Marvin OnumonuThe latest Pension Protection Fund (PPF) 7800 index showed the aggregate funding surplus for UK defined benefit pension schemes fell by £9.9bn in April to £263.8bn.
The funding ratio rose slightly from 130.8% to 131.4%.
Total scheme assets dropped by 4.8% to £1,105.0bn, while total scheme liabilities were down 5.2% to £841.2bn.
The number of schemes in deficit remained unchanged at 4,838, with the collective deficit for those schemes rising from £17.4bn to £18.9bn.
Jaime Norman, senior actuarial director at Broadstone, said: “Pension scheme funding dropped back in March as equity market volatility and widening credit spreads caused a slight deterioration.
“The funding position for most schemes nonetheless remains far healthier than a year ago with the aggregate funding position up by around £50bn highlighting the continued optionality available to many trustees.
“It now looks likely that a new wave of inflationary pressure is likely to hit the market, with interest rate expectations rising as a result, which could impact those schemes that do not have a matched strategy in place.”
Norman added: “Trustees and scheme manager should continue to monitor their investment strategy to protect their long-term objectives and support their members.
“It does not appear, however, that the current volatility is impacting the insurance market which continues to quote for new business as usual as schemes continue to secure their members’ benefits through a de-risking transaction.”
