FTSE 350 defined benefit pension scheme deficit surges

09 Jan 2019

The combined pension deficit of FTSE 350 companies grew by 28 per cent to £41 billion by the end of last year, up from £32 billion in 2017.

According to Mercer's 2018 Pension Risk Survey, based on year-end accounts and financial indices for approximately 50 per cent of all UK pension scheme liabilities and updated as FTSE 350 constituents change, the deficit was driven by a £19 billon fall in asset values from £766 billion at the end of 2017 to £747 billion at the end of 2018.

Le Roy van Zyl, Partner at Mercer, said the volatility demonstrated “the importance of schemes locking in gains when opportunities to take risk off the table arise”.

He went on to add that “2018 was a turbulent year and it is disappointing to see it finish in deficit after finally reaching a surplus for the first time since Mercer began regularly monitoring the position”.

Planning for retirement and mitigating IHT

Financial security in retirement does not just happen. It takes planning and commitment, and money too.

Speak to a Beavis Morgan adviser who will ask the right questions relating to your individual situation and give practical advice on the best approach towards planning for retirement and mitigating inheritance tax.

What’s more, businesses should be using auto-enrolment to their advantage, as a pension can be a powerful incentive when attracting and retaining the right people.

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To find out more, contact Steve Govey or your usual Beavis Morgan Partner.