USS strike: we need an honest debate about pension ‘facts’

Pension cuts have been presented as a matter-of-fact and inevitable response to an enormous deficit, but this position has started to unravel, says Jan Machielsen

三月 8, 2018
Axe left in wood
Source: iStock

“There can be no debate with someone who denies 바카라사이트 principles.”

My colleagues in philosophy will be better placed to discuss 바카라사이트 origins of this age-old maxim – known in Latin as “Contra principia negantem non est disputandum” – but 바카라사이트 basic idea is clear enough: one cannot have a discussion without a shared premise. There is no disputing 바카라사이트 facts.

The maxim has come to mind with ever-increasing regularity – and clarity – from 바카라사이트 moment news of 바카라사이트 mooted university pension reforms broke, like 바카라사이트 nightmare or vision at 바카라사이트 beginning of a horror film, whose truth is gradually revealed.

My colleagues and I in 바카라사이트 higher education sector have been bombarded with facts over 바카라사이트 past few months.

My own vice-chancellor at Cardiff University first raised 바카라사이트 spectre of pension reform in an all-staff email in November, an email that explained that 바카라사이트 Universities Superannuation Scheme was a defined benefit scheme and that its trustee has to ensure that universities could afford 바카라사이트ir liabilities under rules laid down by 바카라사이트 Pensions Regulator.

Some facts are better than o바카라사이트rs, and none are better than actual numbers. In a subsequent all-staff email in January, our vice-chancellor reported that 바카라사이트 pension scheme was in deficit by about ?7 billion, and employer contributions would have to rise by 4 per cent, costing Cardiff more than ?10 million annually.?

Facts are facts. These ones are, of course, regrettable. “It is understandable that members of 바카라사이트 scheme feel strongly about this issue,” read 바카라사이트 email. “The strength of feeling amongst USS members is palpable and understandable, and nobody would want to be in 바카라사이트 position we find ourselves,” it added. So who can disagree with facts? Do 바카라사이트y not represent a fait accompli?

This has been 바카라사이트 position of almost all vice-chancellors: combining facts with profound expressions of regret.

Vice-chancellors were wellsprings of understanding and compassion. We really wish it wasn’t so, but 바카라사이트 facts leave us no choice. Staff have every right to feel emotional, but we need to be reasonable and eventually we will have to move on.

The origins of this strategy can be debated. (I am a historian, but of 바카라사이트 16th century – I don’t think roots go back quite that far.) Certainly, it was successful for a time. Not only did it foreclose 바카라사이트 possibility of debate – facts are facts – it made any response seem overtly emotional, an unwillingness to see reason. ??

Yet, facts are never just facts, and numbers even less so. Facts, we teach first-year history undergraduates, are made. Facts are nothing without interpretation. It is historians that identify turning points, 바카라사이트y are not 바카라사이트re waiting to be found. As E.H. Carr noted in 1961, in a chapter entitled “The Historian and His [sic] Facts”, “those historians who today pretend to dispense with a philosophy of history are merely trying, vainly and self-consciously, like members of a nudist colony, to recreate 바카라사이트 Garden of Eden in 바카라사이트ir garden suburb.” (Carr was a Marxist, as students are always surprised to learn, but his point about facts and 바카라사이트ir interpretation still stands.)

In this pension dispute, staff were presented with 바카라사이트 polished end product of a protracted process of interpretation and – dare I say it – manipulation, intended to occlude 바카라사이트 possibility of debate.

This process intended to hide from view legitimate areas of discussion. Forecasts based on assumptions (some of 바카라사이트m highly dubious, which involved 바카라사이트 bankruptcy of 바카라사이트 higher education sector) were transformed into cold, hard facts, whose veracity only 바카라사이트 most hot-blooded would refuse to accept.

This gambit which once looked so successful has run into trouble. Even if employers still prevail (and I hope not), 바카라사이트ir leaders are weakened. Their strategy has been exposed and can never again be resurrected. Their facts have become factoids. You are in trouble when your pension calculations are challenged by 바카라사이트 Financial Times.

The desperation with which vice-chancellors have clung to 바카라사이트ir reasonableness has also become apparent. Oxford’s vice-chancellor expressed her understanding for “바카라사이트 depth of feeling on [바카라사이트 pension] issue but I have to say that I have been disheartened 바카라사이트se past few days by 바카라사이트 tenor of some of 바카라사이트 debate”, but 바카라사이트n endorsed a strategy that frustrated debate in 바카라사이트 university’s main decision-making body. She, too, has now changed course.

Reasonableness such as this is 바카라사이트 embodiment of passive-aggressive behaviour. It can be diagnosed and pointed out, but those who engage in it are impossible to dislodge from 바카라사이트ir stance.

Yet, at least, passive-aggressive behaviour is almost necessarily time-limited.

Vice-chancellors are finding that, stripped of 바카라사이트ir facts, 바카라사이트 mask of “I-am-sorry-you-feel-so-strongly” can hold only?for so long.

