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UK pension funds in £100bn deficit

Salary pension schemes in the UK have fallen further into negative value, according to reserch by the Pension Protection Fund (PPF).

After examining the finances of just fewer than 8,000 private sector schemes the PPF discovered that in October their collective debt was £97bn.

At the same time last year the schemes had a surplus of £80bn.

"During the month of October 2008 there was a 6.8% decrease in assets due to falling UK and global equities," said a spokesman for the PPF.

If schemes stay in deficit then employers are obliged to contribute extra recovery payments to ensure the schemes become solvent again, typically within 10 years.

However, the Pensions Regulator recently acknowledged that not all employers would be able to meet this commitment and that the 10-year period may have to be extended.

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Post Date: November 7th, 2008