By the end of December 2016, the aggregate deficit of the almost 6,000 schemes included in the Pension Protection Fund (PPF) 7800 Index had risen to £223.9bn. 

In November 2016, there was a deficit of only £194.7bn.  Andy Tunningley, head of UK strategic clients at BlackRock, recently weighed in on the latest figures saying for UK pension schemes, “2016 was like a marathon on a treadmill.”  He went on to explain how the aggregate funding ratio went up and down all year long, ultimately to end very close to where it started. The only schemes that avoided playing this up and down game were those that implemented LDI, according to human resource experts.

HR experts say that as pension funds age, the cost of making any kind of wrong decision gets greater and greater.  Strong risk management is extremely important now, especially when you consider the volatility of the UK economy.  Buyer beware, however, it is important to note that risk management alone is simply not enough.