JLT EB Funding Level Update April 2015

30 April 2015

Latest Monthly Update

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 30 April 2015, JLT estimates the total DB pension scheme funding position as follows:

At 30 April 2015  Assets  Liabilities  Surplus/ (deficit)  Funding Level
 FTSE 100 Companies  £553bn  £637bn  (£84bn)  87%
 FTSE 100 Companies  £626bn  £722bn  (£96bn)  87%
 All UK Private Sector Pension Schemes  £1,275bn  £1,536bn  (£261bn)  83%
 For comparison, the corresponding figures as at 30 November 2013 are as follows:
 At 30 April 2014  Assets  Liabilities  Surplus/ (deficit)  Funding Level
 FTSE 100 Companies  £517bn  £577bn  (£60bn)  90%
 FTSE 100 Companies  £585bn  £654bn  (£69bn)  89%
 All UK Private Sector Pension Schemes  £1,152bn  £1,323bn  (£171bn)  87%

Charles Cowling, Director, JLT Employee Benefits, comments: 

“The ballooning of defined benefit pension deficits continues, with the burden on UK private sector employers increasing by £90bn over last 12 months. The long term impact of low interest rates coupled with improving longevity is continuing to pile the pressure on DB schemes – particularly those with an actuarial valuation in 2015. This can quickly become unsustainable, and the closure of Tesco’s DB scheme – one of the largest in the UK private sector – could lead many others to follow suit.”

“Meanwhile, the General Election next week and its uncertain outcome will have a medium term impact on the financial markets as well as the overall economy. This could have negative repercussions for pension investments and sponsors’ ability to fund deficits.”

“Despite the relative gloom, there may be some good news on the horizon. It is still early days for the Freedom and Choice reform and it is too soon to observe any substantial effects. But it may offer some hope for DB schemes if enough members transfer DB benefits to DC schemes to take advantage of the new flexibilities.”

- ENDS -

At 31 July 2014

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