The value of pension funds fell by £165billion following the onset of the recession back in 2008, the Office of National Statistics (ONS) has said.
In 2008, the value of pension fund schemes run by trustees or fund managers – known as self-administered pension funds – stood at £928billion, down from £1,093billion in 2007.
Consequently, the drop in value also caused the total income received by self-administered pension funds to fall. In 2008, the total income of these funds was £58.6billion, down sharply from £71.8billion in 2006.
According to the ONS, this decrease was "driven" by a reduction in employers' special contributions as this figure fell by almost 50 per cent from £13.2billion in 2006 to £6.8billion in 2008.
In addition, transfers into pension funds were significantly lower in 2008 compared to the figure seen in 2006. In 2008, the value of these transfers were worth £1.5billion compared to £9.7billion two years before.
Meanwhile, expenditure of pension funds was also lower in 2008 than in 2006. Two years ago, expenditure totalled £48.9billion compared to £52.1billion 2006.
© Fair Investment Company Ltd