Pensions - Articles - Comments on latest PPF 7800 Index figures from the PPF

 Alex Oakley, BPA Transaction Manager, at Standard Life, part of Phoenix Group: “The funding positions of UK defined benefit pension schemes have been very much in the spotlight in recent weeks. In January, the aggregate section 179 funding ratio for the 4,969 schemes in the PPF 7800 Index stands at 127 per cent at the end of January 2025, compared to 125.7 per cent at the end of December 2024.  DB schemes continue to be in a stronger funding position when compared to previous years and there has been a focus on the government’s plans to unlock scheme surpluses to help boost people’s retirement savings, and drive economic growth. However, further details of the government’s proposals won’t be known until the spring. In the meantime, trustees will continue to focus on ensuring all members’ pension obligations are met in full and on time. Strong overall funding positions are allowing many schemes to continue exploring end-game options. Trustees are focused on de-risking strategies that align with their long-term objectives, while the BPA market continues to thrive, underlined by the recent new entrants. BPA continues to provide an attractive solution to support de-risking objectives and will remain the gold-standard for many schemes.”

 Sarah Elwine, Actuarial Director at leading independent consultancy Broadstone, said: “The first PPF 7800 update for 2025 finds funding improvements in January despite a turbulent start to the year. The month was characterised by the return of volatility with significant swings in the gilt markets while the potential for a global trade war is driving continued macroeconomic uncertainty. Trustees and scheme managers will need to be aware of how this uncertainty, alongside the possibility of a return to inflation and a rocky economic outlook, could impact funding levels. Hedging strategies could be considered to lock in positive positions while there are regulatory issues to consider in 2025 given the mooted access to surpluses and the new Funding Code for schemes embarking on valuations.”

  PPF publish latest PPF 7800 Index figures for January 2025