The aggregate surplus of the UK’s defined benefit (DB) pension schemes against long-term funding targets remained “extremely positive” in May, rising by £1bn from £178bn to £179bn, analysis from XPS Pensions Group has revealed.

Based on assets of £1,441bn and liabilities of £1,262bn, the tracker showed that the aggregate funding level of UK pension schemes on a long-term target basis remained “extremely positive”, at 115 per cent of the long-term value of liabilities, as of 31 May 2024.

According to XPS, a 0.06 per cent decrease in long-term gilt yields led to an increase in the value of liabilities.

Commenting on the findings, XPS Pensions Group partner, Danny Vassiliades, said: “As surpluses remain significant, the positive outlook highlights the strong position of schemes looking to run-on.

“Our recent survey found that 75 per cent of trustees are willing to manage and govern a scheme that runs on for surplus.”

However, XPS called on the future parliament to ensure that the new DB funding code comes into force in September 2024 as planned.

In May, Prime Minister, Rishi Sunak, announced that a general election will take place on the 4 July, putting into question the new DB funding code, which was due to be published this summer and take effect from September 2024.

Indeed, XPS said the uncertainty around the future government means that there might be some delays expected to the code, as well as on the progression around options on uses of surplus by DB schemes.

“The timelines for the release of the new DB funding code should be carefully monitored by employers hoping for emerging surpluses and favourable legislation around recovery,” said Vassiliades.

“We therefore call on any future parliament to ensure the funding code comes into effect in September 2024, as delays will only cause pension schemes headaches and uncertainty.”

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