The Government must work to support workplace pensions by issuing more long-dated and index-linked gilts, according to research from the NAPF.

The association's annual survey has found that 82 per cent of respondents felt that further issuance of government bonds would help reduce defined benefit (DB) pension fund deficits and liabilities.

DB funds' allocation to equities has fallen further according to the NAPF, with the average allocation at 44 per cent compared to 51 per cent last year. Fixed asset classes contribution increased by five per cent to 38 per cent on average. The body also revealed that 23 per cent of schemes remain open to new entrants - a five per cent fall from a year ago.

The Government's 2012 pension reforms were also covered in the survey, with 41 per cent of the 300 NAPF members surveyed agreeing that they would maintain their own scheme in its current form and choose to auto-enrol their employees into it. Eight per cent, however, are planning to level down contributions in 2012, and a further ten per cent said employees who do not opt to join the existing scheme will be auto-enrolled into Personal Accounts at the minimum level. Thirteen per cent are proposing other changes come 2012, and 27 per cent have not yet decided what action they will take.

However, it was not all bad news with contribution to defined contribution (DC) schemes found to have fared well and not been cut back as a result of the recession. Average contribution rates to DC schemes remained stable and stand at 11.5 per cent, with ten per cent of schemes suggesting that they will increase these payments in the future.

Joanne Segars, NAPF chief executive, said: "Our survey shows the high levels of commitment employers have in providing good quality pensions for their staff; but the recession has made their job more difficult.

"The Government can no longer sit on its hands. It must take bold and positive action to help support employer-sponsored pensions. The Chancellor has a golden opportunity to make a difference in his Pre-Budget Report by announcing that the Government will issue more long-dated and index-linked gilts. This single measure would benefit pension funds by helping to reduce deficits and support corporate scheme sponsors by reducing the scale of pension fund liabilities in their balance sheets."

Segars added that this is an "opportunity that must not be missed".

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