THE total deficit on final salary pension schemes in the UK has risen by £100 billion in the last month, to £710bn, specialists at PwC have calculated.

The deficit represents the accountancy firm’s estimate of the shortfall between the total value of the liabilities of the UK’s 6,000 defined benefit pension schemes in the UK and their assets.

PwC highlighted the potential impact of the move by the Bank of England to support the UK economy following the Brexit vote in June by cutting interest rates to a fresh record low of 0.25 per cent.

This had had the effect of depressing yields on interest paying investments. As a result pension funds will have to hold more of such investments to generate the funds required to meet future pension payments.

Alison Fleming, head of pensions at PwC in Scotland, said: “With the prospect of further action from the Bank of England to reassure the economy in these uncertain times, the challenging environment for pension funds is likely to endure for several years.”