FTSE 350 pension scheme deficits static in 2012

Accounting deficits for FTSE 350 organisations’ defined benefit (DB) pension schemes in the UK showed little increase in 2012, according to research by Mercer.

Its Pension risk survey found that the estimated deficit for DB schemes stood at £62 billion at 31 December 2012, compared to a deficit figure of £61 billion at the end of November 2012 and £61 billion at the end of December 2011.

The research also found that the value of scheme liabilities increased from £548 billion to £588 billion in 2012, while asset values increased from £487 billion to £526 billion.

According to Mercer, part of the increase in asset values was as a result of around £20 billion of contributions being paid by UK organisations and part was due to asset growth.

Ali Tayyebi, head of DB risk in the UK at Mercer, said: “On the surface, it appears to have been a fairly flat year with deficits remaining broadly unchanged compared to 31 December 2011.

“However, that masks the volatility experienced during the year and the fact that the year has ended with both assets and liabilities at their high point.

“This suggests that, as much as ever, there may be opportunities as well as risks that should be prepared for.”