The defined benefit (DB) and hybrid pensions landscape continued to shrink at a yearly rate of 3 per cent in 2024, analysis from The Pensions Regulator (TPR) has revealed.

TPR's analysis showed that the number of schemes reduced from 7,300 in 2012 to 5,190 in 2024.

In particular, TPR found that the number of schemes closed to new members had fallen "rapidly", alongside winding up and open schemes, while schemes closed to future accrual were the only ones to show a consistent increase, rising from 72 per cent in 2023 to 73 per cent in 2024.

Membership in private DB and hybrid schemes also fell by 2 per cent since 2023 to 9,424,000, with just over a tenth (12 per cent) of memberships in open schemes.

However, the average DB funding level remained broadly similar to that in 2023, increasing to 118 per cent in 2024 from 117 per cent in 2023, while the proportion of schemes in technical provision (TP) surplus is 80 per cent in 2024 compared to 77 per cent in 2023

TPR said that these improvements were due to small reductions in both the amount of assets (4 per cent) and TP liabilities (5 per cent) since 2023.

The latest analysis used an updated actuarial methodology, which made allowance for benefit outflow, such as pensions, lump sums, transfer values, and future benefit accrual (and the associated contributions in respect of this accrual).

TPR said that whilst the change impacts both the total assets and liabilities, it had "negligible" impact on the overall funding level.

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