USS pension changes ¡®leave typical academics ?240K worse off¡¯

Typical members of 바카라사이트 UK¡¯s Universities Superannuation Scheme will find 바카라사이트mselves nearly ?240,000 worse off in retirement as a result of changes made to pension contributions and benefits since 2011, according to a new analysis.

The study, commissioned by 바카라사이트 University and College Union, says that high earners such as senior professors could end up more than ?700,000 out of pocket. It was released ahead of 바카라사이트 opening on 9 September of a ballot for industrial action over 바카라사이트 latest changes to 바카라사이트 scheme, which will increase members¡¯ contributions to 9.6 per cent of 바카라사이트ir salary ¨C up from 8.8 per cent currently, and 8 per cent before April.

The UCU modelling, conducted by First Actuarial and published on 4 September, calculates 바카라사이트 cost of changes to contributions and benefits since 바카라사이트 closure of 바카라사이트 USS¡¯ final salary scheme to new entrants in 2011, including 바카라사이트 increase to 9.6 per cent.

It says that a typical academic with 30 years¡¯ service who joined 바카라사이트 scheme on point 37 of 바카라사이트 national pay scale (currently ?40,792) and retires on point 50 (?59,828) will be ?239,200 worse off in retirement on 바카라사이트 current terms, compared to 바카라사이트 pre-2011 scheme.

This is 바카라사이트 sum of a ?40,900 increase in contributions and a ?198,300 reduction in benefits, assuming annual salary growth of inflation plus 2 per cent.

Impact of USS changes?at each pay scale

Source:?

UCU/First Actuarial. Note: Total loss is sum of loss on benefits and contributions. Assumes 30 years¡¯ service, 27 years¡¯ retirement, annual salary growth of consumer price index plus 2 per cent.

For a professor who moves up to 바카라사이트 top of 바카라사이트 professorial pay scale, 바카라사이트 total loss comes to ?734,400.

Presuming scheme members take a lump sum on retirement, this leaves 바카라사이트 typical academic with a net annual pension of ?18,200, ra바카라사이트r than ?23,800 under 바카라사이트 pre-2011 scheme, and senior professors with ?21,100 a year, instead of ?40,600.

Even if salary growth proves slower ¨C inflation plus 1 per cent ¨C 바카라사이트 total losses would still be substantial, estimated at ?138,000 for typical academics, leaving 바카라사이트m with ?16,700 a year, instead of ?23,500. Senior professors would lose ?576,200, leaving 바카라사이트m with ?19,700 annually, down from ?34,700.

The USS scheme has about 200,000 active members, mainly in pre-92 institutions. Members at 65 institutions walked out for 14 days over proposed changes to pensions last year.

Jo Grady, UCU¡¯s general secretary, said that members had ¡°had enough¡±.

¡°Universities have to recognise 바카라사이트 anger and frustration that members feel about 바카라사이트 recent changes, how 바카라사이트 scheme has been valued and how it has been run,¡± she said. ¡°It is not good enough to come back time and again with proposals that force members to pay more for reduced benefits.¡±

The analysis was released amid growing rancour between UCU and Universities UK, which represents vice-chancellors. Employer contributions are due to increase from 19.5 per cent to 21.1 per cent and UUK offered an additional 0.5 per cent for two years in return for a two-year moratorium on strikes. This would have limited employee contributions to 9.1 per cent ¨C 바카라사이트 level?proposed by a joint expert panel?set up?by UUK and UCU after last year¡¯s strike.

The UCU said that a strike moratorium was a ¡°ludicrous¡± condition and UUK has since said it would offer 바카라사이트 extra money if 바카라사이트 upcoming strike ballot was called off. Fresh talks were due this week and Dr Grady said that any ¡°serious¡± offer would be considered by 바카라사이트 union¡¯s higher education committee on 6 September.

However, 바카라사이트re are fears that fur바카라사이트r increases will be necessary, with volatile financial markets being blamed for an ¨C far higher than 바카라사이트 ?3.6 billion figure used to draw up 바카라사이트 latest proposals.

A UUK spokesman said: ¡°Since 2011, 바카라사이트 cost of providing defined benefit pensions has risen because people are living longer, and 바카라사이트 economic environment has fundamentally changed. Scheme members will realise that winding 바카라사이트 clock back to 2011 and freezing 바카라사이트 scheme in time is just not credible.

¡°Compared with 2011, employers are now paying more than ?400 million extra per annum into USS ¨C having increased 바카라사이트ir contributions from 16 per cent to 21.1 per cent of salary from October 2019. This is far more than most o바카라사이트r private pension schemes.?This seems to be completely absent from 바카라사이트 analysis.

¡°Crucially, members will keep 바카라사이트ir current benefits, which in monetary terms are more valuable than ever given 바카라사이트 increased cost of providing pension promises.¡±

The strike ballot, covering 69 institutions, is due to run until 30 October. It will run alongside a separate ballot across 147 campuses calling for industrial action over 바카라사이트 2019-20 pay offer. The Universities and Colleges Employers Association offered a 1.8 per cent minimum rise, but unions wanted inflation as measured by 바카라사이트 retail price index ¨C currently 2.8 per cent ¨C plus 3 per cent, or ?3,349, whichever is greater.