The aggregate deficit of the UKs defined benefit schemes is estimated to have increased to £164.9bn at the end of October 2014, from £144.3bn at the end of September, the Pension Protection Fund said.
The fund's latest monthly PPF 7800 Index update highlighted that the deficit position of schemes had worsened from the previous year, when a deficit of £49.9bn was recorded at the end of October.
It also noted an increase in the number of schemes in deficit, from 4,472 at the end of September to 4,570 at the end of October. Correspondingly, the number of schemes in surplus fell to 1,487, from 1,585 at the end of September.
Within the index, total scheme assets amounted to £1.198 trillion, up 1.1% from the end of September 2014, with liabilities increasing by 2.5% to £1.363trn over the month.
The funding ratio, which measures schemes' assets as a percentage of their liabilities decreased over the month from 89.2% to 87.9%. The funding ratio is lower than the 95.8% recorded in October 2013, PPF noted.
PPF said equity markets and gilt yields were the main drivers of funding levels.
It said: 'Scheme liabilities are sensitive to the yields available on a range of conventional and index-linked gilts.
'The value of scheme assets is affected by the change in prices of all the major asset classes, not just equity markets. However, due to their weight in asset allocation and volatility, equities are usually the biggest driver behind changes in scheme assets.
'Over the month of October 2014, 15-year gilt yields fell by 12 basis points, 15 year index-linked gilt yields fell by 7 basis points and the FTSE All-Share Index fell by 0.9%. Over the year to October 2014, 15-year gilt yields were down by 38 basis points and the FTSE All-Share Index fell by 2.3%.'
