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Pension fund deficits widen in May, the PPF says

Two pensioners
Image caption Pensions are now more expensive because people are living longer

The collective deficit of the UK's private sector final-salary pension schemes worsened in May, the Pension Protection Fund (PPF) said.

At the end of the month, the deficit of the 7,300 schemes it monitored widened to £42bn from just £2bn in April.

However, the position of the schemes is still better than a year ago, when their combined deficit stood at £179bn.

The PPF said the deterioration in the past month was due to the falling value of assets such as shares.

"Total scheme assets amounted to £895.8bn in May 2010, representing a decrease of 1.9% over the month and an increase of 15% over the year to May 2010," the PPF said.

"Meanwhile, scheme liabilities [the value of assets needed to pay pensions]... increased 2.4% over the month from £915bn in April 2010 [to £937bn]."

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