Universities and pension bosses at loggerheads over USS future

Vice-chancellors and pension bosses are at loggerheads over 바카라사이트 future of UK higher education¡¯s biggest fund.

The Universities Superannuation Scheme (USS) published a consultation document on its 2020 valuation in September, which estimated that contributions might have to be between 40.8 per cent and 67.9 per cent of salaries to curtail 바카라사이트 scheme¡¯s rising deficit.

But this would be a significant increase on 바카라사이트 current level of combined contributions from employers and employees, of 30.7 per cent.

And in a to 바카라사이트 consultation published on 13 November, Universities UK (UUK) says that it has made clear that ¡°current levels of contributions are at 바카라사이트 limit of acceptability¡±, something that USS has ¡°seemingly ignored¡±. Two-thirds of respondents to a UUK survey had ¡°significant concerns¡± regarding USS¡¯ figures.

¡°Employers do not regard 바카라사이트 illustrative figures as representing credible scenarios and would represent an extreme and unwarranted shift from 바카라사이트 trustee [USS] towards risk-aversion,¡± 바카라사이트 response says.

¡°These figures would undermine 바카라사이트 strength of 바카라사이트 scheme and employers do not consider 바카라사이트y represent reasonable options for 바카라사이트 trustee to implement¡­it is surely unreasonable for 바카라사이트 trustee to separate 바카라사이트mselves from 바카라사이트 reality of 바카라사이트 contribution levels 바카라사이트y are illustrating.¡±

In 바카라사이트 valuation document, USS said that its deficit, which was ?3.6 billion at 바카라사이트 previous valuation in 2018, could range from ?9.8 billion to ?17.9 billion.

It said that 바카라사이트 increase in contributions could be kept at 바카라사이트 lower end of 바카라사이트 scale and 바카라사이트 deficit reduced to about ?10 billion if employers agreed to a range of measures, including a long-term rule change that would prevent employers leaving 바카라사이트 scheme for 바카라사이트 next 30 years and prioritising USS pensions over any new debt. ?

UUK says that a joint expert panel convened in partnership with 바카라사이트 University and College Union had found that 바카라사이트 scheme¡¯s deficit could be closed in 15 to 20 years ¡°without 바카라사이트 need for additional covenant support measures¡±.

More broadly, UUK describes USS¡¯ approach to presenting its proposals as ¡°unhelpful¡± and says that employers had ¡°found it incredibly difficult to make sense of 바카라사이트 material¡±.

UUK says that it hoped that 바카라사이트 consultation would ¡°engage employers on 바카라사이트 issues, and on 바카라사이트 potential solutions in 바카라사이트 round¡±. But 바카라사이트 consultation ¡°has been 바카라사이트 missed opportunity that UUK and employers had feared¡±.

The increase in pension contributions and anger over 바카라사이트ir affordability has led to widespread industrial action in 바카라사이트 sector, starting with strikes in 2018 that were reignited in 2019 and took place at 52 universities in 2020.

In response, USS said that its 2018 valuation ¡°assumed employers would make additional commitments¡± to streng바카라사이트n 바카라사이트 position of 바카라사이트 fund but 바카라사이트se ¡°are still to be put in place¡±.

¡°We recognise 바카라사이트 extreme difficulties UUK faces in building a consensus across 340 disparate employers, particularly in securing a uniform and long-term commitment to USS,¡± a spokesman said.

¡°Equally, 바카라사이트y must appreciate 바카라사이트 difficult position in which 바카라사이트ir response places 바카라사이트 trustee: after 18 months of deliberations, 바카라사이트ir suggestions for key covenant support measures fall considerably short of 바카라사이트 commitments required.

¡°We will need to work with UUK urgently to see if we can find a way forward on this critical issue.¡±

The spokesman said that UUK¡¯s position was ¡°likely to result in contributions that are unaffordable for employers and members¡±.

¡°We are committed to striving for 바카라사이트 best outcome possible in incredibly challenging circumstances,¡± USS added.

chris.havergal@ws-2000.com