The story was more dramatic for the year ended July 31, with all-U.K. corporate pension funds recording a 42.3% increase in deficits. Assets increased 7.9%, and liabilities increased 12.6% in the period. The funded level decreased to 83%, from 86%.
In a statement accompanying the data, Charles Cowling, director at JLT Employee Benefits, said deficits remained “stubbornly high” despite a signal from Bank of England governor Mark Carney, that an interest rate rise may be “imminent.”
“Some rise in interest rates is already anticipated in market prices, so companies and pension schemes may be disappointed to see little respite in pension deficits for many months, even years yet,” he said.