Email from branch president Vicky Blake to branch members 24 October 2018
Dear Members,
The situation with our USS pension has moved rapidly since
our open meeting with Mark Taylor-Batty and Sam Marsh (a member
of the USS Joint negotiating committee) two weeks ago. It is really vital
that we all fill in responses to the USS consultation.
Today’s Internal Comms email from the university does note that Sam Marsh has demonstrated that – without changing our contributions and still using the prudent measures that USS apply – the scheme will be in surplus in the time frame applied in valuations (http://sam-marsh.staff.shef.ac.uk/uss/docs/UoS_USS_discussion_document.pdf).
However, the university communication also links to USS’s inadequate response to Dr Marsh’s findings, which contains inaccuracies and, remarkably, fails to use the words ‘test 1’, the mechanism that was at the heart of Dr Marsh’s critique (see the bottom of this email for links to responses to USS’s latest communication).
The USS consultation with members of the scheme is still open, and we now have a recommended set of responses for you to apply. To access those responses and the link to the consultation, please go here: https://medium.com/ussbriefs/resile-and-resubmit-uss-consultation-response-template-4809945fb6bc. It’s really quick to do, and obviously even better if you can tweak and personalise responses.
Please do give those a read – it is particularly empowering to see how UCU members’ action, and UCU members’ analysis has shifted the debate, and gained us access to previously hidden-but-vital figures.
Thank you to everyone who voted in the Pay and Equality Ballot, and all who helped us to get the vote out. As you will see from Matt Waddup’s email that has just gone out to members nationally, our historically high turnout in this postal ballot on pay and equality was not quite enough to break the 50% threshold set by the (anti-)Trade Union Act 2016.
In this email:
• Our result
• What next in the pay and equality dispute
• Local campaigning and action on gender pay and casualisation
Our result
Prior to 2016, we would be celebrating this turnout, and this result. At Leeds, members voted strongly for strike action (69.8%) and action short of a strike (77.7%). This government’s anti-trade union legislation has denied us our right to withdraw our labour despite our turnout of 49.2%. We only needed 15 more votes to break the threshold.
(You may wish to note that, while advocating the 50% threshold’s introduction, Boris Johnson was in post as London Mayor having achieved… 31.8% turnout in his election.)
What next?
We remain in dispute over the joint unions’ pay and equality claim. Two important meetings are coming soon which will inform the union’s next steps:
1 November Higher Education Committee (HEC)
7 November Special Higher Education Sector Conference (HESC) on Pay and Equality
I am an elected member of HEC, and I would very much value your comments and thoughts. I will write with further updates following that meeting on 1 November. As a branch, we are also sending 5 delegates to the HESC (+ me in HEC capacity), and similarly all of us would value feedback from the branch before we go.
Local campaigning on gender pay and casualisation
Locally, we continue our work to push senior management to implement effective policies for closing the 22.5% gender pay gap at the University of Leeds. On 15 August, we submitted our Gender Pay Claim asking for further data on the extent of the gap and how it affects different groups of staff, and arguing for a clear timeline for redressing the problem by 2025 (the Claim can be found here: http://www.leedsucu.org.uk/wp-content/uploads/2018/09/Gender_Pay_Claim.pdf). Meetings are now being set up in which we will be negotiating for meaningful change.
On Friday (26 October) members are invited to “UCU Anticas Roadshow: IGNITION!“ events in Leeds University Union – to kick off planning for the Anti-Casualisation Roadshow and to turbo-boost our Anti-Casualisation claim. We’re also holding a “Contract Casualty: a drop in for the confused” from 12-2pm. Please see attached flyer and please circulate! Our workshops on Friday will lay the foundation of a strategy day we’re holding with our branch anticas activists in mid-November, with national UCU bargaining office support.
The latest development in the ongoing USS saga sees the revelation that USS themselves seem to have failed to correctly apply their own ’Test 1’, and that when this is corrected there is no deficit in the scheme as of March 2018. If there is no deficit, then there is no longer any argument for any change to our contributions or for any ‘benefit reform’, the euphemism we hear often which means changes to how much we receive in pension, and the means by which it is calculated. This seeming flaw has been exposed by Sam Marsh, a member of the Joint Negotiating Committee (JNC).
‘Test1’ and ‘self-sufficiency’
The USS have three tests which they apply in coming to a valuation.* Of these, Test 1 considers the viability of achieving a ‘self-sufficiency’ position in 20 years. ‘Self-sufficiency’ is, in effect, a position whereby all owed pensions can be paid without significant further contributions to the scheme from employers or employees. The Joint Expert Panel (JEP) expressed concern about Test 1 as “given too much weight in determining the valuation and its effects extend beyond its original purpose” (p. 8) and that specifically “Test 1 drives the investment strategy toward a low return investment strategy that results in a higher deficit and higher contributions than would be the case if the current investments strategy were maintained” (p. 24). In other words, the JEP argued that Test 1 was responsible for magnifying the very deficit that it seeks to address.
