LONDON, 30th October 2008 - As the funding deficit for the 200 largest privately sponsored pension schemes fell by £9 billion to a deficit of £15 billion at the end of October, Aon Consulting is warning that trustees may ask sponsoring companies to commit a further £45 billion a year for the next five years to make up the huge shortfalls. Total asset losses over the last year have now reached £226 billion for the UK's 8000 final salary schemes, according to the leading pension, benefits and HR consulting firm. Aon predicts that 2009 is set to be the bleakest year yet for companies sponsoring defined benefit schemes and urges sensible financial planning to make good the shortfalls.
The Aon200 Index, which tracks the 200 largest privately sponsored (where companies bear most of the risk) pension scheme accounting deficits, shows that 64 per cent of schemes are now in deficit. Aon recently reported that defined contribution (where employees bear the risk) pension scheme assets have lost £157 billion in the past year, meaning that total pension asset losses are £383 billion over the same period. At present, approximately two thirds of employees' pension benefits are provided by defined benefit schemes, and one third by defined contribution schemes, which are the main sources of retirement protection the UK population.
Access international media contacts, the full library of Aon media releases, and a media kit with fact sheet and executive bios, via links below.