Pensions - Articles - Stable markets allow UK pension schemes to stay in surplus


The funding status for the UK’s 5,300 corporate defined benefit (DB) pension schemes continues to show that schemes are, on average, in a clear surplus position, according to the PwC Pension Funding Index.

 Assets and liability values both fell slightly over May, resulting in a similar position to last month of a £30bn surplus. This highlights the relative stability in the market, with the aggregate funding position based on schemes’ own measures staying out of a deficit for the last four months.

 PwC’s Adjusted Funding Index incorporates strategic changes available for most pension funds, including a move away from low-yielding gilt investments to higher-return, income-generating assets, and a different approach for potential life expectancy improvements which are yet to occur. This measure shows a £210bn surplus.

 Raj Mody, partner and global head of pensions at PwC, said: “Our funding index illustrates that pension schemes on the whole are in a good position. The aggregate surplus position reflects significant cash injections from sponsors over the last decade, and more recent improvements in market conditions. Trustees and sponsors should take comfort from this and use this period to define and lock into a long-term strategy.

 “It’s important not to get distracted by other measures, such as the accounting position. The accounting measure is not helpful for assessing performance against a real-life strategy in practice. Similarly the buy-out measure, and any apparent deficit against that, is only relevant if you are planning to transfer your scheme to an insurance company as part of your strategy. There is a danger that trustees and sponsors can drown in the variety of measures surrounding their scheme, but should remain focused on the relevant metrics for their scheme-specific strategy.”

 The PwC Pension Funding Index and PwC Adjusted Funding Index figures are as follows:
 

Back to Index


Similar News to this Story

No retirement plan leaves you four times more stressed
Almost a third of people in the UK admit to having no plan for their finances in retirement (30%). People without plans are four times more likely to
Regulatory risk remains high on the list of schemes concerns
Aon has released the UK results of its ‘Global Pension Risk Survey 2025/26’, which highlights regulatory risk as a continuing concern for defined bene
PPF publishes latest PPF 7800 update for September 2025
This update provides the latest estimated funding position, based on adjusting the scheme valuation data supplied to The Pensions Regulator as part of

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.