Pension shortfall soars at Mersey

THE deficit in the pension fund of Mersey Docks & Harbour, the country's second-largest port operator, has ballooned more than tenfold in just six months.

The company blamed stock market turmoil for the growing shortfall. New accounting rules had shown a deficit of just £800,000 at the end of last year, it said. But this had jumped to £11m, on assets of £153m, by the end of June. Mersey Docks closed its generous final-salary pension scheme to new members in November 2000.

Higher insurance costs helped clip first-half profits from Mersey's mainstay ports business. That left group pre-tax profits down 6.8% at £27.2m before goodwill for the six months ended June. Turnover rose 6.6% to £133.3m. The company, which operates the Port of Liverpool, handles some 25% of container traffic between Britain and North America.

Chief executive Peter Jones said a sluggish manufacturing sector and costs associated with last year's share buyback were also a factor in the profit dip.

Underlying earnings rose 1.3% to 22.9p a share compared with the second half of 2001 and the interim dividend rises 4.6% to 6.8p a share.