Members will have seen in last week’s all-staff communication the reminder that our USS pension contributions will be going up from 8% of Salary to 8.8% of salary, as from your pay slip at the end of April. We will be receiving letters from the USS this week with further details. We have communicated this known forthcoming contribution a few times in updates on pensions in the last few months. This is the first of a series of increases in contributions that were triggered last summer as a result of a failure to agree the 2017 valuation – the source of the big pension strike this time last year. Further increases will take place if no agreement is reached – and you will see these mentioned in the USS letter and by following links from the all-staff email – but please note that there are no employers who desire these further increases and the pressure is on to come to a conclusion and agree a way forward to avoid them.
Members will recall that the Joint Expert Panel was established on the back of our strike, and its first report came out last September. Partially in response to that, USS proposed to put forward a 2018 valuation that might replace the contentious 2017 one. This is currently being consulted upon by employers. The further increases that have been slated could be stopped or replaced as a consequence, and we’ll report on the outcome of these when we know them. Current pressures are growing around the issue of so-called ‘contingency contributions’, which employers would be asked to make in specific circumstances. Neither the employers nor UCU think these are a good idea, but USS remains reluctant to agree to all the recommendations of the JEP.
In associated news, a recent article by respected pensions journalist Josephine Cumbo argues that USS’s failure to be transparent – something that has long been argued by UCU and more recently by employers – sends a warning to pension schemes more widely, and queries the motivations of the regulator.http://www.pensions-expert.com/Comment-Analysis/USS-dispute-has-exposed-a-transparency-deficit?
Talking of the Regulator, their recent Annual Funding Statement contains a straightforward contradiction of what USS have claimed as being the guidance they are following from the Regulator. This has profound consequences for the current ongoing consultation with members, as outlined in this blog from Michael Otsaku: https://medium.com/@mikeotsuka/on-the-significance-of-usss-misrepresentation-of-tpr-717021bc3771
Sam Marsh outlines the implications of this misrepresentation of the Pension Regulator in a series of tweets early last week: https://twitter.com/Sam_Marsh101/status/1103589129328250882 Marsh here points out that the new information calls into question the integrity of the USS executive team, who had rejected some of the JEP proposals arguing that the Pensions Regulator had internal benchmarks that dictated what they could do. This having been refuted by the Regulator, USS appears exposed as having seemingly manufactured arguments to support their valuation methodology, something that has always been at the core of our dispute over projected deterioration of our pension.