Defined benefit pension scheme deficits up £50 billion

The deficit of the UK’s defined benefit (DB) pension schemes ended 2011 £50 billion up on 2010, according to figures by Xafinity Corporate Solutions.

The figures, based on the FRS17 and IAS19 accounting rules, showed that liabilities rose by £101 billion, but these were offset by £51 billion growth in the value of scheme assets.

The value of scheme assets picked up £17 billion during the final month of 2011, helped by the continuing rises in gilt markets and the slight gain in equity markets during December.

Hugh Creasy, director at Xafinity Corporate Solutions, said: “2011 ended on a strong note with a boost to equity prices, but the real saviour for DB pensions in 2011 was price inflation falling by 1%; without this the figures would look very grim.”

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