Published by Nick Griggs on
Although contributions to pay down DB scheme deficits are on the increase, companies appear to be in a healthier position to deal with this based on the increase in free cashflow over the period.
With equities performing strongly and bond yields having a quiet year, the funding position improved for many of the FTSE350 DB schemes. Overall, the aggregate IAS19 deficit for companies in the FTSE350 reduced from £62bn in 2016 to £55bn in 2017.
While this is all good news, it would not take much to tip the balance the other way. Our analysis suggests that a 0.5% fall in bond yields in 2017 would have pushed the aggregate deficit of the FTSE350 DB schemes up to £85bn.
value of transfer payments to DC schemes
average deficit contributions paid as a proportion of dividends
proportion of total pension cost relating to DB schemes
Download the full report below.