The combined IAS19 pensions surplus for UK FTSE 100 defined benefit (DB) pension schemes remained steady at around £60bn in September, having stayed at a consistent level over the whole quarter, according to analysis from LCP’s Pensions Explorer.

The firm suggested the prolonged period of strong funding levels has given DB pension schemes time to plan and develop "robust" endgame frameworks and strategies.

LCP said that this, coupled with new products and investments that can be tailored to scheme characteristics and specific objectives, means that sponsors and trustees are able to plan and proceed with confidence on their chosen endgame.

In particular, LCP noted that the endgame market is proving to be “very busy”, with a “record number” of transactions this year to date, and full-year deals expected to exceed £40bn.

However, LCP noted that more schemes are now targeting run on, meaning more sponsors and trustees are taking active endgame decisions, which is providing the industry with lots of “exciting” challenges and opportunities.

LCP partner and head of endgame innovation, Jonathan Griffith, said: “Endgame planning is now at the forefront of many pension schemes’ decisions.

“The strategy has moved on from automatically targeting buyout as soon as affordable to determining both the right endgame target and appropriate timescales, taking into account wider stakeholder objectives and the sponsor covenant.”

Adding to this, LCP consultant and part of the endgame team, Aaron Chaderton, stated: “As we see schemes consider their end game more actively, and new ideas and products start to come into the market, joining the two up presents interesting opportunities in the space to help boost outcomes for sponsors and members.

“The funding code will force all schemes to determine their long-term strategy, so we are going to see a lot of activity over the coming months and years.”

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