Taylor Wimpey stands high on pension fund worry list

The remorseless collapse in the share price of Taylor Wimpey (TW) means that the house builder now has one of the UK’s worst rankings when it comes to the size of the company’s pension fund deficit in comparison to its market capitalisation.

The Financial Times publishes figures today showing TW to be in the third-worst position.

TW has a figure of 10% - i.e. the pension fund deficit of £216m is a tenth the size of the entire company, that figure being put at £2.2bn.

British Airways is miles higher than anyone else, with a figure of 23%. BAE Systems finds itself flying at a similar height to TW with a percentage figure of 11%

The rankings come as the Pension Protection Fund, set up to provide safeguards to pensioners in schemes provided by companies that become insolvent, points to a £155bn shortfall in the provisions by all private companies operating within its safety net.

Experts think that a rather large hole, triggered by recent changes in financial markets, will fill itself in… and if a different set of assumptions were made, based on how bond yields are calculated, the deficit would shrink to £75bn.

The FT provides information from pension consultants Lane Clark & Peacock which appears in tabular form: