JLT EB Funding Level Update 1 Sep 2015

31 August 2015

Latest Monthly Update

JLT Employee Benefits's monthly fund index update for the month of August

JLT EB has updated its monthly index, showing the funding position of all UK private sector defined benefit (DB) pension schemes under the standard accounting measure (IAS19) used in company reports and accounts.

As at 31 August 2015, JLT estimates the total DB pension scheme funding position as follows:

At 31 August 2015  Assets  Liabilities  Surplus/ (deficit)  Funding Level
 FTSE 100 Companies  £536bn  £612bn  (£76bn)  88%
 FTSE 100 Companies  £606bn  £694bn  (£88bn)  87%
 All UK Private Sector Pension Schemes  £1,222bn  £1,470bn  (£248bn)  83%

For comparison, the corresponding figures as at 31 August 2014 are as follows:

 At 31 August 2014  Assets  Liabilities  Surplus/ (deficit)  Funding Level
 FTSE 100 Companies  £534bn  £609bn  (£75bn)  88%
 FTSE 100 Companies  £601bn  £688bn  (£87bn)  87%
 All UK Private Sector Pension Schemes  £1,202bn  £1,414bn  (£212bn)  85%

Charles Cowling, Director, JLT Employee Benefits, comments:

“These latest figures on the pension deficits within UK Private Sector Schemes, showing a total deficit of £248bn, up from £212bn a year ago, highlight the continuing challenge of managing DB pension risks. The volatile numbers reflect the fragile nature of our economic recovery, as well as the effect of tight global interdependence of markets. This was recently brought to light by the recent crash of Chinese equities and the ongoing Greek drama. “The problems in China and Greece won’t go away in the near term. The last bailout deal with Greece didn’t solve the fundamental problems of its large pile of debt, but was yet another stratagem to kick the can down the road. Meanwhile, China has got its own profound issues. Being the second largest world economy, its struggles to maintain growth will have a considerable ripple effect on other nations near and far. “With just under half of DB pension assets still invested in equities, schemes are exposed to a huge amount of market volatility, potentially leading to big losses that can further widen the deficit gap. “It is in times like these that the risks to our pension funds become evident. For some, this kind of exposure is more than they can reasonably tolerate on their balance sheet. Last week’s events should be a rude awakening for trustees to look into the amount of risk they hold and explore any opportunity to de-risk their pension scheme.”

- ENDS -

Notes to Editors 

Enquiries:

Smithfield Consultants:

Fay Israsena

fisrasena@smithfieldgroup.com

+44 (0)20 7903 0633

Julia Cooke

jcooke@smithfieldgroup.com  +44 (0)20 7903 0674&

About JLT Employee Benefits

JLT Employee Benefits is one of the UK's leading employee benefit providers offering a wide range of benefit and pension services, including administration, actuarial and pension consultancy, investment, Self Invested Personal Pensions (SIPPs) and Small Self Administered Schemes (SSASs) administration, flexible benefits, healthcare, benefit communication and financial education.

JLT Employee Benefits employs over 2,200 professionals throughout the UK and in 2013 had revenues of £172m in UK & Ireland.

Pensions and employee benefits companies within the JLT Employee Benefits group of companies include: JLT Benefit Solutions Ltd, Profund Solutions Limited, JLT Wealth Management Limited, JLT Investment Management Limited and Independent Trustee Services Limited. JLT Employee Benefits is part of Jardine Lloyd Thompson Group plc. www.jltemployeebenefits.com

About Jardine Lloyd Thompson Group plc

Jardine Lloyd Thompson is one of the world's largest providers of insurance and employee benefits related advice, brokerage and associated services. JLT's client proposition is built upon its deep specialist knowledge, client advocacy, tailored advice and service excellence.

JLT is quoted on the London Stock Exchange and owns offices in 39 territories with some 9,000 employees. Supported by the JLT International Network, it offers risk management and employee benefit solutions in 135 countries.

www.jlt.com/
contact Charles Cowling
Director charles_cowling@jltgroup.com 0161 242 5388