Tesco has experienced a rise of more than £500m in its defined benefit pension scheme deficits, according to its latest financial results.

Deficits recorded on 25 February 2012 were around £1.9bn and rose to around £2.4bn as at 23 February 2013. Tesco stated that this was a direct result of a reduction in real corporate bond yields which lead to a fall of 0.3 per cent in the discount rate used to measure liabilities.

The increase in deficits was despite employer contributions of £486m being ploughed into the scheme by the supermarket. In addition as part of the 2011 triennial valuations, Tesco agreed with the trustees to make an additional contribution of £180m to the UK pension scheme on 30 March 2012.

Deficit in schemes at the end of the year net of deferred tax read £1.4bn at as 25 February 2012 compared to £1.8bn as at 23 February 2013.

The company expects to make cash contributions of around £525m to defined benefit schemes in the year ending 22 February 2014. Tesco operates a variety of post-employment benefit arrangements covering funded defined contribution schemes and both funded and unfunded defined benefit schemes.

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