A scheme’s s179 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 surplus of the 5,050 schemes in the PPF 7800 Index is estimated to have increased over the month to £485.1 billion at the end of October 2024, from a surplus of £476.0 billion at the end of September 2024.
• The funding ratio increased from 148.4 per cent at the end of September 2024 to 151.0 per cent.
• Total assets were £1,437.0 billion and total liabilities were £951.9 billion.
• There were 450 schemes in deficit and 4,600 schemes in surplus.
• The deficit of the schemes in deficit at the end of October 2024 was £3.7 billion, similar to the £3.6 billion at the end of September 2024.
Shalin Bhagwan, PPF Chief Actuary said: “Over the course of October we’ve seen both liability and asset values fall. With equities largely unchanged over the month, the main driver behind these movements was the increase in gilt yields, with a combination of global (US election) and domestic (UK Budget) forces sending 10-year and 30-year gilt yields to one-year highs. As the drop in liabilities outstripped the fall in asset values, the estimated funding ratio of schemes in the DB universe increased by 2.6 per cent, to 151.0 per cent.
“In terms of the aggregate surplus of schemes, the impact of these movements is estimated to have led to a £9.1 billion increase over the month to £485.1 billion. However, the deficit of the schemes in deficit rose slightly to £3.7 billion, from £3.6 billion at the end of September.”
View the November update and see the supporting data on the 7800 Index for 31 October 2024 here: The PPF 7800 index | Pension Protection Fund.
A note on upcoming changes to the PPF 7800 index
The PPF will publish the next edition of the Purple Book in early December. As usual, the subsequent release of the PPF 7800 index will be updated to reflect the latest data. Alongside this update, the PPF will introduce a number of refinements to the roll-forward calculation methodology used to estimate the asset and liability figures in the Purple Book and 7800. Further information about these changes can be found on the PPF’s website: The PPF 7800 index | Pension Protection Fund.
PPF Purple Book publication
The PPF will be marking the launch of its annual Purple Book with an exclusive webinar hosted by Professional Pensions on 5 December 2024 (10am). PPF chief actuary Shalin Bhagwan and PPF actuary James Emmott will discuss the latest edition of the pensions universe risk profile.
The annual survey of scheme finances paints a holistic picture of the risks posed by UK defined benefit (DB) schemes protected by the PPF – giving an idea of the latest trends in scheme de-risking, asset allocation, and membership, among numerous other areas. This year’s edition will incorporate more granular asset allocation data collected by TPR, as well as a number of refinements to the PPF’s own roll-forward calculation methodology used to estimate asset and liability figures.
Registration for the webinar is now open and attendees can book their place online here.
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