The total deficit of defined benefit (DB) pension schemes listed on the Pension Protection Fund's 7800 Index fell by nearly £10bn in May, up from £55.5bn in April to £45.7bn.
According to the index, which provides an update of more than 7,800 DB schemes, the number of schemes in deficit in May 2008 stood at 4,991, down from 5,271 schemes in April. This is the lowest proportion since October 2007.
Monthly increases were also recorded in the aggregate funding position of schemes, which rose to a surplus of £53.4bn during May, up more than £20bn on April’s figure.
However, year-on-year figures for scheme funding showed a decline, with a surplus of £126.1bn being recorded in May 2007.
A fall in performance over the year was attributed to the negative impact of equities on scheme assets combined with falling bond yields, both of which led to an overall worsening of the funding position.
Lower bond yields caused an 8% increase in aggregate liabilities, while weaker equities reduced assets by 3.6%, the index’s update reported.IFAonline
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