The aggregate deficit of UK defined benefit (DB) schemes within the Pension Protection Fund (PPF) 7800 index increased by £42.3bn to £112.3bn over April 2014.

The aggregate deficit of UK defined benefit (DB) schemes within the Pension Protection Fund (PPF) 7800 index increased by £42.3bn to £112.3bn over April 2014.

The PPF said that virtually all of the change to scheme funding on an aggregate level is due to the change in assumptions as opposed to changes in gilt yields and equity markets.

The recent PPF 7800 index for April takes account of updated valuation guidance for s179 valuation. The PPF said the impact of the change is to raise estimated s179 liabilities by 3.4% and reduce the aggregate balance by £41.3bn.

Without the change in assumptions, the aggregate deficit would have increased from £70.0bn to £71.0bn.

Despite the increase, the position has improved on the previous year, when a deficit of £231.3bn was recorded at the end of April 2013.

Over April, the funding ratio fell from 94.3% to 91.1%, but without the change in assumptions, scheme funding would have fallen from 94.3% to 94.2%.

The total assets of the 6,150 DB schemes within the index were £1,154.5bn and the total liabilities were £1,266.8bn.

The PPF said that there were 4,328 schemes in deficit while 1,822 were in surplus over the month.

First published 14.05.2014

monique_simpson@wilmington.co.uk