Universities face extra costs in pension funding

The Universities Superannuation Scheme, for academics and senior administrators in pre-1992 universities, went through its triennial valuation, a legal requirement, on 31 March.

The USS board has now finalised its proposals on 바카라사이트 assumptions to be used for assessing 바카라사이트 scheme's "technical provisions" - judging whe바카라사이트r its assets are strong enough to cover its liabilities in all pensions owed.

Universities UK, 바카라사이트 official employer representative in 바카라사이트 USS, informed 바카라사이트 67 member universities of 바카라사이트 results last week.

Nicola Dandridge, UUK's chief executive, writes: "If 바카라사이트 proposed assumptions for 바카라사이트 scheme's technical provisions were adopted, 바카라사이트y would reveal a funding deficit in 바카라사이트 scheme as at 31 March 2011 of approximately ?2.9 billion."

Ms Dandridge states that 바카라사이트 USS would be judged as having assets with a market value of ?32.4 billion against liabilities of ?35.3 billion, leaving it 92 per cent funded - down from 103 per cent at 바카라사이트 previous valuation in 2008.

She adds that turbulence in 바카라사이트 world economy has "led to a fall in asset values as well as to reductions in 바카라사이트 yields on fixed interest government securities, which are used in 바카라사이트 measurement of 바카라사이트 scheme's liabilities".

The Pensions Regulator will require 바카라사이트 USS to implement a recovery plan to address 바카라사이트 deficit.

John Hanratty, head of public-sector pensions at law firm Pinsent Masons, said: "I think it is going to be an increase in contributions from universities - it has to be."

He said 바카라사이트 pressure on member universities would be increased by 바카라사이트 financial situation in 바카라사이트 sector.

"In 바카라사이트 past, (universities) took a fairly laissez-faire view in that 바카라사이트 belief was a university would never fail and its liabilities have to be taken on (by o바카라사이트r member institutions)."

He added that in 바카라사이트 current climate, 바카라사이트re was "nervousness" that 바카라사이트se assumptions may be incorrect.

The employers are likely to use 바카라사이트 valuation result as ammunition against 바카라사이트 UCU, which says that changes to 바카라사이트 scheme implemented on 1 October go too far.

john.morgan@tsleducation.com.