Final salary schemes are back in surplus

Private sector final-salary pension schemes have moved back into surplus — just — for the first time since June 2008.

In March, the 7,342 pension schemes had a total surplus of £0.3 billion, compared with a deficit of £15.1 billion the previous month, the Pension Protection Fund (PPF) said.

A year ago the deficit was much higher, standing at £242 billion.

However, despite the improvement overall, 5,032 or two-thirds of schemes are still in deficit with only the remaining third (32%) — or 2,310 schemes — in surplus. The numbers are an improvement on a year ago when 6,637 schemes were in deficit and only 774 in surplus.

The PPF said rising share prices meant the funds’ assets had risen by more than the cost of paying for pensions.

“Total scheme assets amounted to £915.4 billion in March 2010, representing an increase of 3.9% over the month and an increase of 22.3% over the year to March 2010,” the PPF said.

Against that, scheme liabilities showed a monthly increase of 2.1% to £915 billion. Liabilities were 7.6% higher than a year ago.

www.pensionprotectionfund.org.uk/DocumentLibrary/Documents/PPF_7800_April_10.pdf