UK - Private sector defined benefit (DB) schemes cut their deficits from £156bn (€176.8bn) to £63bn in the year to the end of March, according to data published by JLT Pension Capital Strategies

The change is in part due to a government-mandated switch from the retail price index to the consumer price index as the basis of measurement.

Data from the company show funding levels increased from 86% to 94% during the same period.

But schemes' assets are still failing to match the liabilities. Across private sector schemes, liabilities totalled £1.05trn at the end of March, against £993bn in assets.

The figures for FTSE 100 companies were £442bn in liabilities against £410bn in assets, and for FTSE 350 companies, £508bn against £471bn.

In other news, consultancy Mercer has slated the government's plan to limit tax relief available to employers making asset-backed contributions to DB pension schemes as "missing the point", claiming tax changes could damage both employers' cash flows and pension scheme funding.

The proposed new rule will eradicate upfront tax relief for employers on arm's-length special-purpose vehicles, including sale-and-leaseback agreements that treat assets as belonging to the pension scheme.

Mercer partner Matthew Demwell said if the government's intention was to penalise overly aggressive valuations, it should focus on asset valuations using existing powers.

He added: "It would be missing the point to use the tax system to control what may be, essentially, a regulatory issue."