Pension deficits at the top 25 Irish companies have more than doubled in the last 12 months, according to a report by Lane Clark and Peacock (LCP) Ireland.

The independent analysis, which has measured deficits according to international accounting standards (IAS19), has reported that deficits of the top 25 companies quoted on the Irish Stock Exchange have reached EUR 4.5 billion.

LCP also analysed the pension plans of four of the top state-sponsored bodies - An Post, ESB, CIé and RTé, revealing that total pension deficits among these four bodies alone amounted to a further EUR 4.5 billion.

The analysis shows that, despite recent rallies in the equity markets, deficits have doubled due to falling equity values in late 2008 and early 2009, coupled with falling bond yields.

Conor Daly FSAI, partner with LCP Ireland and author of the report, said: "Irish pension plans are the latest victims of the excesses of the 'Celtic Tiger'. Adequate risk controls were not put in place during the growth period. Instead, aggressive investment strategies left many pension plans particularly exposed to the falls in global equity markets. The resulting level of underfunding of pension liabilities of some of Ireland's largest employers is now quite staggering and it is clear that in many cases the pension plans have become unsustainable. There is enormous risk inherent I the system."

The LCP update follows a more positive report earlier this week which stated that Irish pension managed funds returned +1.1 per cent for November 2009, according to Hewitt's Managed Fund Index.

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