Pension deficits hit by markets

Published on 11/07/2012 00:00

Chronically weak stock markets and record low bond yields have pushed company pension deficits in Britain and the US sharply higher, adding to the burden of retired people living longer than ever before.

In the US, the aggregate deficit of S&P 1500 companies grew $59 billion (£38bn) in the first half of the year to $543bn, consultancy Mercer said.

Corporate America is sitting on total liabilities of $2.09 trillion against total assets of $1.55tn, Mercer added.

The picture is no less bleak in Britain, where the combined deficit of FTSE 100 companies more than doubled over the past year to £41bns, actuarial firm Lane, Clark & Peacock (LCP) said in a separate report yesterday. This is despite companies having poured £11bn into schemes over the last year.