The aggregate surplus of defined benefit schemes continued to increase through April, rising from a surplus of £359.3 billion at the end of March to £378.6 billion, according to the latest industry data.
Funding levels are still significantly higher compared to a year ago when the aggregate funding position stood at £221.9 billion at the end of April 2022.
The figures show that the vast majority of DB schemes are now in surplus — with 4,440 in this position compared to 691 in deficit.
Broadstone senior actuarial director Jaime Norman says: “While long-term interest rates are more stable than in 2022, there is still considerable market volatility not least through the tremors we have seen in the global banking system and persistent inflationary pressures.
“However, defined benefit pension schemes have largely maintained their strong funding levels generated from last year’s rise in gilt yields and posted further gains through April as markets stabilised.
“For DB schemes, the rise in surplus levels has given many an opportunity to reach end-game far quicker than they would have thought a year ago but agility will be needed to take advantage.
“We have already witnessed a rapid start to the year in terms of de-risking transactions that look to secure the future payments of scheme members with an insurer. We have also seen the Bank of England fire a warning shot across the bow of the bulk annuity market. Schemes will need best-in-class administration and data standards to attract insurer interest in this competitive market while ongoing monitoring will also allow schemes to transact rapidly should the opportunity arise.”
