Some pension schemes at large companies will now be linked to the Consumer Prices Index (CPI) rather than the Retail Prices Index (RPI) saving an average 2.5 per cent for large companies, according to research by Towers Watson.
The change comes after the government allowed some pension schemes to link to the lower CPI rate.
More than half of the 42 clients from the FTSE 100 questioned by Towers Watson said at least some of their pension scheme’s rules meant that they could switch to CPI inflation from RPI.
Five of the firms questioned said all pension increases would now be CPI-based.
All of the companies surveyed hold pension fund assets of at least £1bn.
Head of UK pensions at Towers Watson John Ball said: “The government’s policy change has transferred wealth from pension scheme members to sponsoring employers.”