A quick reminder that Leeds UCU has organised an Open Meeting on USS this Thursday (11 March) 12 noon – 1 pm. Please come along to find out what’s going on with the latest valuation. Our pensions rep Mark Taylor-Batty will be expanding on the brief contribution he was able to make to the recent university ‘Conversations’ sessions about USS, and we are keen to discuss this with you. Please encourage your colleagues to attend too, whether union members or not, and please forward this invitation to as many people as possible – thank you.
Register for the Open Meeting here
Once you have registered we will send you a link to the meeting, which will be held on Zoom. You are welcome to eat your lunch at the same time!
More information at leedsucu.org.uk/2020valuation
We want the USS employers, including University of Leeds, to join UCU in pushing for a more sensible valuation, including implementing the full Joint Expert Panel recommendations.
A colleague at University of Bristol, Neil Davies, organised a collective letter of complaint to the USS Trustee in January, under the scheme’s Dispute Resolution procedure.
A response is expected around the beginning of April. USS have subsequently issued their valuation report, which would require contributions to go up substantially (from 30.7% currently to between 42.1% and 56.2% of salaries, of which staff pay a third and employers pay two thirds). Neil has now drafted a letter to the FT raising about our concerns, and is asking USS members to sign it. The letter is copied below and I would encourage you to sign it.
The letter will be sent on Friday 12th March.
Text of letter to FT
Four years ago we raised serious concerns in the FT that the USS valuation methodology was underestimating likely investment returns, and overestimating life expectancy and future pay increases. Since 2017, the USS’s assets have increased by 34%, exceeding their own forecasts by at least £17bn, mortality has been higher than expected due to COVID, and increases in pay for university staff have fallen far short of the 4.4% per year anticipated by the USS.
For the 2020 valuation, the USS is proposing to further reduce the assumed rate of nominal returns from 2.8% per year to between 2.1% and 2.3% per year, and to increase the assumed increase in life expectancy from 1.5% per year to 1.6% and 1.8% per year for women and men. The USS is now assuming the scheme will barely be able to match inflation in its investment returns over the next 30 years, whereas in reality, just since the valuation date at the end of March 2020, the scheme’s assets have increased by around a fifth to £80bn. If this valuation is approved, then to maintain current benefits, contributions would have to increase to between 42.1% and 56.2% of salaries from 30.7% today.
Since 2015, members’ satisfaction in the USS has collapsed from 68% to 24% in 2020. The USS needs to urgently restore members’ trust, and if its valuations are to have any credibility it needs to start basing them on evidence, opening up the assumptions and methods that underpin them for full scrutiny. This is the only way to end the cycle of disputes over the scheme.
Meanwhile, UCU pensions negotiators will be meeting with the Pensions Regulator to discuss the levels of prudence (in our view, highly excessive) that USS seem to think are required in the valuation, and which are generating the large “deficit” which if accepted will drive up contributions. Universities UK are consulting employers on their response to the valuation, and once we know where employers stand, there will be a UCU Higher Education Sector Conference for delegates from every UCU branch to discuss our next steps as a union.
There is also a UK-wide ‘Emergency Meeting to Defend USS Pensions (Again)’ organised by UCU Solidarity Movement on Sunday 14th March from 4.30pm – 6.30pm with speakers including UCU President Vicky Blake.
Register for our Open Meeting on Thursday to discuss all this.
Fundamentally, we need to keep on defending USS, to ensure it remains a good pension scheme for everyone currently in it and to ensure it is affordable for everyone in academic and academic-related roles at the university.
University of Leeds UCU President