A typical defined benefit (DB) scheme was able to meet 93.7% of its accrued pension rights as of 30 September this year, according to Legal & General Investment Management (LGIM).
The figures from the LGIM DB health tracker represent a drop of 1.3 percentage points on the previous quarter.
The 93.7% figure from the asset manager is slightly higher than what the DB tracker showed this time last year, when a typical scheme was expected to meet 92.9% of accrued pension rights.
The results for the third quarter follow the fall in interest rates, which has had a negative impact on schemes that have not fully hedged against moves in bond yields.
LGIM head of solutions research John Southall said trustees "could stand to benefit from revisiting their liability-driven investment (LDI) strategies, using leverage where appropriate".
The tracker - initially launched to improve scheme decision-making around cashflow-matching investment strategies - uses "expected proportion of benefits met" as its metric. This considers average proportion of benefits met across the lifetime of the scheme over multiple economic scenarios.
According to the tracker, the manageability of a scheme's deficit is dependent on the strength of its sponsor, the size of deficit relative to the size of the assets, and the quality of the investment strategy. Economic and demographic risks within the scheme also play a part.
Head of multi-asset funds John Roe said: "This is an unwelcome reminder that UK interest rates and inflation remain outsized risks for many UK DB pension schemes. In these circumstances, trustees and their advisers shouldn't focus on what they think will happen in those markets, but whether they can afford the cost of being wrong."
With yields now on the up, average funding levels should also even out with many schemes likely to further their de-risking, Roe added.
"When doing this, schemes should bear in mind that credit spreads on corporate bonds remain close to mid-2018 lows, which in turn might justify gradually averaging into any further credit allocations."
The most recent Purple Book from the Pension Protection Fund, published last December, showed that a typical pension scheme held approximately 25% in equities, 60% in bonds/LDI, 5% in property, and 10% in other assets.
Mobius Life has launched a specialist fund range in a bid to make alternative investment strategies available to more defined benefit (DB) schemes.
As more schemes reach a fully funded status, it is important that the risk-averse environment is not codified into regulations, says Paul McGlone.
Without specialist help, smaller DB schemes are being left behind in a bulk annuity market increasingly focused on mega-deals, says Rob Dales.
NHS England has confirmed it will take urgent action on to ensure NHS workers who exceed their annual allowance during this financial year will be able to take on additional work without being left out of pocket.
A Merseyside pre-school nursery and its director have been ordered to pay £8,200 after admitting failing to enrol members of staff into a workplace pension scheme.