The total FRS17 deficit for the 200 largest pension schemes has fallen to just 14bn, its lowest monthly level since records began and 30% of those pension schemes are now in surplus. Deficit volatility is still high, however, and weekly changes of 5bn in deficit levels are common.
In addition, the removal of pension schemesí ability to reclaim Advanced Corporation Tax on dividends since 1997 has cost the 200 largest pension schemes 20bn, according to research by Aon Consulting. If ACT relief had been maintained, the 200 largest pension schemes would be in surplus by 6bn and 40% of schemes would now be in surplus.
The analysis comes on the back of research by Aon Consulting, a leading pension, benefits and HR consulting firm, which provides a monthly tracker of the scheme deficits of the UKís 200 largest Defined Benefit schemes, including all of those in the FTSE-100. The analysis of the deficits for the largest 200 schemes is shown graphically below:
Source: Aon Consulting
Commenting on these latest results, Marcus Hurd, senior consultant and actuary at Aon Consulting, said: One third of pension schemes are now in surplus, which is to be welcomed, but volatility still remains and the pensions crisis is not yet over. The impact of the volatility of pension scheme valuations on employersí balance sheets continues to be a major cause for concern. The aggregate pension scheme deficit is 14bn, but, if ACT relief for pension schemes had been retained, then the same UK pension schemes would be in surplus by 6bn. Pension schemes will continue to rue the day that ACT relief was removed.î
