The Pension Protection Fund has reported a £1.8 billion surplus at the end of 2012/13 and said that the probability of meeting its long-term funding target has increased to 87 per cent.
These figures are revealed in the PPF’s 2012/13 annual report which, as usual, has been published alongside its latest funding strategy update. This allows the PPF’s latest performance to be put firmly into the context of the goal of financial self-sufficiency by 2030.
PPF Chairman, Lady Barbara Judge, said: “We remain firmly on our glide path to financial self-sufficiency in 2030. During 2012/13, we recorded another year of rapid growth, both in the numbers of members benefiting from our protection and the amount of assets we now have under management.
“Our focus during the year was to reassure our members by managing our growth effectively, meeting the continuing challenge of turbulent markets and dealing with claims totalling more than £1 billion - a record for the PPF.”
The PPF’s performance owed much to a total return of 11.1 per cent on its invested assets which, including levy income and assets from transferring schemes, grew from £11.1 billion in 2011/12 to £14.9 billion in 2012/13.
Lady Judge added: “The risks we face as an organisation remain high. As well as a record year for claims, we saw pension scheme funding worsen during 2012/13 and, although long bond yields have recovered a little since then, scheme funding remains at low levels.
“However, despite notable claims since March 2013, we remain financially strong and the probability of meeting our 2030 target remains broadly the same. Our 2030 funding target is a key milestone for the PPF so staying on track to hit that target will be of great reassurance to both our levy payers and members.”
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