Joint support for swift USS pension improvements
05 October 2023
The organisations representing UK universities and USS pension scheme members have issued a joint statement calling for the 2023 pension scheme valuation to be finalised quickly so pension benefits can be increased and contributions lowered as soon as possible.
Universities UK (UUK) and the University and College Union (UCU) pledged a collaborative approach to increasing benefits and accrual rates back to the levels prior to the reductions made in April 2022, (so reducing contribution rates for members and employers by around a third), and exploring options to make the scheme more sustainable.
These improvements are dependent on the final outcomes of the 2023 full evaluation of the USS scheme, which is due to complete next year, and ongoing consultation processes by UUK and UCU on the USS Trustee proposals. Members can also have their say until 24 November in the USS member consultation.
Following recent changes in the gilt market, which now return much greater yields, forecasts suggest the full evaluation will return a more positive picture, with a surplus of +£7.6bn predicted, compared to a deficit of -£14.1bn in 2020. The USS has proposed improved benefits for members as a result of this.
Reading is one of many UUK member employers to have supported making the proposed improvements as soon as possible in its submission to UUK’s consultation, while urging measures to improve the sustainability of the scheme.
The joint statement urges reduced contributions to come into effect from 1 January 2024, and benefits to be changed from 1 April 2024. It also proposes one-off payments to members in April 2024, to mitigate the reduced benefits between April 2022 and March 2024.
Responding to the statement, Vice-Chancellor Professor Robert Van de Noort said: “We welcome this statement by UUK and the UCU, which represents positive progress towards helping our USS members who are facing financial pressures.
“We thank UUK and the UCU for their continued collaborative and constructive approach on pensions. We continue to believe that working together and overcoming points of difference will bring an outcome that works for all parties.”