The total deficit of U.K. defined benefit funds covered by the Pension Protection Fund's 7800 index decreased to £71.1 billion ($91.8 billion) at the end of November, from a deficit of £103.6 billion at the end of October.
The position worsened from a year ago, when the pension funds in the London-based PPF's index recorded a surplus of £14.3 billion as of Nov. 30, 2018, according to a report Tuesday from the PPF.
The funding ratio of pension plans also improved over the month to 96.1% as of Nov. 30, from 94.4% as of Oct. 31. As of Nov. 30, 2018, the funding ratio was 100.9%, the update said.
Assets increased by 0.3% during November and rose 10.4% for the year ended Nov. 30, to £1.74 trillion. For the month, liabilities fell 1.5% and increased 11.6% for the year to £1.815.7 trillion.
The PPF said in its update that the FTSE All-Share index increased 2.2% for the month and improved 11% for the year ended Nov. 30. Five- to 15-year index-linked gilt yields climbed 8 basis points in November but fell 48 basis points over the year.
As of Nov. 30, 61% of the 5,450 pension funds covered by the index had a deficit, compared with 63% as of Oct. 31. A year ago, 55% of the 5,450 pension funds covered by the index had a deficit.
Commenting on the figures, Sion Cole, head of U.K. fiduciary business at BlackRock, said in an emailed comment:
"Funding levels were boosted once again by increasing gilt yields, causing liabilities to fall around 1.5%, as well as equity market growth. Equity markets were up 2% to 3% over November, buoyed by President Trump announcing that the U.S. and China were in the 'final throes' of a phase one deal and continued positive (Purchasing Managers' index) data," said Sion Cole, head of U.K. fiduciary business at BlackRock, in a statement.
"With funding levels still 1.9% lower than where they started the year, schemes will have turned their attention to 2020 and what they can do to close their funding deficits in the next decade," he said.
