Pensions black hole hits £85bn

The black hole in Britain’s company pension schemes passed £85 billion at the end of July, according to a report by professional services firm Mercer today.

The report says the huge gap between scheme assets and their liabilities to members increased by a further £3 billion over the month. The shortfall has widened alarmingly this year; at the end of 2012 it stood at £72 billion.

Schemes are now only 87% funded by assets. They were boosted by a 6.6% surge in share prices.

But Mercer said the yields on high-quality bonds issued by big companies fell by more, wiping out the gain.