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 which is defined contribution, where contributions are invested in your own savings pot and where you have more flexibility in how you use this at retirement.
USS Valuation 2020
The USS Trustee has agreed to proceed with the employers’ proposals for concluding the 2020 valuation. This includes a compromise on postponing the lowering of the inflation cap until April 2025. Failure to conclude the 2020 valuation would have meant significant increases in payments for employees (to 11% of your salary) and employers (23.7%) from April 2022 and increases every 6 months thereafter up to a member contribution rate of 18.8% from October 2025. These increases would have been imposed had an agreement not been reached.
The increases that were timetabled are now off the table – and the 2020 valuation has been concluded with a total combined rate of 31.4%. This will mean that members’ contributions will be maintained at 9.8% with employers increasing to 21.6% (previously 21.4%).
It is also important to remember that pensions built up prior to 31 March 2022 are secure and won’t be changed. The Scheme retains a significant defined benefit (DB) component, albeit lower than previously, and is one of the few private schemes of this type which are still open to new members and future accrual.