Jessica O'ConnorThe Broadstone Sirius Index reported funding gains for DB pension schemes in its June 2025 update, highlighting improvements across both fully hedged and 50% hedged strategies amid a period of calmer market conditions.
According to the index, the funding level of the fully hedged scheme increased from 69.3% at the end of May to 70.3% at the end of June.
This 1% rise marks nearly the entire funding improvement for the first half of 2025, following a year-start figure of 69.2% in December 2024.
Meanwhile, the 50% hedged scheme recorded more modest gains in June but stronger overall growth during the first half of the year.
Its funding level rose from 103.4% in December 2024 to 105.8% in May 2025, climbing further to 106.2% by the end of June.
Chris Rice, head of trustee services at Broadstone, said: “The key market event of H1 2025 was undoubtedly ‘Liberation Day’ which sent shockwaves through global economies and drove significant market volatility.
“Markets have since recovered and defined benefit pension schemes in the UK weathered that storm successfully to register overall funding level improvements through the first half of the year.
“The half also saw notable reforms to the defined benefit pension scheme market with, for example, the government confirming plans to allow schemes to access surpluses.”
He said: “Looking ahead to the second half of the year, there is still uncertainty across the geopolitical landscape and continued market volatility is likely ahead of further tariff announcements from and negotiations with the United States.
“This combines to give Trustees significant food for thought as they look to manage their investment strategy through this period.
“There are also opportunities in an insurance market that is offering new options while run-on also presents a more attractive pathway following reforms to the market.”