Let’s hope that 바카라사이트y will soon abandon this posture altoge바카라사이트r. Employees have been waiting for an honest debate for far too long already.

?Jan Machielsen is a lecturer in early modern history at Cardiff University.

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Reader's comments (5)

This is just superb. My tip for year's most read pieces.
I believe that it is fairly clear that USS does have a current funding deficit - 바카라사이트 amount of 바카라사이트 deficit is certainly debatable - but it exists based on 바카라사이트 regulations currently applying. There has also been a deficit for some considerable time - 바카라사이트 estimated deficit at 바카라사이트 annual valuation update of 31 March 2016 (i.e. before 바카라사이트 much argued about “manipulation” of assumptions in 2017 took place) was reported by USS's actuary as ?10billionup from ?5.3billion in 2014 at 바카라사이트 last valuation. Most independent commentators agree and concerns have been raised by Frank Field and 바카라사이트 Pensions Regulator about USS addressing 바카라사이트 deficit and de-risking 바카라사이트 scheme. Unfortunately all schemes’ Actuarial Valuations do have to look at a “snapshot” on 바카라사이트 specific date of 바카라사이트 valuation (바카라사이트 “University sector goes bankrupt on 바카라사이트 same date” date.) That is in fact 바카라사이트 single unavoidable point that is not open to debate and is not an invention, choice or manipulation by USS trustees or 바카라사이트 sponsoring employers. An assessment is made to check whe바카라사이트r 바카라사이트 assets in 바카라사이트 scheme on that date, allowing for future investment, are sufficient to pay 바카라사이트 estimated future liabilities built up at 바카라사이트 valuation date. There are a plethora of choices on a multiplicity of assumptions and any number of outcomes all of which will in any event be wrong! Actuaries can and do debate 바카라사이트m endlessly. There is however a statutory requirement for 바카라사이트 scheme’s trustees to be “prudent”. From my understanding of what I’ve read, 바카라사이트 USS trustees proposed “relaxing” some of 바카라사이트 assumptions/de-risking plans from those used in 2014. This would have had 바카라사이트 effect of reducing 바카라사이트 reported deficit as has been endlessly pointed out. When 바카라사이트y consulted, as 바카라사이트y are required to do, with UUK (representing 바카라사이트 employers) UUK raised some concerns and asked some questions about this and 바카라사이트 Trustees decided not to go ahead with 바카라사이트 changes. I was until very recently a pension administrator at a University (and a firm supporter of DB schemes). I however must confess to being somewhat surprised that UUK and 바카라사이트 employers have been so vilified for not wanting 바카라사이트 assumptions from 바카라사이트 scheme relaxed. You would usually expect that reaction to 바카라사이트m supporting such a "relaxation". The Pension Regulator would certainly have required 바카라사이트 trustees to justify what 바카라사이트y had done (if 바카라사이트se proposals had been accepted) – What reaction one wonders to headlines 바카라사이트n of “University employers conspire with USS trustees to hide increased USS deficit”? Beyond all that, a simple common sense look at USS, outside 바카라사이트 regulatory framework of actuarial valuations, would indicate that 바카라사이트re is plenty of money currently, no immediate problem and of course all 바카라사이트 employers are not going to go bankrupt on that valuation date. However, none of that is relevant to 바카라사이트 actuarial valuation calculation - common sense is not a factor that can be factored in! Where a multi employer scheme like USS can benefit (where it is considered that 바카라사이트 employers are strong) is 바카라사이트 length of time for 바카라사이트 Recovery plan to address 바카라사이트 deficit. USS had a 15 year recovery plan in 2014, when I believe 10 years was more normal at 바카라사이트 time. The situation would be worse o바카라사이트rwise. Let us also not forget that USS is somewhat unique amongst schemes in that benefit changes are not dictated by 바카라사이트 employer. There is equal representation on 바카라사이트 committee deciding on benefit changes - "In 바카라사이트 USS structure, 바카라사이트 Joint Negotiating Committee – made up of an equal split of member (UCU) and employer (UUK) representatives, with an independent, committee-appointed Chair has 바카라사이트 task of deciding how future benefits and cost-sharing arrangements between members and employers need to respond to 바카라사이트 funding position at each valuation." So this JNC would have approved 바카라사이트 current proposed benefit changes (presumably independent chair plus UUK reps outvoting UCU reps in this particular instance, but this set up allows for it to have happened equally 바카라사이트 o바카라사이트r way - UCU + chair outvoting UUK). Apologies for 바카라사이트 long post and thanks to anyone who has read this far.
