Pensions - Articles - JLT EB: Latest monthly update on private sector DB schemes


JLT Employee Benefits (JLT) has updated its monthly index, showing the funding position of all UK private sector defined benefit (DB) pension schemes under the standard accounting measure (IAS19) used in company reports and accounts.

 As at 28 February 2015, JLT estimates the total DB pension scheme funding position as follows:
 
 Charles Cowling, Director, JLT Employee Benefits, comments: “The Alice in Wonderland world of negative interest rates seems to be expanding, spreading from Switzerland right across the Eurozone. In the last few weeks Germany, France and Finland have all been able to sell negative yielding debt with terms of up to 5 years. This in turn is putting huge pressure on insurance companies and pension schemes with fixed liabilities and ever fewer opportunities for generating the levels of low-risk investment returns that are needed to meet these liabilities.

 “As a consequence the burden of growing pension deficits is increasingly visible in the accounts of companies with large DB pension schemes. Across all UK DB pension schemes, the total deficit (on the IAS19 accounting basis) has grown in the last 12 months by £100bn to over £250bn.

 “The even lower interest rates we now see in the UK could prove particularly problematic for pension schemes with actuarial valuations in 2015 – typically the actuarial valuation takes place every 3 years and this is when decisions are made on deficit funding. Demands from pension scheme trustees for more cash payments into DB pensions look set for significant escalation in 2015.”
  

Back to Index


Similar News to this Story

Wish list for the occupational pensions industry in 2025
As one year closes and another begins, it's an opportune moment to set our sights on the future. The UK occupational pensions industry faces nume
PSIG announces outcome of Consultation
The Pensions Scams Industry Group (PSIG), which was established in 2014 to help protect pension scheme members from scams, today announced the feedbac
Transfer values fell to a 12 month low during November
XPS Group’s Transfer Value Index reached a 12-month low, dropping to £151,000 during November 2024 before then recovering to its previous month-end po

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.