We should note that, of course, this calculation of a ‘self-sufficiency’ position is to ignore the fact that the contributions made to the scheme each month more than cover the pensions paid out each month, always have done, and are forecast do so safely for at least the next fifty years (JEP, p. 7). That is to say, the USS make a valuation of the scheme not on the basis of affordability in these income/outcome terms, but on a basis of whether we can reach ‘self-sufficiency’ in 20 years, regardless of the unlikely necessity of such a position. The ‘deficit’ is the projected amount needed to attain something close to that position. This is a response to the regulatory requirements put on the scheme to demonstrate its viability.
Test 1 can flag a problem even when none exists
Sam Marsh made a submission to the JEP on Test 1, but it was received too late to be factored into their report. He had concluded that Test 1 could flag a problem even if the projected value of assets in 20 years was greater than the cost of paying off all pensions at that point, because Test 1 as formulated does not take into account the projected value of the assets. What is more, USS confirmed his calculations that, applying their own measures and projections, there will indeed by a surplus in year 20. The deficit disappears. It’s just that USS, remarkably, never do this calculation of what the assets will be worth as part of Test 1.
USS’s response
USS have today begun to respond to the critique of their application of ‘Test 1’, and in doing so confirm that ”current contributions are ultimately adequate” (via @JosephineCumbo on Twitter). Sam Marsh comments on this admission that “this is pretty much the first time #USS have explicitly said this. I have a feeling that @UniversitiesUK and many VCs/finance directors around the country may be surprised to hear this.” (@Sam_Marsh101 on Twitter) In this Twitter thread, he responds to each of USS’s points
No deficit means no detriment
Where does this leave us? Well, if there is no deficit, then there should be no detriment. If the JEP report vindicated our strike action, this latest revelation furthers our cause: the status quo should be the outcome of any further deliberations, and JEP can continue their scrutiny and exposure of Test1, and appeal for better transparency from USS.
*Test 2 measures the stability of contributions to the scheme and Test 3 considers the ability the HE sector to underwrite the scheme in a disaster scenario. The recent report from the Joint Expert Panel (JEP) found that “Tests 2 and 3 appear not to play a significant role in either the valuation or the on-going monitoring” (p. 8)
Chloe and colleagues outside the School of Law during the USS pension strike
A personal post from new UCU committee member Chloe Wallace
When I look back over our strike action in February and March, I have a lot of good memories: standing with friends old and new; the support of my colleagues and students; the feeling of empowerment and hope for the future. But all in all, it wasn’t much fun. Quite apart from the snow, the rain, and the pay deduction, there was disruption to the job I love and the students I’m committed to, anxiety in such an uncertain situation, and an ever-present feeling of guilt. When it was over, I breathed a sigh of relief; back to normal at least for a while.
So my heart sank when it became clear that we would have to ballot on striking yet again for a fairer deal on equality, casualization and pay. We, individually and collectively, have too much to do, and university staff and students don’t deserve more disruption after what we dealt with this year. We talked about fairness, equality and casualisation on the pickets and on #striketwitter throughout and beyond the action. We know they matter and that we have to fight for them, but the memory of the difficulties of that fight make being pushed to disruptive strike action (by employers who, it turns out, still aren’t listening) difficult to contemplate.
The problem is, we have to do this. Above all, we all have to vote in the ballot. The Trade Union Act 2016 requires, for a ballot on industrial action to be valid, that at least 50% of eligible members vote in the ballot, as well as that a majority of those voting vote for the proposed action. This is quite clearly, and explicitly, intended to make it harder for unions to strike. In January this year, UCU branches defied the legislation, with a 58% turnout across affected branches. We need to do it again, to prove that that was not a fluke and that we remain a force to be reckoned with. Abstaining the ballot is not sitting on the fence. It undermines the strength of the unionacross the board, not only on pay, equality and casualization, but in the many local issues, disputes and negotiations on which UCU works for its members, and all university staff, around the country. It also undermines us on pensions. The JEP report was a massive vindication and felt like a moral victory, but it isn’t a victory. We need UUK to stand with us to push its recommendations through to the trustees and regulator, and I don’t believe they will do that if we show weakness at this point. We need to beat the turnout threshold to show that we are still engaged and we still care; if we don’t, we risk undoing all the good we did earlier this year.
Voting “no” in the ballot is better than abstaining. But voting yes/yes is even better, and I think it’s the strongest way to maintain pressure and show we mean business. Universities are now expecting to be able to get away with below inflation pay-rises for ever more, and that has to stop. Most university staff, particularly support staff and academics who can’t, or won’t, work long hours to fast track to promotion, can’t rely on incremental pay-rises – and increments are supposed to recognise professional advancement, not increased cost of living. The gender pay gap in the sector is simply unacceptable, and recent reports confirming that over half of all academic staff are on insecure contracts ought to be pushing university management into action – but they aren’t. And, given that the size of the pension fund is dependent on contributions, which are dependent on salary, the further our salaries fall behind inflation, the less money goes into the fund to pay out later on. I am privileged in academic terms: full time, permanent contract, senior and well paid. It’s easy for me to say that a percentage point or two on the pay scale isn’t worth the challenge of another strike. But the stakes are much higher than that, for my colleagues (present and future) and for the health and success of the sector I’ve spent my whole life in.
So please dig out your ballot paper and vote in the ballot, to show that we are a united and active union. And please make that vote Yes/Yes, to show that there’s fight in us yet, and we’re not giving in.
