BusinessCompany NewsCompany pensions £150bn in deficit under FRS 17

Company pensions £150bn in deficit under FRS 17

The deficit in company pension funds has risen to £150bn under controversial accounting standard FRS 17, a new study has found.

Link: FRS 17 ‘terrible’ for top companies

In a study of FTSE-350 company reports, actuarial group Mercer Human Resource Consulting found that the average funding lever of pension funds had fallen from 91% to 74% in the last year.

At the same time, median pension costs, as a proportion of profits, grew from 6% to 8%.

On an FRS 17 basis the study estimated FTSE 350 companies could find themselves with a deficit of as much as £90bn.

The deficit for the whole UK corporate sector could be up to £150bn, according to Mercer’s calculations.

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