• From The BBC:

    Nearly a quarter of the biggest companies on the UK stock market will be unable to pay off their pension deficits, a report says.The accountancy firm KPMG says 22% of the firms in the FTSE 100 share index will not have enough spare cash to make the necessary payments. It says this will prompt many more big firms to close their final-salary schemes to existing members of staff. Their pension scheme finances are now at a “tipping point”, KPMG says. As an illustration of the burden of making the extra cash payments, KPMG calculates that FTSE 100 firms are now paying as much into their schemes to pay off past deficits as they are paying in contributions for current staff.
    Mike Smedley, pensions partner at KPMG, predicted that within five years, £4 out of every £5 being paid in would be to clear past deficits. “It is unprecedented for companies to be spending as much or more on their defined-benefit pension benefits for previous employees than for current staff,” Mr Smedley sai…

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    Posted by Jon @ 12:08 pm

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