UK DB pension schemes hold strong surplus positions as surplus release reforms boost confidence to run on

UK defined benefit (DB) pension schemes maintained strong funding positions through June 2026, according to PwC UK's Pension Funding Index, while growing regulatory clarity around surplus extraction is increasing confidence among trustees and sponsors to run on schemes and release surplus. 

As of 30 June 2026, PwC estimates that UK DB schemes held assets totalling £1,110 billion against liabilities of £900 billion on a low dependency measure. This represents a surplus of £210 billion and a funding ratio of 123%, maintaining the robust funding position seen over recent months despite continued economic uncertainty and market volatility. 

Meanwhile, PwC's Buyout Index, which tracks the estimated cost for UK defined benefit pension schemes to fully insure their liabilities through an insurance buyout, showed an estimated surplus of £155 billion, with schemes totalling an aggregate position of 116% funded.  

PwC's Superfund Index also remained robust, with an estimated surplus of £220 billion and a funding level of 125%, highlighting the continued strength of alternative endgame solutions. 

This strength has been consistent throughout 2026, with low dependency and buyout measure consistently exceeding 120% and 110% respectively, alongside a general upwards trend.  

Saye Mkangama, Pensions Partner at PwC UK, said: 

"With funding levels remaining strong, the government's surplus release consultation marks an important step towards making surplus release a practical option for well-funded schemes. That greater clarity is already influencing market sentiment, with around two-thirds of trustees, sponsors and industry professionals responding to PwC polling saying the consultation and The Pensions Regulator's (TPR) statement have increased their confidence in running on schemes and releasing surplus. 

"The focus now turns to translating that confidence into action. Government and TPR have an opportunity to create a practical framework that gives trustees and sponsors the certainty to make informed decisions while maintaining appropriate member protections. If achieved, the new flexibilities could allow well-funded schemes to put surplus capital to more productive use without compromising members' security." 

The PwC Low Dependency Index, Buyout Index and Superfund Index figures are as follows: 

ENDS 

Notes to editors: 

The PwC Indices measure the aggregate funding position of the UK's defined benefit schemes. The Low Dependency Index uses a discount rate assumption of gilt yields plus 0.5% pa. “Gilts plus” measures are often collectively referred to as funding targets where there is a low level of reliance on the company that ultimately supports the scheme.  The Buyout Index reflects PwC’s view of indicative market pricing based on their current experience of completing buy-in and buy-out transactions. The Superfund Index (vehicles that consolidate defined benefit pension schemes by transferring their assets and liabilities to a well-capitalised entity) uses PwC’s estimate of how pricing is set on this measure, and is calculated relative to the Buyout Index. 

The PwC Indices focus on liability value measures which schemes may be targeting in the long-term. These differ from other liability value measures, for example, those used for the purposes of preparing accounting disclosures or for the calculation of the levy payable to the Pension Protection Fund (“PPF”). 

The PwC Indices covers the whole universe of around 5,000 UK defined benefit pension funds. Some other market trackers cover just a minority subset (e.g. fewer than 10% of schemes), so may show different trends. 

The estimated asset value for the UK’s defined benefit pension schemes is based on monthly data from the PPF 7800 index, tracked over each month based on the movement in asset indices using data provided by Refinitiv. From May 2026 onwards the asset values have been set in line with the actual monthly assets published by the PPF. 

The PwC polling referenced in this release was conducted among approximately 200 trustees, sponsors and industry professionals during a PwC pensions event in 2026. The findings are based on responses to live polling and are indicative of attendee sentiment.