With global stock market declines and rising liabilities at home, the ability to fund pensions in the UK worsened during the month of June.
Considering the latest calculations, 4420 schemes to fund pensions are experiencing shortfall. This number represents over two thirds of all structured benefit pensions.
The value of scheme’s assets also fell by 1.8 per cent during May, affected by the global decline in stock market values.
Also, their liabilities increased by 1.9 per cent during the month due to a change in gilt yields, which is what liabilities are based upon.
Although pension schemes deteriorated in value in June, they are still in better financial shape than they were in June 2009.
Unfortunately due to rising life expectancy and investment volatility seen globally, companies are still offering pension plans but having employees shoulder all the risk.