The combined deficit of the UKs private sector defined benefit pension schemes increased to £110bn last month, according to figures published today by JLT Pension Capital Strategies.
The consultancy's latest monthly index shows that, as of November 30, the combined assets of the schemes totalled £1,075bn, but their assets amounted to £1,185bn, giving schemes a funding level of 91%.
An increase in the value of schemes' assets from the £1,063bn recorded at the end of October was more than cancelled out by a larger increase in their liabilities - up from £1,165bn a month earlier. At the end of October, the combined deficit of the schemes stood at £102bn.
JLT also noted schemes' worsening position compared to a year earlier, with the total deficit at the end of November 2011 standing at £93bn, although schemes' combined funding position stood at 91%, as it did at the end of last week.
Charles Cowling, managing director of JLT, related the figures to the government's plans to increase risk-sharing in pensions, included in its Reinvigorating workplace pensions strategy, published last month.
'In the current economic environment we do not see many employers wanting to increase their pension risks,' he said. 'The reality is simply that there is very little appetite from employers for risk sharing in DB schemes. As such, we believe, and we expect, the rapid decline of DB schemes in the UK to continue.
'Nevertheless as the above figures show, there is still a huge legacy of DB liabilities across UK plc which is going to require very careful management for many years to come.'
In a separate assessment of schemes' funding positions, Xafinity Corporate Solutions today said the combined deficit of the UK's DB pension schemes fell last month, from £502bn to £494bn.
The consultancy attributed this to a slight rise in equity markets, but warned of difficulties ahead for scheme sponsors.
Hugh Creasy, director at Xafinity, said: 'Stability is no bad thing in pension funding, but corporate sponsors must not be lulled into a false sense of security, nor perceive this as a sign of stability in their pension costs.
'Regardless of Mr Osborne's Autumn Statement, many companies are facing extremely challenging corporate pension disclosures at 31 December 2012, and their stakeholders will be looking to see that positive steps are being taken to address the issues, regardless of what the markets do.'
