Organisations have moved through shock, anger and denial about the nation’s pensions deficit, but have finally reached acceptance, according to a leading pensions expert.
PricewaterhouseCoopers pensions leader Marc Hommel said the pensions picture was improving, a year since tough rules were brought in to reduce the shortfall.
The consultancy has produced research revealing that the pensions deficit has fallen from £65bn to £47bn in the last 12 months. The Pensions Act 2004 gave fund trustees far greater influence over companies’ contributions from 22 September 2005.
Much of the improvement has been due to stock market conditions, but Hommel insisted schemes were learning to use this to their advantage.
“The mismatch of pension schemes’ assets and liabilities has led to great swings in the accounting value of deficits,” he said. “But companies are getting better at implementing sensible strategies.”
“Pension schemes’ immediate reaction to pensions deficits was shock and then anger. Then they went through denial, but now we are moving into the era of acceptance, and in some cases opportunity.”
There is still a lot of work to be done, however, before the UK is free of pension problems, Hommel said.
“Some companies are doing a lot better than others,” he added, “but 90% are still in deficit. Companies are beginning to get better, but it will take a while.”