Update on discussions about USS
19 Dec 2014
Further discussions about USS took place on 4 December
You will be aware that a valuation of the USS pension scheme is currently underway. The Trustee of a pension fund is legally required to carry out a formal valuation every three years and to provide a report to the Pensions Regulator of its funding position. In USS’ case the valuation date is 31 March 2014 and the Trustee is obliged to complete the valuation no later than 15 months later – by 30 June 2015 in USS’ case. The Trustee of USS is made up of four Universities UK (UUK) nominees, three University and College Union (UCU) nominees and up to five independent appointees. A full list of board members is available at:
The USS Trustee Board is required to consult with UUK, as the representative of the scheme’s employers, on the assumptions being made in the valuation process (the “technical provisions”). Whilst USS is only required under the rules of the scheme to formally consult with UUK, it also chooses to share the same information with UCU nationally. This consultation closed on 28 November and UUK’s response can be read at:
UUK indicated that they do have “significant concerns about the overall level of prudence that is being assumed in the valuation process”. UCU also submitted their comments on the consultation document to the USS Trustee Board.
The USS Board met on 4 December 2014 to consider the responses to the consultation on technical provisions for the 2014 valuation. The Board decided that it wished to consider the responses further before taking final decisions on the technical provisions. The next meeting of the USS Trustee Board is planned for 15 January 2015. The Scheme Actuary, Ali Tayyebi, advises the USS Trustee Board on the valuation process. A copy of a presentation by him on the 2014 valuation process can be found:
The USS Trustee Board may, shortly, choose to circulate further information to scheme members and, if they do so, we will make this available to you.
In parallel with decisions being made by the USS Trustee Board on the valuation, the Joint Negotiating Committee (JNC) is also meeting. Any changes to the benefits structure are required to be negotiated through the JNC which comprises of five UUK nominees, five UCU nominees and an independent Chair. Two formal proposals, one from UUK and one from UCU, for changes to the benefits structure have been presented to the JNC. There are common features between the two proposals - both, for example, include a move from final salary to career revalued benefits for all future service – however there are also areas of difference.
The UUK proposals can be seen at:
The UCU proposals can be seen at:
Both parties have indicated that they “did not regard the current iteration as their final positions”.
Intensive negotiations between UUK and UCU representatives have, therefore, been taking place over the last few weeks including today, with the aim of reaching an agreement on scheme changes. A further series of meetings will be held in January including a meeting of the JNC on 15 January. Given that the USS Trustee Board is also meeting on that day, a further JNC meeting may be required before the end of January. The current timetable suggests that the earliest the JNC will decide upon changes to benefits will be in January 2015. It is not expected, therefore, that any additional meeting will have any impact on the overall timetable.
Once any changes to the benefit structure are approved by the JNC, a legally required 60 day consultation process with all scheme members will follow. Any actual changes to benefits would be effective from April 2016 at the earliest.
Further updates will be issued as appropriate.
Will Spinks
Registrar, Secretary and Chief Operating Officer
The University of Manchester