Pensions shortfall stays unchanged
There has been no change in the shortfall facing defined benefit pensions in the UK over the last six years, according to latest figures.
Companies have invested a combined total of £50 billion into the pensions during the period but it has not been enough to reduce the collective deficit of £68 billion faced by the UK's 200 biggest defined benefit schemes, consultants Aon Hewitt said.
Defined benefit schemes, including final salary pensions, have become increasingly unpopular amongst companies in recent years with many firms now not offering them to new members of staff as they face increased liabilities as a result of life expectancy getting higher.
Marcus Hurd, principal and actuary at Aon Hewitt, said: "Contributions are only part of the equation, but it's devastating to see £50 billion of contributions eaten up by lacklustre longer term investment returns, driven by challenging and volatile financial market conditions.
"After six years of deficit contributions, companies are left exactly where they started."
Copyright © Press Association 2011
Find Your Financial Consultant