Private pensions surplus boosted by low inflation

November saw the largest recorded rise in the value of the UK’s biggest pension schemes.

The accounting position of the 200 largest privately sponsored pension schemes improved by £38bn over the month, according to advisory firm Aon Consulting.

Its Aon200 Index showed that the schemes’ combined funding position improved from a deficit of £15bn at the end of October to a surplus of £23bn at the end of November.

The main reason for the rise was a dramatic fall in inflation, which left schemes with lower forecast payouts.

Marcus Hurd, head of corporate solutions at Aon Consulting, said it was an optimistic sign after a pesimistic year.

“It has been one hell of a year and I have never seen anything like it, with market conditions frequently changing dramatically on a daily basis,” he said.

“We have never known trustees and employers to express so much concern. The pensions picture is not black-and-white, however, and current economic factors present opportunities as well as exposing schemes to risks.”

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