Universities UK report on the outcome of their USS pension scheme consultation
17 Jun 2021
Employers representing 95% of USS current members have responded to the UUK consultation
We know how valuable the USS pension scheme is to our colleagues and how important it is that the scheme provides appropriate retirement benefits and remains affordable to all members.
You will be aware that USS is facing a large deficit and the trustee has priced future benefits much higher than current rates. With major pressures from the UK pension regulator and other challenges, without significant reform employers and scheme members will face unaffordable and escalating contribution rates.
Along with all other employers in the USS, we are working closely with Universities UK (UUK) to find a way forward that enables us to deliver a valuable, affordable and sustainable pension.
As part of that process, we recently submitted a response to the formal consultation about USS. UUK has now produced a report based on the consultation responses from 141 employers. The vast majority of these employers – including our University – are backing a series of proposals for medium and long-term reform of the pension scheme.
The proposals include a series of significant covenant support measures proposed by Universities UK (UUK) and which are deemed necessary by the USS Trustee to lower its pricing in the current valuation if it is to retain a good level of Defined Benefit pensions and avoids unaffordable contribution increases.
UUK have published a full list of the proposals which are being supported, which include:
- No increases in member contributions or employer contributions.
- Maintaining the scheme’s Defined Benefit /Defined Contributions hybrid.
- A major review of the scheme’s governance.
- Addressing the high opt-out rate by giving eligible members the choice of a new lower contribution option.
- A commitment that should the scheme’s financial situation get better then improvements to benefits can be considered rather than reducing contribution rates.
These proposals will now be discussed over the coming weeks with the UCU, UUK and USS at the Joint Negotiating Committee, which is responsible for approving any scheme rule changes and to conclude the 2020 valuation.
Further updates will be published on StaffNet as discussions at the Joint Negotiating Committee continue over the coming weeks to try to reach an agreed position, ideally at the current levels of payment.
For further information you can read a glossary of terms.
You can also watch a recording of our open meeting with members of the Senior Leadership Team and external pensions expert, Paul Hamilton, which included an informative presentation by Paul. We have also published a timeline and highlighted letters from Universities UK and the Russell Group.
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