Changes to the Universities Superannuation Scheme
We want our staff to have access to an affordable and sustainable pension which will provide for their retirement. A number of pension schemes are available for staff to provide this.
If you are a member of the Universities Superannuation Scheme (USS) then you are in a hybrid scheme that provides some defined benefits, which promise you a set income for life when you retire, and some defined contribution benefits.
USS Valuation 2020
USS has to ensure there is enough money to pay this promise both now and in the future. To do this USS carries out regular actuarial valuations as a financial health check of the scheme. An actuarial valuation looks at the scheme’s funding situation as it was on a certain date. For the latest valuation, that date is 31 March 2020.
The 2020 valuation is showing that significant additional costs for members and employers will be required to maintain the existing benefit structure. This valuation is being used as the basis for discussions on how much employees and employers will pay in contributions and how benefits to members may have to change.
Our University is involved in this process through the Joint Negotiating Committee (JNC) of USS – an independently chaired group made up of an equal number of representatives from the University and College Union (UCU) on behalf of members, and Universities UK (UUK) on behalf of employers. We also have responded directly to consultations issued by UUK during the negotiations.
We continue to recognise the very difficult challenges facing all USS members, employers and the Trustee. There is an absolute need to find a long term and sustainable solution for all stakeholders and to enable members to have confidence in the scheme.
Decision of the Joint Negotiating Committee
The JNC has now has now determined how the funding challenges facing the scheme should be addressed. This will result in changes to the future benefits of USS and other related changes required under pensions law.
The decision is subject to formal sign-off from the USS Trustee, and will then progress through further stages of consultation with members and representative bodies.
Members will continue to receive monthly updates from USS and we will keep all employees updated on StaffNet.
USS Trustee agreement to proceed with the employers’ proposals
The USS Trustee has agreed to proceed with the employers’ proposals for concluding the 2020 USS valuation.
This means that the substantial increases timetabled for 1 October 2021, and April 2022, are now off the table – and the 2020 valuation will be concluded with a total combined rate of 31.2%, which is an increase over the current rate and will mean that members’ contributions will rise to 9.8% and employers’ to 21.4%. UUK are consulting with employers over this small increase.
Further updates will be posted here and on StaffNet News.