A scheme’s 179 liabilities represent, broadly speaking, the premium that would have to be paid to an insurance company to take on the payment of PPF levels of compensation. This compensation may be lower than full scheme benefits.
Highlights
• The aggregate deficit of the 5,422 schemes in the PPF 7800 Index is estimated to have increased over the month to £166.1 billion at the end of September 2020, from a deficit of £140.5 billion at the end of August 2020.
• The funding level decreased from 92.6 per cent at the end of August 2020 to 91.4 per cent.
• Total assets were £1,771.4 billion and total liabilities were £1,937.5 billion.
• There were 3,588 schemes in deficit and 1,834 schemes in surplus.
• The deficit of the schemes in deficit at the end of September 2020 was £279.6 billion, up from £258.6 billion at the end of August 2020.
Lisa McCrory, PPF Chief Finance Officer & Chief Actuary, said: “This month the funding position of the 5,422 schemes declined. The funding level decreased by 1.2 per cent to 91.4 per cent at the end of September 2020 and the aggregate deficit increased by £25.6 billion to £166.1 billion.
“The movements were caused by a decrease in bond yields driving up the value of liabilities which were to a certain extent offset by an increase in asset values, due to higher bond prices.
“While we expect to see increased claims in the future due to COVID-19, we remain confident we are on a strong footing to continue to protect the UK DB pensions universe.”
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