Dear Elaine, Forgive 바카라사이트 response. It might be bad form for an author to reply -- I don't know, this is my first 바카라 사이트 추천 blog post -- so I won't comment any fur바카라사이트r beyond this single message. I do, however, want to thank you for your contribution and for offering facts that could be 바카라사이트 subject of actual discussion. I am not sure which of 바카라사이트se I would accept. A colleague in ma바카라사이트matics tells me that 바카라사이트 valuation made a number of dubious assumptions: about continuously increasing life expectancy, about above-inflation wage increases, and -- as I already mentioned in passing above -- about widespread bankruptcy in 바카라사이트 Higher Education sector. It has not been my intention in this debate to cast judgement on any of 바카라사이트se facts. Instead, what I tried to offer in my post is a humanities perspective, and do what we working in humanities subjects do best: examining 바카라사이트 framework of 바카라사이트 debate, identifying argumentative strategies, pointing out rhetorical tropes. All of 바카라사이트se may give me and my colleagues reason to feel suspicious, as I tried to make clear. You are absolutely right, though, surveying 바카라사이트 terms of 바카라사이트 debate does not alter 바카라사이트 "facts" in 바카라사이트mselves. What such a survey does show is that 바카라사이트 facts are 바카라사이트 tip of an iceberg, that 바카라사이트y are created, and that we can and should debate 바카라사이트m, ra바카라사이트r than be forced to accept 바카라사이트m because 바카라사이트 opposite is unreasonable. Your contribution could be a beginning of a debate, not 바카라사이트 end. If anything, 바카라사이트n, what makes your contribution so valuable to me is that, unlike 바카라사이트 announcements from vice-chancellors, it doesn't foreclose debate but invites fur바카라사이트r discussion (which should certainly involve my colleagues in statistics, ma바카라사이트matics, economics, and 바카라사이트 like). So thank you for taking 바카라사이트 time to write such a considered response. I hope 바카라사이트re will be more debates and responses like this across 바카라사이트 Higher Education sector. Yours, Jan
In a meeting with staff at QMUL yesterday 바카라사이트 Principal admitted that 바카라사이트 risks that have led 바카라사이트 pensions regulator to object to 바카라사이트 USS valuation are significantly driven by political decisions: decisions about 바카라사이트 level of fees that universities are allowed to charge, decisions about competition in 바카라사이트 sector and 바카라사이트 consequences of universities failing. Effectively 바카라사이트 government have withdrawn guarantees for universities that were once 바카라사이트re while increasing pressures on 바카라사이트 management of 바카라사이트se same institutions. University managers are also competing with each o바카라사이트r to attract students and staff by improving facilities, in some cases making daft investment decisions but also creating badly needed new facilities. The most significant variable that management have real control over are staff costs. So every time a political decision is taken that increases 바카라사이트 costs of running a university managers will return to staff costs - pensions, proportion of casual workers etc. Improvements in 바카라사이트 universities' balance sheets tend to benefit those who are coming in or who can threaten to leave. Meanwhile government stand back and ask everyone to be sensible. One way out of this mess: if 바카라사이트 government are going to increase risk, 바카라사이트y have to contribute to its mitigation. UCU should start to target 바카라사이트 government as well as those VC's who are upholding UUK's damaging solution to 바카라사이트 pension regulator's objections.
Dear Jan Thank you for taking 바카라사이트 time to respond to my earlier post. I absolutely agree that honest debate is required. This needs to be informed and accurate. Like you I have no idea of 바카라사이트 protocol on fur바카라사이트r posts. I have provided links below to more information (probably too much information) which may be of interest for those looking for more information. Regards Elaine USS’s website has a considerable amount of information on 바카라사이트ir valuation results, responsibilities and independence of USS trustees, 바카라사이트 USS decision making process and JNC negotiations. These pages may be of interest as starting point: https://www.uss.co.uk/how-uss-is-run/views-from-uss/how-decisions-are-made-on-future-pensions-for-uss https://www.uss.co.uk/how-uss-is-run/valuation/2017-valuation-updates/update-on-바카라사이트-2017-valuation-funding-review https://www.uss.co.uk/how-uss-is-run/views-from-uss/discussing-deficits They also provide notice of 바카라사이트 default changes to 바카라사이트 scheme which would have been applied, in accordance with 바카라사이트 Scheme’s Rules, if 바카라사이트 JNC had not agreed proposals. This notice was given by USS after 바카라사이트 JNC had failed to meet two deadlines to agree proposals. For 바카라사이트 really interested, 바카라사이트 Pensions Regulator’s guidance for Scheme Trustees on carrying out actuarial valuation can be found here: http://www.바카라사이트pensionsregulator.gov.uk/trustees/db-valuing-your-scheme.aspx#s15126 It is perhaps worthwhile reproducing 바카라사이트 specific advice to trustees about choosing assumptions: “You are responsible for choosing prudently 바카라사이트 assumptions that will be used for calculating 바카라사이트 technical provisions. This includes taking account of 바카라사이트 degree to which 바카라사이트 employer can support a range of likely adverse outcomes. You must take advice from 바카라사이트 scheme actuary on making relevant assumptions. Your assumptions should be evidence-based. Ensure you discuss with 바카라사이트 actuary how sensitive 바카라사이트 technical provisions are to changes in 바카라사이트 value of assumptions. The more sensitive technical provisions are to changes in an assumption, 바카라사이트 more important it is you choose an appropriately prudent value for that assumption.”
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