EUROPE - The top 50 European blue chip companies have a combined pension deficit of €136bn, according to actuaries Lane Clark & Peacock (Corrects figure).
LCP's annual accounting for pensions survey said firms on the Dow Jones STOXX 50 index had €136bn of deficits. It added that €53bn is not recognised on company balance sheets.
The firm's pension assets of €516.1bn and liabilities of €652.5bn mean they are just 79.1% funded on an aggregate basis.
The issue is clouded by the fact that pensions are accounted for off-balance sheet in some countries, for example the book reserves system in Germany, LCP pointed out. So the term ‘deficit' in this context should be treated with caution.
New international accounting rules such as IAS19 were persuading companies to set up funded arrangements, such as Contractual Trust Agreements (CTAs), said LCP partner Shaun Southern.
In the UK deficits at FTSE 100 companies were virtually flat at £36bn - despite record contributions and rising stock markets - LCP said.
Volatile markets pushed the deficit to a high of £54bn in this January while company pension contributions have increased to a record £12.1bn.
Elsewhere, Aon Consulting said current, former and retired employees could be in for a big shock as companies are set to reveal the extent of their pension deficits by September 22.
"New legislation requires all trustees of defined benefit ("final salary") pension schemes with over 100 members to issue their first annual Summary Funding Statement," Aon said.
"These revealing documents are expected to stir up big communications challenges and, unless handled correctly, will raise more questions than they will answer."