UK - FTSE 100 companies' pension deficits have declined by £8bn (€9.3bn) to £66bn over the last year, according to figures released by Pension Capital Strategies.

The company found that pension contributions made to plug funding shortfalls had increased threefold to £12bn since September 2009, with Royal Dutch Shell paying £2.7bn into its scheme last year.

PCS also stressed that company pension schemes were no longer seeing a drastic shift from equity to bonds, a point raised in the past.

Charles Cowling, managing director at PCS, said: "This is only a temporary respite for equity allocations. As more companies look to close down risk in their pension schemes, we expect bond allocations to continue to rise to 75% within five years."

He added: "While the proposed change to CPI-based pension increases from RPI-based pension increases will help many companies, it is clear there is still a long way to go in tackling pension liability and deficit issues in the FTSE 100."

BT recently saw its liabilities fall by more than half when it calculated the impact of the switch to the CPI.

Meanwhile, campaign group Fair Pensions is looking for two new trustee board members following the departure of Stephen Hain and Stuart Bell.

The group said it would be be interested in any applicant with HR experience and/or experience of working with a large occupational pension scheme, either as a scheme trustee or scheme officer/advisor.

Responsibilities, in addition to four meetings a year lasting between two to three hours and an AGM, include guaranteeing that the charity does not stray from its remit and acts within the boundaries of UK charity law.

Further details can be found on Fair Pension's website, with applications welcomed until 21 December.

Finally, Dutch custodian KAS Bank has announced the development of a stress test for pension funds, allowing trustees to better asses the stability of their scheme.

The service, already available to clients in Germany and the Netherlands, allows participants to calculate the stability of their schemes on an annual, quarterly or monthly basis.

Stephen Isgar, UK business development manager for KAS, said there had been increasing demand for services that prepare pension funds for worst-case scenarios in the wake of the collapse of Lehman Brothers two years ago.

He added: "The new stress test identifies risks in a pension fund's portfolio, enabling trustees to get a full grasp of the dangers potentially facing the pension scheme in the event of severe market movements."

Topics