Pension liabilities to shock shareholders, says PwC

Fri, 30 Oct 2009

A top financial services firm has said that falling bond yields could leave companies shocked at the growth of their pension liabilities .

Research by PricewaterhouseCoopers (PwC) showed that pension liabilities have increased by 25 per cent in the past six months, despite assets rising in value by 20 per cent in the same period.

PwC puts the spike down to falling bond yields, but legal firm Pinsent Mason believes that the liabilities are merely due to the "perverse accounting rules" which accompany pension calculations .

"In real life, the amount of money going into pension schemes will probably not vary that much, it will just be the accounts that the companies will show that will show deficits not surpluses," the group explained.

Age Concern and Help the Aged recently said that pensioners will take advantage of new changes to the capital disregard limit on benefits given to over-65s with under £6,000 in savings .
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