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Employee Benefits News

Latest News
09 Jan 2013

Defined Benefit Schemes Record Smaller Deficit In December

Defined benefit (DB) schemes in the UK saw their collective deficit reduce to £245 billion at the end of December 2012, when compared to £252.2 billion a month earlier, the Pension Protection Fund (PPF) said.

PPF also recorded an improvement in the position of the schemes in the PPF 7800 index in annual terms as well, as the deficit was smaller than the £268.9 billion shortfall registered at the end of December 2011.

Of the total 6,316 final-salary pension schemes available in the country, as many as 5,173 schemes exited the last month of 2012 with a shortfall, which is down from 5,205 schemes in November and the 5,263 schemes the previous year. Their aggregate deficit shrank to £269.1 billion from £275.7 billion in November.

The number of salary-related schemes in surplus added up to 1,143 in the last month of 2012, from 1,111 in November and 1,053 in December 2011. Schemes in surplus recorded surpluses of £24.4 billion, which is up from £23.5 billion a month earlier.

Total scheme assets went up by 0.2% over the month and by 5.9% year-on-year to £1,065.6 billion, while liabilities came in at £1,310.3 billion, which is down 0.4% compared with November but 2.8% higher than the volume recorded in December 2011.

The schemes´ funding ratio, which is a measure of assets as a percentage of s179 liabilities, increased to 81.3% in December from 80.8% in November. The ratio was also above the 78.9% level registered in December 2011.

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